Linking BRI with Cambodia’s rectangular development


March 29, 2019

Linking BRI with Cambodia’s rectangular development

Khmer times:
Chinese President Xi Jinping (R) meets with Cambodian Prime Minister Hun Sen in Beijing, capital of China, May 17, 2017. Xinhua/Rao Aimin

The Belt and Road Initiative (BRI) is an ambitious international cooperation and connectivity project initiated by China in 2013. Cambodia is one of the staunchest supporters of the initiative with the expectation that BRI will contribute to peace and shared prosperity. As a small and open economy, Cambodia is committed to building an open and inclusive international system.

The second Belt and Road Forum for International Cooperation will take place in late April this year to further expand and deepen international collaborations and partnerships based on the spirit of peace, cooperation, openness, transparency, inclusiveness, equality, mutual learning, mutual benefit and mutual respect by strengthening cooperation on the basis of extensive consultation and the rule of law, joint efforts, shared benefits and equal opportunities for all.

Cambodian Prime Minister Hun Sen will lead a big delegate consisting of deputy prime ministers, ministers and other senior leaders to attend the forum in Beijing. Cambodian leaders will also have a number of bilateral meetings with some key Chinese business leaders who are interested in investing in Cambodia. BRI is a key framework, or even a catalyst, to encourage and facilitate the investment inflow from China to the Kingdom.

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In the joint statement of the first forum, the leaders stressed of forging joint endeavour on BRI and urged to build synergy between BRI with other connectivity initiatives. From the Cambodian perspective, building synergy between BRI with the five-year development plan, called Rectangular Development Strategy, is the priority of bilateral cooperation between Cambodia and China.

The Rectangular Development Strategy Phase IV prioritises four pillars namely human resource development, economic diversification, private sector and job development, and inclusive and sustainable development. At the core of the four pillars is the acceleration of the governance reform, which refers to institutional reform and capacity building, strengthening accountability and integrity in the public administration, strengthening of work effectiveness, and strengthening of private sector governance.

Under the BRI cooperation framework, China should further align BRI with key development areas of Cambodia. So far, Chinese development assistance and investment projects concentrate on hard infrastructure and labour-intensive industry. Both countries need to expand their areas of cooperation to include human resource development, digital economy and sustainable development.

The Chinese companies and factories should build vocational training centres or schools to build and transfer skills to local workers. Due to lack of local skilled labour forces, most of Chinese companies choose to bring Chinese workers, which costs more than hiring local workers. Chinese companies should also provide on-the-job training to build the capacity of local workers in order to improve productivity. In this regards, Chinese companies can learn a great deal from Japanese companies in terms of skills development and knowledge transfer.

Digital economy is the future economic sector of Cambodia. The key challenges facing Cambodia to realise a full-fledged digital economy are the lack of human resources and digital infrastructure, and the lack of public and private investment in innovation and entrepreneurship. Mega Chinese private companies like Huawei and Alibaba could help Cambodia to build the necessary infrastructure and human capital to help the Kingdom fully harness digital economy and the Fourth Industrial Revolution.

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In terms of inclusive and sustainable development, China and Cambodia should work closely together to link BRI with the UN Sustainable Development Goals and the National Sustainable Development Goals. Chinese investments need to further link with rural development and poverty reduction. Some investment projects relating to land grabbing, serious environmental degradation, and socio-economic exclusion need to be reviewed. Environmental and social impact assessment needs to be seriously conducted before deciding on investment or development projects.

The success of BRI depends very much on the quality of the projects and the perception and participation of the local community. Both countries still need to double their efforts to ensure that development projects under BRI really benefit the local people. People-centred development approach should be at the core of BRI and Cambodia-China partnership.

Suos Yara is Member of Parliament from Cambodia.

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  • Image result for benny widyono

The quintessential UN diplomat-DR. Benny Widyono

When career diplomat Benny Widyono died in his sleep in the United States on March 17, the world lost a beautiful bloke, a distinguished diplomat, a United Nations governor of Siem Reap Province and an Ambassador and Dean of the Diplomatic Corps as UN Ambassador to Cambodia.

Copyright © 2019 Khmer Times

 

Picking Up the Pieces After Hanoi


March 19, 2019

Picking Up the Pieces After Hanoi

by Richard N. Haass

The collapse of last month’s summit between US President Donald Trump and North Korean leader Kim Jong-un was perhaps the inevitable result of a process in which the two leaders dominated, optimistic about their personal relationship and confident in their abilities. The question is what to do now.

