<TABLE border=0 cellSpacing=0 cellPadding=0 width="100%"><TBODY><TR>Cambodia welcomes new best friend: China
</TR><!-- headline one : end --><TR>Tricky ties of past are put aside as Beijing pumps billions into country </TR><!-- Author --><TR><TD class="padlrt8 georgia11 darkgrey bold" colSpan=2>By Sim Chi Yin
</TD></TR><!-- show image if available --></TBODY></TABLE>
<!-- START OF : div id="storytext"--><!-- more than 4 paragraphs -->Phnom Penh - Bookstores sell investment guides in Chinese. Local rural workers speak Mandarin. And the government's newest office block is funded by Beijing.
Welcome to Cambodia.
With Sino-Cambodian political ties going from strength to strength in recent years, Beijing has leapt to pole position as the impoverished South-east Asian country's top aid donor and No.1 investor.
Last year alone, China pumped in US$4.3billion (S$6.2billion) - or more than 40per cent - of all the foreign investments Cambodia received for the year, according to the Xinhua state news agency, citing official statistics from Phnom Penh.
From running garment and telecommunications businesses to gold-mining ventures and mega-dam projects, often with loans from Beijing's Export-Import (Exim) Bank, Chinese companies pumped in almost four times the amount invested by second-place South Korea.
Recent statistics suggest China is also Cambodia's biggest foreign donor, building roads and bridges across the country. But reliable aid numbers are hard to pin down.
In downtown Phnom Penh, a sleek new imposing building of glass and stone stands as a symbol of China's growing influence.
Beijing has picked up the US$49 million tab for the Council of Ministers building, which will be Cambodia's seat of government when it opens next year.
In addition to its latest eye-popping gift to Asean in April - a US$10 billion fund for infrastructure construction and US$15 billion worth of credit - Beijing pledged an extra US$39.7 million in help for Cambodia, Laos and Myanmar, the region's poorest countries.
For the most part, China's help is welcomed with open arms here.
While older Cambodians might still feel some resentment towards China for its staunch support of the ultra-Maoist Khmer Rouge regime in the 1970s - that dark chapter of history which claimed 1.7million Cambodian lives from starvation, disease, overwork, torture and execution - it seems all but forgotten with younger locals.
When then President Jiang Zemin made a historic visit to Cambodia in 2000, just as Beijing was pushing its influence in South-east Asia in earnest, protesters flashed banners and shouted 'China is a bad friend' and 'Cambodia is not a Chinese province'.
These days, the views of Mr Kang Karno, 30, a worker at a Chinese-owned garment factory near his village 30km south-west of Phnom Penh, are far more typical.
He said in accented but fluent Mandarin: 'I think the Chinese today are very different from the ones before who supported the Khmer Rouge. Those here now are just businessmen.'
His parents lost almost 80 members of their extended family to the Khmer Rouge, which received money, supplies and training from China. But to Mr Kang Karno, who takes daily Mandarin lessons which his boss provides, Chinese businesses now provide Cambodians with a lifeline.
'They provide a lot of jobs here. It is good for me to learn Mandarin. It is easier for me to find a job,' he said.
His wife and younger sister also work at the factory, ironing the clothes that come off the assembly line to earn a basic salary of US$50 a month.
The Cambodian government, too, laps up Chinese aid and investments. Where Western aid typically attaches conditions such as good governance or rights, Beijing's comes with no such strings attached.
Cambodian Prime Minister Hun Sen, who has called China his country's 'most trustworthy friend', declared his gratitude on national radio in 2007.
'China is a very big country with 1.3 billion people. If the Chinese all urinated at once, they would cause a great flood. However, Chinese leaders do good things with their partners,' he said.
As the historic United Nations-backed trial of Khmer Rouge leaders finally got under way here recently, Cambodian observers noted that China did not pledge funds or support, unlike many other countries. But Beijing also did not try to block the trial to bury its key role in backing the Khmer Rouge, as some had expected.
History and politics are barely part of the China-Cambodia equation now, argued Mr Jimmy Gao, president of the Chinese Chamber of Commerce in Cambodia.
'Whether they are SOEs (state-owned enterprises) or SMEs, the Chinese companies come looking for mutual commercial benefits,' said the Shanghainese, who has lived in Cambodia for 16 years.
Emerging from decades of war, Cambodia's relative political stability over the past 10 years has seen its annual gross domestic product average 9.5per cent growth. Strong growth, low labour costs and cosy political ties with China have drawn mainland businesses, said Mr Gao.
Those firms also readily find Mandarin-speaking business partners among the 350,000-strong Chinese Cambodian population, which is experiencing a resurgence of ethnic pride in recent years. Locals note that shop signs bearing Chinese characters have sprung up in Phnom Penh, and not just on Mao Tse Tung Boulevard.
