Foreign Aid Underwrites Another Chapter in Cambodia's Bloody History

June 10, 2012
By Michael Benge
American Thinker

"Plus ça change, plus c'est la même chose" (the more things change, the more they remain the same). The band plays on -- and all too often, our foreign aid does more harm than good, while America ends up looking like a paper tiger.

Recently, I watched Florida's Senator Marco Rubio -- who is allegedly short-listed as a vice-presidential candidate -- on TV, dancing around to avoid answering whether he supports Mitt Romeny's position of cutting foreign aid to reduce the budget deficit. While totally ending foreign aid is unnecessary, countries with repressive and corrupt regimes are prime candidates for such a move. First, a diplomatic démarche should be issued with a concrete timetable for ending human rights abuses and theft of aid.

Cambodia is high on the list of problem nations in this regard. Free and fair elections were held for the first and last time in 1993, when the Royalist FUNCINPEC Party (the United Front for an Independent, Neutral, Peaceful, and Cooperative Cambodia) won. However, in 1997, Hun Sen, the number-two official in the communist Cambodian People's Party (CPP), backed by 300 Pol Pot Khmer Rouge (KR) fighters commanded by the notorious butcher Keo Pong, led a coup d'état against FUNCINPEC. The new regime then committed extrajudicial executions of around 100 top Army officers and party officials. Since then there have been no free and fair elections, but instead only façades -- rigged elections under control of the CPP. Hun Sen is now prime minister of Cambodia.

Hun Sen stands credibly accused of war crimes. In one eyewitness report, "Hun Sen's troops threw hand grenades and later slit the throats of critically ill patients" in two hospitals in Kompong Cham. Relief troops "discovered hundreds of bodies of men, women and children, young and old, including Buddhist monks who had been first tortured and then killed -- some executed by a gunshot to the back of the head, others chopped to death with hoes, still others strangled to death or suffocated by plastic bags tied over their heads."

Hun Sen was also in charge of enforcing the K-5 Plan, referred to as the "Petite Genocide," during the Vietnamese invasion, in which Cambodians were forced into KR mine fields along the Thai border to plant bamboo thickets, create fields of punji stakes, and lay additional mines. They had to choose between the risk of being blown up constructing the"bamboo wall" and being shot if they tried to escape. Tens of thousands of Cambodians were killed.

Once a dog, always a dog - Op-Ed by Chhaya Khemarak

Former Reagan aide serving a KR killer is rewarded with the titles of "Minister w/o portfolio" and "His Ach-cellency"

Bretton Sciaroni, right, shakes hands with Cambodian prime minister Hun Sen

America’s [corrupt?] fixer in Cambodia

In the post-communist kleptocracy, a former Reagan aide is the man to see.

Monday, Oct 31, 2011
By Ken Silverstein
Salon

PHNOM PENH — Bretton Sciaroni, an American expatriate and former ideologue of Ronald Reagan’s White House, makes a most unusual power broker in contemporary Cambodia. The portly Sciaroni is an official advisor to the government of Prime Minister Hun Sen, a one-time Khmer Rouge cadre. The Cambodian government has bestowed on Sciaroni the titles Minister Without Portfolio and His Excellency. From his office in an exclusive section of the city — neighbors include the president of the ruling party — he runs a consulting firm that brokers business deals on behalf of foreign investors — deals that often benefit well-connected companies and individuals like Sciaroni himself.

Sciaroni also appears to be a chief intermediary between the U.S. government and Cambodia, which has emerged in recent years as an unlikely American ally. The U.S. cut most assistance to Cambodia in 1997 after Hun Sen staged a coup but resumed aid a decade later. Competition with China for influence in the region and growing trade ties — the United States buys more than half of Cambodia’s apparel production, its primary export — are the primary factors behind the political warming. It probably didn’t hurt that Cambodia struck oil and Chevron got a stake in the most promising field. Today Cambodia is the third-largest recipient of U.S. aid in Southeast Asia, after Indonesia and the Philippines. And Brett Sciaroni is, at least politically, the biggest American in the country.

Earlier this year Sciaroni met me for drinks at the Elephant Bar of the Raffles Hotel. Wearing a light-colored jacket and yellow tie and sporting gold-rimmed glasses and a thick gold bracelet, Sciaroni offered an upbeat view of his adopted country.