 

NEW YORK – When last month’s summit between US President Donald Trump and North Korean leader Kim Jong-un ended without a deal, the result was not surprising. One or both countries came to Hanoi with a misunderstanding of what was possible.

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The United States maintained that North Korea wanted nearly all international sanctions lifted upfront and was not prepared to give up enough of its nuclear facilities to warrant doing so. North Korean officials explained that they were prepared to dismantle the country’s main facility, the Yongbyon Nuclear Scientific Research Center, “permanently and completely,” but only in exchange for a considerable reduction in existing sanctions.

The anticlimax in Hanoi was perhaps the inevitable result of a process in which the two leaders dominated, optimistic about their personal relationship and confident in their abilities. Senior officials and other staff members, who normally devote weeks and months to preparing for such summits, had but a limited role.

The question is what to do now. One option is to try to negotiate a compromise: either more dismantling of nuclear infrastructure in exchange for more sanctions relief, or less dismantling in exchange for less relief.

Although one of these approaches may prove possible, either outcome would be less than ideal. Simply agreeing to give up individual nuclear facilities is not the same as denuclearization. Indeed, it does not necessarily even get us closer to denuclearization, because facilities could be built or expanded as others are being dismantled. Precisely this currently seems to be occurring. Meanwhile, lifting sanctions removes the pressure on North Korea to take meaningful steps toward denuclearization.

So what are the alternatives? Using even limited military force risks escalation, a costly war from which no one would benefit, and a crisis in relations between the US and South Korea. And, given North Korea’s demonstrated resilience, existing or even additional sanctions alone are highly unlikely to be enough to coerce its leaders into abandoning their nuclear program.

Moreover, no matter how much pressure is brought to bear on North Korea, China and Russia will likely do whatever is necessary to ensure its survival, given their strategic interest in avoiding a reunified Korean Peninsula aligned with the US. Hopes that North Korea will collapse under its own weight are thus unrealistic.

Trump seems to harbor the equally unrealistic notion that North Korea will voluntarily give up its nuclear weapons in order to become the next Asian economic tiger. But while Kim wants sanctions relief, fundamental economic reform would threaten his tight grip on power, and giving up his nuclear weapons and missiles would make North Korea and himself vulnerable. He has taken note of what happened to Ukraine, which voluntarily relinquished its Soviet-era nuclear weapons in the early 1990s, as well as to Iraq’s Saddam Hussein and Libya’s Muammar al-Qaddafi.

The status quo, however, is no solution. The current testing moratorium could end; indeed, North Korea is threatening to resume tests and there is evidence it is reconstituting its principal missile-testing site. This may be a bid to encourage the US to show more flexibility, or the North may actually be preparing to restart testing – a step that would likely lead the US to resume large-scale military exercises with South Korea and push for new sanctions. Talks would likely be suspended; we would be back to where we were two years ago but with an overlay of recrimination and mistrust.

Even absent such developments, drift is not desirable. North Korea could use the passage of time to increase the number of nuclear weapons in its arsenal and make some improvements to its warheads and delivery systems without overt testing. There is a big difference between a North Korea armed with a handful of inefficient warheads and inaccurate missiles and one with dozens of advanced weapons that could be mounted on accurate long-range missile systems capable of reaching the US.

At this point, any realistic policy must begin with accepting the reality that complete and fully verifiable denuclearization is not a realistic prospect any time soon. It need not and should not be abandoned as a long-term goal, but it cannot dominate near-term policy. An all-or-nothing policy toward North Korea will result in nothing.

So it makes sense to explore a phased approach. In an initial phase, North Korea would agree to freeze not just the testing of its systems, but also the production of nuclear material, nuclear weapons, and long-range missiles. This would require the North Korean authorities to provide a detailed accounting (a so-called declaration) of the relevant facilities and agree to verification by international inspectors.

In exchange, North Korea would receive the sort of substantial sanctions relief it sought in Hanoi. There could also be an end to the state of war that has existed for the past seven decades, and liaison offices could be opened in Washington, DC, and Pyongyang. But full sanctions relief and diplomatic normalization would come only with full denuclearization.

