Cambodia's Shifting Financial Landscape: China's Investment Pause

Cambodia sees a pause in loans from China, historically its biggest creditor. No loans have been approved by China in 2024, signaling a cautious approach after unsuccessful infrastructure investments. Despite this, Cambodia has secured over $1 billion from other creditors, with the World Bank leading new loans.

China has not approved any new loans to Cambodia in 2024, marking a notable change for the Southeast Asian nation, which has relied heavily on Chinese funds in previous years. The pause hints at China's cautious investment strategy following several ineffective infrastructure projects in Cambodia.

According to Cambodian government data, China accounts for over a third of the nation's $11.6 billion in debt. Despite the freeze, lending from other international creditors, including the World Bank and Japan, has filled the gap, collectively adding approximately $1 billion to Cambodia's treasury this year.

A spokesperson from China's foreign ministry emphasized the strong ties between Beijing and Phnom Penh, though they did not directly address the loan halt. Last year, China was Cambodia's leading lender, surpassing $300 million in loans, a role now taken over by the World Bank.

(With inputs from agencies.)