china's strategic interests in cambodia: influence and resources

8/11/2019 China's Strategic Interests in Cambodia: Influence and Resources

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Asian Survey, Vol. , Number , pp. . ISSN - , electronic ISSN - X. by the Regents of the University of California. All rights reserved. Please direct all requests for permis-sion to photocopy or reproduce article content through the University of California Presss Rightsand Permissions website, http://www.ucpressjournals.com/reprintInfo.asp. DOI: AS. . . . .

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SIGFRIDO BURGOS AND SOPHAL EAR

Chinas Strategic Interests in CambodiaInuence and Resources

ABSTRACT

Cambodia is pivotal to Chinas strategies to project greater inuence in SoutheastAsia, buffer longstanding rivals, and potentially tame Americas hegemony. Chinastransformation from regional backwater into inuential global actor raises concernsfor many countries. As expected, the rise of a powerful regional player makes tradi-tional hegemonic countries anxious.

KEYWORDS: China, Cambodia, geopolitics, political economy, strategy

C C are part of a wider stra-tegic agenda in Southeast Asia that is a natural outgrowth of Beijings Principles of Peaceful Coexistence. Tis document called for respect for thesovereignty and territorial integrity of all states, non-aggression against otherstates, non-interference in the internal affairs of other states, equality andmutual benets, and peaceful coexistence.1 Tis comes as no surprise. South-east Asia is home to roughly million inhabitants and is an economicallyrelevant trade partner to the U.S., the EU, and Japan. Te region accrues agross national product (GNP) of more than billion, hosts a number ofnascent democracies, and sits atop some of the worlds most transited searoutes, giving it a pivotal geostrategic position from which to oversee half of

S B is Analyst and echnical Writer at the Food and Agriculture Organization(FAO) of the United Nations in Rome, Italy. S E is Assistant Professor of National Secu-rity Affairs and a ED Fellow in Monterey, California, U.S.A. Te authors are writing a book onChinas global resources strategy across Asia, Africa, and South America. Tey wish to thank Mi-chael Glosny and several anonymous reviewers for constructive comments and suggestions. Teviews expressed are those of the authors and do not reect the views of the FAO or the United Statesgovernment. Email: .

. See Paul Marks, Chinas Cambodia Strategy,Parameters : (Autumn ), pp. , which is seminal; and a new book, denitive, by Sophie Richardson,China, Cambodia, and the FivePrinciples of Peaceful Co-existence (New York: Columbia University Press, ).
mailto:[email protected]:[email protected]


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616 ASIAN SURVEY 50:3

global trade.2 Cambodia has been a compliant ally of Beijing ever since it wasclear that mutual benets existed. For China, any nation-state that activelyfurthers the Chinese regional strategic agenda is welcomed as a friend, regard-less of who is at the helm. Evidently, Chinas potential utility in shaping itsallys economy argues that Beijing should continue to play a dominant rolein Cambodia. Trough a literature review that covers an array of scholarlyand media sources, this paper attempts to elucidate some of the Sino-Cambodian linkages and the mutual benets that arise from them. Te paperstarts with a brief account of the historical ties between the two countries.Tis is followed by an analysis of the mechanisms, motivations, and subsid-

iary actions designed to solidify strategic interests, and the potential conse-quences of such actions.

HISTORICAL BACKGROUND

Cambodia gained independence from France in . Formal Sino-Cambodianrelations began in immediately after the French system of administeringChinese communities was at last terminated. Tis colonial system levied taxes

and fees on all Chinese and non-Chinese communities residing in Cambodiain order to develop economic infrastructure, just as was done in British Burmaand Malaya. Between the late s and early s, ethnic Chinese were Cam-bodias largest minority, but by , as a result of Khmer Rouge genocide,social unrest, and Vietnamese persecution, only a few thousand remained.

In , Cambodias monarchy was abolished. From to , MaoistChina financially supported Pol Pots Communist Party of Kampuchea(Cambodia). However, after the communist regimes demise, new andfriendly ties developed through Norodom Sihanouk, the King Father ofCambodia. In late , Vietnamese forces invaded Cambodia. Sino-Soviettensions arose in connection with three elements: Moscows support for theVietnamese military intervention, the ensuing but brief war betweenChina and Vietnam, and the Soviet invasion of Afghanistan.

Regional tensions eased somewhat afterward, as a result of changes in the wider international environment.3 During the s, a Cambodian resistance

. Council on Foreign Relations, Te United States and Southeast Asia: A Policy Agenda for theNew Administration(New York: Report of an Independent ask Force, ), pp. .

. Bobo Lo, Axis of Convenience: Moscow, Beijing, and the New Geopolitics (Washington, D.C.:Brookings Institution Press, ), p. .


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conditional loans and grants from Western donors), and be perceived as along-term, loyal ally in Southeast Asia.

Although Chinas approach is hardly country-specic, it is now evidentthat some countries in the region are more equal than others. Tis is espe-cially true when historical ties, behavioral legacies, and tactical geopoliticsplay out in ways that largely help fulll Chinas desire to establish itselfthrough a charm offensive as an emerging superpower.6 o better elucidatethese tactical moves, selected issues are discussed below: security and over-sight, energy self-sufficiency, infrastructure projects, nancial hegemony,strategic approaches, and securing resources. A brief analysis follows on the

consequences of intervention, focusing on labor abuse, livelihood, and eco-logic disruptions. A conclusion offers summary ndings.

SECURITY AND OVERSIGHT

Few would disagree that the traditional underpinnings of foreign relations inSoutheast Asia are undergoing a dramatic overhaul owing to Chinas increasingpresence, a relative decline of American hegemony, amelioration of antago-

nistic bilateral relationships, the expanding normative inuence of regionalmultilateral institutions, and a growing sense of potentially benecial eco-nomic interdependence among stakeholders. Chinas new security and mili-tary postures, and concomitant strategies, are supported by its distinctivediplomatic approach and increasing involvement in regional affairs. Teseactivities reect Chinas new-found condence and determination in realmsthat for the most part had been the preserve of American and Soviet spheresof inuence.7 Tese approachessome more visible than othersare ourish-ing in largely uncertain circumstances where classic paradigms of the balanceof power interact dynamically with new economic and security challenges.Tese include trade globalization, energy security, nancial stability, interna-tional terrorism, nuclear proliferation, and the spread of emerging andre-emerging infectious diseases.8

. Elizabeth Economy and Michel Oksenberg,China Joins the World: Progress and Prospects (New York: Council on Foreign Relations Press, ).