This might well be too much for North Korea, arguably the world’s most closed society. If so, the bulk of the sanctions need to remain in place; they would be lifted only in proportion to any dismantling – and only so long as the world could be confident that North Korea was not developing new capabilities to replace those it was abandoning. The US could specify which sites, in addition to Yongbyon, need to be dismantled.

Even this less ambitious approach would likely prove extraordinarily difficult. But, given the high stakes and unattractive alternatives in dealing with North Korea, any viable route to a settlement that ensures long-term stability is worth pursuing.

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Richard N. Haass, President of the Council on Foreign Relations, previously served as Director of Policy Planning for the US State Department (2001-2003), and was President George W. Bush’s special envoy to Northern Ireland and Coordinator for the Future of Afghanistan. He is the author of A World in Disarray: American Foreign Policy and the Crisis of the Old Order.

Cambodia: Emerging from the Shackles of History in relations with Thailand, Vietnam and China


March 16,2019

Cambodia: Emerging from the Shackles of History in relations with Thailand, Vietnam and China

By Kimkong Heng and Veasna Var

http://www.ippreview.com

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Kimkong Heng is a doctoral candidate at the University of Queensland and a recipient of the Australia Awards Scholarship. Veasna Var is a doctoral candidate at the University of New South Wales, Canberra and a Senior Fellow at the Cambodian Institute for Cooperation and Peace.

Cambodia has a long history. It has both a proud past and a tragic history. The country had its period of greatness during the ancient Khmer Empire, an empire which built the fabled temple Angkor Wat, one of the seven wonders of the world. Following the Angkorian era which began at the beginning of the 9th century and collapsed 600 years later, Cambodia found itself in one of the most tragic periods in its history. For almost 500 years, the country came under the enduring pressure of foreign invasion and annexation. Both Thailand and Vietnam, its stronger neighbors, annexed large parts of Cambodian territory.

Cambodia, unable to survive by itself due to constant foreign encroachment from its two more powerful neighbors, reached out to France for protection. The French protectorate of Cambodia was then established in 1863, signalling the beginning of Cambodia’s colonial period which lasted for 90 years before the country gained its independence in 1953. Following independence, Cambodia, under late King Sihanouk’s reign, saw major development in almost all areas. Unfortunately, peace was short-lived and the process of nation building did not last very long, as Cambodia soon after found itself engaged in a series of civil wars which dragged on for more than three decades.

Starting in the 1960s, the country became a Cold War battleground and involved in the Vietnam War, was bombed by the US, and later suffered an unspeakable tragedy during the Khmer Rouge regime which lasted for almost four years and killed an estimated 1.7 million Cambodians.

The Khmer Rouge genocidal regime was so devastating that it had instilled in virtually every Cambodian a strong sense of hatred, fear, and scepticism. Although Cambodia was fortunate to have survived the auto-genocidal regime, this tragic past has profound implications for Cambodia and its people.

The memories of pain which cannot be blotted out easily and which will not fade away anytime soon have been carried over to present-day Cambodia and they still haunt the new generations of Cambodians. These bitter memories, either experienced first-hand or told from the survivors, have adversely affected the minds of Cambodian people from all walks of life. Common among them are negative thoughts and feelings towards foreigners or xenophobia.

Xenophobia in Cambodia is a serious issue which should not be ignored or taken lightly. It is a critical issue that has to be addressed carefully and quickly. If not addressed properly and timely, xenophobic sentiments may lead to large-scale violence, discrimination, and hatred. One example was a violent riot against Thai embassy and Thai businesses in Phnom Penh in 2003. This incident was obviously motivated by anti-Thai sentiments among Cambodians. At that time, there were rumors that a famous Thai actress had claimed that Angkor Wat belongs to Thailand. Without knowing whether the rumors were true or not, many xenophobic and nationalistic Cambodians began a savage attack on anything related to Thai.

Thailand and Cambodia share a common culture and history. People of both countries have made numerous claims regarding past events, lands, temples, arts, dances, and more. Each side has asserted and will continue to claim as their own relevant pieces of land, elements of arts and culture, and other claimable abstract and non-abstract things, despite historical facts.

There is no doubt a deep-rooted anti-Thai sentiment among Cambodians and perhaps vice versa. Whenever something which is controversial or uncertain happens, as long as it involves Thailand and Thai people, a sense of anti-Thai sentiments, an element of Cambodia’s broader xenophobic issue, would take centre stage. A notable example is a series of fierce border clashes between Cambodian and Thai troops over the Preah Vihear Temple between 2008 and 2011. The skirmishes were sparked by a land dispute which was in turn caused by conflicting narratives of historical facts and animosity towards each other.

