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Cambodia formally joined ASEAN at a Foreign Ministers' meeting in Hanoi on 30 April. Cambodia is now taking part in major scheduled ASEAN meetings as a full member, such as the ASEAN-EU meeting on 26-27 May in Bangkok. Participation in such important ASEAN meetings will help Cambodia to present itself more favourably internationally and thereby open up new sources of investment and funding from ASEAN and Western donors, by demonstrating the country's return to normality. Indeed, the tone of international media coverage and editorial comment on Cambodia has improved markedly over the past month or so.
The economy is resuming growth. The ADB has forecast that the economy will grow by 4 per cent in 1999 and six per cent in 2000. Especially rapid growth is taking place in the export-oriented textiles manufacturing sector. A British trade fair with 35 exhibiting firms was held in Phnom Penh in late April. The Standard Chartered Bank, mindful especially of the business potential of growing Cambodian-Chinese commercial links, has opened a (US$13.5 million capital) full branch in Phnom Penh.
The Chinese Government at the end of April granted $200 million worth of grant and interest-free loan aid to Cambodia. The aid will be disbursed as two dam projects in Svay Rieng and Kampong Thom provinces, and cement, sugar and other factory projects aimed at expanding Cambodia's industrial base. This Chinese example of a generous no-strings-attached aid package will encourage the World Bank, ADB and other big donors more quickly to unplug their own delayed aid projects to Cambodia.
The attention of international media and human rights lobbyists remains focussed on the Khmer Rouge trials issue, but here too there has been progress. United Nations experts were claiming earlier this year that problems plaguing the Cambodian judicial system, including corruption, political interference and the lack of a culture of respect for an impartial criminal system, were so serious that a domestic Khmer Rouge trial under local law would not be feasible or credible.
However the United Nations has now moved towards compromise. On 19 May Thomas Hammarberg, UN Commissioner for Human Rights, said that he expects the UN to agree to a Cambodian Government request for expert help in preparing the way for a trial in Cambodia of Khmer Rouge leaders. He said the Cambodian Government had sought U.N. help in drafting a (crimes against humanity) law under which a court for a Khmer Rouge trial would be set up in Cambodia and foreign judges and prosecutors allowed to take part. He said he thought the UN Secretary-General would accept this proposal and would send an international expert to Cambodia. Hammarberg expressed optimism, while noting that there were still many problems with the Cambodian judicial system. Drafting the new law is expected to take about two months.
Sam Rainsy continues his spoiling role of seeking to discredit Cambodia internationally. Under lobbying from Rainsy and his supporters, the European Parliament passed a hostile resolution condemning Cambodia for not handing over Ta Mok and other Khmer Rouge war criminals to an international tribunal. As in the case of the US Congress, Rainsy is able to use a very few strongly committed politician supporters to push through resolutions to which the majority of parliamentarians are indifferent. Such resolutions are then used to establish a basis of credibility for wider lobbying. Rainsy recently advised a visiting delegation of German parliamentarians that intimidation prevails in his country and that there can be no progress in Cambodia until the prevailing 'culture of impunity' of the ruling Cambodian People's Party is overcome. But Rainsy is coming to be seen in Phnom Penh as an increasingly lonely and marginalised figure. His political influence is declining. He continues, however, to be well regarded outside Cambodia.
WATCHPOINT: Positive political and economic trends are making Rainsy's jaundiced view of Cambodia less relevant to his fellow Cambodians.
About our company:
AFG Venture Group is an Asia and Australia based corporate advisory and consulting firm with over 20 years experience in creating alliances, relationships and transactions in Australia, South East Asia and India; including a 15 year history of corporate and equities advisory in Australia, undertaking merger, acquisition, divestment, fund raising and consulting for private and public companies.
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