WILL WASHINGTON STEP UP? Cambodia’s alignment with China has occurred in the absence of sustained U.S. and Western engagement. For the time being, Cambodia seems to be far from falling into the Chinese debt trap, given its current Chinese debt which is close to $5 billion. Kenya’s debt profile: Chinese loans comprised 21% of Kenya’s external debt, compared with the World Bank’s 25% at the end of June 2020, according to a National Treasury report. Last year, China wrote off Cambodia's $89 million debt – it forgave a far smaller Khmer Rouge-era $4 million debt in 2010. This is neither a commercial research service nor a domain managed by any governmental or inter-governmental agency; it is managed as a private non-profit open data/open knowledge media group. Materials on the Open Development Cambodia (ODC) website and its accompanying database are compiled from publicly available documentation and provided without fee for general informational purposes only. Cambodia had a GDP of $24.57 billion in 2018. US companies were the fifth largest investors in Cambodia, with more than $1.2 billion in investments over the period 1997-2007. US indicates new willingness to pay for Cambodia's influence but China is already supremely invested. All hosted resources will be in the public domain, or licensed under Creative Commons. WILL WASHINGTON STEP UP? For example, China has proposed a plan to “develop over two million kilometers of national expressways [in Cambodia] by 2040”, which would cost an estimated $26 billion and could leave the Kingdom significantly more in debt to China. Cambodia’s alignment with China has occurred in the absence of sustained U.S. and Western engagement. Made in China: Smashing the Bell Jar January–March 2019. Otherwise, in the event of a default, Cambodia will end up becoming the colony of China. However, Cambodia has a significant trade deficit with China, importing over $3.9 billion (raw fabrics being the largest constituent) compared to its exports of $830 million. We thank you for your support. Beijing-funded $2bn expressway raises questions about costs and benefits . Descending into Debt in Cambodia. The authors also caution that countries heavily in debt to China are at risk of defaulting. His comments were broadcast on state television in Cambodia. The influx of Chinese economic assistance into Sri Lanka and Cambodia has raised questions regarding the intentions behind these massive loans. The amount of money Cambodia owes China has been growing steadily in recent years. However, the trend seems to be worrying. Visiting Chinese legislator Wu Bangguo yesterday inked a deal to forgive more than $4 million of Cambodia’s debt to the country, the amount that Cambodia was due to repay this year, according to the government spokesman. The act’s proponents are Congressmen Dana Rohrbacher and Bill Delahunt, whose legislation states, “The United States may not reduce or forgive any debt owed by Cambodia to the United States.” Two days after Cambodia returned the Uighers to China, on December 19, 2009, China signed 14 deals with Cambodia worth over $1 billion. This work and any original materials produced and published by Open Development Cambodia herein are licensed under a CC BY-SA 4.0. Cambodia’s position with regards to the debt issue will not be affected by US pressure as it has earned strategic trust and support from China, a rising superpower. Cambodia playing US to squeeze more from China. By. China’s colossal infrastructure investments may usher in a new era of trade and growth for economies in Asia and beyond. The figure is significantly higher than the combined multilateral debt owed to institutions such as the World Bank and Asian Development Bank. China is Cambodia’s largest creditor country, accounting for 45 percent of the Kingdom’s total foreign debt, followed by Japan at 6.2 percent and South Korea at 4.63 percent. Secondly, Cambodia owes close to 65% of its debt to China. Do you have a new idea that could help transform the Open Development Cambodia (ODC) website? “Some countries owe up to 200%, 300% or 500% of their GDP,” Hun Sen said. The latest payment from China came last week in the form of a $500 million loan for … China is Cambodia’s biggest aid donor and investor, pouring in billions of dollars in development funds and loans through its Belt and Road initiative, which aims to bolster land and sea links with Asia, the Middle East, Europe and Africa. Science and technology policy and administration. Cambodia owes China more than $4 billion—two-fifths of its outstanding national debt according to some estimates. TOPICS: COVID-19 microfinance. China was battling the worst of the virus when the Cambodian strongman arrived to show his support -- the first foreign leader to do so since the outbreak. Last year, China wrote off Cambodia's $89 million debt – it forgave a far smaller Khmer Rouge-era $4 million debt in 2010. In … Cambodia’s Prime Minister Hun Sen (L) extends a hand shake to China’s President Xi Jinping before a meeting at the Great Hall of the People in Beijing (November 7, 2014). Authors: Veasna Var, UNSW Canberra and Sovinda Po, ECNU. The latest payment from China came last week in the form of a $500 million loan for post-flood infrastructural development. Cambodia has drawn closer and closer to China over the last two decades. We will gladly help you. Please make sure the resources are in the public domain or fall under a Creative Commons license. Author: Milford Bateman, Nithya Natarajan, Katherine Brickell and Laurie Parsons. From Africa to Asia