All decisions, measures, and approaches to solutions of issues, be it political, economic, social, or cultural, tend to be clouded by anti-Thai sentiments which seem to exist in every Cambodians of all ages and genders. They seem to lie in hibernation inside Cambodian people and just need a small trigger to come back to life and begin, in many cases, to create problems and issues that could further exacerbate an already troubled situation. The consequences of which are generally unpleasant and harmful, easily leading to more racial discrimination, hatred, and anti-Thai nationalism. This issue of xenophobic sentiments, if not taken into account properly by both Cambodian and Thai governments and relevant stakeholders, will remain and will continue to harm Cambodia-Thailand relations and prevent harmonious co-existence between Cambodian and Thai people.

The anti-Thai sentiment is just one thing; anti-Vietnamese nationalism is another, an issue which appears to be even more serious in Cambodia. It is widely believed and known among Cambodians that Vietnamese people’s intention to encroach on Cambodian land never changes. Many Cambodian people hold a perception that Vietnam is a threat to Cambodia’s territorial sovereignty. This constant pessimistic thought about the Vietnamese, the so-called anti-Vietnamese sentiment, exists in almost every Cambodians to varying degrees. Much like the anti-Thai sentiment, this hatred towards Vietnamese people lies in a dormant state until it is “awakened” by any issue or incident involving Vietnamese.

Youn”, a Khmer word commonly used to refer to Vietnam and Vietnamese people, is arguably a pejorative term associated with anger and hatred. Khmer people often use this word instead of its equivalents, Vietnam and Vietnamese, to refer to their eastern neighbors when they are angry or want to express negative emotions about Vietnam and its people. As noted two decades ago, “forms of Cambodian racism towards Vietnam and the Vietnamese minority in Cambodia did not develop in a historical vacuum but rather developed particularly in response to the expansionist tendencies of the pre-colonial imperial state”. Apparently, almost if not all Cambodians know or have heard stories of Vietnam’s encroachment on Cambodian territory. They are all aware of the fact that many Cambodian provinces were lost to Vietnam. In particular, it is well-known among Cambodians that Vietnam encroached Prey Nokor (formerly a Cambodian territory) and institutionalized it as a city, now known as Ho Chi Minh City.

emories and knowledge of Vietnam’s encroachment on Cambodia’s sovereign territory are passed down from one generation of Cambodians to the next and are seen to be ingrained in the minds of many Khmers. Even now Cambodian people still think that Vietnam wants to “swallow” Khmer land and that Vietnam’s wish to take over Khmer territory still remains. This line of thinking is not helpful. Not only does it fuel anger, hatred and distrust among Cambodians, but it also stirs up widespread anti-Vietnamese feelings in Cambodia.

Recognizing the deep-rooted anti-Vietnamese sentiments among Cambodians, Sam Rainsy, the exiled leader of the now-dissolved opposition Cambodia National Rescue Party (CNRP), has always taken advantage of this issue and used it as part of his party’s main propaganda. As one of the authors of this analysis has argued in a recent article, anti-Vietnamese sentiments have always been a political tool Sam Rainsy and his party’s senior officials use to undermine their opponents, Prime Minister Hun Sen and his ruling Cambodian People’s Party (CPP) elites. The use of the anti-Vietnamese sentiment, another form of Cambodia’s xenophobia, is harmful, although the opposition party draws support from it. What this anti-Vietnamese rhetoric does is create tensions, division, and confrontations among Cambodians. Sam Rainsy and his party elites should begin focusing their attention on tackling other important social issues, not dwelling on using anti-Vietnamese sentiments for political gain at the expense of Cambodia-Vietnam relations and amicable existence between people of the two neighboring countries.

Moving beyond the anti-Thailand and anti-Vietnam sentiments, Cambodia still has to face other forms of xenophobia. There were memories of anti-French sentiments, particularly among older Cambodians, driven by the impact of French colonization of Cambodia. However, now there seems to be no evidence of any anti-French sentiment in Cambodia today, as all attention is given to more modern issues facing the country. Looming large are key issues such as income generation, self and family survival, education, politics, and other critical social issues.

