Cambodia Says No Strings Attached in Recent Chinese Aid

Chinese Premier Wen Jiabao, right, with Cambodian Prime Minister Hun Sen during their meeting in China on Sept. 2. (Associated Press)

September 6, 2012
By Patrick Barta
The Wall Street Journal

China has done a lot to support Cambodia over the years with millions of dollars in aid, loans and investment. But after reports this week that China has pledged another $500 million in soft loans and grants—and publicly thanked Cambodia for its support in Southeast Asia—Cambodian officials want to be sure no one suspects the little country is falling too much under China’s sway.

Cheam Yeap, chairman of the Commission on Economy, Finance, Banking and Audit at the Cambodian National Assembly, said China’s loans have nothing to do with Cambodia’s recent support for China in disputes involving the South China Sea, parts of which are claimed by China and several Southeast Asian states. That backing includes a now-famous episode in July when members of the Association of Southeast Asian nations failed to reach a consensus on how to resolve conflicts in the sea at their latest summit in Phnom Penh, failing even to issue their customary joint communiqué at the end.

Representatives from the Philippines and other nations blamed Cambodia for resisting any agreement that would embarrass China, which has long indicated its desire to negotiate settlements in the South China Sea on a bilateral basis, away from multilateral forums.

The latest loans are just “encouragement from China’s premier Wen Jiabao” Mr. Cheam Yeap said, adding that China doesn’t ask for anything in return. Rather, China just “sees that Cambodia is in need for [money] to develop the country,” he said. “This is not the first time that China has provided concessional loans to Cambodia.”

The loans are mainly for infrastructure, agriculture, irrigation, flood control, and human resource development, he said.

Mr. Cheam Yeap also said that reports Cambodia tried to torpedo an agreement at the July summit were unfair. “It is not like the accusation from other Asean members and the U.S. about the blockage of a joint communiqué,” he said. Cambodia was “trying” to support a statement, he said, but it wasn’t possible to agree on one.

According to Reuters, the latest Chinese loans included four agreements for unspecified projects worth about $420 million, as well as three additional loan deals worth more than $80 million that are expected to be signed this year. It cited a Cambodian secretary of state for finance speaking at a recent briefing.

The state-run Xinhua news agency reported earlier in the week that Chinese Premier Wen Jiabao thanked Cambodian Prime Minister Hun Sen in a weekend meeting for Cambodia’s “important role in maintaining the overall situation of friendly relations between China and the Asean.” It went on to say that “China will closely coordinate with Cambodia, and support the country to make the upcoming series of meetings for East Asian leaders a success,” an apparent reference to the next Asean summit in November at which South China Sea disputes are also expected to figure prominently.

In the past, Mr. Hun Sen has applauded Chinese leaders for extending aid without the usual restrictions that come with development money from Western nations. Foreign donors have repeatedly pressed Cambodian officials over the years to reduce corruption and increase transparency in public affairs, at times suggesting future aid could be contingent on further progress in those and other areas. They have also publicly criticized Cambodian leaders for failing to act on recommendations from Western non-governmental organizations aimed at boosting health, education and other development standards.

“China talks less but does a lot,” Mr. Hun Sen said during a speech several years ago, soon after China had pledged an earlier $600 million in aid. Mr. Hun Sen has also referred to China in the past as Cambodia’s “most trustworthy friend.”