GuarantCo, the Private Infrastructure Development Group (PIDG), and the Credit Guarantee Corporation of Cambodia (CGCC) have formalized a partnership aimed at accelerating financial inclusion and enhancing investment in sustainable infrastructure in Cambodia. The three entities signed a Memorandum of Understanding (MoU) outlining their collaborative efforts to expand CGCC’s capabilities through a variety of transaction types supported by GuarantCo and PIDG Technical Assistance (TA).

This MoU marks an initial step towards a broader Framework Agreement anticipated to be finalized later this year. The agreement will include the syndication of GuarantCo’s guarantee exposure to CGCC and vice versa, alongside technical assistance to bolster CGCC’s operational capacity. GuarantCo, which has previously completed three transactions in Cambodia, aims to enhance CGCC’s capital market guarantee capabilities through the PIDG Credit Enhancement Facility initiative.

Boost The Availability Of Onshore Local Currency Guarantees

This initiative seeks to boost the availability of onshore local currency guarantees by partnering with local entities and leveraging products from across the PIDG Group, including re-guarantee facilities from GuarantCo and technical assistance from PIDG TA.

Read more: Royal Group Securities and Credit Guarantee Corporation of Cambodia Forge Strategic Partnership to Support Capital Market Development

The Technical Assistance program is set to provide CGCC with essential support, including the development of key guarantee documents, engagement of a transaction counsel for facility documentation, and capacity-building in credit, investment, and Sustainable Development Impact management processes.

Philippe Valahu, CEO of PIDG, emphasized the significance of local financing solutions in their 2030 strategy. “Local financing solutions are an essential part of our 2030 strategy and the establishment of in-country credit enhancement facilities is a key objective to help develop local markets. Signing this Memorandum of Understanding with the Credit Guarantee Corporation of Cambodia will help expedite this work,” Valahu stated.

Layth Al-Falaki, CEO of GuarantCo, expressed pride in the collaboration. “We are proud to have signed this Memorandum of Understanding with the Credit Guarantee Corporation of Cambodia and to be able to mobilise guarantee capacity to help CGCC expand to undertake transactions in progressive sustainable financing through the local capital markets, in line with PIDG and GuarantCo’s strategic plans. GuarantCo’s engagement in Cambodia started in 2022 through transactions with First Finance and Royal Railway followed by Cellcard in 2023. Through this MoU with CGCC, we are continuing our momentum in the country to the advantage of Cambodians who will benefit from improved infrastructure.”

Enhancing Cambodia’s Financial and Infrastructural Landscape

Wong Keet Loong, CEO of CGCC, highlighted the benefits of the partnership. “We are honoured to have the opportunity to work with GuarantCo, an established international guarantee provider, funded by seven G12 governments including the United Kingdom, Switzerland, Sweden, Australia, the Netherlands, Canada, and France. CGCC will benefit from the technical expertise to embed best practices into our bond guarantee processes. We are excited with this collaboration and look forward to the structured facility which will expand our guarantee capacity.”

This partnership signifies a strategic move towards enhancing Cambodia’s financial and infrastructural landscape, promoting sustainable development, and increasing investment opportunities within the region.

Credit to: Cambodia Investment Review, Published on 01 August 2o024