The Cambodian government should improve law enforcement and work hard to reduce the large and growing number of unpleasant incidents such as violence, accidents, and abuses that tend to involve the Chinese diaspora living in Cambodia. The anti-Chinese sentiment has emerged from these issues.

It is particularly and surprisingly fortunate that seemingly the whole country has moved beyond discrimination and historical hatred against France whose colonization of Cambodia led to the loss of Kampuchea Krom (former territory of Cambodia) to Vietnam in 1949. Although there have been petitions demanding the decolonization of Kampuchea Krom territory, there seems to be no sign of animosity expressed towards France and the French people. Little is known why Cambodians seem to disregard the fact that the French colonialist “cut” Kampuchea Krom and gave it to Vietnam, despite numerous protests from Khmer Krom activists in Cambodia and abroad. However, that Kampuchea Krom was ceded to Vietnam by the French has obviously further intensified anti-Vietnamese sentiment among Cambodians.

Moving forward, two issues remain which could potentially become new forms of xenophobia in Cambodia, if not addressed properly and in a timely manner. The first is the incumbent government’s recent reiteration of the US bombing of Cambodia in the late 1960s and early 1970s that contributed to the rise of Pol Pot and the Khmer Rouge which took control of Cambodia in 1975 and immediately proceeded to decimate the country and its people, wishing to create a pure, self-reliant, and sovereign Khmer nation. Hun Sen and his team’s criticism of the United States, although offering short-term benefits to their party, is also harmful. It may over time develop a sense of hatred and ill will towards the US and American people, potentially creating another form of xenophobia in Cambodian society, that is, anti-American sentiment among Cambodians, particularly those who support the current ruling party.

In reality, history is history; it can neither be denied nor changed. However, it is much better to learn from past lessons to plan for the present and future rather than let the past control the present and dictate the future. The ruling elites of the CPP, in this regard, should move beyond their recent narratives of the “US bombing” and, like the CNRP, should direct their attention to resolving pressing social issues facing Cambodia. Repeating and promulgating the damage that the US inflicted on Cambodia in the 1970s will not benefit Cambodia and its people in the long run. It only exacerbates the current poor relations between the US and Cambodia, which is certainly not a viable foreign policy option for the latter.

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The second issue which has arisen recently in Cambodia is the emergence of anti-Chinese sentiment which appears to be on the rise. The perceived increase of anti-Chinese feelings among many Cambodians are seen as a negative side effect of the growing Chinese presence in Cambodia, especially in the country’s coastal province, Sihanoukville. Over the last few years, Chinese investors have in large numbers flocked into Sihanoukville to invest in building casinos, apartments, theme parks, and resorts.

The Chinese’s increasing presence has implications for the Cambodian province and Cambodia at large. Not only can one see the mushrooming of high-rise buildings, casinos, restaurants, and other businesses run by the Chinese immigrants, but one can also experience or at least feel an increase in crime, violence, drug trafficking, and pollution, in the once-sleepy coastal province. There are frequent reports in the news about violence, abuses, scams, cybercrime, and violations of expected social norms and rules of law, many of which involve the Chinese living and working in Cambodia and in Sihanoukville in particular. Until October 2018, for example, 1,649 Chinese nationals were deported from Cambodia for scams and cybercrime offenses. These many incidents, together with similar stories happening in other countries, have arguably contributed to the emerging rise of anti-Chinese sentiments among the general public in Cambodia.

This new issue of anti-Chinese nationalism may not be seen as a serious issue now, but if left to develop freely and not addressed properly and timely, it is likely to lead to a big problem, consequences of which is less predictable and should raise concerns for the Cambodian government and Cambodian people. It is the duty and responsibility of the current ruling government of Cambodia to find ways to address the issue while it is still in the early stages. Although the Cambodian government, especially the ruling elites, has significantly benefited from Cambodia’s close relationship with China, it is wise to diplomatically bring this issue to the discussion table and work towards collaborating with the Chinese government to tackle this rising anti-Chinese sentiment among the Cambodian populace. It is always a good idea to make big problems small and small problems even smaller. To do so, the Cambodian government, with support from its Chinese counterpart, has to do something to deal with this emerging issue.

