Cambodian official: 70% of Soviet-era debt to be forgiven

PHNOM PENH, Dec. 30 (Chinese media) -- A Cambodian lawmaker insisted that most of

the 1.5 billion U.S. dollars of debt that Cambodia borrowed from Russia will be

scratched, although the lender had denied it, national media said on Tuesday.

This cancellation will potentially reduce almost two-thirds of the debt

that the kingdom owed to foreign nations, said English-language daily newspaper

the Phnom Penh Post.

Cheam Yeap, chairman of the Committee of Finance, Banking and Audits of the

National Assembly, on Monday assured other lawmakers that Russia will cut 70

percent of Cambodia's debt.

If not, Cambodia will still be in good shape financially, he said.

"If Russia doesn't eliminate our debt, Cambodia will continue to repay it

and will still be able to ask for additional loans from other countries," he

added.

According to the Ministry of Economy and Finance, Cambodia now owes 2.37

billion U.S. dollars to foreign countries, which is equivalent to 23 percent of

the country's Gross Domestic Product.

Around 63 percent of the debt is owed to Russia due to loans in the 1980s

when the former Soviet Union was a major benefactor to Cambodia.