GuarantCo, the Private Infrastructure Development Group (PIDG), and the Credit Guarantee Corporation of Cambodia (CGCC) have signed a memorandum of understanding (MoU) to accelerate sustainable financial inclusion and increase investment opportunities in Cambodia. 

The collaboration will also facilitate the scaling up of CGCC’s capacity through involvement in a range of transaction types with GuarantCo and PIDG Technical Assistance (TA).

Having completed three transactions in Cambodia, GuarantCo is seeking to develop CGCC’s capital market guarantee capability via the PIDG Credit Enhancement Facility initiative. This programme aims to increase the availability of onshore local currency guarantees in target markets, by partnering with local entities and utilizing products from across the PIDG Group, in this case re-guarantee facilities from GuarantCo and technical assistance from PIDG TA.

The MoU is the first step towards a broader framework agreement, which both GuarantCo and CGCC hope to close and execute later this year, covering syndication of GuarantCo‘s guarantee exposure to CGCC and vice versa, as well as technical assistance.

The technical assistance programme will help CGCC to develop key guarantee documents and engage a transaction counsel to advise on the facility documentation, as well as provide capacity-building support on credit, investment and Sustainable Development Impact management processes.

 “Local financing solutions are an essential part of our 2030 strategy and the establishment of in-country credit enhancement facilities is a key objective to help develop local markets," says PIDG chief executive officer Philippe Valahu. "Signing this memorandum of understanding with the Credit Guarantee Corporation of Cambodia will help expedite this work.”

GuarantCo’s engagement in Cambodia started in 2022 through transactions with First Finance and Royal Railway, followed by another deal with Cellcard in 2023.

“We are honoured to have the opportunity to work with GuarantCo, an established international guarantee provider, funded by seven G12 governments including the United Kingdom, Switzerland, Sweden, Australia, the Netherlands, Canada and France," says CGCC CEO Wong Keet Loong. "CGCC will benefit from the technical expertise to embed best practices into our bond guarantee processes.  We are excited with this collaboration and look forward to the structured facility which will expand our guarantee capacity.”