Neak Srok Sre's (Farmer's) rambling

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Comment originally posted on the Camdisc bulletin board

Too much buttering up

Translated from Khmer by Chao Sok

Yesterday, I was watching the Bayon TV station, there was a point in there that I found so sickening. In the show, I saw an interview in a program called “Phum Kh-nhom, Pha-let-phal Kh-nhom” (my village, my product) in which a villager was discussing about his wooden mermaid carving. The villagers said that, in the past, he used a hand sander to polish the carving to smooth it, but now, he is using a mechanical sander instead because it makes his job easier. Immediately, the anchorman cut in and said that the villager was able to use a mechanical sander was because of the progress achieved by Samdach Akak Moha Sena Bat Dey Dek Cho [Hun Sen], and thanks to that, we are now developed and have received modern technology to use in our daily life. This is so sickening to me … just for a mechanical sander that costs 4 or 5 bucks, how could they claim that this is the Dek Cho’s achievement? How about the corruption cases involving millions of US dollars, why don’t they talk about these achievements as well?

Please help me, can you make any sense out of this?

Samnang

Oil, Corruption And The Resource Curse

2008-08-20
The Straits Times/ ANN

"Thailand is currently one of the largest foreign investors in the country."

Late last month, Cambodian Prime Minister Hun Sen's party won a resounding victory in national polls, winning more than two-thirds of the seats in Parliament. Clearly, the days of unstable coalition government are over. But have the elections also put the country on track to become Asean's next success story, as some analysts have suggested?

Optimists can point to a number of factors in the country's favour. Two stem from the elections themselves. The first is that political leaders will now have more time to formulate and implement economic policy rather than political infighting. After the 2003 elections, talks between the Cambodian People's Party (CPP) and the royalist Funcinpec party dragged on for almost a year before a coalition government could be formed.

The second factor is that the election, though widely denounced by opposition groups as unfair, was one of the most peaceful since the 1991 Paris Peace Agreement. Such an improvement in the security situation is unlikely to go unnoticed by potential foreign investors.

But there are more reasons than these for suggesting that the impoverished country may finally be about to achieve sustainable economic development.

An improved security situation, for example, suggests that the tourism industry will continue to grow strongly. The sector, which earned the country US$1.4 billion last year, is already expected to expand by at least 20 per cent this year. Then, there is the current construction boom, suggesting that both local elites and foreign investors have confidence in the country's growth potential.

An economic take-off, however, is far from inevitable. One problem facing the country is that the highly successful garment industry is now experiencing stiffer global competition and slowing demand. Last year, the industry earned 80 per cent of Cambodia's foreign exchange and employed an estimated 350,000 people. But according to the Commerce Ministry, apparel exports have been declining since last October. This is largely due to the economic slowdown in the United States, which imports about 70 per cent of Cambodia's textile production.

Then, there are the country's persistent feuds with neighbouring Thailand. Last month's dispute over the Preah Vihear temple, for example, prompted the Thai Embassy in Phnom Penh to issue travel warnings to its citizens in the country.

The incident evoked memories of attacks on Thai-owned businesses in Phnom Penh in January 2003, when rioters rampaged for hours while the security forces apparently did little to restrain them. The crisis was triggered when false reports circulated in Phnom Penh that a popular Thai soap opera actress had questioned Cambodia's claim to the famed Angkor Wat temple complex and demanded that it be returned to Thailand. Thailand is currently one of the largest foreign investors in the country.

But the most significant drag on economic development could, ironically, be what is currently regarded as its brightest hope: oil.

In the wake of the discovery of oil off the coast in 2005, the World Bank estimated Cambodia's total offshore production potential at up to two billion barrels.

But massive oil revenues could also produce a phenomenon known as the 'resource curse'--corrupt elites siphoning off the wealth, making the nation even poorer and less democratic. Nigeria is often cited as an example. As the World Bank has noted, Nigeria had enjoyed more than $280 billion in oil revenue in the last three decades--more than the total of official development assistance for all of Africa. But Nigeria's real per capita income actually declined over the period.

Corruption is already a drag on Cambodia's economic growth. Prime Minister Hun Sen admitted as much earlier this year when he said that corruption was "a dangerous cancer".

Since about 50 per cent of the government's budget is currently funded by foreign donors, the government faces substantial pressure to keep malfeasance in check, particularly when it comes to foreign investors. But with a projected massive injection of funds into government coffers around 2010 as a result of oil, such influence will soon decline.

The July election has certainly helped provide Cambodia with some of the preconditions for continued growth. But the real test will come when the oil starts flowing.

Cambodia's Premier in Strong Position Ahead of Vote

Hun Sen Has Steered Economic Miniboom, But Graft Abounds

July 22, 2008
By PATRICK BARTA
Wall Street Journal

"The kind of growth we are having now is not sustainable or equitable," contends Sam Rainsy, a French-educated former finance minister who leads a prominent opposition party

PHNOM PENH, Cambodia -- Prime Minister Hun Sen, whose party is expected to win re-election here Sunday, is credited by many Cambodians with guiding their country to become one of Asia's newest investment hot spots.

After enduring one of the worst genocides in history, a new Cambodia now features skyscrapers, foreign investors and stability. This week's national election will serve to show just how far the country has come.

But keeping the economic recovery on track in Cambodia -- a nation best-known for its genocidal 1970s Khmer Rouge regime -- is getting more difficult in the face of a global slowdown, regional competition and entrenched corruption.