and even in South America, the issue of the Chinese debt trap associated with China’s no strings attached aid and loans have often become news headlines. The joint report estimated Cambodia’s debt to countries at about 28 per cent of gross domestic product for both 2011 and 2012. Have you found a technical problem or issue on the Open Development Cambodia (ODC) website? Cambodian debt to China now stands at $4 billion, 35 percent of last year’s gross domestic product and more than half of the country’s total outstanding debt to foreign donors, according to a senior government official. The Cambodian economy has undoubtedly been on a roll over the last decade. Image: Twitter/Bilaterals.org. China is far from the first country to be accused of using debt to bully poorer nations. This is in contrast to the 72% and 34% increase respectively in neighbouring Laos and Cambodia over the period. News article summaries are extracted from their sources, as guided by fair-use principles and are copyrighted by their respective sources. Otherwise, in the event of a default, Cambodia will end up becoming the colony of China. In extreme cases, recent evidence from Cambodia highlights how indebted rural households will even choose to become debt-bonded labourers on one of Cambodia’s proliferating brick kilns in order to avoid default and the concomitant land loss (Brickell et al. Hun Sen said Chinese loans were low interest and long-term, and that overall debt remained low, at 21.5% of gross domestic product (GDP). The debt dispute between Cambodia and the US certainly plays to Beijing's favour. “For Cambodia, we maintain our sovereignty in borrowing, we borrowed according to the projects we need, and China respects our decision.”. An additional, but most frequently resonated, concern is the potential debt trap posed by the BRI. Cambodia and the United States have been negotiating the debt since 1995 but have failed to come close to an agreement. Cambodian debt to China now stands at $4 billion, 35 percent of last year’s gross domestic product and more than half of the country’s total outstanding debt to foreign donors, according to a senior government official. The third world debt crisis, beginning with the OPEC oil shock of the 1970s and culminating in mass write-offs 30 years later, saw largely Western countries in the frame. Photo: LICADHO (Cambodian League for the Promotion and Defense of Human Rights) April 30, 2020. Reporting by Prak Chan Thul; Editing by Robert Birsel. As COVID-19 wrecks Cambodia’s economy, workers and families face added risks from record-high levels of microfinance debt. Trade between Cambodia and China totaled US$4.8 billion in 2016, compared to $732 million in 2006 and has increased by an average of 26% for the last 10 years. China To Forgive Cambodia’s 2010 Debt. China has pledged to help Cambodia if the EU withdraws the market access, Hun Sen said in April during a visit to Beijing. Sok Sidon - November 5, 2010. Site users are encouraged to do additional research in support of their activities and to share the results of that research with our team, contact us to further improve the site accuracy. Refugees heading to Phnom Penh in 1975. The crippling 1997 Asian Financial Crisis prompted Asian economies, including China, to build up foreign exchange reserves as a safety net. Many of the new Chinese businesspeople arriving in Sihanoukville are here to take advantage of a new China-Cambodia tax-free economic zone. Government Debt to GDP in Cambodia is expected to reach 31.00 percent by the end of 2021, according to Trading Economics global macro models and analysts expectations. “The European [Union] countries are having an economic crisis, and its 27 members are struggling, so we only have China,” Cheam Yeap, chairman of the National Assembly’s commission on Economics, Finance, Banking and Auditing, said on Monday. The trend will continue in 2021. “China agreed to cancel…the debt that [we] are on deadline to pay China in 2010,” he said. China’s debt trap, also called debt-trap diplomacy, is a topic of significant interest which has gained increasing attention in recent years. Something's gone wrong, Please Resubmit the form! A new China-Cambodia trade pact will not provide Phnom Penh the economic lifeline it needs amid the Covid-19 pandemic. The economy of Cambodia currently follows an open market system (market economy) and has seen rapid economic progress in the last decade. The debt dispute between Cambodia and the US certainly plays to Beijing's favour. Debt bubble: Kenya’s debt to China stood at $737m in 2014, the first year of President Uhuru Kenyatta’s presidency, before ballooning to $6.4bn in December, representing a 766% increase. Cambodia Government Debt to GDP - values, historical data and charts - was last updated on March of 2021. China remains Cambodia’s primary moneylender, with some 40 percent of its $7.6 billion having been loaned by the Chinese government, according to official figures. China has also made a flurry of economic agreements in recent years, including a deal to allow Huawei to build Cambodia’s 5G network. The United States lent Cambodia’s anti-Communist regime $274 million in … Both Tajikistan and Cambodia are among the seven countries whose debt to China amounts to more than 25 percent of their national GDP. The southern coast of Cambodia is now home to $4.2bn worth of power plants and offshore oil operations all owned by Chinese companies. Many of these projects are financed with Chinese loans – as of the end of 2018, Cambodia had … By