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ADB to Support Policy Reform to Boost Trade and Competitiveness in Cambodia

The Asian Development Bank (ADB) approved a $50 million policy-based loan to support Cambodia’s efforts to make the business environment more investment-friendly, upgrade businesses toward higher competitiveness, and ease trade barriers.
Bavet International Border Checkpoint at the border between Cambodia and Viet Nam.

The Asian Development Bank (ADB) approved a $50 million policy-based loan to support Cambodia’s efforts to make the business environment more investment-friendly, upgrade businesses toward higher competitiveness, and ease trade barriers.

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This second subprogram of the ongoing Trade and Competitiveness Program reinforces the government’s efforts to leverage private sector investments to achieve higher, inclusive, and sustainable growth and improve the lives and livelihoods of its citizens.

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“This program supports ADB’s continued commitment to advancing Cambodia’s economic potential and creating a more robust ecosystem that enables businesses to grow, leading to increased investment, job creation, and sustainable economic growth. It focuses on micro, small, and medium-sized enterprises (MSMEs) as they are the backbone of the economy, and their growth is crucial to drive competitiveness. Through targeted incentives, we aim to empower them to diversify, integrate digital solutions, and increase productivity,” said ADB Country Director for Cambodia Jyotsana Varma. “This program also seeks to facilitate smoother, more efficient cross-border trade by improving regulatory frameworks, streamlining procedures, and reducing barriers to trade, leading to Cambodia being better positioned to participate in regional and global markets.”

Three main interlinked constraints contribute to Cambodia’s broader development challenges: a sub-optimal enabling environment for investment and business, underdeveloped MSMEs, and barriers to cross-border trade. Combined, they reduce productivity and competitiveness and prevent the economy from fully realizing its growth potential.

The program supports the government’s efforts to address these challenges and boost Cambodia’s competitiveness. It will help streamline business regulations and enhance public services, making it easier to do business in Cambodia. By 2027, the program would lead to some 50,000 MSMEs being formally registered in the online business registration system, and digitally secure necessary business licenses, certificates, and permits. In parallel, the program provides incentives and technological support to MSMEs to encourage them to expand in strategic sectors and move up the value chain. The program also supports flagship reforms to improve border facilitation to boost trade.

About ADB

The Asian Development Bank (ADB) is committed to achieving a prosperous, inclusive, resilient, and sustainable Asia and the Pacific while sustaining its efforts to eradicate extreme poverty. It assists its members and partners by providing loans, technical assistance, grants, and equity investments to promote social and economic development. Established in 1966, it is owned by 69 members—49 from the region.

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