“This is very much an emerging economy and democracy,” he said while sipping from a glass of Chateau Batailley, a French Bordeaux. “There’s been a lot of political progress. The ruling party no longer intimidates the opposition.” He describes his own work in Cambodia in altruistic fashion, saying, “This is a country where you can make a difference. If you make a suggestion to a government official and he likes it, it will happen.”

Most independent observers have a different view of Cambodia under Hun Sen, who has held power since a 1997 coup. Forty percent of the population lives on less than $1.25 a day, and groups like Human Rights Watch and Global Witness have documented large-scale corruption and political repression.

Sacrava's Political Cartoon: The Muderous Kleptocrat​s, Inc.

Cartoon by Sacrava (on the web at http://sacrava.blogspot.com)

Cambodia's leaders are murderous kleptocrats: author

Stephen Long reported this story on Thursday, July 14, 2011

Listen to MP3 of this story

STEPHEN LONG: Cambodia is one of the world's poorest nations. At least 30 per cent of the population live on less than a dollar a day.

The Australian Government gives over $64 million in aid to Cambodia every year - the world, more than a billion. But how much of that actually gets to the Cambodian people?

Joel Brinkley is the author of a new book called Cambodia's Curse. He says Cambodia's leaders are murderous kleptocrats who pocket most foreign aid, while selling the nation's rice crop for the own gain, and leaving their people to starve, as the world turns a blind eye.

Joel Brinkley spoke to me from his home in California.

JOEL BRINKLEY: Cambodia is an oddity in that 80 per cent of people who live in the country live in the countryside with no electricity, no clean water, no radio, not television. They live more or less as they did 1,000 years ago.

Thai protesters should count their blessings

Thailand (John Blanchard / The Chronicle)
Supporters rally for the Thai government (seen here) while Red Shirt foes denounce it. (Photo: Paula Bronstein / Getty Images)
Supporters rally for the Thai government while Red Shirt foes (seen here) denounce it. (Photo: Manpreet Romana / AFP/Getty Images)

Sunday, May 2, 2010
Joel Brinkley
San Francisco Chronicle (California, USA)

Today, Cambodia is ruled by a kleptocratic, elective dictatorship. Emblematic of its behavior, the government sold a beautiful lake, a landmark in the center of the capital city, to a developer for $79 million and pocketed the money. The buyer began pumping sand into the water intending to fill it up and build a new development. But to do that, the government had to order the eviction of 4,000 families from their homes on the water's edge. Angry about this, one resident painted a declaration on the side of his home that said "Stop Evictions!" The government sued him for defamation.

Southeast Asia is a frustrating part of the world for anyone hoping to live in a democracy, as the violent protests in Bangkok right now make perfectly clear. But take a close look at Thailand's neighborhood and you come away wondering: Why can't the Thai people appreciate what they have?

To Thailand's west lies Burma, which last held democratic elections in 1990. Aung San Suu Kyi's opposition party, the National League for Democracy, won a sweeping victory. But the ruling military government refused to accept the results and instead locked her away in her home. The next year she won the Nobel Peace Prize, but that changed nothing. She is still under house arrest today. Now the military junta is planning new elections this fall, but it recently released rules structured so that Aung San Suu Kyi cannot participate. Last month, her party's leadership announced it would boycott the vote. No one anywhere regards these planned elections as anything but a sham.

To the north of Thailand lies Laos, a closed, impoverished little nation where hammer-and-sickle flags fly above government offices, perhaps the last place on Earth where that is so. Schools and offices display posters of Marx and Lenin, and in a speech earlier this year, President Choummaly Sayasone opined that "Marxist-Leninist theory is practical and is suitable for the current situation in Laos."

Laos last held an election in 1955, but the coalition government collapsed in 1958, and the country hasn't experienced even a breath of democracy since. Meanwhile, half of the nation's children are so malnourished that they are stunted, meaning they are not growing, either physically or mentally.

To the east lies Cambodia, whose people received an extraordinary gift from the world almost 20 years ago. The United Nations, recognizing the tragedy the nation faced under the Khmer Rouge, occupied Cambodia for two years and spent $3 billion to redeem the state, giving it a democratic constitution. The United Nations staged national elections and, obviously hungry for democracy, 90 percent of the Cambodian people voted. But all of it was for naught.