. Aaron L. Friedberg, Ripe for Rivalry: Prospects for Peace in a Multipolar Asia,InternationalSecurity : (Winter / ), pp. .

. P. Dibb, oward a New Balance of Power in Asia (Oxford: Oxford University Press, ); S.Ear and S. Burgos Cceres, Livelihoods and Highly Pathogenic Avian Inuenza in Cambodia,Worlds Poultry Science Journal : (December ), pp. .


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BURGOS AND EAR / CHINA-CAMBODIA CONNECTION 619

As a complement to traditional security issues, a new mode of interna-tional cooperation has arisen: the eld of non-traditional security. Tis isdened as increased attention to anti-proliferation and anti-terrorism issues.In the Chinese case, awareness of potential threats has created fertile politicalgrounds to justify Chinas increasingly active presence in these shrouded andsensitive spheres. For instance, China has played a notable role in seeking apeaceful solution to the nuclear issue on the Korean Peninsula 9 as a memberof the Six-Party alks. Tis role has evolved despite Beijings rejection by the

Association of Southeast Asian Nations (ASEAN) in its effort to join theSoutheast Asia Nuclear Weapon Free Zone accord in . Moreover, that

November, Beijing hosted a Security Policy Conference with officials fromthe ASEAN Regional Forum to discuss potential future challenges to re-gional security.10 More recently, China has been active and vocal, yet alwaysambiguous, about Irans and North Koreas nuclear programs. In the past,Chinas position in relation to Iran and North Korea was outright support-ive, but heavy Western lobbying has somewhat distorted Chinas embrace.

Now, as in the past, China disputes its sea borders with several countries,most heatedly with Japan, the Philippines, and Vietnam. In fact, throughouttheir histories, Vietnam and China have engaged in conicts on their bor-ders as well as in their waters.11 In recent times, these conicts have beennarrowed to shing and navigation rights in the South China Sea. However,discord over territories and water does not prevent China and its neighborsfrom developing collaborative relationships aimed at building regional cohe-sion, in order to foster frictionless, mutually benecial multilateral trade. Itstands to reason that rapidly improving trade relations (and economic wind-falls) will mitigate any potential fallout from territorial disputes. For instance,in the past decade, improved Sino-Russian relations based on regional strategicconvergence and natural resources provide evidence supporting this utilitariancamaraderie.

In consideration of a novel, all-embracing principle of harmonious coex-istence, Chinas domestic and regional security relations with its neighborsare essentially shaped by shifting ideological congurations, the evolution of

. Proliferation from North Korea and IranWill Russia and China Pitch In?Te Economist(London), September , .

. David Shambaugh, China Engages Asia: Reshaping the Regional Order,InternationalSecurity : (Winter / ), pp. .

. Ang Guan, Vietnam-China Relations since the End of the Cold War, Asian Survey :(December ), pp. .


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foreign relations with other countries, and geographical proximity. Havingunrestricted air, land, and sea access to the eastern side of the Gulf of Tai-land powerfully motivates Beijing to engage in economic diplomacy. China,between and , donated nine patrol boats and ve warships toCambodia. Tese are now docked at the Port of Sihanoukville, about kilometers southwest of Phnom Penh, Cambodias capital. China argues thatit is helping Cambodia strengthen its marine security to ght off pirates anddrug smugglers, with improvements in social stability and territorial securityas spillover effects. Although this may seem in principle a good-natured ges-ture, it can also be seen as an overt attempt to establish a military bulwark to

counteract present and future threats that may arise in the region. Shouldtangible future threats arise, Beijing could build on improved military capac-ity in Cambodias coastal stretch off the Gulf of Tailand to squelch it, thusgranting China valuable time to deliver reinforcements as needed. Te cur-rent donated ships, however, are solely operated by Cambodia. Te concernis that such threats could jeopardize Chinese interests in Cambodia, espe-cially a tactically relevant port through which import deliveries take place.

Geopolitically speaking, Chinas interest in Cambodia can easily be linkedto its security and oversight issues in the South China Sea with Vietnam,aiwan, and the Philippines, as well as safeguarding Beijings claims to thedisputed Spratly Islands and their resources (mainly oil and natural gas). Forinstance, if sensitive security issues were to arise in the South China Sea re-garding aiwan, Beijing may need Cambodia as a strategic, sea-accessiblelocation from which to launch a response. Similarly, in response to recentcases of piracy and looting, the capability for rapid Chinese deployment of

warships to protect its own vessels en route to the Gulf of Aden is also ameans of supporting Chinas strategic interests.

Tese tactical overtures signal that Chinas economic support and diplo-matic maturity can be conducive to security and stability in Cambodia. Byfostering bilateral cooperation and strengthening the Cambodian economy,in exchange Beijing gets to leverage its inuence to mediate regional con-icts.12 For example, China has played a pivotal role in mediating, throughthe Six-Party alks, the nuclear crisis on the Korean Peninsula. Tese desired

outcomes are backed by relentless advocacy in order to be perceived as. See Richardson, China, Cambodia, and the Five Principles of Peaceful Co-existence; and Joshua

Kurlantzick,Charm Offensive: How Chinas Soft Power Is ransforming the World(New Haven,Conn.: Yale University Press, ), p. .


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non-intrusive and non-threatening, especially in response to concernsamong scholars and international leaders over the potential implications ofChinas rise. Moreover, to promote its perception as a peaceful giant in Cam-bodia and the region, Chinas foreign affairs advisers have concocted a so-phisticated mix of sustained development assistance, trade incentives, andcondence-building measures. Also, Beijing has been opportunistic, step-ping in when American and Japanese authorities have hesitated (e.g., on aid,trade agreements, and infrastructure development). By all accounts, this pos-ture suggests an unwavering willingness to build lasting relations with neigh-boring countries, where others have left off.13 Yet, it is worth noting that

practical and sudden cooperation between two countries in a populous re-gion could be hamstrung by historical suspicions, cultural prejudices, geo-political rivalries, and evolving priorities.14

All things considered, it is plausible that Chinas security and oversightinterests in Cambodia may be ( ) strongly supported by an overall collectivenotion of developing a region in which trade-propelled development pro-ceeds smoothly; or ( ) unlikely as it sounds, received reluctantly with silentresistance, impinged by an already solid tradition of Southeast Asian nationsbeing staunch supporters of the norms of sovereignty, territorial integrity,and non-intervention. Whether Chinas strategy proves to be successful re-mains to be seen.

