By KER MUNTHIT Associated Press Writer
The Associated Press
PHNOM PENH, Cambodia — Reliance on potential oil revenues could threaten Cambodia's existing industries, a natural resources expert warned the impoverished country Wednesday.
Ian Gary, Oxfam America's policy adviser for extractive industries, said Cambodia faces a challenge in protecting sectors such as its garment industry, currently its leading foreign exchange earner.
"Oil has a tendency to push out and crowd away other industries," Gary said at a seminar on Cambodia's offshore oil production prospects.
With oil seeming to offer a fast track to national riches, other industries might not receive the attention they need to remain sustainable, he warned.
"This might be an issue in Cambodia with the textile industry being crowded out because of the oil boom," said Gary, who has studied and written on oil issues in countries like Nigeria, Chad and Angola.
Cambodia's garment industry employs 320,000 workers in 286 factories. Annual exports have grown to more than US$2.2 billion (euro1.6 billion) in recent years, largely due to U.S. and E.U. restrictions on garment imports from China.
The government is pinning high hopes on offshore oil reserves to lift Cambodia from dire poverty.
In February, Prime Minister Hun Sen said the country could begin tapping oil revenues in 2010.
U.S. energy giant Chevron Corp. discovered oil in 2005 off Cambodia's coast, 145 kilometers (90 miles) southwest of the southern seaport of Sihanoukville.
The company found the crude oil in four wells in an area called Block A, and plans to drill 10 more wells by the end of 2007.
Gary said there is still much uncertainty about whether Cambodia will become a significant oil producer.
If it does, he said this could generate a sense of complacency seen in many oil-rich nations.
"In many countries, when they start receiving oil, there is a sense that 'Oh ... there's all this free money coming in, why should I work?' So there's this mentality that 'Well, let's just enjoy the party while it lasts." he said.
"It's very important to start thinking about how you can move away from oil as soon as you start receiving oil," he said.
Past experience shows that oil would not likely create many jobs for Cambodians, Gary said.
He said the government should diversify the economy and find ways to protect existing industries "so that they maintain their competitiveness on the international market when oil revenues come in."
Also, critics of the government have also voiced concerns that oil revenues could exacerbate Cambodia's already widespread corruption as it did in Nigeria - a well-known case of "oil curse."
But Hun Sen has brushed off such concerns, saying Cambodia would not follow that path and pledging that the health and education sectors would receive a large share of any oil revenues.
Oxfam is a private aid agency concerned with development, advocacy and relief worldwide.
Ian Gary, Oxfam America's policy adviser for extractive industries, said Cambodia faces a challenge in protecting sectors such as its garment industry, currently its leading foreign exchange earner.
"Oil has a tendency to push out and crowd away other industries," Gary said at a seminar on Cambodia's offshore oil production prospects.
With oil seeming to offer a fast track to national riches, other industries might not receive the attention they need to remain sustainable, he warned.
"This might be an issue in Cambodia with the textile industry being crowded out because of the oil boom," said Gary, who has studied and written on oil issues in countries like Nigeria, Chad and Angola.
Cambodia's garment industry employs 320,000 workers in 286 factories. Annual exports have grown to more than US$2.2 billion (euro1.6 billion) in recent years, largely due to U.S. and E.U. restrictions on garment imports from China.
The government is pinning high hopes on offshore oil reserves to lift Cambodia from dire poverty.
In February, Prime Minister Hun Sen said the country could begin tapping oil revenues in 2010.
U.S. energy giant Chevron Corp. discovered oil in 2005 off Cambodia's coast, 145 kilometers (90 miles) southwest of the southern seaport of Sihanoukville.
The company found the crude oil in four wells in an area called Block A, and plans to drill 10 more wells by the end of 2007.
Gary said there is still much uncertainty about whether Cambodia will become a significant oil producer.
If it does, he said this could generate a sense of complacency seen in many oil-rich nations.
"In many countries, when they start receiving oil, there is a sense that 'Oh ... there's all this free money coming in, why should I work?' So there's this mentality that 'Well, let's just enjoy the party while it lasts." he said.
"It's very important to start thinking about how you can move away from oil as soon as you start receiving oil," he said.
Past experience shows that oil would not likely create many jobs for Cambodians, Gary said.
He said the government should diversify the economy and find ways to protect existing industries "so that they maintain their competitiveness on the international market when oil revenues come in."
Also, critics of the government have also voiced concerns that oil revenues could exacerbate Cambodia's already widespread corruption as it did in Nigeria - a well-known case of "oil curse."
But Hun Sen has brushed off such concerns, saying Cambodia would not follow that path and pledging that the health and education sectors would receive a large share of any oil revenues.
Oxfam is a private aid agency concerned with development, advocacy and relief worldwide.
3 comments:
I DON'T HAVE PhD IN ANYTHING BUT I CERTAIN CAN STAND INFRONT OF YOUR SHARP NOSES, WHITE SKIN, BALD HEADS AND POT BELLIES TO DECLARE THAT CAMBODIA WILL BE THE SAME WITH OR WITHOUT OIL MONEY.
ONE THING I KNOW BEST IS ABOUT CAMBODIAN LEADERS NATURAL BORN INSTINCTS, DEVIL SMILE, AND BREATH SMELL.
The Khmers used to learn from other nations. They copied others too, but they did better. Their ancient temples are a testimony. They learned Hindoism, Budhism and arts from the Indians, but in India there is no such majestic temple as Angkor wat.
Let's not as obscurantist as the Khmer Rouge and close off our minds to ideas from other nations and their experiences.
Many Asian countries have sent their students in the thousands and tens of thousands to study in western countries. They have also invited and hired western experts to assist them in developing their economies. Ask the Japanese how much of their government budget was allocated for foreign expertise at a time when Japan undertook reform at the beginning of the Meiji era at the end of the 19th century. For sure, the Japanese hired a French jurist to draft their code of laws. To my knowledge South Korea, Hong Kong, Malaysia and Thailand, all have had foreign (western)experts at one time or another. But they have their own experts working with foreign experts. When the foreign experts leave, the local experts continue the work with enhanced knowledge, skills and expertise.
LAO Mong Hay, Hong Kong
Lao, not everything done by the
KR are all wrong. I know it is
difficult for you to see it from
studying in the west all that long,
but you must try harder if you want
to get close to the absolute truth.
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