China's push into Cambodia is part of a broader trend of its businesses heeding Beijing's call to 'go out' into the world. Over the past five years or so, that policy has borne fruit. In just the first quarter of last year, Chinese companies invested nearly US$19billion abroad, a leap of more than 300per cent year-on-year.
But even if history is no longer a hindrance, China's growing presence in Cambodia is raising eyebrows - as is its ever-larger footprint in Africa, Latin America and other parts of Asia.
Critics question labour conditions in Chinese-run factories and the lack of transparency in the handling of deals between the Cambodian authorities and Chinese financiers.
Dr Michael Sullivan, a Cambodia-based scholar who has researched Chinese investment and aid in the country, said: 'Invariably, decisions about large infrastructure projects take place between high-ranking officials from both sides behind closed doors, excluding all others.'
Others worry about the hydro-power dams Chinese firms are building in rural Cambodia. These will undoubtedly ease the country's severe power shortages and in the long term help attract more foreign investment. But critics bemoan the environmental impact and displacement of local populations.
China's Ambassador to Asean, Dr Xue Hanqin, acknowledged in a recent interview with The Straits Times that some of the criticism of Chinese firms' poor environmental track records was legitimate, but said Beijing was actively working to improve its sense of corporate social responsibility both at home and abroad.
In recent weeks, Beijing announced mandatory green guidelines for Chinese companies taking on overseas projects and told its logging firms to be 'well behaved' abroad, state media reported.
Analysts say China's interest in Cambodia is motivated by its need to spread its 'soft power' as well as its thirst for strategic influence and natural resources.
Professor Carlyle Thayer, an Indochina expert at the Australian Defence Academy in Canberra, said: 'Beijing hopes to expand its access to the deep sea port at Sihanoukville in Cambodia's south-
west for better access to the Strait of Malacca - through which the bulk of China's imported oil passes - and to the disputed, oil-rich Spratly Islands in the South China Sea.
'Such port access from Cambodia to the Indian Ocean is part of what analysts call China's 'string of pearls'.'
However, the more immediate concern, noted Dr Sullivan, is that Cambodia might become too reliant on Chinese help.
'Cambodia may become locked into a dependent core-periphery relationship...Chinese companies extract natural resources and export commodities to China, and in return, cheap Chinese manufactured goods flood Cambodia's markets. That could hamper the country's prospects for industrial development.'
[email protected]
<HR SIZE=1 width="50%">
Changing mindsets
While older Cambodians might still feel some resentment towards China for its staunch support of the ultra-Maoist Khmer Rouge regime in the 1970s, it seems all but forgotten with younger locals.
</TR><!-- headline one : end --><TR>Tricky ties of past are put aside as Beijing pumps billions into country </TR><!-- Author --><TR><TD class="padlrt8 georgia11 darkgrey bold" colSpan=2>By Sim Chi Yin
</TD></TR><!-- show image if available --></TBODY></TABLE>
<!-- START OF : div id="storytext"--><!-- more than 4 paragraphs -->Phnom Penh - Bookstores sell investment guides in Chinese. Local rural workers speak Mandarin. And the government's newest office block is funded by Beijing.
Welcome to Cambodia.
With Sino-Cambodian political ties going from strength to strength in recent years, Beijing has leapt to pole position as the impoverished South-east Asian country's top aid donor and No.1 investor.
Last year alone, China pumped in US$4.3billion (S$6.2billion) - or more than 40per cent - of all the foreign investments Cambodia received for the year, according to the Xinhua state news agency, citing official statistics from Phnom Penh.
From running garment and telecommunications businesses to gold-mining ventures and mega-dam projects, often with loans from Beijing's Export-Import (Exim) Bank, Chinese companies pumped in almost four times the amount invested by second-place South Korea.
Recent statistics suggest China is also Cambodia's biggest foreign donor, building roads and bridges across the country. But reliable aid numbers are hard to pin down.
In downtown Phnom Penh, a sleek new imposing building of glass and stone stands as a symbol of China's growing influence.
Beijing has picked up the US$49 million tab for the Council of Ministers building, which will be Cambodia's seat of government when it opens next year.
In addition to its latest eye-popping gift to Asean in April - a US$10 billion fund for infrastructure construction and US$15 billion worth of credit - Beijing pledged an extra US$39.7 million in help for Cambodia, Laos and Myanmar, the region's poorest countries.
For the most part, China's help is welcomed with open arms here.
While older Cambodians might still feel some resentment towards China for its staunch support of the ultra-Maoist Khmer Rouge regime in the 1970s - that dark chapter of history which claimed 1.7million Cambodian lives from starvation, disease, overwork, torture and execution - it seems all but forgotten with younger locals.
When then President Jiang Zemin made a historic visit to Cambodia in 2000, just as Beijing was pushing its influence in South-east Asia in earnest, protesters flashed banners and shouted 'China is a bad friend' and 'Cambodia is not a Chinese province'.