ENERGY SELF-SUFFICIENCY

Te worlds population is projected to grow to more than nine billion by. As of April , it is estimated by the U.S. Census Bureau that there

are . billion people in the world, of which . billion reside in China(roughly ). 15 Chinas immense population is growing at a rate of .per year (or roughly . million). As a result of Chinas rapid populationgrowth and economic development, an increasingly affluent growing middleclass is demanding more and more products and services. Te countrys in-dustrial sector desperately needs to secure inexpensive, reliable energy sources

. Elizabeth Economy, Chinas Rise in Southeast Asia: Implications for the United States, Journal of Contemporary China : (August ), pp. .

. Bruce Vaughn and Wayne Morrison, China-South East Asia Relations: rends, Issues, andImplications for the United States (Washington, D.C.: Congressional Research Service [CRS]Report for Congress, April ), pp. .

. U.S. Census Bureau, Data Finders, , accessed April , .
http://www.census.gov/http://www.census.gov/


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to keep the engines of middle class consumption growth at full speed, oncethe worlds economy recovers from the recession. China is likely the worldslargest consumer of oil, followed closely by America. Te jury is still out on

whether oil reserves around the world will dwindle in the near future.16 As with oil, China is heavily dependent on cheap coal to generate much of itselectricity, consuming almost three billion tons of coal per year. It also de-rives of its power needs from fully functional nuclear reactors.

Cognizant of these facts, China has invested heavily in developing alterna-tive energy sources such as wind, solar, thermal, and hydroelectric power.17 Seen through an economic lens, hydroelectric power plants are the most ef-

cient means of producing electrical energy.18

With this cost-effective notionin mind, China is nishing its fourth hydroelectric dam on the upper reachesof the Mekong River, sparking concerns among its neighbors about future

water supplies. China has also promised to build hydroelectric dams alongthe Mekong inside Cambodian territory. Te Cambodian authorities aim totriple Cambodias energy output from a projected megawatts in tonearly , megawatts by , with the goal of connecting nearly ofthe population to sources of electricity.19

Although Cambodians may be wary of these developments, there arestrong incentives to proceed. Te proposed Chinese dams along the MekongRiver portion of Cambodia would likely create desperately needed jobs inthe north-eastern provinces and eventually enable potential surplus energysales to Tailand and Vietnam. Furthermore, to Chinas advantage is the factthat once hydroelectric dams are in place in the upper and lower MekongBasin, controlling water ow and energy production could easily become apolitical tool to advance Chinas long-term energy and resource plans.

If nearby oil is what China is looking for, then securing long-term oil re-serves should be uncomplicated because the Cambodian National Petroleum

Authority, which administers oil contracts, is under the direct control of a

. M. A. Adelman, Te Real Oil Problem, Regulation : (Spring ), pp. ; DianaFarrel, Susan Lund, Eva Gerlemann, and Peter Seeburger, Te New Power Brokers: How Oil, Asia,Hedge Funds, and Private Equity Are Shaping Global Capital Markets (San Francisco: McKinseyGlobal Institute, October ).

. erry Macalister, China Puts bn into Energy, Te Guardian , February , .

. Hydroelectric power, , accessed April ,.

. Khouth Sophak Chakrya and Sebastian Strangio, Villagers Gather to Express Dam Con-cerns,Phnom Penh Post , September , .
http://www.usbr.gov/power/edu/pamphlet.pdfhttp://www.usbr.gov/power/edu/pamphlet.pdf


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prime minister and deputy prime minister all too happy to sing Chinaspraises.20 China has allegedly acquired the rights to offshore Cambodian oilelds by purchasing a rm with pre-existing claims. Recent geological worksuggests that signicant amounts of oil and gas may reside undergroundthroughout Cambodian territory. Tese reserves are often hailed as providinga way out of poverty.21 It should be noted, however, that proven reserves arescarce, and tapping them is expensive, given prevailing energy prices, highexploration and production costs, and low levels of technology. In practice,Chinese officials weigh higher demand against lower reserves, perceivingtheir existence as an exploitable opportunity.

Whether Chinas interest is oil, hydroelectric power, or both will soon beelucidated as its strategy unfolds. China, either alone, or in conjunction withits Southeast Asian partners, aspires through decentralized energy generationstructures to become energy independent. Tis lofty strategy may backre ifmainland Southeast Asian nations conclude that Chinese dams, oil explora-tion, or any other gargantuan infrastructure projects are hurting their futuredevelopment prospects. Some dispersed action groups, civil society organiza-tions, and environmental activists are already protesting Chinas dams andoil thirst.22 What is now undisputed is that energy self-sufficiency is a centralgoal for China, one that can be attained through a multidimensional actionplan23 that places Cambodia as an important partner.

INFRASTRUCTURE PROJECTS

As implied above, the most important infrastructure projects embarked onby China are related to development of the Mekong River through buildingseveral hydroelectric dams.24 Chinas strategic advantage in water resourcemanagement arises from its upstream contribution to Mekong waterways.For instance, it is estimated that during the rainy season, of Mekong

. Global Witness, Country for Sale: How Cambodias Elite Has Captured the CountrysExtractive Industries, Investigative Report (London: Global Witness, February ), pp. .

. Cambodias Oil ResourcesBlessing or Curse?Te Economist , February , .

. David C. Kang, China Rising: Peace, Power, and Order in East Asia(New York: ColumbiaUniversity Press, ), pp. .

. Robert Ebel, Chinas Energy Future: Te Middle Kingdom Seeks Its Place in the Sun (Washing-ton, D.C.: Center for Strategic and International Studies, October ), p. .

. Cambodia, Kuwait, and FarmlandPetrodollars v Smallholders,Te Economist , April ,.