Xenophobia in Cambodia, whether it is a long-standing issue like anti-Thai and anti-Vietnamese sentiments or a new one like anti-Chinese sentiment, is a critical issue that needs to be addressed properly and taken more seriously than it currently is. As has been argued, Cambodian youth have crucial roles to play in improving Cambodia-Vietnam relations. Youth are the backbone of the country and the future of Cambodia. They are “Cambodian ambassadors in the making who are responsible for raising the profile of Cambodia in the region and the international stage”. They can contribute to navigating the Cambodian ship as long as they are given chanced and their efforts are recognized and valued. Thus, engaging youth in all realms of political, economic, social, and cultural life, for example, is important and is what the Cambodian government should strive for.

Cultivating and nurturing mutual respect, understanding, and tolerance between people of all nations involved is also crucial. In the case of Thailand and Vietnam, prevalent racial hatred, contempt, and discrimination resulting from awful past history and recent events can probably be minimized through the cultivation of genuine and mutual respect between Khmer and Thai people and between Khmer and Vietnamese. With respect to improving Cambodia-Thailand relations, one of these authors has also argued in an article in the IPP Review for the important role of mutual respect and the role of Cambodian youth in shaping Cambodia’s relations with Thailand. As it is argued, Cambodian people, youth in particular, “should not dwell on their dark history; instead, they should use lessons from history to help them make informed and impartial judgments when dealing with issues concerning Thailand and its people”.

However, these cannot be done without support from the Cambodian government as well as governments of Thailand and Vietnam. All parties have vital roles to play in fostering and improving their respective relations. Efforts, commitment, and cooperation at all levels, individual, institutional, and national, are essential. These are important steps towards fostering good relations between these countries which have regarded each other as one’s own traditional enemy.

With respect to the US, the Cambodian government should stop using the rhetoric of US bombing of Cambodia. While it is true, it only worsens Cambodia’s relations with the world’s largest economy. Although Cambodia has great relations with China, its largest economic and military benefactor, it would be unwise to alienate the US and fully embrace China. The most viable approach or way forward for Cambodia is to make as many friends as possible. It is undeniably true that having two best friends, the US and China, is absolutely better than having just one friend. All Cambodian eggs should be placed on two or more baskets, not just one basket. It is safer and more secure that way.

On the issue of anti-Chinese sentiment, Cambodia should take it into account most seriously. Now it seems to be not an issue yet but it will be a problem, a big one, if no due attention is paid to it. Recently, Prime Minister Hun Sen has urged and assured that many Chinese immigrants who are working in Cambodia, particularly in Sihanoukville, will leave the country once the Chinese projects for which they work are complete. This assurance is helpful but not sufficient. The Cambodian government should improve law enforcement and work hard to reduce the large and growing number of unpleasant incidents such as violence, accidents, and abuses that tend to involve the Chinese diaspora living in Cambodia. The anti-Chinese sentiment has emerged from these issues. Addressing them would also address the recently growing anti-Chinese feelings among the Cambodian general public.

Finally, xenophobia in Cambodia is a major social problem that requires absolute attention from all stakeholders in the country. It is neither the job of the government nor the duty of Cambodian citizens alone. It is a critical issue that requires cooperation, commitment, understanding, and willingness from all parties, regardless of their political views, positions, or beliefs. Cambodian xenophobia and paranoia, no doubt, have a malign influence on Cambodia’s efforts to promote the Kingdom’s integration into the region and the world. It will definitely damage the image of Cambodia on the global stage in the long term.

It is time for Cambodians, the ruling elites and the ordinary people, to work together in unity and in harmony to solve key issues facing their country. As a saying goes, “God helps those who help themselves”. Thus, Cambodians must work collaboratively and willingly to help themselves and their country.

 

 

The emergence of Suukyinomics


March 3, 2019

The emergence of Suukyinomics

 

Author: by Naing Ko Ko, ANU
http://www.eastasiaforum.org

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State Counsellor Aung San Sun Kyi’s National League for Democracy (NLD) administration in Myanmar has been heavily condemned by international policy analysts for its absent economic vision and lack of a tangible policy on minority management. But it seems now there is a plan: Suukyinomics, a brand that began with the announcement on 28–29 January 2019 to amend the 2008 military-backed constitution.

 

Suukyinomics is built on the rule of law and institutional economics. It consists of two broad plans. The Myanmar Sustainable Development Plan (MSDP) aims to achieve a peaceful, prosperous and democratic country. The Myanmar Investment Promotion Plan (MIPP) aims to transition Myanmar to a middle-income economy and persuade foreign investors to part ways with US$200 billion over the next two decades.

