[hepr-vn] Trade, aid fail Cambodia's poor

[Vern Weitzel]

Subject: [SEA-SPAN] Trade, aid fail Cambodia's poor
Date: Mon, 18 Aug 2008 07:11:19 +0700
From: user at sea-user.org
To: vern at coombs.anu.edu.au


Trade, aid fail Cambodia's poor
By Joanne Knight
The Age, Melbourne
August 15, 2008

The future is bleak for Cambodians and Burmese when corruption is rife.
BURMA and Cambodia occupy significant geopolitical positions in Asia. The West 
has an interest in controlling this area as a buffer against China's growing 
power. As a pawn in global politics, Cambodia is being controlled through 
international aid at the expense of its people.

Burma is possibly heading in the same direction. As Burma bows to pressure from 
the West to allow aid into the country after cyclone Nargis, critics argue the 
aid will come tied to economic liberalisation.

Cambodia and Burma share striking similarities: both are extremely poor and are 
governed by corrupt elites. But Cambodia is about 10 years ahead in accepting 
Western aid. Its present does not augur well for Burma's future.
The outcomes of Cambodia's development have been mixed: extremely beneficial for 
economic growth, the ruling elite and crony capitalism, and less advantageous 
for the poor. The development has been centred on trade liberalisation, with 
open markets for the country's timber and textile exports.
The World Bank has reported that local corruption has impeded the country's 
development, particularly poverty reduction, but the real difficulty may be the 
porous state of Cambodia's economy.

Corruption is common in Cambodia. Transparency International's Corruption 
Perceptions Index ranks Cambodia at 162 out of 179 countries (Burma ranks at 
179, the worst country along with Somalia). Some claim that much aid from the 
international community has gone to private pockets.

Since the Paris peace agreement of 1991, Cambodia has been subjected to the 
scrutiny of international donors, including the World Bank, the International 
Monetary Fund and the Asian Development Bank. Aid constituted more than 10% of 
gross national income in 2004, far more than the low-income country average of 
2.8%. In 2006, the amount of aid reached $US595 million. Cambodia is also a 
fast-growing economy, with annual economic growth at nearly 11% in 2006. But 
poverty has fallen at a rate of only 1% a year. Two key features of Cambodia's 
National Strategy Development Plan 2006-10, funded by the World Bank, are trade 
liberalisation and the creation of export-processing zones.

Development projects have done little to limit corruption in Cambodia. The World 
Bank's Forest Concession Management and Control Pilot Project
(FCMCPP) began in 2000, funded by a $US5 million Learning and Innovation Loan. 
In June last year, Global Witness published Cambodia's Family Trees, which 
detailed the intimate connections between the owners of logging companies and 
the Cambodian Government. Owners of the largest logging companies