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waters originate in China, while during the dry season its contribution jumps to . In addition to building hydroelectric dams along the Me-kong, many other projects are envisaged to cope with the logistics of Chinasfuture economic development. For example, a big initiative will modernizeSihanoukvilles port and its associated facilities for import and exports ofgoodsand also to host a naval presence.25 Naturally, goods will requiretransport to and from Cambodian cities; therefore, establishing a series ofroads, highways, and bridges is a subsidiary development project. In ,China offered Cambodia million in no-strings-attached loans to helppay for two major bridges near Phnom Penh that will link into a network of

primary and secondary roads, and also to pay for a modern ber-optic network to connect Cambodias telecommunications with Vietnam and Tai-land. Even construction of modern railroads connecting major cities to theport has been proposed.26

Chinese projects in Cambodia are not limited to hydroelectricity, ports,roads, highways, and bridges. As with East imors presidential palace, Chi-nas infrastructure projects also include prestigious buildings such as Cam-bodias Senate headquarters (completed in ) and the recently nishedCouncil of Ministers building for which China sent work crews to labor hours a day. Prime Minister Hun Sen refused to move into his office, alleg-edly because of feng shui (geomantic) concerns. He ordered the constructionof an annex next doorperhaps also to avoid the possibility of pre-installedlistening devices. Large mining and forestry projects, oil exploration, bio-fuel generation, telecommunications, and manufacturing have also enjoyedChinese patronage. o Cambodians, new industries such as oil, gas, miner-als, forestry, and hydro-energy offer lucrative nancial rewards and newemployment opportunities. Cambodia is not an isolated recipient of thisbenevolence: Beijing has lent other Southeast Asian nations large sums ofmoney for railways, hydropower projects, and shipbuilding yards. In thepast ve years, it has signed declarations proclaiming strategic partnerships

with Indonesia and the Philippines.27 Although all proposed infrastructureprojects in Cambodia have aroused controversy and sparked harsh criticism,

. China is also reported to be interested in establishing naval bases in Bangladesh, Sri Lanka,Myanmar, Pakistan, and Tailand to protect its maritime supply routes from the Middle East and Africa. See Craig Nelson, Chinas Naval Base Proposal May Raise Suspicion,Te Nation (AbuDhabi), January , .

. Tomas Bradley, Chinas Cambodian Hegemony, Te Diplomat ( okyo), May , .

. Richard Halloran, Chinas Paths to Hegemony, Washington imes , January , .


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which have both retrenched.29 Cambodias accession to the World rade Or-ganization (W O) in , carried out to preserve Cambodias access to theglobal trading commons, especially for its garment sector ( of gross do-mestic product [GDP]) with the end of the Multi-Fiber Arrangements, hasnot prevented retrenchment in that sector. In fact, as part of a wider initia-tive on food security and development, investment in rural roads and irriga-tion systems is being encouraged to raise productivity and reduce operatingcosts; it has helped produce good crop harvests.30 o further attract interna-tional investors, the Council for the Development of Cambodia, the govern-ments chief investment body, is keen to approve foreign direct investment

in agricultural and industrial sectors. Tis agency, in collaboration with theMinistry of Commerce, actively promotes the establishment of special eco-nomic zones (SEZs) such as the Phnom Penh Special Economic Zone(PPSEZ). Tis zone was established in , as enclosed, tax-exempt, complexpartnered, and co-nanced by Singaporean, Japanese, Malaysian, and Chineseprivate rms. Te PPSEZ is one of SEZs in Cambodia.

It is expected that upstream and downstream businesses, and their associ-ated networks, will greatly benet from SEZs even if they are not located

within the connes of an SEZ. Tis will not only give China increased po-litical leverage over Cambodian officials but will grant the Chinese a strongerfoothold in negotiations with the ruling Cambodian Peoples Party, giventhat follow-up investments in phased projects can be strategically withheldor halted if regional or domestic policies do not converge as desired by Bei-

jing.31 o sweeten many of these deals, China has already agreed to waiveimport tariffs on almost Cambodian products. At the same time, andequally important, China envisages a bilateral free trade agreement withCambodia.

Despite an avalanche of bilateral benets accruing on both sides, thereare fears that latent resentment may surface against a sizable population ofChinese-Cambodian economic elites, owing to a growing Chinese economic

. Sophal Ear, Sowing and Sewing Growth: Te Political Economy of Rice and Garments inCambodia, Stanford Center for International Development (SCID), Working Paper, no. (Stan-ford, Calif.: SCID, April ).

. International Monetary Fund (IMF), Statement at the Conclusion of an IMF Staff Missionto Cambodia, press release, no. / , September , .

. In recent years, China has begun to take a less confrontational, more sophisticated, morecondent, and, at times, more constructive approach toward regional affairs. See Evan S. Medeirosand M. aylor Fravel, Chinas New Diplomacy, Foreign Affairs (November/December ).


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presence. In some sectors such as furniture, garments, and perishable pro-duce, Chinas expansion is not welcome because it supplants those tradition-ally produced locally. China not only encourages Chinese investments inCambodia but also finances established Chinese-Cambodian firms thatmake cost-effective usage of inexpensive and plentiful local labor. As appeal-ing as Chinas nancial domination may appear to officials in Beijing andPhnom Penh, there will always be unexpected situations. With this in mind,it stands to reason that Chinese political strategists are busy planning forcontingencies.

STRATEGIC APPROACHES

An alternative interpretation of Chinas emerging might and friendlier diplo-macy is what some scholars call soft power, that is, the application of Chinasexpanding economy to trade, aid, and investment to achieve political ends:a case in point is Chinas largesse in the Southeast Asian region.32 Chinesedevelopment assistance and aid ows freely to Laos, Myanmar, and Cambo-dia. Especially in Cambodia, China acts as a trading partner and donor, with

an eye to buffering Vietnams and aiwans geopolitical leverage in the re-gion, which derives from their international political buy-in (i.e., approba-tion or inuence), their impressive economic growth, and their access to seaborders.33 It is argued in scholarly and journalistic circles that Chinas appli-cation of diplomatic overtures, military initiatives, and economic coopera-tion proposals are merely instruments that regulate power relationships withfriendly countries. Chinas goal is building solid allegiances to advance itsagendas related to foreign policy, image shaping, economic preeminence,and national security. All these instruments play out in Cambodia.