accessing this ODC website or database users agree to take full responsibility for reliance on any site information provided and to hold harmless and waive any and all liability against individuals or entities associated with its development, form and content for any loss, harm or damage suffered as a result of its use. PHNOM PENH (Reuters) - Prime Minister Hun Sen dismissed on Thursday fears that Cambodia was falling into a Chinese “debt trap”, saying its loans are low interest, low risk and were not a threat to national independence. We will review any map data, laws, articles, and documents that we do not yet have and see if we can implement them into our site. Speaking at a Future of Asia conference in Japan, Hun Sen said China respected Cambodia’s sovereignty when it came to using Chinese loans. The economy of Cambodia currently follows an open market system ... (a slowdown in the US economy and lifting of safeguards on China's exports). Even in Cambodia wants to borrow more funds it needs to diversify the sources. According to the finance ministry, Cambodia owes China more than $4 billion, or about two-fifths of the country’s outstanding debt. Meanwhile, trade between Cambodia and China has risen rapidly in recent years, amounting to $6 billion (€5.4 billion) in 2017. According to the World Bank, Myanmar's outstanding debt to China was $3.34 billion at the end of 2019, down 26% from the end of 2015, right before the NLD government came to power. Information is publicly posted only after a careful vetting and verification process. A senior US Embassy official in Cambodia has warned Cambodia over its growing closeness with Beijing. A few days later, China promised Cambodia another $600 million in aid and loans. Disclaimer: Open Development Cambodia (ODC) will thoroughly review all submitted resources for integrity and relevancy before the resources are hosted. 2018). The EIU forecasted a rapid rise in Cambodia’s external debt in the next few years, according to Chanco. To learn more about the system architecture, read our documentation. He added that Cambodia’s total amount of outstanding debt has reached $7 billion, a figure that includes $1.8 billion in debt to Russia and the US that was accumulated in the 1970s and 1980s…. Debt relief measures by micro-loan providers in Cambodia are failing to alleviate the serious financial burdens on indebted families affected by the Covid-19 pandemic. Related Posts Prime Minister Hun Sen dismissed on Thursday fears that Cambodia was falling into a Chinese "debt trap", saying its loans are low interest, low risk and were not a threat to national independence. As Hun Sen tests the new Trump administration, Cambodia-China relations are booming. China is now Cambodia’s largest military benefactor and provider of development aid and foreign investment, having given about US$3 billion in concessional loans and grants to Cambodia since 1992. This is an extremely dangerous situation to be in. In the long-term, the Cambodia Government Debt to GDP is projected to trend around 33.00 percent in 2022, according to … China is now Cambodia’s largest military benefactor and provider of development aid and foreign investment, having given about US$3 billion in concessional loans and grants to Cambodia since 1992. We will be glad to hear it. ODC makes no representation or warranty, either expressed or implied, in fact or in law, with respect to the accuracy, completeness or appropriateness of the data, materials or documents contained or referenced herein or provided. China's share of external debt in Myanmar fell to about 30% in 2019 from nearly 45% in 2015. A Chinese Embassy spokesman said yesterday evening he was too busy to comment. There is debate about the extent of the threat posed by China’s role in the region. Cambodia ($5 billion in China finance commitments) faces similar potential benefits, but the majority of its intact landscapes (84%) are already under protection, limiting the opportunity to find suitable locations to efficiently and ethically implement traditional debt-for-nature swaps. All quotes delayed a minimum of 15 minutes. Human rights groups decried Cambodia's establishment this week of a China-style internet gateway that would allow all online traffic to be controlled and … Our Standards: The Thomson Reuters Trust Principles. The amount of money Cambodia owes China has been growing steadily in recent years. Despite these mounting concerns, Cambodian Prime Minister Hun Sen has reassured his people that Cambodia would not fall into China’s debt trap and that the country would stand to significantly benefit from China’s Belt and Road Initiative (BRI). The median loan debt in Cambodia is now at $3,370 per household, the highest average for small loans in the world. Cambodian workers owe $10 billion in microfinance debt as COVID-19 wipes out incomes. Cambodia, Sri Lanka and the China debt trap 18 March 2017. Speaking after the meeting, government spokesman Khieu Kanharith said that the $4.24 million debt China has agreed to write off was the sum Cambodia was due to repay this year. This website is built on WordPress using the JEO Beta theme and CKAN as back-end for structured data. Trade between Cambodia and China totaled US$4.8 billion in 2016, compared to $732 million in 2006 and has increased by an average of 26% for the last 10 years. Of course, Cambodia is already heavily indebted to China -- it owes around $4.5 billion, accounting for about 40% of its total foreign obligations. According to the World Bank, Myanmar's outstanding debt to China