Cambodia – Thematic Bond Issuance Feasibility Study and Roadmap

Bankers without Boundaries and Bank & Finance developed a feasibility study and roadmap for thematic bond issuance in Cambodia. This document contributes to the United Nations Development Programme’s (UNDP) support to the Royal Government of Cambodia’s (RGC) progress towards the Sustainable Development Goals (SDGs).

The rapid rise of thematic bond issuances in the fixed income market has led many sovereigns to consider their own issuances. This instrument has the potential to offer Cambodia a means of raising funding from the capital markets to finance projects that positively impact the nation’s SDGs achievement.

The Feasibility study and roadmap for thematic/green bond in Cambodia was initiated with the overall objective to facilitate socio-economic development at the local level through strengthening accountable, transparent, and results-oriented public finance mechanisms. The objective is to ascertain the viability of the issuance of a sovereign thematic bond in Cambodia.

The overall aim of the study is to establish whether a thematic bond issuance is the right step for Cambodia at this moment in time, and to identify what processes would need to take place for the country to establish a solid foundation for thematic bonds in the future.

This report explores the current debt issuance market and economic situation, debt management strategy, key national sustainable development and climate change priorities, and current pipeline of public investment projects. The study also highlights stakeholders required for thematic bond issuance, including ministerial and financial services counterparties, and addresses the current capacity of the Cambodian government to consider a thematic bond issuance in the near future.

As well, the report identifies the RGC’s current debt-carrying capacity and suggested thematic bond characteristics based on the government’s appetite for the issuance, project pipeline and capacity to support such issuance.

This study concludes with a clear roadmap that Cambodia could consider from a financial and non-financial perspective to seek additional sources of finance through thematic bonds and makes recommendations on how organisations like UNDP can help to deliver the underlying requirements of a thematic bond issuance.

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