Cambodia Seeks Large Reduction to US Debts

Chun Sakada, VOA Khmer
Phnom Penh Thursday, 17 March 2011

"Hor Namhong requested that debt be lowered by 70 percent, to about $133 million, and that interest be lowered from 3 percent to 1 percent."

Cambodia has asked the US to decrease its Lon Nol-era debt and to decrease the interest rate on the balance, officials said Thursday.

Foreign Minister Hor Namhong met with US Deputy Assistant Secretary of State Joseph Yun, who is in charge of Asia Pacific, on Thursday, over some $445 million in debt accrued during the Lon Nol era.

Hor Namhong requested that debt be lowered by 70 percent, to about $133 million, and that interest be lowered from 3 percent to 1 percent, officials said after the meeting.

The war-era debt has been a sticking point in bilateral relations between the countries. Cambodian officials have said they should not have to repay the debt, which was accumulated by a pre-Khmer Rouge era government. Prime Miniser Hun Sen calls the war-era debt “dirty.”

US Officials say Cambodia's Debt to US is "an irritant" for Better Relation

US congressman raises Cambodia's war debt with Clinton

Cambodian Prime Minister Hun Sen, right, talks with U.S. Congressman Eni Faleomavaega, left, during a meeting in Phnom Penh, Cambodia, Jan. 7, 2010. Faleomavaega will oversee the hearing. (Photo: ASSOCIATED PRESS)

Tuesday, November 09, 2010
Radio Australia News

A congressman in American Samoa, Faleomavaega Eni Hunkin, has used a meeting with the US Secretary of State to raise concerns about Cambodia's outstanding war debt.

He spoke to Hillary Clinton on Monday night, while her plane was refuelling in the capital Pago Pago, at the end of a seven nation Asia-Pacific tour.

Cambodia owes the US some $US300 million dollars, plus fees, in debt incurred during the Lon Nol regime of the 1970s.

However, the current Prime Minister Hun Sen says they should not have to pay back money borrowed by the pre-Khmer Rouge government.

Faleomavaega Eni Hunkin has been arguing that the US cannot forgive the debt unless at least a part of it is repaid.

Congressman Hunkin says he raised the point with Mrs Clinton, but says, he didn't get to go into as much depth as he would have like.

"I did mention to her about the situation in Cambodia, we've had this ongoing debt obligation that Cambodia has accumulated for some 30 years now but basically, we didn't have a chance to talk about all the issues," he said.

Clinton urges Cambodia to strike a balance with China

Monday, November 1, 2010
By John Pomfret
The Washington Post

PHNOM PENH, CAMBODIA - Secretary of State Hillary Rodham Clinton called on Cambodia Monday to maintain an independent foreign policy and avoid relying too much on China.

On the second leg on a seven-country swing through Asia, Clinton's trip is designed to reinforce a central plank of foreign policy in the Obama administration: that the United States views Asia as key to the future and that the U.S. must act in this region to balance China's influence. President Obama also heads to Asia later this week for meetings in India, Indonesia and South Korea.

"You don't want to get too dependent on any one country," Clinton said in response to a question about China's influence during a meeting with Cambodian students on Monday.

"There are important issues that Cambodia must raise with China," she continued, pointing to a string of Chinese dams on the upper Mekong River that risk lowering the flow of the river as it courses through Cambodia.

Clinton came to Cambodia from talks in Vietnam and China. Her trip to Vietnam marked the U.S. accession to the East Asian Summit -- a group of 18 Asian nations which the United States joined as a way to balance China's heft.

Clinton has been to Vietnam twice in the last four months and this is her sixth trip to Asia as secretary of state. Her visit to Cambodia marked the first time since Colin Powell came here in 2003 that a U.S. secretary of state has held meetings in this country.

U.S. officials acknowledge that countering China's growing influence here will not be easy. China is the top provider of aid to Cambodia, giving more than $200 million a year. It has built bridges, roads and power plants all over the country, and China also trains and supplies Cambodia's military.

One issue that divides the United States and Cambodia is the more than $400 million of debt Cambodia owes to Washington. The debt was incurred during the Lon Nol regime in the 1970s.

Clinton announced that Washington would send a team to resume talks with the Cambodian government over the issue.

Foreign Minister Hor Namhong told reporters that his country wanted the debt to be diverted into development assistance and education.

Another issue involves the international effort to bring to justice members of the Khmer Rouge regime, which is believed to be responsible for killing 1.5 million to 2 million people from 1976 to 1979. Cambodia has indicated that it wants the prosecutions to stop after four senior Khmer Rouge officials go to trial, perhaps next year.

Hor told reporters Monday that if the prosecutions were expanded to include lower-ranking Khmer Rouge officials "it could jeopardize peace and stability." Clinton responded that her first priority was raising the $50 million needed to prosecute the existing cases against Nuon Chea, Ieng Thirith, Ieng Sary and Khieu Samphan.