was $3.34 billion at the end of 2019, down 26% from the end of 2015. Do you have questions on the content published by Open Development Cambodia (ODC)? June 27, 2019 As policymakers and commentators debate the significance of how much money Cambodia owes to China – now close to $5 billion – the World Bank’s latest economic update paper reveals something potentially more serious: Cambodians themselves are increasingly dependent on … It is certainly in US interests to settle the Cambodian debt as soon as possible. The latest appeal by Cambodian Prime Minister Hun Sen likely stems from the Cambodian People’s Party’s (CPP) anxiety about its popular support ahead of the 2017 local government election. As a small, poor and insecure state surrounded by two bigger, historical enemies, Cambodia needs China as … China’s taking over Laos’ electricity sector in lieu of paying debts has shown other regional countries the risks of BRI debt traps, few of which are as vulnerable as Laos when it comes to resisting Chinese pressure and defending their financial and economic independence. China buys U.S. debt for the same reasons other countries buy U.S. debt, with two caveats. For example, China has proposed a plan to “develop over two million kilometers of national expressways [in Cambodia] by 2040”, which would cost an estimated $26 billion and could leave the Kingdom significantly more in debt to China. Even in Cambodia wants to borrow more funds it needs to diversify the sources. A 2016 International Monetary Fund (IMF) report showed that Cambodia’s external multilateral public debt is now at US$1.6 billion, while its bilateral public debt with China is US$3.9 billion — 80 per cent of this is owned by China. That median amount was $200 in 2004 and $1,000 in 2014. China continues to draw Cambodia closer into its orbit through the provision of aid, grants, and loans, all of which appear to be condition-free. Posted in Article, Window on Asia. China's debt jumped by 335 per cent of GDP. At the present moment, Chinese loans to Cambodia are equivalent to 20% of its GDP! In Cambodia, even debt-free roads lead to more Chinese influence. Global debt is equal to 355 percent of global GDP. This is an extremely dangerous situation to be in. “I’ve heard so many people saying that Cambodia may fall into China’s debt trap,” Hun Sen said. China’s debt trap, also called debt-trap diplomacy, is a topic of significant interest which has gained increasing attention in recent years. Secondly, Cambodia owes close to 65% of its debt to China. The European Union, which accounts for more than one-third of Cambodia’s exports, including garments, footwear and bicycles, in February began an 18-month process that could lead to the suspension of special market access for least developed countries because of human rights violations. Cambodia’s public debt was $7 billion as of last year, according to the Ministry of Economy and Finance, and the country had repaid 19 percent of it. Do you have resources that could help expand the Open Development Cambodia (ODC) website? In two different speeches in February, Prime Minister Hun Sen said Cambodia would borrow $302 million from China for roads and irrigation systems, and would apply for an additional $500 million for similar construction. Written on 18 April 2019. The EIU forecasted a rapid rise in Cambodia’s external debt in the next few years, according to Chanco. Countries are going into greater debt to support companies and workers. From Africa to Asia and even in South America, the issue of the Chinese debt trap associated with China’s no strings attached aid and loans have often become news headlines. Cambodia owes China more than $4 billion—two-fifths of its outstanding national debt according to some estimates. Cambodia has for years come under criticism for human rights violations and other problems but Western countries hoping to see improvements have little leverage when China can be counted on to help in the event of Western aid cuts. However, ODC cannot guarantee accuracy, completeness or reliability from third party sources in every instance. According to the finance ministry, Cambodia owes China more than $4 billion, or about two-fifths of the country’s outstanding debt. The figure is significantly higher than the combined multilateral debt owed to institutions such as the World Bank and Asian Development Bank. 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China is now Cambodia’s largest military benefactor and provider of development aid and foreign investment, having given about US$3 billion in concessional loans and grants to Cambodia since 1992. … However, Cambodia has a significant trade deficit with China, importing over $3.9 billion (raw fabrics being the largest constituent) compared to its exports of $830 million. Cambodia Appeals to Trump to Forgive War-Era Debt. China ordered a punitive invasion of Vietnam after it invaded Cambodia in December 1978 and forced the Khmer Rouge out of Phnom Penh, causing Beijing to lose its proxy state. The jobs left over for locals are tough and dangerous. Cambodia has refused to repay … As Hun Sen tests the new Trump administration, Cambodia-China relations are booming. PHNOM PENH (Reuters) - Prime Minister Hun Sen dismissed on Thursday fears that Cambodia was falling into a Chinese “debt trap”, saying its … See here for a complete list of exchanges and delays. At a meeting in the capital, Michael Newbill, the embassy’s chargé d’affaires, said incurring substantial debts to China has had negative impacts on other countries…