Te structure of Chinas soft power engagements with Cambodia takes twoforms: ( ) multilateral cooperation within institutional bodies, and ( ) bilateralcooperative agreements. Multilateral cooperation has been particularly strongin the past four years. In , combined loans to Cambodia from donorstotalled million, of which China contributed over one-tenth via indirect,informal networks. In , China for the rst time formally pledged aid of

million, a increase from the previous year, as part of the Development. See Kurlantzick, Charm Offensive.. David Shambaugh, Power Shift: China and Asias New Dynamic (Berkeley: University of

California Press, ), pp. .


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Partners (e.g., Organization for Economic Cooperation and Development[OECD] member countries) package totalling million. In , interna-tional donors pledged some million, with China leading the way with

million, followed by the EU ( million) and Japan ( million). 34

For comparative purposes, in , American aid commitments to Cam-bodia reached just million, a little over one-fth of Chinas commitment(which is invariably higher than actual disbursements). As for bilateral coop-erative agreements, these are harder to estimate, given the complexity oftransactions that overlap across time and sectors. Nonetheless, some dataexist: In and , China alone committed million and mil-

lion, respectively, for infrastructure and development projects.35

In a recentinterview, Prime Minister Hun Sen asserted that from to June ,Chinas nancial aid to Cambodia totalled million. 36

Beijings sugar-coated relationship with Cambodian officials has thick-ened.37 By disbursing aid and investment funds liberally and without condi-tions, the donor country makes the recipient country heavily dependent onit. In the process, China shoos away other lenders and donors who imposecomplicated restrictions on their largesse. Te Chinese approach, it can beargued, provides political leverage that senior officials can exploit in pressingforward their economic and political ends. o illustrate: in February ,Chinese Foreign Minister Yang Jiechi pledged million in aid and bil-lion in direct investment to aggressively develop Cambodias power industry,

while vowing to increase bilateral trade beyond million. Tese loftypromises undermine an already weak governance capacity in Cambodia andcould prompt unrealistic expectations, strengthened patronage networks,and greater rent-seeking behavior. Chinese aid for infrastructure projectstargets trade integration in the region, which is, by all accounts, a usefuloutcome for poor countries with weak governance.

Furthermore, a palatable approach for the Cambodian private sector is theopening of Chinese markets for their products, services, and investments.

. Oliver Hensengerth, Money and Security: Chinas Strategic Interests in the Mekong RiverBasin, Brieng Paper, ASP BP / (London: Chatham House, June ), p. .

. Ibid.

. Cambodian-Chinese Friendship Benets wo Peoples: Hun Sen, Xinhua News Agency,September , .

. Sophal Ear, Governance and Economic Performance: Credibility, Political Will, and Re-form, Cambodian Economic Review : (May ), pp. ; Julio Jeldres, China-Cambodia:More Tan Just Friends? Asia imes Online (Hong Kong), September , .


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However, comparing the two economies, it is clear that Cambodia wouldbenet more from China than China from Cambodia. In terms of markets,for instance, Cambodia nets a win-win situation because it gains access tolarger markets for its products, as well as faster development of its manufac-turing industries thanks to Chinese know-how. Nevertheless, opportunities

will surely abound for both countries. For instance, in Cambodia alone thereare roughly , Chinese-registered companies operating, most of themrelated to garments and textiles. In , there was interest for the Cam-bodian export of rice to China, but the latter scuttled one deal when itfound phytosanitary issues related to bacterial contamination. Most impor-

tant to China is open and easy access to Sihanoukvilles port, which will ineffect guarantee deliveries of imported oil and mobilization of resources asneeded. It is important to highlight that the China-ASEAN Free rade Areabegan on January , , with the goal of a zero tariff rate for of goodstraded among China, Cambodia, Laos, Myanmar, and Vietnam by . 38

Another strategic approach being used can be best dened as culturalforce-feeding. In its most basic form, this means the use of cultural back-ground to inuence states and peoples in other locations. In Cambodia, thistakes form as cultural showcasing and the promotion of the Chinese lan-guage. In , through political coaxing, senior Cambodian officials per-mitted the establishment of multilingual institutions; Chinese dialects grewin prominence. China contributes to this cultural and educational rubric byfunding school construction, textbook production, and training of teachers,as well as offering scholarships to Chinese-Cambodians for secondary anduniversity education in China. It should be noted that not only Cambodiansof Chinese ancestry study Chinese but pure ethnic Khmer do too, realizingthe advantages of learning the language and customs of one of Cambodiasmost powerful partners.

Another inuential front has been the establishment of Chinese-languagenewspapers in Cambodia, coupled with Chinese television entertainmentand news broadcasts on cable V channels. Similarly, Beijing has encouragedand supported Chinese-Cambodian social organizations (e.g., the Cambodian-Chinese Association, based in Phnom Penh, and clan-based organizations),

many of which promote Chinese roles, practices, and demeanors to youngCambodian enthusiasts. As a result of the near decimation of ancient

. Brian Shen, New Opportunity for China-ASEAN rade, Beijing Review (May ),p. .


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Cambodian cultural heritage by the Khmer Rouge regime from to ,China spotted a golden opportunity to aggressively support a Chinese cul-tural revival. Tis cultural and educational expansion results in wider accep-tance among Cambodians of Chinese ways, ideologies, policies, products,and services.39

Te regionally diverse portfolio of Beijings engagement strategies and dip-lomatic approaches suggests that not all Southeast Asian countries share auniform perception about Chinas intentions. Each country has its ownunique relationship with China, reaps its own benets, and deals with itsown difficulties. Although a great deal of money has been doled out through-

out the region, Chinas special generosity toward Cambodia has caught theattention of Western governments40 and caused alarm over the potential tiltin the region in favor of a non-traditional hegemony.

SECURING RESOURCES

High food prices, rapidly emerging animal and plant pests and diseases, andpolicy-induced supply shocks all ignite fears among Chinese officials that

dependence on world food markets to satisfy domestic demand would leaveChina vulnerable. As a result, leaders realize the need for access to criticalcommodities, not only to feed an expanding population but also to meet thedemands of insatiable output and export-oriented industries. More broadly,growing concerns about future scarcity have led foreign governments to un-dertake large-scale land acquisitions abroad. A multi-institutional study in-dicates that in agriculture-oriented countries, land-based investments haverisen over the past half decade, spurred by foreign investment that seeks toexploit opportunities for its own advantage.41

China is thirsty for natural resources such as timber, gas, oil, water, rub-ber, fertile cropland, and minerals (gold, silver, and iron ore). More impor-tant, it is keenly interested in having cheap, unprotected, unrepresented, andreadily available labor forces abroad. Tis interest reects the fact that the

. See Marks, Chinas Cambodia Strategy; and for related arguments Richardson,China,Cambodia, and the Five Principles of Peaceful Co-existence.