Mr. Hun Sen opened Cambodia's doors to foreign investors and has overseen notable improvements in living standards. Economic growth has surged 10% or more annually in recent years, driven by an influx of investment funds, property speculators and a few big multinationals, including Chevron Corp. and BHP Billiton.

Phnom Penh, the capital, recently got a new fleet of metered taxis, and it soon will have its first skyscrapers, including a 42-story luxury condominium tower rising up next to an office for a national antileprosy campaign. In brochures, the project's South Korean developers compare the building -- which boasts a grass-covered "sky park" on its 10th floor -- to Manhattan's Time Warner Center.

But attracting a lot more investment will depend on Cambodia overcoming its reputation as one of the world's most corrupt countries. It ranks among the worst on Transparency International's annual list of graft-ridden nations, with 72% of its residents reporting they paid at least one bribe in the past year -- roughly on par with Cameroon and Albania. Opposition leaders and others say a more pervasive rule of law is needed to sustain the boom by making Cambodia attractive to blue-chip foreign investors who currently prefer countries such as Thailand or Vietnam.

Many economists believe Cambodia's miniboom is already fading. Growth has been fueled by just a few sectors -- notably tourism, construction and garment manufacturing. Inflation is soaring, pushed by higher fuel and food prices, and the new garment factories around Phnom Penh are facing new competition as China expands its textile output and global demand slows.

The International Monetary Fund predicts growth of Cambodia's economy will slow to about 7% this year, in part because of slowing garment exports.

Mr. Hun Sen has "delivered political stability, and that has translated into economic growth," says Arjun Goswami, country director for the Asian Development Bank in Phnom Penh. But, he adds, "the story is going to get more difficult for Cambodia."

Economic issues have played an important part in the election campaign. "The kind of growth we are having now is not sustainable or equitable," contends Sam Rainsy, a French-educated former finance minister who leads a prominent opposition party. Much of Cambodia's economic activity, he notes, involves illegal businesses or black-market operations: illicit logging, land speculation, gambling and prostitution. Such businesses thrive, he says, because of a political system permeated with graft.

Ruling-party leaders have dismissed some allegations of graft as exaggerated, and promised to pass legislation to rein in corruption in the future.

Though small, Cambodia could become a major investment site. It has significant deposits of bauxite, gold and other minerals, and energy companies have recently found sizable oil deposits off its coast. The country also has large areas of arable land that could be developed for rice and other crops to help meet Asia's growing demand.

Much of that potential was squandered as Cambodia suffered through wars and atrocities in recent decades. Cambodia became independent from French colonial rule in the 1950s, but was bombed heavily by U.S. forces during the Vietnam War. It later fell to the Khmer Rouge, a home-grown Maoist rebel group whose leaders, including the notorious Pol Pot, outlawed money and private property in a disastrous bid to create a nation of agricultural collectives. Some 1.7 million people -- about a fifth of the population at the time -- died of illness or starvation or were killed.

Invading Vietnamese forces eventually ousted the Khmer Rouge and installed Khmer Rouge defectors, including Hun Sen, in a new government. He became prime minister in 1985. A battle-hardened soldier-turned-politician -- he lost an eye in combat -- Mr. Hun Sen survived Cambodia's transition to nominally democratic rule in 1993 and has since fended off all challengers to his rule, including a violent coup in 1997 against a rival with whom he shared power.

Despite his government's reputation for corruption and its strong authoritarian streak, Cambodians re-elected Mr. Hun Sen's party in 1998 and 2003, and he has remained popular among many Cambodians who believe the country is better off than it was a decade ago.

A party victory in Sunday's national parliamentary elections would give him another five years in power. Now in his late 50s, he has said he plans to stay in power until he is 90 years old. In a speech earlier this year, he said, "I wish to state it very clearly this way: No one can defeat Hun Sen. Only Hun Sen alone can defeat Hun Sen."

To sustain popular support, the government has rebuilt schools and repaired roads, in part with money provided by foreign donors. It has also made it easier for foreigners to visit and invest in the country, stoking a surge in tourist arrivals and hotel and office construction.

Mr. Hun Sen's party "has done a lot to improve the country," says Sokna Tea, a 20-year-old finance student who was hanging out one recent afternoon near a new $1 billion property development expected to include a 52-story tower and convention center. Many Cambodians simply believe Mr. Hun Sen's victory is inevitable or fear that a vote against his government could lead to political unrest.

Despite some reports of campaign-related violence, independent election observers say they expect the vote to be fair, and campaigning for the dozen or so parties contesting the vote has been vigorous. Mr. Hun Sen's political organization, the Cambodian People's Party, is backed by many of the country's wealthiest tycoons and has deep pockets, allowing it to vastly outspend the smaller opposition groups.

Some economic analysts say controlling Cambodia will become harder for Mr. Hun Sen, especially if rising food and energy prices undermine the recent gains in poverty reduction. More than half of Cambodia's population of 14 million is under 21 years old, and many youths are better educated than their parents, meaning they will likely demand more from their government in the future.

"I want something more than stability," says Theary Seng, a social activist in her 30s who has lived in the U.S. and now is the executive director of a Phnom Penh watchdog group known as the Center for Social Development. After all, she says, "North Korea has stability."

Write to Patrick Barta at patrick.barta@wsj.com