Implementation of Tourism Recovery Co-Financing Scheme Launched

Cambodian Government yesterday launched the implementation of the Tourism Recovery Co-Financing Scheme (TRCS) to boost the sector after being seriously affected by the COVID-19 crisis.

The launching ceremony was held virtually under the presidency of H.E. Dr. Aun Pornmoniroth, Deputy Prime Minister, Minister of Economy and Finance and Chairman of the Committee on Economic and Financial Policy, with the participation of leaders and representatives of relevant ministries and institutions, development partners, business associations, microfinance associations and the private sector.

The Royal Government of Cambodia (RGC) has adopted and launched the “Strategic Framework and Programmes for Economic Recovery in the Context of Living with COVID-19 in a New Normal 2021-2023” on Dec. 16, 2021, to restore and promote Cambodia’s economic growth in the short and medium terms to return to the path of potential growth, and strengthen resilience for sustainable and inclusive socio-economic development in the long term, recalled the Ministry of Economy and Finance in a press release.

In fact, it continued, before the advent of the COVID-19 crisis, tourism sector in 2019 provided a gross revenue from international tourism of approximately US$4,919 million contributed to about 4.4 percent of the Cambodia’s GDP. However, unfortunately, during 2020 and 2021, tourism sector declined sharply due to the impacts of COVID-19, causing many enterprises in this sector to reduce, suspend or close their businesses completely, as a result, tens of thousands of people lost their jobs and incomes.

Therefore, in order to promote and restore the tourism sector, the source added, the RGC has introduced a number of intervention measures, such as: Payment allowance to workers in the tourism sector who have been suspended due to the COVID-19 crisis, with each receiving a monthly stipend of US$40 from the RGC, Free of charge for licence and permit application services related to reopening businesses, such as hotel and restaurant patents, Development of infrastructure in existing or newly established tourist areas, Providing new skills training to workers who have lost their jobs, Implementation of co-financing scheme, and Promoting the tourism market through outreach campaigns, increasing confidence in Cambodia as a safe destination and developing new tourism products and physical infrastructure.

At the same time, the RGC has also implemented the Master Plan for Siem Reap Tourism Development 2021-2035, Master Plan for Mondulkiri Tourism Development 2021-2035, and plans to officially implement the Master Plan for Kep Tourism Development 2022-2035 in the near future as well, it said.

So far, it underlined, during 2020, the RGC has implemented the first phase of co-financing scheme through the Small and Medium Enterprise Bank of Cambodia (SME Bank) in collaboration with participating financial institutions (PFIs) in the amount of US$100 million, including US$50 million contribution from the RGC and US$50 million from private financial institutions. With positive results from the implementation of the first phase, in August 2021, the RGC decided to implement the second phase of SME co-financing scheme with a total amount of US$240 million, from the contribution of the RGC of US$120 million and contribution from the private financial institutions of US$120 million.

According to the press release, with the approval and permission from Samdech Techo Hun Sen Prime Minister, the co-financing scheme has a total amount of US$150 million, which comes from the RGC’s contribution of US$75 million through SME Bank and PFIs contribution of US$75 million. Through this scheme, enterprises in the tourism sector affected by COVID-19 crisis can apply for loans from participating financial institutions that are partners of SME Bank at a concessional interest rate.

The implementation of the tourism recovery co-financing scheme focuses on tourism sector only, in order to promote: Resumption of business operations, Improvement and modernisation, Expansion and diversification of tourism services to prepare for national and international tourists as the COVID-19 crisis eases. Through this tourism co-financing scheme, enterprises in the tourism sector will be able to restore, recover and strengthen their competitiveness, as well as promote and transform tourism sector to be more attractive.

The recovery of Cambodia’s socio-economic activities, especially tourism, to return to stability and toward the path of potential economic growth in a new normal after COVID-19 crisis, requires close cooperation, active participation and high responsibility from all stakeholders, especially the SME Bank and the private financial institutions, in this co-financing scheme.

Source: Agency Kampuchea Press