. Tomas Lum, Cambodia: Background and U.S. Relations (Washington, D.C.: Report, April ), p. .

. International Institute for Environment and Development/FAO/International Fund for Agricultural Development,Land Grab or Development Opportunity?(London: Russell Press,

), p. .


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great majority of Chinese exports are still labor intensive. Te main com-parative advantage of Chinese manufacturing power lies in its abundantlabor supply, but its wages have inevitably risen in concert with economicgrowth. o witness this manufacturing phenomenon, investors and purchas-ing managers are encouraged to visit the city of Yiwu, also commonly re-ferred to as the International rade City, southwest of Shanghai, which hosts

what is alleged to be the biggest market in the world, the Yiwu Market.Here, stalls display thousands of items to potential buyers.42 Nowadays,China faces a growing dependence on imports of important minerals and isalready a crucial world market for copper, iron ore, platinum, aluminum,

and precious woods. In , global production of crude steel reached thebillion-ton mark almost entirely as a result of intense Chinese demand. It isno secret that China already consumes more steel, grain, and coal than

America. As if this were not enough, China is also one of the worlds largestimporters of tropical timber from the region. Because smaller householdsconsume more resources per person, Chinas rapid increase in householdnumbers and reduction in household size results in rapacious resourceusage.43 Although China has shown signs of assuming greater regional andinternational obligations, and is steadily becoming a responsible stakeholder,its approach to domestic and global affairs remains largely utilitarian.

INTERVENTION CONSEQUENCES

For nations, there are often direct and indirect consequences related to spe-cic interventions (mainly through infrastructure projects) that prove to bedetrimental in multiple dimensions for the short, medium, and long term.In the past years, Cambodians have experiencedand most fear they willcontinue to experiencea series of actions: unlawful land-grabbing, chokingof freedom of expression (not to mention human rights), illegal logging,unregulated mining, labor abuses, illicit resource exploitation, and environ-mental damage to rivers, lakes, and water-dependent ecosystems. In manycases, the government itself has been behind these abuses. Because of thefrailty of Cambodias democracy, the profound lack of sensible political

. Bill McKibben, Deep Economy: Economics as if the World Mattered (Oxford: Oneworld Pub-lications, ), p. .

. Jianguo Liu and Jared Diamond, Chinas Environment in a Globalizing World,Nature (June , ), pp. .


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institutionalization, weak social cohesion, and the utter disregard for peoplesrights, concern has grown over the potentially pernicious outcome of Chinasactions that are embraced, accepted, and encouraged by Cambodian officials.Lately, close ties between top Chinese officials and Cambodian Prime MinisterHun Sen have played a pivotal role in advancing Chinas strategic interests inboth Cambodia and the region.44 Tis is no novelty: corruption, cronyism, andnepotism are endemic in Cambodia.45

Labor Abuses

Cambodians have a long history of suffering human rights and labor abuses.46 In response to allegations and in collaboration with the royal government ofCambodia and the International Labor Organization, the U.S. and EU haveadvanced innovative, incentive-based policy experiments (e.g., expandedexport quotas as incentive) that have rendered positive results in garmentfactories,47 but there is much room for improvement in other industries.Some of the most common features of abuse and exploitation, anecdotallyreported, are harsh and demeaning working conditions, unpaid overtime,harassment, unauthorized paycheck deductions, underage workers, unpaidsick leave, verbal abuse, delayed compensation, and suppression of workerscomplaint mechanisms. In many cases, because of a profound lack of gainfulalternative jobs, many Cambodians agree to abusive and exploitative workconditions, lest they join the ranks of the unemployed (known colloquiallyas dah twat ktiol literally, walk-kick air). Recently, the World Bank forecastthat , Cambodians will fall below the poverty line this year partly asa result of the global economic slowdown.48 It is feared that young unem-

ployed women will turn to prostitution or begging to make up for house-hold budget shortfalls. Households facing multidimensional insecurities

. Long Kosal, Sino-Cambodia Relations, Cambodian Institute for Cooperation and Peace(CICP), Working Paper, no. (Phnom Penh: CICP, ).

. ransparency Internationals Corruption Perception Index ranked Cambodia outof countries.

. John A. Hall, Human Rights and the Garment Industry in Contemporary Cambodia,Stanford Journal of International Law : (Winter ), pp. .

. Sandra Polaski, Combining Global and Local Forces: Te Case of Labor Rights in Cambo-dia, World Development : (May ), pp. ; Worker Rights and Global rade: Te U.S.-Cambodia Bilateral extile rade Agreement, Harvard Business School Case Studies (Cambridge,Mass.: Harvard Business School, ), pp. .

. World Bank, Battling the Forces of Global Recession, East Asia and Pacic Update (Wash-ington, D.C.: World Bank, April ), p. .


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could try to cope with income losses by migrating to nearby cities, sellingvaluable assets such as livestock, borrowing money from usurers, or encour-aging their young children to work.

Livelihood and Ecological Disruptions

In the past quarter century, international organizations have come to recog-nize that sale or long-term lease of farmland to foreign governments or in-ternational investors can result in land expropriation.49 Or it may ultimatelylead to unsustainable resource use, thereby undermining the livelihoods oflocal communities through job loss or income reduction, in addition toother pernicious outcomes. However, the other side of the argument is thatland sales or transfers can also bring opportunities to local communities,including employment creation and demand-driven multiplier effectsthrough backward and forward network linkages.50

Ecologists and environmentalists, aided by classical and contemporarytools to measure anthropogenic effects51 on ecosystems, have highlighted theloss of productive land to non-productive uses, sometimes leading to slash-and-burn deforestation. Often, in-depth investigations with farmers in ruralareas reveal that continuous farming of these in-transition plots reduces cropyields. Tis stems from factors such as soil erosion, inadequate pest controlpractices, and low-quality inputs (seeds, pesticides, and fertilizers), amongother things. Similarly, non-governmental organizations have denouncedunrestrained mining exploration in northern Cambodia that has damagedsix of the countrys protected wildlife areas. Loss of livelihoods based onbamboo harvesting and resin tapping from treesbecause of extensive

logginghas also been reported recently.52

Because no country in the region is more reliant on the Mekong Riverthan Cambodia, English-language local newspapers such as thePhnom PenhPost and the Cambodia Daily as well as some Khmer-language newspapers,have been covering river-related issues. Tey have reported stories of villagers

. See Cambodia, Kuwait, and FarmlandPetrodollars v Smallholders.