Today, Cambodia is ruled by a kleptocratic, elective dictatorship. Emblematic of its behavior, the government sold a beautiful lake, a landmark in the center of the capital city, to a developer for $79 million and pocketed the money. The buyer began pumping sand into the water intending to fill it up and build a new development. But to do that, the government had to order the eviction of 4,000 families from their homes on the water's edge. Angry about this, one resident painted a declaration on the side of his home that said "Stop Evictions!" The government sued him for defamation.

Then, to the south lies Malaysia, which does have a democracy of sorts. But like their neighbors, Malaysians are having serious difficulties maintaining democratic freedoms. The U.S. State Department's human rights report, published last month, noted that "significant obstacles prevented opposition parties from competing on equal terms with the ruling coalition. Some deaths occurred during police apprehensions and while in police custody.

"The government also arrested other opposition leaders, journalists, and Internet bloggers apparently for political reasons" and "continued to restrict freedom of press, association, assembly, speech, and religion." At the same time, "arbitrary arrest and detention using the Internal Security Act and three other statutes allowed detention without trial, and persistent questions remained about the impartiality and independence of the judiciary."

And then there's Thailand, a democracy. It's not without problems, some quite serious. Official corruption is rampant. Occasionally, as in 2006, the military stages a coup. The Thai government, like Malaysia's, "maintained some limits on freedom of speech, of the press, and of assembly," the State Department said.

But by and large, Thailand is more democratic - freer than any of its neighbors. And yet, thousands of people are demonstrating in the streets because they don't like the outcome of recent elections, just as they did before, in 2006 and 2008.

Two mass-protest groups, the Red Shirts and the Yellow Shirts, are roughly similar to Democrats and Republicans. It's a crude comparison, but the Red Shirts are poor and working-class populists, while the Yellow Shirts are defenders of Thailand's oligarchy. In recent years, leaders who were perceived to be advocates of one camp or the other have served as prime minister. Each time, the other side took to the streets, paralyzing the nation.

Thailand's protesters should look around, see how their neighbors live, realize how fortunate they are - and then wait for the next election.

Joel Brinkley, a professor of journalism at Stanford University, is a former foreign correspondent for the New York Times.

Cambodia: A land up for sale?

Romam Fil says he was tricked into signing away more land
The Cambodian government has been accused of undermining the poor

Wednesday, 12 August 2009
By Robert Walker
BBC World Service

"They cleared areas where our people had their farms, and they destroyed our burial ground" - Romam Fil

Romam Fil is moving rapidly through a dense patch of forest. Every few metres he pauses and points to edible plants and roots that the Jarai people of north eastern Cambodia have relied on for generations.

Then suddenly the trees come to an end. In front of us is a vast clearing, the red earth churned up and dotted with tree stumps.

Beyond that, stretching as far as we can see is a rubber plantation, the young trees are still thin and spindly and sway gently in the breeze.

This is the scene of a battle the Jarai people of Kong Yu village have been fighting, and losing for the past five years.

It started when local officials called a meeting and said they needed some of the forest.

"They told us they wanted to give part of our land to disabled soldiers," said Mr Fil.

"They said if you don't give us the land, we'll take it. So we agreed to give them a small area, just 50 hectares."

The villagers say they were then invited to a party and when many of them were drunk they were asked to put their thumbprints on documents.

"Most of us don't know how to read or write, and the chiefs did not explain what the thumbprints were for," said Mr Fil.

The villagers later found they had signed away more than 400 hectares - and the land was not for disabled soldiers, but a private company who began making way for the rubber plantation.

"They cleared areas where our people had their farms, and they destroyed our burial ground," said Mr Fil.

Political connections?

Lawyers for the owner of the plantation company, a powerful businesswoman called Keat Kolney, insist she bought the land legally.

But groups advocating for local land rights in Cambodia say part of the reason she was able to acquire the land is because she is married to a senior official in the ministry of land management.

It is not the only case where those closely connected to senior government figures are alleged to have taken land from poor Cambodians.

Five years ago, in north-western Pursat province a large grazing area was turned into an economic land concession - land the government grants to private firms for investment in large-scale agriculture.

It was allocated to a politically well-connected company called Pheapimex.

"They just came one day with their bulldozers and started clearing the land straight away," said Chamran, a farmer in the area.

