By Alvin Cheng-Hin Lim

Cambodia Joins the “Belt and Road”

Oct. 14, 2016  |     |  0 comments

Chinese President Xi Jinping’s first state visit to Cambodia in his position as president in mid-October 2016 marked Cambodia’s entry into the growing group of nations participating in China’s “Belt and Road” infrastructure construction and investment initiative. President Xi pledged Chinese investment for infrastructure projects including a high-speed railway as well as a new airport in the tourist town of Siem Reap.

These new “Belt and Road” projects will not be China’s first infrastructure projects in Cambodia. China has long been involved with the “rehabilitation of old and the construction of new transportation infrastructure” in Cambodia, including the completed and planned construction of almost 2,600 km of roads, as well as the construction of “seven large-scale bridges, crossing the inland Tonle Sap River and the Mekong River.” Another major Chinese project in Cambodia was construction of the Phnom Penh Autonomous Port, which was “built by a Chinese construction company, with a US $28 million loan from the Chinese government.” This port on the Mekong River has become “the second-largest port in Cambodia, handling more than 160,000 shipping containers annually,” and China has proposed to further develop the port by constructing “a railway directly linking the port to Phnom Penh and on to Cambodia’s national rail network.”

When President Xi met Cambodian Prime Minister Hun Sen at a meeting in Jakarta in 2015, President Xi suggested that their nations increase their “cooperation in infrastructure interconnectivity.” Cambodia’s participation in the “Belt and Road” initiative will raise such cooperation to a new level, for instance by connecting Chinese infrastructure development in Cambodia with other “Belt and Road” projects in the region (An, 2016; Lowe, 2016; Lim, 2015b; Prak, 2016; Chen & Ma, 2016; “Basic facts,” 2016).

In his signed article that was published in the Cambodian newspaper Rasmei Kampuchea the day before his arrival in Phnom Penh, President Xi observed that Cambodia was “an important link on the ancient Maritime Silk Road,” and also that Sino-Cambodian relations date back “more than a millennium”:

“Through the ancient Maritime Silk Road, Chinese porcelain and lacquer wares were brought to Cambodia, and Cambodian spices and yellow wax stones were sent to China. The bas-reliefs of the Bayon Temple vividly depict the scenes of Chinese merchants trading with the locals in Cambodia. During China’s Southern and Northern Dynasties in the fifth and sixth centuries AD, Sanghapala, Mandrasena and Subhuti, three eminent Cambodian monks, came to China to disseminate Buddhism. In China’s Yuan Dynasty, Zhou Daguan, a Chinese envoy, visited Cambodia. He later wrote The Customs of Cambodia, providing a vivid account of the local customs in Angkor and the friendly interactions between Chinese and Cambodians. Zheng He, the famous navigator from China’s Ming Dynasty, made many stopovers in Cambodia on his voyages. He described Cambodia as a land with a warm climate and fertile fields where the locals boiled seawater to make salt and had colorful customs.” (“Full text,” 2016)

Looking at the modern era, President Xi highlighted the raising of Sino-Cambodian relations to a comprehensive strategic partnership in 2010, and stated that the Chinese and Cambodian governments will “find ways for China’s ‘Belt and Road’ initiative and Cambodia’s ‘Rectangular Strategy’ to work together” (“Full text,” 2016).

This visit was not Xi Jinping’s first visit to Cambodia. He had earlier visited Cambodia in 2009 in his position at the time as China’s Vice President. His 2009 visit had “immediately followed Cambodia deporting 20 asylum-seeking Muslim Uighurs to China amid widespread international condemnation,” and during this visit he “pledged $1 billion in investments in Cambodia.” China has continued to be “the largest single donor” to Cambodia, supplying “at least $600 million in aid” in 2016 alone prior to Xi’s visit, with an additional $237 million pledged during his visit (Khuon, 2016; Prak, 2016). Not surprisingly, China’s emergence as Cambodia’s “biggest bilateral donor and lender,” having supplied Cambodia with $15 billion in aid over the past 2 decades, has made Cambodia “less reliant on aid from western nations.” The incident with the Uighur asylum seekers is an illustration of this, as the US and its allies had imposed sanctions on Cambodia following their repatriation. (The Uighurs had been seeking asylum from China, and by repatriating them back to China, Cambodia had violated its obligation of non-refoulement under the UN Conventions it is signatory to.) The loss of aid from the US and its allies was more than compensated by China’s $1 billion grant (Lim, 2015a, p. 17; Ith, 2016a; Ith, 2016b). Indeed, the US and its allies have continued to find themselves unable to match China’s generosity. As Julio Jeldres, a long-time observer of Cambodia, points out:

“The US has been trying to build a confident relationship with Cambodia through economic assistance, military cooperation and other initiatives … So far it’s been unable to compete with China, which has provided huge amounts of grants and assistance to Cambodia and developed links in economic, military, educational and cultural fields with the Southeast Asian country.” (Quoted in Millar, 2016)

Cambodia has hence been willing to offer support for China in matters of international diplomacy. Within ASEAN, for example, Cambodia has used its veto on several occasions to prevent the group from issuing unanimous criticisms of China for its actions in the dispute over the South China Sea (Millar, 2016).

Economic Cooperation

Trade between China and Cambodia has grown steadily over the years. Sino-Cambodian bilateral trade increased from $3.75 billion in 2014 to $4.4 billion in 2015. In the first half of 2016 Sino-Cambodian bilateral trade reached $2.34 billion, and both governments target their countries’ bilateral trade to reach $5 billion by 2017. In terms of investments, China has become Cambodia’s largest source of foreign direct investment, with $14 billion invested in Cambodia “from 1994 up to March 2016.” During President Xi’s state visit, 31 cooperation agreements were signed in a range of key sectors, including “agriculture, oceanic, energy, telecommunication, investment and infrastructure.” China also “pledged another $14 million in military aid” and “cancelled around $89 million debt” (An, 2016; Rui, 2016; Lim, 2015b; Parameswaran, 2016; Prak, 2016; Chen & Ma, 2016; “Cambodia, China vow,” 2016).