. FAO of the U.N., From Land Grab to Win-Win: Seizing the Opportunities of Interna-tional Investments in Agriculture,Economic and Social Perspectives (Rome), Policy Brief, no. ,

.. Anthropogenic effects are those that are derived from human activities, as opposed to those

occurring in natural environments without human inuences.. See Global Witness, Country for Sale.


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in riverside communities forced to move because the ooding Mekong de-stroyed their lands. Rural and indigenous communities that depend on animalhunting, fruit gathering, shing, or water transport along the Mekong Riverand the onle Sap (Cambodias great lake) have voiced fears that Chinese-backed infrastructure developments will damage the environment andthreaten their livelihoods.53 In the environmental arena, China is perceivedas the source of numerous regional ecological disruptions. Chinas dam de-velopment has already hurt Cambodia. By mid- , the Mekong waterlevel had reached record lows, resulting in a nearly drop in the sh catchfrom the previous year and also menacing rice production. It is equally

alarming how many households could experience drops in tourism-relatedincome in areas around the onle Sap and Siem Reap (home to the famed

Angkor temples) that potentially could push people into food insecurity,mass urban migration, prostitution, increased violence, and protests.54 Socialanthropologists have warned of the unexpected increase in costs associated

with post-displacement minority group relocations. Tey have also pointedto the long-term developmental and health effects of diminished nutritionalproles in infants, children, and adults resulting from reduced consumptionof animal proteins. A report by the World Wildlife Fund (WWF) re-veals that pollution in the -kilometer stretch of the Mekong River be-tween Cambodia and Laos has pushed the local population of Irrawaddydolphins to the brink of extinction while nearly decimating other endan-gered species and harming aquatic populations.55

Fifteen years ago, plans to develop the Mekong were viewed by regionalcountries and the international community with trepidation. Te MekongRiver Commission (MRC) was formed on April , , by an agreementamong the governments of Cambodia, Laos, Tailand, and Vietnam. Te

Agreement on Cooperation for the Sustainable Development of the MekongRiver Basin sought joint management of the four countries shared waterresources and development of the rivers economic potential.56 Interestingly,

. See Chakrya and Strangio, Villagers Gather to Express Dam Concerns.

. In March , the Economist Intelligence Unit (EIU) ranked Cambodia fourth out of countries in terms of political instability. EIU, Manning the Barricades: Whos at Risk as Deepen-ing Economic Distress Foments Social Unrest, Special Report (London) (March ).

. WWF, Mekong Dolphins on the Brink of Extinction (Washington, D.C.: WWF, June).

. MRC, Meeting the Needs, Keeping the Balance: Strategic Plan (Vientiane:MRC, December ).


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China and Myanmar are only dialogue partners, not commission members.In subsequent years, the MRC hosted and encouraged multi-stakeholderconsultations and roundtables to better address the most pressing issues sur-rounding development of the Mekong River. As a result, many detailed plansand strategies were showcased. However, despite drafting comprehensiveenvironmental-impact assessments and mitigation plans, backed by signi-cant funding assistance and institutional support, little improvement hasbeen seen. Among other factors, this derives from Chinas determinationto move ahead regardless of impediments, coupled with weak enforcementof environmental regulations, lack of popular condemnation, and state

permissiveness.Indeed, the decimation of Cambodias natural resource base is alarming,

considering that of the population of million is rural, with agricultureaccounting for two-fths of GDP and constituting the main domestic activ-ity of rural households.57 Recent cases of highly pathogenic avian inuenza(bird u) were a valuable lesson on how a disease with global public healthimplications was allowed to further damage rural livelihoods via a lethal mixof international incentives and domestic politics.58 As if this were not enoughto raise eyebrows, conservationists warn that parts of the Mekong regionmainly Cambodia, Laos, and Chinas Yunnan Provinceare particularlyvulnerable to the effects of anthropogenic climate change that in all likeli-hood will transform sensitive ecosystems.59 For instance, in , Chineselogging operations abroad were denounced for engaging in illegal activitiesthat spurred severe deforestation in Burma and Indonesia.60 Te result wassoil erosion, biodiversity loss, and lower water-generation capacity. Between

and , civic groups have emphasized the immediate need for con-certed action to stop dam development along the Mekong before furtherhuman rights and environmental abuses take place. In , an InternationalRiversreport warned of signicant social and environmental costs accruingfrom poorly planned Chinese hydroelectric power plants being developed in

. S. Burgos and M. J. Otte, Poultry, HPAI, and Livelihoods in CambodiaA Review, FAOof the U.N., Mekong eam Working Paper, no. (Rome), , pp. .

. See Ear and Burgos Cceres, Livelihoods and Highly Pathogenic Avian Inuenza in Cam-bodia.

. C. Shay, Scientists Announce rove of Fragile New Species in Mekong, ime , September, .

. Elizabeth Economy, Te River Runs Black: Te Environmental Challenges to Chinas Future (Ithaca, N. Y.: Cornell University Press, ), p. .


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Cambodia.61 More recently, in , a joint publication by the United Na-tions Environment Program (UNEP) and the Asian Institute of echnology(AI ) urged officials to attain a balance between resource exploitation andmaintenance of ecological health.62 Chinas projects are now consideredmajor contributors to the precipitous decline in biodiversity in Cambodia.In addition, tigers, bears, seahorses, and rare turtles, among other exotic

wildlife, are eagerly sought by some Chinese traders. Te growing purchas-ing power within certain social groups provides strong economic incentivesfor the illegal wildlife trade. With all this in mind, and based on empiricalevidence, it is unlikely that China will soon assume a proactive leadership

role in promoting labor rights protection, fostering good governance, andcatering to the environment.

CONCLUSION

From its portfolio of approaches planned and implemented so far, it is clearthat Chinas strategic interests go far beyond projecting greater inuence inSoutheast Asia and securing vast supplies of natural resources in Cambodia.

