The US Loses Out to China in Cambodia

Wednesday, 10 November 2010
By Sam Campbell
Asia Sentinel

Beijing offer of no-strings aid to a corrupt administration pays off

Hillary Clinton's two-day visit to Cambodia Oct 30-Nov 1 could be seen as touching base with an old ally and building links with a future partner. But under the surface a battle for influence is being waged between the US and China in Cambodia, a fight Uncle Sam is unlikely to win.

Cambodia is unique in its dependency on aid, something that countries wanting to influence the kingdom have capitalized on. Since the 1992-3 era of the United Nations Transitional Authority in Cambodia, literally billions of aid dollars have flowed into Cambodia. Donors in June pledged US$1.1 billion for the coming year, up from last year's pledge of US$950 million.

Cambodia has been happy to receive aid, for the most part–basic services like health care and education are still reliant on donor funds, yet schools and hospitals routinely bear the name of high-ranking Cambodians who are happy to take the credit for Cambodia's rapid development (the head of the Cambodian Red Cross, Hun Sen's formidable wife Bun Rany, is a good example)

The US has been one of the main players in the aid game, both through small NGOs and the US Agency for International Development, which funds a wide range of democracy and governance activities.

Yet rights issues, governance, and in particular corruption, remain pressing problems, and some question how much improvement has been made. Attempts to chastise Cambodia over the snail's pace of reforms have ended badly – US ambassador Carol Rodley was blasted last year for remarking that corruption costs Cambodia US$500 million annually, just one of many Western critics slapped down by the Cambodian government.

As regards aid, the contrast between Washington's (and the West's) blustering moralizing and Beijing's circumspect mercantilism is striking.

Whereas Western aid comes with often-unpalatable conditions or aims, China has spent prolifically on high-profile, 'no-strings-attached' items like bridges, roads and dams, or has simply doled out cash. The imposing US$49 million Council of Ministers (Cambodian cabinet) building in central Phnom Penh is a notable example of recent Chinese largesse. Loans associated with these comparatively low-cost infrastructure projects can also be cancelled upon maturity, earning China further plaudits.

To Cambodian leaders perched high atop teetering patronage networks, efforts to promote transparency and accountability can look like attempts to undermine support and stability. By contrast, few risks are associated with infrastructure.

US military assistance has been much more warmly received, both for the concrete items donated and for the opportunity to posture with the world's mightiest military, the latter motivation not to be underestimated in a country whose history is littered with bitter civil wars and brutal occupations. The ongoing standoff with Thailand, a country with far more modern military than Cambodia, has brought military affairs again to the forefront in Cambodia–the 2010 budget raised military spending by 23 percent.

But even US military aid is subject to conditions, as Cambodia found on April 1, when the US said it had halted shipments of surplus military vehicles to Cambodia in retaliation for the decision last December to deport 20 Uighur asylum seekers back to China. A shipment of 200 military trucks and trailers was suspended as a consequence of Cambodia's decision.

The Uighur deportation, which provoked sharp criticism from both international and local human rights groups, is a good example of the lengths Cambodia will go to please Beijing.

The US said Cambodian authorities had ignored appeals from Hillary Clinton on the Uighurs. Washington said the suspension was an appropriate response to Cambodia's "failure to live up to their international obligations." However, the measures were hardly draconian; around US$60 million worth of non-military aid remained unaffected, the US embassy confirmed.

China's gift of 257 brand new military trucks and 50,000 uniforms to the Cambodian military, announced May 2, seems aimed at sending a message to the US. Where the US sends used surplus vehicles to Cambodia, China is willing to send a greater number of new vehicles, and uniforms in addition. The aid was said to be worth US$14 million.

Cambodia's veteran Foreign Minister Hor Namhong said China's President Hu Jintao has promised more military assistance in the future. Hor Namhong said that Cambodia "did not ask" China for the military aid, but added that the Chinese "know our requirements, and promised to provide further military assistance in the future."

Cambodia is China's "good neighbor, friend and partner," China's Defense Minister Liang Guanglie told Pol Saroeun, commander-in-chief of the Royal Cambodian Armed Forces (RCAF), in Cambodia May 11.

China's choice to compete with at the US in military aid is informative. US military aid cannot go to foreign military units if the US government believes they have enjoyed impunity after committing human rights violations–just the kind of meddling Cambodia abhors. China, of course, is bound by no such niceties.

China has more recently chosen another symbolic gift to Cambodia: forgiving the 2010 Cambodian debt repayment, a move worth US$4.24 million. Significantly, the Nov 4 Chinese debt agreement came just after Hillary Clinton said the US would reopen talks on US$445 million owed to the US by Cambodia. Cambodian officials have grown impatient with the US on the debt, though they dare not risk the harsh consequences of defaulting.

US influence, then, is progressive falling further behind China's in Cambodia. On the same day the Chinese debt forgiveness was inked, Chinese officials also put pen to paper on 16 infrastructure deals–you guessed it; big ticket items like roads, bridges and railways (detailed information was not released) said to be worth US$1.6 billion. US foreign assistance to Cambodia this year totals around US$70 million.

Perhaps the US should be happy to accept a lesser role in Cambodia as, after all, US and Chinese interests and aims in Cambodia differ. While the US wants a strategic ally to counter Chinese influence, China is mostly looking to secure oil, minerals, energy, and agribusiness commodities.

The US and Cambodia celebrate 60 years of diplomatic ties this year. But that pales in comparison to the many centuries China has maintained official diplomatic relations with Cambodia.

In more recent times, China has sought to limit other countries' influence in Cambodia by patronizing a succession of Cambodian strongmen, from ex-King Norodom Sihanouk in the 1960s, the murderous Democratic Kampuchea regime (the 'Khmer Rouge') leader Pol Pot 1975-78, and since the waning of Vietnamese influence in Cambodia, Hun Sen.

Cambodia is currently one of China's closest friends in Southeast Asia, second only to Burma, and Cambodian Prime Minister Hun Sen has described China as Cambodia's "most trustworthy friend." US officials probably should consider what that role involves and whether they really want to play it.