These days, the views of Mr Kang Karno, 30, a worker at a Chinese-owned garment factory near his village 30km south-west of Phnom Penh, are far more typical.
He said in accented but fluent Mandarin: 'I think the Chinese today are very different from the ones before who supported the Khmer Rouge. Those here now are just businessmen.'
His parents lost almost 80 members of their extended family to the Khmer Rouge, which received money, supplies and training from China. But to Mr Kang Karno, who takes daily Mandarin lessons which his boss provides, Chinese businesses now provide Cambodians with a lifeline.
'They provide a lot of jobs here. It is good for me to learn Mandarin. It is easier for me to find a job,' he said.
His wife and younger sister also work at the factory, ironing the clothes that come off the assembly line to earn a basic salary of US$50 a month.
The Cambodian government, too, laps up Chinese aid and investments. Where Western aid typically attaches conditions such as good governance or rights, Beijing's comes with no such strings attached.
Cambodian Prime Minister Hun Sen, who has called China his country's 'most trustworthy friend', declared his gratitude on national radio in 2007.
'China is a very big country with 1.3 billion people. If the Chinese all urinated at once, they would cause a great flood. However, Chinese leaders do good things with their partners,' he said.
As the historic United Nations-backed trial of Khmer Rouge leaders finally got under way here recently, Cambodian observers noted that China did not pledge funds or support, unlike many other countries. But Beijing also did not try to block the trial to bury its key role in backing the Khmer Rouge, as some had expected.
History and politics are barely part of the China-Cambodia equation now, argued Mr Jimmy Gao, president of the Chinese Chamber of Commerce in Cambodia.
'Whether they are SOEs (state-owned enterprises) or SMEs, the Chinese companies come looking for mutual commercial benefits,' said the Shanghainese, who has lived in Cambodia for 16 years.
Emerging from decades of war, Cambodia's relative political stability over the past 10 years has seen its annual gross domestic product average 9.5per cent growth. Strong growth, low labour costs and cosy political ties with China have drawn mainland businesses, said Mr Gao.
Those firms also readily find Mandarin-speaking business partners among the 350,000-strong Chinese Cambodian population, which is experiencing a resurgence of ethnic pride in recent years. Locals note that shop signs bearing Chinese characters have sprung up in Phnom Penh, and not just on Mao Tse Tung Boulevard.
China's push into Cambodia is part of a broader trend of its businesses heeding Beijing's call to 'go out' into the world. Over the past five years or so, that policy has borne fruit. In just the first quarter of last year, Chinese companies invested nearly US$19billion abroad, a leap of more than 300per cent year-on-year.
But even if history is no longer a hindrance, China's growing presence in Cambodia is raising eyebrows - as is its ever-larger footprint in Africa, Latin America and other parts of Asia.
Critics question labour conditions in Chinese-run factories and the lack of transparency in the handling of deals between the Cambodian authorities and Chinese financiers.
Dr Michael Sullivan, a Cambodia-based scholar who has researched Chinese investment and aid in the country, said: 'Invariably, decisions about large infrastructure projects take place between high-ranking officials from both sides behind closed doors, excluding all others.'
Others worry about the hydro-power dams Chinese firms are building in rural Cambodia. These will undoubtedly ease the country's severe power shortages and in the long term help attract more foreign investment. But critics bemoan the environmental impact and displacement of local populations.
China's Ambassador to Asean, Dr Xue Hanqin, acknowledged in a recent interview with The Straits Times that some of the criticism of Chinese firms' poor environmental track records was legitimate, but said Beijing was actively working to improve its sense of corporate social responsibility both at home and abroad.
In recent weeks, Beijing announced mandatory green guidelines for Chinese companies taking on overseas projects and told its logging firms to be 'well behaved' abroad, state media reported.
Analysts say China's interest in Cambodia is motivated by its need to spread its 'soft power' as well as its thirst for strategic influence and natural resources.
Professor Carlyle Thayer, an Indochina expert at the Australian Defence Academy in Canberra, said: 'Beijing hopes to expand its access to the deep sea port at Sihanoukville in Cambodia's south-
west for better access to the Strait of Malacca - through which the bulk of China's imported oil passes - and to the disputed, oil-rich Spratly Islands in the South China Sea.
'Such port access from Cambodia to the Indian Ocean is part of what analysts call China's 'string of pearls'.'
However, the more immediate concern, noted Dr Sullivan, is that Cambodia might become too reliant on Chinese help.
'Cambodia may become locked into a dependent core-periphery relationship...Chinese companies extract natural resources and export commodities to China, and in return, cheap Chinese manufactured goods flood Cambodia's markets. That could hamper the country's prospects for industrial development.'
[email protected]
<HR SIZE=1 width="50%">
Changing mindsets
While older Cambodians might still feel some resentment towards China for its staunch support of the ultra-Maoist Khmer Rouge regime in the 1970s, it seems all but forgotten with younger locals.