"So we organised a demonstration but then a grenade was thrown among us - we don't know who by. Nine people were injured. The military police pointed a gun in my stomach and said if you hold another demonstration we will kill you."

Transparent process

Under the law, land concessions granted by the government should not exceed 10,000 hectares but the Pheapimex concession, although much of it is so far inactive, covers 300,000 hectares.

Global Witness, an environmental pressure group, estimates Pheapimex now controls 7% of Cambodia's land area.

The organisation says the company's owners, a prominent senator and his wife, have strong links to Cambodian Prime Minister Hun Sen.

Pheapimex did not reply to requests for a response to these allegations, but the Cambodian government maintains that the process by which private companies acquire land is both transparent and legal.

"The requirement is not to be close to the prime minister," said Phay Siphan, spokesman for Cambodia's Council of Ministers.

"The requirement is that you have enough capital, you have the technology to develop the land."

'Kleptocratic state'

It is not just in rural areas that people complain of losing land.

Cambodia's recent stability, following decades of violence, has attracted a rapid boom in tourism and a race among foreign and local entrepreneurs for prime real estate on which to build new resorts.

Many of the country's beaches have already been bought up.

And rights groups estimate that 30,000 people have been forcibly evicted from their homes in the capital Phnom Penh over the past five years to make way for new developments.

The roots of the problem date back to the 1970s when the brutal Khmer Rouge regime abolished private property and destroyed many title documents.

A land law passed in 2001 recognises the rights of people who have lived on land without dispute for five years or more, but in many cases it is not being implemented.

The UN estimates hundreds of thousands of Cambodians are now affected by land disputes.

The government has said that they are not forcefully taking land from farmers
But land is not the only state asset being sold at an alarming rate.

Beginning in the 1990s, large swathes of the country's rich forests were bought up by logging companies.

Now sizeable mining and gas concessions are also being granted to private enterprises.

Eleanor Nichol of Global Witness believes individual members of the Cambodian government, right up to the highest levels, are benefiting.

"Essentially what we're dealing with here is a kleptocratic state which is using the country and its assets as their own personal slush fund," she said.

The Cambodian government rejects these allegations.

"They could accuse [the government of] anything they like. Cambodia operates under a modernised state of law. Everyone is together under one law,” said Phay Siphan.

Back in Kong Yu village, the Jarai people are waiting to hear the result of suit filed in a local court to try to get their land back.

"If the company gets the land, many of our people will starve," says Mr Fil.

"If we lose the land, we have lost everything.”

Assignment is broadcast on BBC World Service on Thursday at 0906 GMT and repeated at 1406 GMT, 1906 GMT, 2306 GMT and on Saturday at 1106 GMT.

Cambodia's mining, oil sector allegedly corrupt

Thursday, February 05, 2009
By DENIS D. GRAY

BANGKOK, Thailand (AP) — The corrupt elite of Cambodia, one of the world's most impoverished nations, has laid the groundwork for siphoning off vast profits from a coming boom in mining and oil exploitation, a nongovernment organization said Thursday.

Britain-based Global Witness said that rights to exploit the resources have been allocated behind closed doors by a small number of power brokers around Prime Minister Hun Sen and other senior officials. The report, titled "Country for Sale," said "the same political elite that pillaged the country's timber resources has now gained control of its mineral and petroleum wealth."

"Unless this is changed, there is a real risk that the opportunity to lift a whole generation out of poverty will be squandered," the report said.

Global Witness, which has worked in Cambodia for more than a decade, said its findings were based on numerous interviews with industry insiders in the country and with others around the world over the course of 2008. The report's appendix also cites a number of academics, journals and newspaper reports.

The allegations were denied by Suy Sem, the minister of Industry, Mines and Energy, saying Global Witness "always defames the government."

"Regarding the exploration for oil and gas, we operate under procedures that are very fair and transparent and based on the rule of law," he told The Associated Press in the Cambodian capital, Phnom Penh. He did not address specific allegations in the report.

The government's spokesman could not be reached despite numerous attempts.

Others have raised concerns that rather than pulling Cambodia out of its "beggar status," the revenue windfall will further fuel already rampant corruption. The Berlin-based Transparency International ranked Cambodia 166 out of 180 on its 2008 world corruption index.

The report said international donors, which prop up the country, have so far turned a blind eye to the looming "corruption disaster." Donors, including the United States, European Commission and the World Bank, pledged $1 billion in development aid two months ago, without using the opportunity to demand transparency in the emerging industries, it said.

