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Wednesday, November 07, 2007

Political Links Influence Way Of Doing Business In Cambodia

PHNOM PENH, Nov 7 (Bernama) -- A study on the investment climate in Cambodia undertaken by the World Bank showed that companies with links with political leaders and organised crime have more influence over business regulations in the country.

Charis Woerffel, social research director of Indochina Research which is carrying out the study for World Bank, said initial results from 100 respondents showed they are also influenced to a lesser extent by business associations and foreign firms operating in Cambodia.

Asked who have less influence on them, the respondents, mostly small companies, mentioned international development agencies, said Woerffel at the Cambodia Investment, Trade and Infrastructure Conference here today.

But she was quick to point out it was preliminary results as they have only interviewed 100 of the targeted 500 firms operating in Phnom Penh, Seam Reap, Sihanoukville, Kampong Cham and Battambang.

The selected firms are in the garment, tourism, retail and trade industries, she said.

On a positive note, Woerffel said the respondents wanted to invest more in the next three years but also cited concern over corruption, anti-competitive issues and high electricity tariffs.

Senior partner of Sciaroni & Associates, Brett Sciaroni, described Cambodia as the "best kept secret" of Asia desite some rating agencies and international development agencies giving it poor marks.

"There is a lot of potential in the country. With all the poor reports and rankings, the country still attracts interest and that is why we have 600 participants today, more than double the number two years ago," he said.

One of the main reasons for the foreign interest was political stability, Sciaroni said, adding that the current government has been in office for some time and likely to win the mandate again in the election next year.

"There are little changes to the ministries and the ministers are the same. So there is not much swing in policies," he said.
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Cambodia Buys 9 Chinese Patrol Boats

PHNOM PENH, Cambodia — Nine Chinese-built patrol boats intended to combat smuggling and other crimes arrived in Cambodia Wednesday.

Cambodian Defense Minister Tea Banh, who declined to reveal how much the boats cost, presided over a ceremony in which Cambodia received the boats from China.

Chinese Ambassador Zhang Jinfeng spoke at the ceremony at the coastal city of Sihanoukville, some 185 kilometers (114 miles) southwest of Phnom Penh but did not address the details of the deal.

Aside from combating crime at sea, the defense minister said the boats will be used to protect Cambodia's "natural resources" _ an apparent reference to recently discovered offshore oil.

In 2005, China provided six patrol boats to help the impoverished Southeast Asian country combat maritime crime. China has provided Cambodia with hundreds of millions of dollars in grants and loans in recent years.

Zhang said Chinese engineers will help train Cambodian naval personnel and assist in the maintenance of the vessels for two years.

"I hope that these sophisticated machines will increase (Cambodia's) capacity for cracking down on drug smuggling, trafficking activities and pirates, and in patrolling the sea border," she said.

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Cambodia's retired King Sihanouk supports ban on cluster bombs

PHNOM PENH, Cambodia: Cambodia's retired King Norodom Sihanouk, whose country remains littered with live explosives after decades of war, expressed support Wednesday for a new international treaty banning cluster bombs.

He said Cambodians and many other people around the world "have been affected by these man-made calamities" that "can and must be stopped."

Cluster bombs and shells are dropped from aircraft, fired in rockets or shot from artillery. A single round can spread hundreds of small, deadly explosives over a wide area. They can kill indiscriminately during an attack, but often fail to detonate and remain a threat to civilians long after fighting ends.

An estimated 4 million to 6 million unexploded weapons, including cluster bombs and land mines, remain buried in Cambodia after more than three decades of conflicts.

Sihanouk, 85, posted a statement on his official Web site saying he supported the Feb. 23 Oslo Declaration that launched a process to conclude a global treaty on cluster bombs in 2008.

"It is important that actions against these weapons be accompanied (by) commitment, dedication and patience to achieve the complete eradication of this cruel form of warfare," he wrote.

Sihanouk abdicated the throne in favor of his son Sihamoni in 2004 but is still revered by most Cambodians.
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Cambodia PM: Speculation Over Oil Fortunes 'Premature' - AFP

PHNOM PENH (AFP)--Prime Minister Hun Sen said Wednesday it was "highly premature" to estimate how much oil Cambodia might hold in undersea reserves, blunting earlier optimism that a petroleum windfall could pull the country out of poverty.

Officials had forecast that oil production could begin as early as 2009.

Block A alone, where Chevron (CVX) has exploration rights, was said by some petroleum officials to reportedly hold as many as 500 million to 700 million barrels of oil.

But to date no reliable reserve figures have been released and Hun Sen adopted a cautious approach towards any potential oil revenue.

"There has been much speculation about the extent of the petroleum resources of Cambodia. All I can say is that much of that speculation is highly premature, " he told a biannual investment and trade meeting.

"The ultimate extent of our petroleum resources is very much unknown," he added.

Following the discovery of oil two years ago by the U.S. energy giant Chevron, Cambodia was quickly feted as the region's next potential petro-state, sitting on an estimated hundreds of millions of barrels of crude, and three times as much natural gas in six blocks located off of the coast.

Chevron, the most active of several firms preparing to further probe the fields off of Cambodia's coast, remains mum, saying only that its test wells have found that the oil and gas is "dispersed rather than located in one core field," according to a spokesperson.

Still, Hun Sen said the government was in discussions with investors about constructing a refinery in the coastal town of Sihanoukville, which will likely become the hub of any Cambodian oil sector.

"In case this project is finalized, the oil refinery plant will be in operation in 2010," he said.

