The Asian Development Bank (ADB) has signed up the Foreign Trade Bank of Cambodia (FTB) to its trade and supply chain finance programme, targeting swathes of small businesses in the Southeast Asian country.

FTP will issue trade finance instruments backed by the ADB’s programme to both corporate and micro, small and medium-sized enterprise (MSME) clients in Cambodia.

“The agreement is part of ADB’s private sector development initiative to promote the sector’s participation in Cambodia’s economic diversification,” says Jyotsana Varma, ADB country director for Cambodia.

“It will fill market gaps by providing financing through partner banks to support trade and MSMEs, representing about 99% of all enterprises in Cambodia,” Varma adds.

Signed by Varma and FTB chief executive Dith Sochal on February 6, the deal is also aimed at encouraging more international banks to enter the Cambodian market, providing “further opportunities to expand support for regional and international trade and commerce”.

The deal builds on the ADB’s existing work in Cambodia, with the bank lending an annual average of US$363.28mn in development assistance between 2019 and 2023. It says it has already started working with FTB to boost skills in report preparation, training and performance measurement.

The ADB merged its trade finance and supply chain programmes together in 2020 in a bid to improve its response to disruptions during the pandemic.

The bank says it has supported US$57bn in trade through more than 45,000 transactions in emerging markets since 2009.