The MSDP is structured around three pillars, five goals, 28 strategies and 251 action plans. All are firmly aligned with the United Nations’ Sustainable Development Goals and the 12 Point Economic Policy of the NLD government. The MSDP aims to institute strong macroeconomic management and good governance, prudent fiscal discipline and the maintenance of a fiscal deficit no more than 5 per cent of GDP.

The MIPP aims to integrate domestic and foreign investment promotion in line with the directions of the National Comprehensive Development Plan (NCDP) and the Investment Policy of 2016. The MIPP also aims to improve the business environment — by 2020, Myanmar’s rank in the World Bank’s ease of doing business index should drop to below 100.

The Investment Promotion Committee (IPC) will be established to facilitate implementation of the MIPP and is chaired by U Soe Win, the Union Minister of Planning and Finance. Whether it will be a success depends on the effectiveness of Myanmar’s 1.8 million bureaucrats who continue to be criticised for the quality of service delivery. The government of Myanmar is the largest employer in Southeast Asia and its union civil servant board (UCSB) is unnecessary — it is militant and has inflexible business practices.

There are three shining spots to be found in the NLD’s economic reform during the period 2016–19. The first is related to the rule of law. Anti-corruption efforts have been particularly successful. President U Win Myint’s recent dismissal of ex-advocate general of Yangon Han Htoo and ex-lieutenant colonel Yan Naing Tun represent a milestone in the recent five-decade history of judicial practice and public administration. U Win Myint and the NLD’s senior leadership have done well to clean up tainted politicians even within their own party, expelling elected members accused of misuse of entrusted power for private gain.

The NLD has also made successful gains in modernising the Central Bank of Myanmar (CBM). After being heavily criticised by local banks and the private sector for unseating the governor of the CBM U Kyaw Kyaw Maung, reformers U Soe Thein and U Bo Bo Nge were appointed as deputy-governors of the CBM with the remit of correcting institutional difficulties. The CBM is vigorously stabilising the economy by controlling inflation, reducing the money supply and regulating its money and financial markets after issuing the Burmese Way to Basel Regulation in July 2017.

The CBM-floated foreign exchange rate now permits 13 foreign banks to loan project financing and trade financing. Recently, the CBM allowed for the Japanese yen and Chinese yuan to be used as convertible currencies to tackle the dollarisation of trade at Myanmar’s borders. In contrast to previous administrations, the reference exchange rate of the kyat for account transactions against the US dollar and other currencies is released daily on the CBM website. A financial stability report and Myanmar’s monetary report are released periodically.

The third shining spot is infrastructure. Roads are being built and rail tracks upgraded nationwide. Some of Myanmar’s coastal areas and border trade routes are also undergoing development thanks to Chinese investment.

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According to Aung San Suu Kyi, it is the right time to invest in Myanmar. Still, provision of meaningful assistance for the stateless people of Arakan, Kachin and other minority groups in Myanmar’s border regions remains unaddressed.

Suukyinomics itself is ambitious and its outcomes will be tested in coming years as the NLD attempts to amend the militarised 2008 constitution. Whether the NLD remains in power come 2020 will partly depend on Aung San Suu Kyi’s tactical skill, strategic manoeuvring and the success or otherwise of this new economic plan.

Naing Ko Ko is a PhD Candidate at the Regulatory Institutions Network, College of Asia and the Pacific, The Australian National University.

 

The Mekong region is caught in a tug-of-war


February 14, 2019

The Mekong region is caught in a tug-of-war

by Nguyen Khac Giang, VEPR

The Mekong region is caught in a tug-of-war

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For the Mekong countries, including Thailand, Laos, Myanmar, Cambodia and Vietnam, 2018 was a big year both domestically and regionally. Key developments from last year will inevitably continue to shape the politics of the region in 2019. In terms of domestic affairs, the most worrying trend is the consolidation of autocratic power in almost all countries.

 

In Vietnam, the sudden death of president Tran Dai Quang in September 2018 created a huge power vacuum, which was filled by Vietnamese Communist Party chief Nguyen Phu Trong. By merging the two most powerful positions in Vietnamese politics, he has become the strongest Vietnamese leader since the death of Ho Chi Minh in 1969, edging the communist state towards the Chinese model of centralised rule.