CPP MP asks the US to cancel debt

06 August 2010
By Yun Samien
Radio Free Asia
Translated from Khmer by Socheata
Click here to read the article in Khmer

On 06 August 2010, a high-ranking official for the National Assembly’s economy and finance committee [Cheam Yeap] asked the US to cancel the debt owed by the Lon Nol Khmer Republic regime as a repayment to Cambodia for the losses during the war between the US and Vietnam.

The request was made after Cambodia and the US are looking for a reasonable resolution to re-pay the US debt. Currently, Cambodia owes the US more than $300 million.

A high-ranking US official told RFA on Tuesday 03 August that Cambodia still has the duty to re-pay the US debt , even though the money was borrowed by a previous government.

US allows Cambodia to reschedule $317 mln debt

PHNOM PENH, Feb 9 (Reuters) - The United States has refused a request by Cambodia to write off $317 million in debt, but has instead agreed to reschedule the impoverished country's loan repayments, a top U.S. official said on Tuesday.

The United States also declined to convert the debt into development aid but would work out a plan for Cambodia to pay back the loans, which date back to the 1970s, U.S. Deputy Assistant Secretary of State Scot Marciel said.

"The U.S. position is that Cambodia has recognised its debt," Marciel told reporters during a visit to Phnom Penh. "We think Cambodia should begin the payment, which the Cambodian government has not been willing to do."

The loans were given to the government of Lon Nol after it came to power in a 1970 coup backed by the United States. The loans were intended to develop the country's agriculture sector and boost commodities exports.

Lon Nol was toppled five years later when the ultra Maoist Khmer Rouge staged its "killing fields" 1975-1979 revolution, which left an estimated 1.7 million people dead and plunged Cambodia into decades of dire poverty and political instability.

The two countries have long disagreed about repayment of the debt and Cambodia has argued the money was spent on arms which were ultimately used on its own people.

China in 2002 cancelled Cambodia's debt from the 1970s, which was estimated by embassy officials to be worth between $60 million and $1 billion.

Marciel, Washington's top official in charge of Southeast Asian affairs, plans to plans to visit Laos and Thailand in the next week.

(Reporting by Prak Chan Thul; Writing by Martin Petty; Editing by Sugita Katyal)

US Congressional Delegation Discusses Trade

Left to right: Joseph Cao (R-LA), Eni Faleomavaega (D-American Samoa) and Mike Honda (D-CA) (Photo: Sok Serey, RFA)

By Chun Sakada, VOA Khmer
Original report from Phnom Penh
07 January 2010

Prime Minister Hun Sen and three US congressmen discussed an extension of trade relations between the two countries on Thursday, while raising the possibility of debt reduction.

The congressmen—Eni Faleomavaega, a Democrat from American Samoa; Mike Honda, a Democratic from California; and Joseph Cao, a Republican from Louisiana—met with Hun Sen, Foreign Minister Hor Namhong, Finance Minister Keat Chhon and Commerce Minister Cham Prasidh

“We did touch on the issue of debt obligations, also on questions of trade and tariffs in trying to bring Cambodia’s trade and economic needs [and] better status especially in trade with the United States,” Faleomavaega told reporters at Phnom Penh International Airport Thursday afternoon.

The US delegation is scheduled to travel to Laos, having already visited Vietnam. The tour will conclude in Japan.

Cambodia owes the US more than $300 million from the Lon Nol period, a debt Cambodian officials maintain should be erased. Faleomavaega said he told Hun Sen he would take the matter to discuss with other US lawmakers.

Debt forgiveness could help Cambodia, he said. Faleomavaega said he wanted to play a role in bettering the relationship between Cambodia and the US.

Eang Sophaleth, an adviser to Hun Sen, told reporters the premier had thanked the men for continued economic support from the US and was happy to promote a relationship between the two countries.

U.S. to consider turning Cambodia's debt into development aid

January 07, 2010
Xinhua

The United States Congressman Eni Faleomavaega told Cambodian Prime Minister Hun Sen on Thursday that he will discuss with his colleagues about Cambodia's debt if it can be turned into assistance for development projects in this country, a Cambodian official said.

Eang Sophaleth, Hun Sen's spokesman told local reporters that during the meeting with Hun Sen on Thursday morning in Phnom Penh, Eni Faleomavaega said he will discuss with his colleagues after returning to the United States about the debt.

Eni Faleomavaega, who was accompanied by his two Congressmen Joseph Cao and Mike Honda, was making a two-day visit to Cambodia.

Cambodia has several times asked the United States government to consider canceling its debt amounting to some 300 million U.S. dollars it borrowed since 1972.

The U.S. has not yet answered to Cambodia's request for the debt written-off.

Cheam Yeap, chairman of the National Assembly's Economic Commission and a senior member of the Cambodian People's Party said several countries including China have written off Cambodia's debts owed some decades ago.

Cambodia is also asking Russia to cancel its debt that amounts around to 1.5 billion U.S. dollars.

Politiktoons No. 67 - Sea of Debt

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