‘The final nail in the proverbial coffin’ is what China’s Belt and Road Initiative (BRI) represents for one of the poorest nations in Southeast Asia—Cambodia.
China has long held a presence in Cambodia. However, the Chinese have become unwanted guests in recent years. The more help Cambodia gets from China, the greater the influx of Chinese. And, along with them, came their rules and way of life.
But, being a country suffering from basic power and sanitation issues, Cambodia welcomed the hefty cheques, soft loans and infrastructural plans from China with open arms. Between 2013 and 2017, China “invested” US$5.3B in the country – that’s more money than the Cambodian government did.
While these and other initiatives were said to be geared to better the lives of Cambodians, the reality could not have been further away from this dream.
Even before the Belt and Road Initiative, China secured a foothold in Cambodia that allowed it to exude a certain influence over the country. However, international onlookers have said that Cambodia sealed its fate as being fully dependent on China when it signed the Belt and Road Initiative.
The initiative is being pushed by China as a grand plan to connect Asia with other parts of the world through massive infrastructural projects. Under the initiative, over 70 countries appear to benefit from multimillion-dollar soft loans from China for the construction of roads, bridges, airports, deep water ports and other infrastructure.
So far, the Belt and Road Initiative has left a trail of failed projects, which furthers nations’ dependence on China. Cambodia joins nations like Malaysia, Sri Lanka and Pakistan.
Yet, the Government of Guyana recently signed a Memorandum of Understanding, (MOU) with the People’s Republic of China to join the Initiative.
Kaieteur News has since highlighted the plight of Malaysia and Pakistan.
This week, the focus is on Cambodia.
For Cambodia, the Belt and Road Initiative serves as a continuation of what began many years ago. In fact, some of the projects that existed before are now linked to the Belt and Road Initiative.
At present, China is at work building a deep water port, airport and virtual city on 45,000 hectares of Cambodian land. The work is being done under the supervision of solely Chinese contractors. The projects brought no jobs for locals.
While the work started before Road and Belt Initiative, the projects now have direct links to the initiative.
Back in 2008, China’s Tianjin Union Development Group (UDG) was granted a 99-year lease to around 20% of the country’s total coastline at the modest price of US$30 per hectare.
Cambodia’s Constructors Association has estimated the so-called “Pilot Zone” project’s total cost at US$3.8 billion.
The amount of land leased is more than three times the legal limit under Cambodian land law, which caps land concessions at 10,000 hectares.
The concession also includes land that was previously protected from development within the Botum Sakor National Park, but was made available for private purchase by a royal decree.
Last June, Asia Times reported that Cambodian villagers and environmental activists were in frequent disputes with the Chinese company, claiming UDG has made use of Cambodian military police to enforce its claim.
Some locals say they have been violently forced off their land by security forces, with homes dismantled and burned to the ground, according to a report by Licadho, a local human rights group.
In 2016, Cambodia’s PM signed 31 agreements which include $237 million in soft loan deals with China under the “troubled” Belt and Road Initiative.
Under the BRI, China offers developmental assistance on Cambodia’s transportation infrastructure, including bridges, highways, railways, and ports.
The projects include linking major Cambodian routes. These are under construction. They include the “Cambodia-China Friendship Bridge” crossing the Mekong River; and the first 190-kilometre expressway connecting the capital Phnom Penh to the coastal Sihanoukville in the southwest.
A five-hour drive away from Cambodia’s capital, Phnom Penh, the Dara Sakor resort was once touted by the Chinese company as a city-sized casino resort for “extravagant feasting and revelry.”
Earlier this year, a Reuters report noted that the US$15M project is now a sprawl of mostly empty hotel buildings, deserted beach bars and the unfinished shell of a casino on a remote part of the Cambodian coast.
“Despite its troubles, the resort and surrounding development have been lauded as a champion of China’s Belt and Road initiative…,” the report stated.
The Dara Sakor resort project was also included in a 2017 Belt and Road yearbook of China’s Ministry of Commerce, as BRI’s biggest project so far in the Cambodia-China Investment plan.
The Dara Sakor is not the only faulty project the Chinese have sold to Cambodia. The Koh Kong project was pitched to Cambodia by China as their personalized version of Hong Kong at an estimated cost of USD$500 million.
According to their calculation, the first phase of Koh Kong will cost between US$300 million and US$350 million. Cambodia’s Koh Kong project is accompanied by a new international airport capable of accommodating 10 million passengers.
Zhang Gaoli, Chairman of the leading Group for China’s Belt and Road Initiative, had sponsored the project since its inception.
A report in the Asia Times outlined that while it is clear that the Koh Kong project is important to Beijing, it is less clear how it will benefit Cambodia.
“While the development in Koh Kong province has the potential to advance China’s domestic and international interests, it has come at the expense of the local population, the environment and potential future income for Cambodia,” the report states.
At Koh Kong, a deep-sea port facility is also part of the package.
Bates Gill, a professor of Asia-Pacific security studies at Macquarie University in Sydney, said the Koh Kong case has “very familiar echoes of other projects in the region and around the world.” He said that because Chinese entities generally employ Chinese labour, rather than a win-win for the host country of big infrastructure projects, “Chinese entities profit the most.”
He alluded to projects such as the Hambantota port in Sri Lanka, military facilities in Djibouti and a 99-year lease over a port facility at Darwin, northern Australia. These facilities were seized by China after the governments could not pay the debt.
He said the Koh Kong port is of marginal significance at present, but its influence would be greatly enhanced if the Chinese proposed canal in Thailand is built.
That port would significantly shorten and reroute the Middle East to Asia shipping routes.
To date, the Chinese investment has resulted in many failed projects, which financial experts predict will leave future generations indebted to China.
However, Cambodia’s Prime Minister, Hun Sen has brushed aside the rising tension saying that, “Chinese investment is key to Cambodia’s development.”
Meanwhile, Cambodia‘s debt is piling up. The country owes almost half of its $6 billion in foreign debt to China, and an additional $3.5 billion for Belt and Road infrastructure is in the pipeline, according to the Center for Global Development, a Washington research group.
A 2016 International Monetary Fund (IMF) report revealed that Cambodia’s combined external public debt is far less than bilateral public debt with China. China remains Cambodia’s largest lender under bilateral loans agreements.
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