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Cambodia and China’s Belt and Road Forum; By Carlyle A. Thayer

Image Courtesy: Khmer Times / Xinhua

Article No. 22/2019

Courtesy: Thayer Consultancy Background Brief, May 5, 2019.

Q1. What are your general assessments of the outcome of China’s Belt and Road Forum (BRF) for the world generally and Cambodia specifically, in particular in terms of ‘debt-trap’ and neo colonization? At the conclusion of the BRF, China’s President Xi Jinping unveiled at a press conference that more than ‘US$64 billion worth of deals’ were signed during the forum and that ‘283 practical outcomes’ were achieved. We request your assessment of the following issues:

ANSWER: Xi Jinping’s Belt and Road Initiative (BRI) 2.0 is being sold ‘as all things to all countries’. It will be expanded from its initial focus on infrastructure to include much broader cooperation to promote sustainable development along the lines of the UN’s Sustainable Development Goals 2030, including agriculture, environment, health, science, technology and people-to-people exchanges. According to President Xi, the BRI 2.0 will be open, transparent, corruption free and promote connectivity. The Belt and Road Forum ended with a Joint Communique of the Leaders’ Roundtable that was wordsmithed to include all the buzz words – equality, inclusiveness, openness, transparency, corruption free, high-quality, unimpeded trade etc. The Belt and Road Forum was a major attempt by China to rebrand its 2013 BRI and to address some of its notable drawbacks. The BRI 2.0 is an enormous program but the same questions remain: Can the central government in Beijing effectively manage all the projects that have been approved? Can the Chinese government turn rhetoric into reality or will its lofty goals be sacrificed for geo political expediency and short-term gains?

The implications for Cambodia are reassurance that the Chinese aid and investment spigot will not be turned off. Cambodia can count on continued Chinese support for its development without interference in its domestic affairs. If, however, President Xi’s announcement of ‘zero tolerance for corruption’ is effectively implemented, Cambodia could find itself under the spotlight.

Q2. Hun Sen held separate meetings with high-level Chinese leaders on the sidelines of the forum. He met with Wang Huning, member of the Communist Party of China’s (CPC) Political Bureau Standing Committee and Secretariat of the CPC Secretariat; Prime Minister Li Keqiang, and President Xi Jinping. All reassured Hun Sen that the Chinese government will help Cambodia on the EU’s Everything But Arms (EBA) suspension issue by ‘seeking other measures’ to help Cambodia, including further opening China’s market for Cambodia’s exports and encouraging Chinese companies to develop more production lines in Cambodia. Why are the Chinese concerned with the EBA question and keen to help Cambodia on this issue? Do you think that China can really help Cambodia on this EBA issue?

ANSWER: China has always provided diplomatic, political, and economic support to Cambodia ever since the so called coup in 1997 when Hun Sen overthrew his coalition partners. The EBA issue provides Beijing an opportunity to highlight differences between China’s approach to economic engagement with Cambodia and other developing countries with that of the EU and traditional donor states. China professes that it provides economic assistance without interfering in a country’s internal affairs and with no strings attached. China is concerned about the EBA because issue because it must come to Cambodia’s assistance or otherwise be found wanting. In other words, China’s credibility is at stake. If Europe proceeds to withdraw the tariffs for Cambodian exports provided for in the Everything But Arms program, Cambodia will be hurt. Beijing cannot easily divert Cambodia’s clothing and textile exports from Europe to China. In other words, China cannot directly address this issue but only offer compensation in the form of increased market access to other Cambodian goods and increasing Chinese investment in Cambodia. Beijing’s pledge to implement “other measures” will only increase Cambodia’s dependency on China but it will not resolve the problem of textile workers laid off.

Q3. China also pledged to provide Cambodia in 600M yuan (around US$90 million in military aid), according to Prime Minister Hun Sen. Why did the Chinese make this commitment for military aid on the sidelines of the BRF? What are the implications for Cambodia and the Chinese BRI itself? Does this mean that the BRI has military ambitions or a hidden agenda in its economic cooperation platform?

ANSWER: China’s BRI has and remains an ambiguous concept. China censors any references to the BRI as a plan, program or strategy. The BRI obviously includes geostrategic considerations. It is not unusual for China to provide military aid alongside economic assistance. In October 2016, when President Xi Jinping visited Cambodia, for example, thirty-one economic agreements were signed valued at $237 million; at the same time Xi pledged $90 million in military assistance. This was the third highest amount of military aid since 2017; China provided Cambodia with $100 million in military assistance in 2018 and $195 million in 2012. What China’s military assistance to Cambodia signifies, is that the bilateral relationship extends well beyond the economic dimension. China is rewarding Cambodia for its support for its core interests and for participating in the BRI.

Q4. What is your assessment of the future of China’s BRF: Will this so-called ‘economic’ BRF platform eventually be transformed into something like a new UN model with its headquarters in Beijing, just like China’s Asian Infrastructure Investment Bank (AIIB)?

ANSWER: The BRI is President Xi’s signature foreign policy initiative. He is virtually “president for life” so we can expect that China will be involved massively in BRI projects for years to come. The second Belt and Road Forum brought together leaders from around 120 countries and extended China’s reach from Eurasia to Greece and Italy as well as Africa, Latin America and the Pacific. China will seek to reshape the existing international order to take Chinese interests more into account at a time of American unilateralism and protectionism. China does not seek to create a new UN model but a new multilateral structure in which China is a major player and no country can exercise a veto over China’s actions.

[Carlyle A. Thayer is an Emeritus Professor at the University of New South Wales, Australian Defence Force Academy, Canberra. The views expressed are his own. All his background briefs are posted on Scribd.com (search for Thayer). Thayer Consultancy provides political analysis of current regional security issues and other research support to selected clients. The views expressed in this article are of the author.]

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