Cambodia, in theory a multi-party democracy, has practically become a one-party regime after an election that saw Prime Minister Hun Sen’s Cambodian People’s Party win all parliamentary seats in July 2018. He is now one of the world’s longest-serving heads of government, having held the premiership for 33 years since 1985.

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Things are no better in Thailand. Four years after seizing power, the military junta has made — and broken — five promises to hold a general election to establish a civilian government. Even if the sixth promise is fulfilled in February 2019, it will be difficult to sen Myanmar, the intensifying Rohingya crisis has not only created Southeast Asia’s biggest humanitarian concern but also exposed the reluctance of Aung San Suu Kyi and her National League for Democracy to complete the democratic transition that started in 2011.e swift change, as the junta will exploit all means available to dominate the electoral process.

In Myanmar, the intensifying Rohingya crisis has not only created Southeast Asia’s biggest humanitarian concern but also exposed the reluctance of Aung San Suu Kyi and her National League for Democracy to complete the democratic transition that started in 2011.

 

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In Myanmar, the intensifying Rohingya crisis has not only created Southeast Asia’s biggest humanitarian concern but also exposed the reluctance of Aung San Suu Kyi and her National League for Democracy to complete the democratic transition that started in 2011.

The autocratisation of the Mekong region has significant implications at a time when its giant neighbour China continues a long march to the south. China has committed billions of US dollars in concessional loans and credit to Mekong countries via the Lancang-Mekong Cooperation (LMC), an ambitious initiative which was launched in 2016. But the LMC’s actual impact remains to be seen. While the LMC is ostensibly aimed at creating a ‘shared future of peace and prosperity’, China can use it as part of a carrot and stick strategy due to its largely opaque and non-binding frameworks.

It should be noted that Beijing has a record of working closely with autocracies. Beijing has helped leaders in Central Asia guard against ‘colour revolution’, provided African autocrats with an alternative model of development and has aided socialist Venezuela in crisis. A less democratic Mekong region will be more exposed to China’s strategy of buying influence, which often involves closed-door negotiations and dealings.

Image result for the Xe-Pian Xe-Namnoy hydropower dam in southern Laos collapsed,

The LMC, as well as other established regional mechanisms such as the Mekong River Commission and Lower Mekong Initiative, have also failed to address the core issue which theoretically binds Mekong countries together: transnational water management. In July 2018, a section of the Xe-Pian Xe-Namnoy hydropower dam in southern Laos collapsed, reportedly killing 34 people, leaving 97 missing and displacing 6000 others. The collapsed part of the dam was only an auxiliary section and the whole project is built in one of the Mekong’s tributaries instead of the main stream. Needless to say, it could have been an even greater catastrophe.

Image result for the Xe-Pian Xe-Namnoy hydropower dam in southern Laos collapsed,

In Vietnam, for example, hydro dams are considered to be time bombs ticking over the head of the Mekong Delta on which 90 per cent of Vietnam’s rice exports depend. Despite the incident, the Laos government resumed its dream of becoming ‘a battery for Asia’ by permitting work to continue on several hydro projects. Beneficiary countries of the hydropower boom such as Thailand and China gave condolences and support to Laos but continued building their own dams. China, for instance, has built 7 and has plans for a further 21 dams on the Mekong — plans formulated without consultation with lower-Mekong countries.

The ongoing trade war between China and the United States also has the potential to impact the Mekong region both economically and politically. If the trade war accelerates, investors will consider countries like Vietnam and Thailand, and to a lesser extent Cambodia, as shelters to circumvent higher tariffs and other technical barriers. Exports from the Mekong region to the United States, many of which are substitutes for Chinese goods, will also benefit from the trade dispute. On the other hand, the region also bears the risk of a flood of Chinese goods into domestic markets, which is already a big issue.

More broadly, the Mekong region will continue to be a battlefield for influence between the two global superpowers. The rumour that China seeks to build a military base in Cambodia, although dismissed by Hun Sen, should be a serious warning for Washington. Of the five Mekong countries, only Vietnam is wary of China’s charm offensive due to a lingering sovereignty dispute in the South China Sea. The superpowers’ tug-of-war will perhaps come to play a key role in shaping the region’s development trajectory.

Nguyen Khac Giang is the lead political researcher at the Vietnam Institute for Economic and Policy Research (VEPR) at the Vietnam National University in Hanoi.

This article is part of an EAF special feature series on 2018 in review and the year ahead.