The European Union (EU) Friday granted €15 million, approximately $16.38 million, to modernize Cambodia’s agricultural sector and improve farmers’ access to both domestic and global markets.

An agreement to the effect was signed between the European Investment Bank’s (EIB) global division and Cambodia’s Ministry of Economy and Finance (MEF) to support the Agriculture Services Programme for an Inclusive Rural Economy and Agricultural Trade (ASPIRE-AT).

As a key initiative of the Cambodian government, ASPIRE-AT is designed to modernize agriculture, enhance food security, and boost export potential. This grant complements a €60 million loan from EIB Global and €4.5 million in technical assistance from the European Union, which will be overseen by the European Investment Bank (EIB).

With this contribution, the total EU-backed investment in ASPIRE-AT amounts to nearly €80 million. Additionally, the International Fund for Agricultural Development (IFAD), a UN agency focused on rural development, is co-financing the program with $49 million.

The agreement was formalized in Phnom Penh by Deputy Prime Minister and Minister of Economy and Finance Aun Pornmoniroth and EIB Vice-President Nicola Beer during her first visit to Cambodia in this role. The signing ceremony was attended by EU Ambassador to Cambodia Igor Driesmans and IFAD’s Country Director for Cambodia, Frew Behabtu.

The EU funding will support the modernization of Cambodia’s agricultural sector by equipping smallholder farmers, agribusinesses, and producer organizations with the necessary tools and infrastructure to increase production, expand market access, and improve food safety.

The program aims to directly benefit 100,000 smallholder farmers and 25,000 land-poor households, creating new income opportunities, particularly in rural areas. It places a strong emphasis on empowering women, engaging young people, and supporting indigenous communities.

EIB Vice-President Nicola Beer said that EIB is proud to support ASPIRE-AT and Cambodia’s agricultural sector, which plays a vital role in the country’s economy and food security.

“With this financing, we are helping the government to strengthen food security, increase farmers’ incomes, and open up new market opportunities for Cambodian products.

“It is a great example of how Team Europe delivers real impact, creating jobs, driving trade, and strengthening Cambodia’s economy,” she said.

EU Ambassador to Cambodia Igor Driesmans emphasized that he is proud to be part of this important agricultural investment project by partnering with the European Investment Bank and IFAD under the European Union Global Gateway and the Team Europe initiatives.

“Our support of €19.5 million ($21.06 million) in grants will help farmers and their communities improve primary production, processing capabilities and market access through capacity building and access to financing, agricultural laboratory support, and better rural and urban connectivity.

“Together, we are helping the sector to become more inclusive and resilient, benefiting all Cambodians, and especially those in rural communities,” he said.

Deputy Prime Minister and MEF Minister Aun Pornmoniroth expressed deep gratitude to the EIB, the European Union, and IFAD for their collaboration in designing and preparing the ASPIRE-AT program.

He reaffirmed that the agreement represents strengthened cooperation between Cambodia and its key development partners, aligning with the government’s Pentagonal Strategy (Phase I) as it pursues its ambition of becoming an upper-middle-income country by 2030 and a high-income country by 2050.

He also reiterated Cambodia’s commitment to fostering further partnerships with the EIB, the European Union, and IFAD across multiple sectors.

IFAD Country Director for Cambodia Frew Behabtu said that this “significant EU grant, alongside the EIB loan and IFAD’s co-financing, marks a powerful step towards transforming Cambodia’s agricultural sector. IFAD is proud to be part of this collaborative effort to empower rural communities, enhance food security, and unlock the export potential that drives sustainable economic growth”.

This investment will enhance Cambodia’s agricultural infrastructure and market connectivity by funding collection and handling facilities, warehouses, drying pads, and access roads to improve bulk produce transport.

Additionally, it will finance the construction of the Kaoh Khsach Tonlea bridge, linking the island to the mainland to improve market access, and will pilot a new agricultural cooperative model.

Furthermore, the funding will contribute to better food safety and quality control through support for laboratories, research and quarantine stations, and the expansion of the National Agricultural Laboratory. These investments are strategically distributed across Cambodia to ensure a wide-reaching impact and stronger integration into regional and global markets.

Source - https://www.khmertimeskh.com