One sector of major interest to Chinese investors is agriculture. Guo Jiguang, an analyst with the Chinese Academy of Social Sciences, notes that Chinese agricultural firms have been drawn by “Cambodia’s vast fields as well as favorable weather conditions” to invest in rice and cassava cultivation. He Jianping, a Chinese entrepreneur who has invested in Cambodia’s garment manufacturing and agricultural sectors, notes that agriculture is a “promising” sector as Cambodia’s “land has not been overdeveloped” (Ma, 2016; Chen & Ma, 2016). As Xu Feng, the chairman of the Cambodia-Chinese Association for Development, observes:

“Chinese investors can get access to Cambodia’s cropland at low prices … For example, cropland costs about 1,000 yuan ($150) per mu (0.067 hectare) in Guangxi Zhuang Autonomous Region, while it costs only 30 yuan per mu in Cambodia.”  (Quoted in Ma, 2016)

Chinese agribusinesses have helped to develop Cambodia’s rural infrastructure, including the construction of “11 massive water conservancy facilities” which have “provided irrigation to over 90,000 hectares of land.” The further development of Cambodia’s agricultural sector will benefit from increased exports to China. The Chinese government agreed in September 2016 “to increase its purchase of Cambodian rice to 200,000 tons for the harvest season of 2016-2017, up from 100,000 tons.” Such exports will expand even further. Cambodian Prime Minister Hun Sen announced the week before President Xi’s visit that their bilateral agreements on agriculture will “open markets in China, which is a huge market for Cambodia’s agriculture sector … Besides milled rice and cassava and other agricultural products, which are existing exports to China, we are trying to boost exports of other agricultural products, including bananas” (Chen & Ma, 2016; “Basic facts,” 2016; “Chinese president’s visit,” 2016).

Chinese investors are also interested in Cambodia’s energy sector. They have invested $2.4 billion in 7 hydropower dams, 6 of which are “100 percent invested by Chinese companies,” while the 7th, the Lower Sesan II hydropower plant which is still under construction, is a “joint venture among Chinese, Cambodian, and Vietnamese companies.” The 6 completed hydropower plants produce “a total of 928 megawatts, representing 47 percent of the electricity available in Cambodia,” and the Lower Sesan II hydropower plant, once complete, will add an additional 400 megawatts to Cambodia’s electrical supply. Apart from hydropower dams, Chinese investment has also been sought for the construction of coal-fired power plants and power transmission lines in Cambodia (“Chinese investment,” 2016).

A third sector of interest to Chinese investors is tourism. While Cambodia is internationally known for its popular Angkorean UNESCO World Heritage Sites as well as its Khmer Rouge genocide “dark tourism” sites, the Cambodian government is seeking Chinese investment for the development of eco-tourism (Algie, 2014; Xue & Nguon, 2016; “Cambodia’s Angkor heritage,” 2016). As Say Samal, the Cambodian Minister of Environment, explains:

“We’re now turning our national parks and wildlife sanctuaries into tourist destinations as we want national parks and wildlife sanctuaries to be part of our social lives, so people can go for camping trips, barbecues, spending time in resorts, bushwalking, trail riding and water rafting.” (Quoted in Xue & Nguon, 2016)

As Cambodia has “45 protected parks and wildlife sanctuaries covering a total area of more than 5.9 million hectares,” there is significant scope for Sino-Cambodian cooperation in the development of the eco-tourism sector (Xue & Nguon, 2016).

Cultural Revival

For Cambodia’s Chinese minority, President Xi’s visit highlights their recent period of cultural revival in the Khmer majoritarian country. The lowest point for the Chinese minority in Cambodia came during the Khmer Rouge revolution of 1975-79. As Wright (2016) recounts:

“Out of a population of 430,000 ethnic Chinese inside the country when the Khmer Rouge took power in 1975, historians say about half had perished by the time the regime was overthrown less than four years later — dead from disease, hunger, exhaustion or execution … The deaths, by proportion, were higher even than the 36 percent of the 250,000 ethnic Cham Muslims and 21 percent of Cambodia’s native Khmer who lost their lives during the regime, according to prevailing estimates.”

While many of the Chinese victims were murdered by the anti-capitalist Khmer Rouge because of their involvement in the commercial life of the overthrown regime, other Chinese victims were murdered due to their ethnicity. The historian Penny Edwards (2012) recounts one major case of mass killing:

“In Chhup in Kompong Cham, respondents gave independent and complementary accounts of a massacre of twenty-nine ethnic Chinese families who had been rounded up and buried alive in a mass grave in 1978 for speaking Chinese.” (p. 130)

Cambodia’s Chinese have since reemerged in social life and reasserted their cultural identity. This reemergence of Chinese cultural pride was not just due to the improved relations between China and Cambodia — of which President Xi’s visit marks a watershed — but is also due to the increase in overseas Chinese investment in Cambodia, as well as the arrival of migrants from China and Taiwan. These investment projects have created new economic niches for Cambodia’s Chinese minority, who have become key middlemen between the overseas Chinese businessmen and the Cambodian political elite, and also between the overseas Chinese managers and their Khmer employees. One indication of the rising importance of China in Cambodia is the trend of Khmer professionals learning Mandarin, which is “increasingly the language of business in Cambodia and beyond” (Edwards, 2009, p. 212; Lim, 2017, pp. 362-363; Nyíri, 2012, p. 94; Verver, 2012, p. 32).


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