There are six major challenges that need to be addressed in the agriculture sector so as to remain competitive in the export market and also to support Cambodia’s economic growth.
The six challenges are low productivity growth due to scarcity of pure seeds; limited agricultural irrigation techniques and technology; lack of investment in processing which causes high domestic production costs, especially the cost of electricity and logistics as well as the stable supply of raw materials.
The other challenges are the level of agri-business and agricultural products for export are informal; lack of access to finance at low-interest rates, especially lack support for infrastructure during and after the harvest and lastly lack of institutional work facilitation in both in planning and implementation stages.
Agriculture Minister Veng Sakhon in his Facebook page said on Saturday that Cambodia needs to address these challenges in a timely manner to boost the development of the agriculture sector in order to support the Kingdom’s economic growth as well as to remain competitive in the export market.
Highlighting the six challenges, he said: “I have put in place measures and support, both fiscal and financial to encourage investment in agriculture as well as agricultural processing.”
In the draft Strategic Framework for Restoring and Promoting Cambodia’s Economic Growth in Living with Covid-19, he added the government will prioritise 15 policies, programmes, and rules to promote the development of the agricultural sector.
He added that one of the key points is that the government will introduce a mechanism for financing the private sector by preparing a budget of about $250 million by 2022 for direct loans for the small and medium enterprises through the SME Bank and the Rural Development Bank.
For those in rural areas, he said, the Ministry will seek the cooperation of the Commercial Banks and Microfinance Institutions to increase loan facilities with a low-interest rate of about 5 to 5.5% for those in key sectors such as agriculture, raising livestock, processing agricultural products, ecotourism and other priority sectors.
The financial institutions, he added can increase the loan facilities by revising the credit guarantee conditions of The Credit Guarantee Corporation of Cambodia by expanding the scope of collateral with favourable conditions.
This article was first published in Khmer Times. All contents and images are copyright to their respective owners and sources.