More than 75 companies, including such internationals as Chevron Corp. and BHP Billiton, were already working in the mining and oil sectors and have paid upfront sums to the government, the report said.

"Companies need to come clean on what they have paid to the government to secure access to these natural resources, or risk becoming complicit in a corrupt system," the report said.

Global Witness said it wrote to both Chevron and BHP asking them to reveal any payments made to the Cambodian government or government officials. Chevron, it said, did not respond while BHP said it had made no illegal payments related to its mining operations.

Chevron spokesman Gareth Johnstone told the Associated Press on Thursday that the company could not comment until they had a chance to read the report.

Global Witness said it could not find a record of bonuses paid to secure concessions totaling millions of dollars in the 2006 or 2007 revenue reports of the Ministry of Economy and Finance.

Of the mine sites investigated in 2008, Global Witness said every one was controlled or owned by members of Cambodia's political and military elite, including top military commanders and relatives of Hun Sen and cabinet ministers.

Charged with control over the gas and industry is the newly created Cambodian National Petroleum Authority, which is stocked with politicians close to Hun Sen and maintains a blanket of secrecy over its activities.

"The small number of elite power brokers who run the state have sold off potentially valuable concessions to companies in a manner which is non-transparent and highly dubious," the report said.

The report said the government's actions duplicate the wholesale destruction of forests with few of the resulting profits ending up in national coffers or among the general population.

The report also said the government was opening up environmentally sensitive areas to private companies, with mining activity already proceeding in at least six of the country's 23 protected areas.

Over the past few years, Cambodia has been buzzing with excitement — and anxiety — about an oil discovery by U.S. energy giant Chevron Corp. off the southwestern coast. There have also been discoveries of other minerals including bauxite, iron ore, copper and chromium, while onshore oil reserves are also being explored.

Conferences and discussions, both domestic and international on how to deal with the windfall have been held.

U.S. Ambassador Joseph Mussomeli told The Associated Press in 2006, shortly after the discovery, that Cambodia could fall victim to an "oil curse" that has afflicted other developing countries.

Some estimate that in coming years Cambodia may reap some $1 billion in annual oil revenues, enough to cut its ties to foreign development aid if the funds are properly utilized.

Associated Press writer Sopheng Cheang in Phnom Penh contributed to this report.

Elite 'selling Cambodia's future'

Cambodia is one of the poorest countries in the world with 40 per cent of the population in poverty [EPA]

Thursday, February 05, 2009
Al Jazeera

"There is a real risk that the opportunity to lift a whole generation out of poverty will be squandered" - Gavin Hayman, Global Witness

Cambodia's economic future is being jeopardised by high-level corruption, with officials siphoning millions of dollars earned from the country's oil and mineral reserves, a report by a British-based nongovernmental group has claimed.

The report by Global Witness, released on Thursday, said rights to exploit the country's resources had been allocated behind closed doors by a "corrupt elite" of powerbrokers close to the Cambodian prime minister, Hun Sen.

Speaking to Al Jazeera Gavin Hayman, the group's campaign director, said Cambodia's mining and oil industries were just beginning to take off, but already tens of millions of dollars in earnings were not accounted for.

That money, he said, was a vital national asset that should be directed towards national development needs.

"We aren't in a disaster yet, but we're on the brink of one," he said.

Cambodia is one of the world's poorest countries, with average incomes less than $300 a year and more than 40 per cent of the population living below the poverty line.

Missing millions


The Global Witness report, entitled Country for Sale, said researchers had found millions of dollars paid by oil and mining companies are missing from national accounts – money that, the group said, could eventually help Cambodia become independent of foreign development aid.

"The same political elite that pillaged the country's timber resources has now gained control of its mineral and petroleum wealth," Hayman said.

"Unless this is changed, there is a real risk that the opportunity to lift a whole generation out of poverty will be squandered."

The group said foreign aid donors should make further assistance conditional on Cambodia implementing new governance measures for key industries.

The report cites Australian mining giant BHP Billiton as confirming it paid one million dollars to the Cambodian government, but Global Witness says the funds have not been declared in the 2006 or 2007 government revenue reports.

It also alleges that $7.5 million paid to the Cambodian National Petroleum Authority by an Indonesian energy firm also did not reach the national treasury.

