Cambodia to benefit substantially from China’s BRI: Moody’s

Moody’s Investors Service Inc sees Cambodia, which has a B2 stable rating, as one of the countries that stand to benefit the most from China’s Belt and Road Initiative.

In its latest report, Moody’s analyses the potential long-run economic gains and near-to-medium term macro-stability risks for 12 emerging and frontier markets in South Asia, Southeast Asia, and Central Asia.

The Kingdom – together with Pakistan (B3 negative), Mongolia (B3 stable), and Kazakhstan (Baa3 stable) – shows great potential to benefit from the BRI, the report says.

The financial services organisation says the BRI – through investments in large transportation and energy projects – helps to expand productive capacity by closing critical infrastructure gaps.

However, Moody’s vice president and senior credit officer, William Foster, warns that the scale and terms of BRI investment can amplify macro-stability risks for nations with weaker economic fundamentals and limited policy effectiveness.

“Inefficient project implementation and absence of macroeconomic and structural reform requirements in many Chinese loans can lessen longer-term credit benefits for some sovereigns,” the vice president said.

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