EU and IFAD Announce €80 Million Investment to Modernise Cambodia’s Agricultural Sector
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The European Union (EU), in collaboration with the European Investment Bank (EIB) and the International Fund for Agricultural Development (IFAD), has announced an investment of nearly €80 million ($86.69 million) to modernise Cambodia’s agricultural sector. The initiative aims to enhance food security, boost export potential, and improve market access for smallholder farmers across the country.
According to a joint press release, the EU’s financing will equip smallholder farmers, agribusinesses, and producer organisations with the necessary tools and infrastructure to increase production, access new markets, and improve food safety. The project is expected to benefit 100,000 smallholder farmers, 25,000 land-poor households, and 500 agricultural enterprises, creating new income opportunities—particularly in rural areas—with a focus on empowering women, engaging young people, and supporting indigenous communities.
The funding agreement was signed on March 14 in Phnom Penh by Minister of Economy and Finance Aun Pornmoniroth and EIB Vice-President Nicola Beer. The signing ceremony was attended by EU Ambassador to Cambodia Igor Driesmans and IFAD Country Director Frew Behabtu.
The €80 million investment package includes a €15 million ($16.25 million) EU grant to support the Agriculture Services Programme for an Inclusive Rural Economy and Agricultural Trade (ASPIRE-AT). This grant supplements a €60 million ($65 million) loan from EIB Global and €4.5 million ($4.8 million) in technical assistance from the EU. IFAD is also contributing $49 million in co-financing, reflecting the strong commitment of international partners to strengthen Cambodia’s agricultural infrastructure.
Nicola Beer highlighted the importance of this investment in strengthening Cambodia’s agricultural sector, which plays a vital role in the country’s economy and food security. “With this financing, we are helping the government strengthen food security, increase farmers’ incomes, and open up new market opportunities for Cambodian products,” she said. Beer described the agreement as a significant example of how Team Europe delivers real impact by creating jobs, driving trade, and strengthening Cambodia’s economy.
EU Ambassador Driesmans underscored the broader benefits of the programme, explaining that the EU’s support of €19.5 million ($21.06 million) in grants will help farmers improve primary production, processing capabilities, and market access through capacity building, better financing, agricultural laboratory support, and improved rural and urban connectivity. He added that the initiative would make the agricultural sector more inclusive and resilient, benefiting rural communities across Cambodia.
The ASPIRE-AT programme will fund the construction of essential infrastructure such as warehouses, drying pads, and access roads, including the Kaoh Khsach Tonlea bridge, which will connect an island to the mainland to improve market access. It will also support the expansion of food safety laboratories and research facilities to enhance quality control and boost Cambodia’s competitiveness in global markets.
Minister Pornmoniroth expressed his gratitude for the investment, noting that it marks a significant step in Cambodia’s efforts to modernise its agricultural sector and improve rural living standards. He reiterated the government’s commitment to working with the EU, EIB, and IFAD to support Cambodia’s development goals, including achieving upper-middle-income status by 2030 and high-income status by 2050.
IFAD Country Director Behabtu emphasised the transformative potential of the programme. “This significant investment is a powerful step toward transforming Cambodia’s agricultural sector. IFAD is proud to be part of this effort to empower rural communities and enhance food security,” he said.
ASPIRE-AT builds on the success of its predecessor, the ASPIRE programme, which ran from 2015 to 2022. By fostering sustainable agricultural growth, the programme aims to reduce rural poverty and strengthen climate resilience for 125,000 rural households, with a strong focus on gender inclusivity, youth involvement, and support for indigenous communities.