Banned

The allegations were denied by Suy Sem, the minister of Industry, Mines and Energy, who said Global Witness "always defames the government".

"Regarding the exploration for oil and gas, we operate under procedures that are very fair and transparent and based on the rule of law," he told The Associated Press news agency in the Cambodian capital, Phnom Penh.

In 2007 a Global Witness report Cambodia's Family Trees accused relatives of Hun Sen as well as close friends and senior government and military officials of stripping what remains of the Cambodia's forests for their own profit.

The government banned copies of the report from being distributed in Cambodia, although it can easily be downloaded from the internet.

Cambodia's officials at the time dismissed that report as "totally groundless, unacceptable rubbish", accusing Global Witness of engaging in a "political campaign" against the government.

Cambodian Oil, Mineral Wealth Sold To Corrupt Elites-Watchdog

February 04, 2009

BANGKOK (AFP)--Cambodia's political elite has captured the country's oil and mineral wealth, putting its economic future at risk while international donors turn a blind eye, an environmental watchdog said Thursday.

London-based Global Witness said impoverished Cambodia has enough natural wealth to wean itself off foreign aid but international donors must do more to ensure the assets are properly managed.

In its new report entitled: "Country for Sale," the group said earnings from oil, gas and minerals were being "jeopardized by high-level corruption, nepotism and patronage" in allocating and managing the assets.

"The same political elite that pillaged the country's timber resources has now gained control of its mineral and petroleum wealth," said Global Witness Campaigns Director, Gavin Hayman.

"Unless this is changed, there is a real risk that the opportunity to lift a whole generation out of poverty will be squandered," he added.

The Cambodian government banned a previous damning report published by Global Witness on Cambodia's forests in June 2007, which claimed the same elites were illegally logging the nation's forests.

In its new report the group said oil, gas and mineral assets had been parceled out by a small number of powerbrokers surrounding Prime Minister Hun Sen and other senior officials.

It also suggested that millions of dollars paid by oil and mining companies to secure access to the resources might be missing from national accounts.

"Companies need to come clean on what they have paid to the government to secure access to these natural resources, or risk becoming complicit in a corrupt system," Hayman said.

So far more than 75 companies are working in Cambodia's extractive sectors, the report said, including some internationally known operators such as Chevron Corp. (CVX) and BHP Billiton Ltd. (BHP).

Last month international donors pledged nearly $1 billion in development aid to Cambodia, their most generous aid package ever to the impoverished Southeast Asian nation.

But Global Witness said the agreements didn't go far enough in securing new governance measures for natural resources.

Cambodia expects to begin oil production of its offshore fields in 2011, following the discovery of oil in 2005 by Chevron.

The kingdom is sitting on an estimated hundreds of millions of barrels of crude - and three times as much natural gas - but it remains unclear how much of the black gold can actually be recovered.

Cambodia on brink of oil and mining corruption disaster; donor governments fail to act: Global Witness

Global Witness report calls for immediate moratorium on both sectors until basic governance structures are in place

5 February 2009
Global Witness Press Release

A corrupt elite has captured the country’s emerging oil and mineral sectors while Cambodia’s international donors turn a blind eye, a new report from anti-graft NGO Global Witness claims today.

Cambodia – one of the world’s poorest countries – could eventually earn enough from its oil, gas and minerals to become independent of foreign development aid. The report, Country for Sale, exposes for the first time how this future is being jeopardised by high-level corruption, nepotism and patronage in the allocation and management of these critical public assets.

Country for Sale details how rights to exploit oil and mineral resources have been allocated behind closed doors by a small number of powerbrokers surrounding the prime minister and other senior officials. The beneficiaries of many of these deals are members of the ruling elite or their family members. Meanwhile, the findings suggest that millions of dollars paid by oil and mining companies to secure access to these resources may be missing from the national accounts.

“The Cambodian government does not have a process for allocating resources outside of patronage,” said Global Witness Campaigns Director, Gavin Hayman. “The same political elite that pillaged the country’s timber resources has now gained control of its mineral and petroleum wealth. Unless this is changed, there is a real risk that the opportunity to lift a whole generation out of poverty will be squandered.”

In December 2008, donors pledged US$1 billion in development aid, yet failed to use this opportunity to demand new governance measures for the industries.

