The US loses out to China in Cambodia

Beijing offer of no-strings aid to a corrupt administration pays off, writes Asia Sentinel's Sam Campbell

Hillary Clinton's two-day visit to Cambodia Oct 30-Nov 1 could be seen as touching base with an old ally and building links with a future partner. But under the surface a battle for influence is being waged between the US and China in Cambodia, a fight Uncle Sam is unlikely to win.

Cambodia is unique in its dependency on aid, something that countries wanting to influence the kingdom have capitalized on. Since the 1992-3 era of the United Nations Transitional Authority in Cambodia, literally billions of aid dollars have flowed into Cambodia. Donors in June pledged US$1.1 billion for the coming year, up from last year's pledge of US$950 million.

Cambodia has been happy to receive aid, for the most part–basic services like health care and education are still reliant on donor funds, yet schools and hospitals routinely bear the name of high-ranking Cambodians who are happy to take the credit for Cambodia's rapid development (the head of the Cambodian Red Cross, Hun Sen's formidable wife Bun Rany, is a good example)

The US has been one of the main players in the aid game, both through small NGOs and the US Agency for International Development, which funds a wide range of democracy and governance activities.

Yet rights issues, governance, and in particular corruption, remain pressing problems, and some question how much improvement has been made. Attempts to chastise Cambodia over the snail's pace of reforms have ended badly – US ambassador Carol Rodley was blasted last year for remarking that corruption costs Cambodia US$500 million annually, just one of many Western critics slapped down by the Cambodian government.

As regards aid, the contrast between Washington's (and the West's) blustering moralizing and Beijing's circumspect mercantilism is striking.