Chinese political and economic analysts are attuned to contemporary issues,as demonstrated through Beijings tactical moves in Southeast Asia, mostespecially in Cambodia.63 Tere, a less than independent judicial system64 provides no substantial relief to ordinary Cambodians but in fact allows forinequities and iniquities with little potential for liability. Te reality is thatChina has assumed a leadership role in Southeast Asian economies andaggressively pursues free trade agreements as a direct result of stagnant ordeclining regional trade with Europe and America.65 Under these circum-stances, which policy options Cambodian authorities embrace to foster social

. Carl Middleton, Cambodias Hydropower Development and Chinas Involvement (Berke-ley: International Rivers Report, January ), pp. .

. M. Babel and S. Wahid, Freshwater under TreatSoutheast Asia (UNEP-AI Report,), pp. .

. Franoise Nicolas, Chinese Direct Investments in Europe: Facts and Fallacies, BriengPaper (London: Chatham House, June ).

. Sophal Ear, Cambodian Justice, Wall Street Journal Asia (Hong Kong), September ,.

. Michael Glosny, Meeting the Development Challenge in the st Century: American andChinese Perspectives on Foreign Aid (Washington, D.C.: National Committee on U.S.-ChinaRelations, ).


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stability will depend on the presence or absence of political will.66 Policyinitiatives (such as contract transparency) that harm patronage networkshave the least likelihood of success given the countrys political economylandscape.67 Naturally, officials in Beijing and Phnom Penh see this as a win-

win situation.Despite much praise for its various regional and international initiatives,

China has also drawn wide condemnation for failing to acknowledge theseverity of ibetan civil unrest and downplaying the Severe Acute Respira-tory Syndrome (SARS) epidemic. Cambodias December forcible repa-triation to China of members of Chinas Uighur minority attracted howls

of outrage from rights groups and Western governments. Te deportationsoccurred one day before Chinese Vice President Xi Jinpings three-day visitto Siem Reap, during which an accord giving Cambodia . billion in eco-nomic aid was signed.

Militarily, it is clear that the port of Sihanoukville could serve as a strate-gic location from which to project Chinese maritime power into the Gulf ofTailand and the Straits of Malacca, both conduits for heavy trade. Aireldsin mainland Cambodia can be used as refuelling stations for military planesconducting sea and land surveillance and reconnaissance missions. Clearly,the rationale supporting a China-Cambodia military partnership is oftentactical and instrumental, rather than being based on long-term sustainabledevelopment. Tis status reects the transitory nature of the contemporaryinternational system.

Diplomatically, China has improved its standing with the internationalcommunity through friendly foreign policies.68 By adopting a similar posi-tion to back Russia, Iran, and North Korea on sensitive issues, Beijing canalso support Cambodia when Phnom Penh is pressured by internationalbodies on allegations of human rights abuses, oppression, corruption, andmisuse of power at high government levels. It is therefore not surprising thatthe Chinese Embassy is the biggest diplomatic mission in Cambodias capi-tal, or that China is by far Cambodias most generous Development Partner.Cambodia, to repay its newfound ally for its largesse, has silently agreed to

. Sophal Ear, Te Political Economy of Aid and Governance in Cambodia, Asian Journal ofPolitical Science : (April ), pp. .

. See Ear, Governance and Economic Performance: Credibility, Political Will, and Reform.

. Avery Goldstein, Parsing Chinas Rise: International Circumstances and National Attri-butes, in Chinas Ascent: Power, Security, and the Future of International Politics,eds. Robert S. Rossand Zhu Feng (Ithaca, N. Y.: Cornell University Press, ), p. .


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serve almost every Chinese desire and whim, from making gargantuan landconcessions to allowing the building of hydroelectric dams, roads, bridges,railways, and telecoms systems, as well as repatriating Uighurs and permit-ting China free access to its economy.

For aid, Cambodia can always turn to China, a generous donor that de-spite its superpower status seems to treat its partners with fairness and re-spect, never asking sensitive questions. It is up to Cambodia to make the bestuse of these economic boosters and its intimate relationship with its giantneighbor, in order to advance economic programs and social projects. In thelong term, these could benet Cambodias populace and its economy, as well

as cementing in place the primary and secondary infrastructure needed tosustain commerce and development.

Economically, Cambodia and China will always maintain a symbiotic re-lationship, owing to the large number of Chinese-Cambodians. But this re-lationship will mainly be reciprocally fed by the ties and benets that bindsenior officials in both countries. Chinas heavy investment in Cambodiastems not only from Beijings strategic interests in the region but also arisesbecause private sector initiatives seek fertile ground where there is an envi-ronment to prosper and grow. Other countries have eyed the kingdom ofCambodia as a partner, be it as their vegetable garden or their rice bowl.

America and Europe have long been a presence in the garment industry; Japan has been donor and advisor; and Australia has had a role in agricul-tural and industrial development. Still, Cambodian officials argue in inter-views and communiqus that what is good for China is good for Cambodia,and this belief, glued by trust and respect, seems absolute. Yet, despite all theheralded advantages behind this strategic partnership, rising concerns aboutlabor abuses, geopolitical backlashes, livelihood disruptions, social unrest,ecological perturbations, economic dependence, and biodiversity losses arealready making headlines.

Lastly, the strategic partnership between China and Cambodia has pro-voked polarized views among Western observers, neighbors, and the interna-tional community because it is seen as an alliance of authoritarian states thatthreatens ASEAN cohesion, regional stability, and democratic norms. How-

ever, seen strictly through a public relations lens, Chinas rise has been peacefuland tactical, achieved through enhancement of global security, promotion ofpeaceful trade, and addressing transnational challenges. Whether the out-come is positive or negative depends in large part on external forces playing


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out dynamically in the international arena. Tese include a debilitatingglobal recession; Chinas willingness to play banker to America; rising nu-clear and viral threats; climate change and its effect on living ecosystems;trade liberalization bottlenecks; reduced consumer condence; and risingglobal poverty, inequality, and hunger. Perhaps we are seeing an active rede-nition of duties and responsibilities as superpowers snatch force and inu-ence from each other, especially after traditional leadership roles have comeinto question around the globe.

china's strategic interests in cambodia: influence and resources

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