Private sector companies also have a role to play in improving the governance of Cambodia’s extractive industries. So far over 75 companies are working in Cambodia’s extractive sectors, including some internationally known operators such as Chevron and BHP Billiton. Country for Sale documents how many of these companies have already paid significant upfront sums to the government. Very few of them have disclosed these payments.

“Companies need to come clean on what they have paid to the government to secure access to these natural resources, or risk becoming complicit in a corrupt system,” said Hayman.

Country for Sale can be downloaded from http://www.globalwitness.org For more information and interviews, please contact Global Witness on the following numbers: In London +44 (0)20 7561 6399 or +44 (0) 7912 516 445 In Bangkok +66 (0)860 520 268

(1) Global Witness exposes the corrupt exploitation of natural resources and international trade systems to drive campaigns that end impunity, resource-linked conflict, and human rights and environmental abuses. Global Witness was co-nominated for the 2003 Nobel Peace Prize for its leading work on ‘conflict diamonds' and awarded the 2007 Commitment to Development Ideas in Action Award, sponsored jointly by Washington DC based Center for Global Development and Foreign Policy magazine.

(2) Global Witness’ last report on Cambodia, Cambodia’s Family Trees, showed how a small group of individuals surrounding the prime minister and other senior public officials have exploited the country’s forests for their personal profit. The report can be downloaded from http://www.globalwitness.org/media_library_detail.php/546/en/cambodias_family_trees

(3) Global Witness wrote to both Chevron and BHP Billiton in October 2008 to ask them to reveal any payments made to the Cambodian government or government officials. At the time of publication, Chevron had not responded. BHP Billiton however, did reply to say that BHP Billiton, Mitsubishi and the Cambodian Government have established a joint social development fund. The total contribution of BHP and Mitsubishi is to be US$2.5 million. BHP’s response stated: “BHP Billiton has never made a payment to a Cambodian Government official or representative and we reject any assertion that the payment under the minerals exploration agreement is, or the amounts contributed to the Social Development Projects Fund are, ‘tea money’.” BHP also shared how much had been paid to the Cambodian government, adding: “In accordance with the terms of a minerals exploration agreement with the Cambodian government which granted BHP Billiton and Mitsubishi the right to explore for bauxite an amount of US$1 million was formally paid to the Cambodian government in September 2006.”

(4) Cambodia’s donors are:
Australia
Belgium
Canada
China
Denmark
Finland
France
Germany
Ireland
Japan
Sweden
United Kingdom
United States
United Nations
European Commission
Asian Development Bank
International Monetary Fund
The World Bank Group

World Bank Faces Kleptocracy Test [... and the Kleptocratic regime comes out unscathed ... as usual]

By Marwaan Macan-Markar

BANGKOK, Aug 7 (IPS) - For all its talk of good governance, the World Bank continues to choose its words carefully when reprimanding errant states it has big stakes in. What is happening in Cambodia is typical.

Over the weekend, the Bank’s new president, Robert Zoellick, uttered the customary warnings that his predecessors have done regarding rampant graft in the South-east Asian country. Phnom Penh should ‘’counter the challenge of corruption,’’ Zoellick told reporters Sunday at the end of his two-day visit.

His talks with Cambodian Prime Minister Hun Sen had touched on the widespread illegal logging networks that have come to symbolise the web of corruption across the impoverished nation. Hun Sen had admitted that there was ‘’a need to stop the logging operations,’’ Zoellick said at the press conference.

This visit was the first to a developing country since Zoellick, a former U.S. deputy secretary of state and a former U.S. trade representative, became the chief of the Washington D.C.-based international financial institution (IFI). He replaced Paul Wolfowitz, who stepped down on Jun. 30.

That mild tone against corruption in Cambodia was also mirrored in the formal press statement issued by the Bank at the end of Zoellick’s visit. The need to fight corruption received passing mention in a three-page Phnom Penh-datelined statement that touched, for the most part, on the other major interests of the Bank. The list includes the Bank’s role in supporting microfinance schemes, help in issuing land titles, coordinating aid and shaping the country’s development agenda.

‘’The World Bank wants to assist the (Cambodian) Government to enact reforms to reduce rural poverty, encourage social development, improve the business and investment climate, and strengthen the rule of law,’’ Zoellick said. ‘’These next, essential steps would help the Government earn the respect of entrepreneurs and investors and, more importantly, the appreciation of Cambodians, who have suffered much and seek the full benefits of peace, growth and opportunity.’’