Hun Sen again downplayed concerns that any oil revenue would evaporate in Cambodia's corrupt bureaucracy, echoing his earlier statements that a petroleum bonanza would not be a "curse" for the resource-rich country, which despite its natural wealth remains of the world's poorest.

"Revenues from those resources will enable Cambodia to self-finance productive investment in order to reduce poverty and promote economic growth," he said.

While GDP growth estimates remain some of the highest in the region at around 9.5% , nearly a third of Cambodia's 14 million people survive on only 50 U.S. cents a day or less.

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Cambodia landmine clearance pushed back 10 years

PHNOM PENH (AFP) - Cambodia, one of the world's most heavily landmined countries, will not be clear of the devices until at least 2020, Prime Minister Hun Sen said Tuesday, adding another decade to demining efforts.
Although the government expects to increase its mine-clearance budget, Hun Sen said projections made in 2000 that the country would be clear 10 years later were "over-optimistic".
"At the time, we said we'd be clear by 2010, but now Cambodia will take about 10 years more", he told an annual meeting on demining efforts, without explaining why.

Hundreds of people are killed or maimed every year by the millions of mines and other unexploded ordnance still littering the countryside after decades of conflict.

Several foreign demining groups have worked with the government's own ordnance agency since 1992 to clear the minefields. But the work is extremely slow, and roughly 2,900 square kilometres (1,119 square miles) of land remains covered with mines.

Earlier in the year Hun Sen said landmines were one of the biggest obstacles to the country's development, and on Tuesday urged the United States to sign the Ottawa Treaty, an international landmine ban.

The United States is responsible for a large proportion of unexploded bombs and other ordnance still being found in much of the countryside after its massive bombing campaigns in Cambodia during the early 1970s.

"It's true that the US has not signed lots of treaties, including the landmine ban... we appeal to the US to work on issues related to the safety of the world", Hun Sen said.

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Cambodia facing uneducated future

"The teachers asked me to stand up," she sniffs. "Sometimes I was ordered to stand for 30 minutes or one hour, just because I didn't have money."

It is something Pich Dy does not have to worry about anymore. At the age of 14, she has dropped out of school and is unlikely to return. Her hope that an education would give her a better future has been dashed.

The story could have come from any poor community in Cambodia. All over the country, teachers' demands for "informal fees" are forcing children to quit classes because their parents cannot afford to pay.

Seng Hong of Education Partnership, an umbrella grouping of Cambodian education organisations, says research shows sending one child to school uses up almost a tenth of the average family income.

"This increases if the family have two or more kids to send to school," he says. "Then they may reconsider which kids should go to high-grade education and which kids should stop."

Justifiable expense?

In many respects, Cambodia is doing remarkably well at school. Registration rates for primary school are high, at about 90%, and in the countryside yellow-washed school buildings are some of the most noticeable landmarks.

Before and after classes, the surrounding roads are packed with white-shirted students, most of them sharing bicycles or walking along the red dirt roads. The numbers dwindle, however, as the students get older.

Cambodia's Ministry of Education has recognised the scale of the problem. The department's Bou Chum Serey has estimated that half of those who start primary school fail to complete their classes.

Poverty is the main factor. The schools are supposed to be free, but in reality they are a major drain on family resources. With about one-third of Cambodians living on less than 50 cents (25p) a day, it can be difficult for parents to justify the expense.

That was certainly the case for Pich Dy's mother, Sophal. She lives with her five children in the community of Boeng Salang, on the outskirts of Phnom Penh.

During the rainy season the area is flooded, leaving many of the ramshackle houses semi-submerged in murky brown water.

Sophal's husband died of Aids, leaving her HIV-positive and struggling to cope.

Like many others in Boeng Salang, she gets by on what she can earn from collecting bottles and cans on the streets. It was not enough to cover the "informal fees" for Pich Dy's teachers.

"When my daughter was smaller I had to pay a few cents a day for school," recalls Sophal.

"As she grew up, I had to pay more - almost 25 cents a day. We had no money, so she had to quit and come scavenging with me. I want the authorities, especially teachers, to help children - not take money from them."

Supplementary income

The teachers, however, have problems of their own. Before Cambodia's decades-long civil war, they were highly valued and relatively well-paid.

Now teachers live close to the poverty line themselves, earning as little as $30 a month.
"The salary barely only covers utility payments like water and electricity. There's nothing left to spend on anything else," claimed one teacher in Phnom Penh, who did not want to be named.

She admitted that she and her colleagues took money from students - for test papers, course materials, or simply for attending class. It was the only way they could earn a living.

Another teacher in nearby Kandal province supplemented his income by driving a motorbike taxi, and saw informal fees simply as a matter of survival.

"Students have many problems, teachers have many problems, people in our communities have many problems," he said.


Limited chances

For the enforced drop-outs in Boeng Salang, it comes as little comfort to hear that teachers are also struggling to get by.

All 15-year-old Srey Mom knows is that her hopes for the future have been thwarted.
"I cried when my mum said we had no money to send me to school," she remembers. "With an education, when I grow up I could have a job. All I can do now is make half a dollar from scavenging."

The scene at Boeng Salang speaks for itself - dozens of school-age children play in the filthy water when they might be expected to be in class. The situation is similar in other parts of the country.

Everyone seems to agree that the best way to change the situation is to raise teachers' pay, but there seems to be little chance of that happening quickly.

Cambodia still depends on overseas donations for about half the national budget, and the teachers will continue to rely on their students to top-up their salaries.
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