These words help to gloss over a prospect looming in the distance that could be damaging to senior government officials with hands soiled by corrupt deals. In early July, the U.S. Senate urged the administration of President George W. Bush in a draft bill to impose travel bans on Cambodian officials named in a recent report on the country’s illegal logging network.

‘’If implemented, the proposed U.S. ban would (prohibit) senior Cambodian ministers, top-ranking generals and others’’ from entering the US, states Global Witness, the London-based environmental lobby, which produced the report, ‘Cambodia’s Family Trees -- Illegal logging and the stripping of public assets by Cambodia’s elite’. ‘’It also wants other western and Asian countries to impose similar restrictions.’’

The Senate is acting on the 2006 Kleptocracy Initiative that was launched by Bush to combat high-level corruption, says Simon Taylor, a director at Global Witness. ‘’The initiative aims to shut out high-level corrupt officials from the global financial system, deny them a safe haven and recover and return proceeds of their crimes.’’

‘’Our report presents strong evidence that corruption and nepotism by high-ranking officials in the Cambodian government has facilitated extensive illegal logging in Cambodia; and that their involvement has undermined the rule of law, democracy and sustainable development,’’ Taylor revealed in an e-mail interview. ‘’The activities of these officials fall within the remit of the Kleptocracy Initiative, and they can be denied safe haven in the United States.’’

On the eve of Zoellick’s visit to Cambodia, Global Witness urged the Bank’s new chief to use his days in Phnom Penh to ‘’set the tone for his presidency and lay the foundations for the Bank’s approach to kleptocratic governments.’’ That would be a shift from ‘’the Bank and most other international donors (having) so far made little effort to call the (Cambodian) government to account on the issue (of illegal logging).

‘’(The) inaction by the donor community is symptomatic of its long-standing failure to ensure that aid strengthens governance,’ says Taylor. ‘’The donor-Cambodian government relationship has descended into a farcical exchange of money for empty promises, which confers legitimacy on those same officials who are looting the country.’’

It is a view echoed by Transparency International. In its 2006 corruption survey for the Asia-Pacific region, the Berlin-based global anti-graft watchdog described Cambodia as being among those with ‘’the highest perception of corruption.’’ The country stands out for ‘’the lack of political will to strengthen anti-corruption institutions,’’ consequently perpetuating ‘’rampant corruption’’ and ‘’undermining improvements in quality of life for the poorest citizens.’’

That year, the non-governmental Transparency ranked Cambodia 151 among 163 countries surveyed for corruption, where the country that topped the list was the least corrupt.

The Global Witness report, released in early June, revealed that the dominant logging syndicates in Cambodia were ‘’controlled by individuals related to Prime Minister Hun Sen, Minister for Agriculture Forestry and Fisheries Chan Sarun and Director General of the Forest Administration Ty Sokhun.’’

The annual timber haul from illegal logging was estimated to be over 13 million US dollars, the report, ‘Cambodia’s Family Tree,’ noted. Consequently, 30 percent of the country’s forest cover has been wiped off over a five-year period, it added. ‘’Illegal logging in Cambodia not only fills the pockets of the political elite; it also funds the activities of a 6,000-strong private army controlled by Hun Sen.’’

Over 35 percent of Cambodia’s 13.3 million people live in poverty, on less than one dollar a day. The World Bank is among a group of aid donors who help the country, pumping in financial assistance that accounts for close to half of the country’s national budget. In June, the donors pledges 689 million dollars.

It was only last year that the Bank responded to corruption, freezing 7.6 million dollars for three projects it was funding, including a water supply and sanitation scheme.

But that was a departure from the norm since the Bank stepped in to shape Cambodia’s development agenda following a peace accord in the early 1990s, bringing to an end decades a bloody conflict. ‘’The World Bank cannot afford to crack the whip on corruption in Cambodia, because it has too much to lose,’’ says Shalmali Guttal, a senior researcher at Focus on the Global South, a Bangkok-based regional think tank.

‘’Corruption is deeply entrenched in Cambodia and so is it within the development system and the aid industry,’’ she told IPS. ‘’The World Bank has been in charge of this development model. It has held it up as a post-conflict reconstruction country.’’