A HALF A BILLION DOLLAR HANDSHAKE

Prime Minister Hun Sen gets warm handshakes at the National Assembly after donors pledged $470 million in Tokyo.

TTHE Cambodian government last week walked away from the Tokyo donors' meeting with

a promise of $470 million in aid over the next year - providing it follows through

with a series of much-publicised reforms.

The multi-million dollar pledge, which is actually slightly more than the government

requested, reflects newfound donor confidence in Cambodia's ability to act, and not

just talk.

But while the money speaks for itself, delegates at the meeting were keen to point

out that the money is not a blank cheque for Hun Sen. Even as the Prime Minister

himself spoke of how much his administration had achieved in "a short time of

just 86 days", the delegates unanimously called for new mechanisms to monitor

the implementation of the reforms.

"The overarching theme throughout the discussions, while noting the considerable

progress made, has been the need to convert commitments into actions and implementation,

in a framework of transparency and accountability" said Ms Ngozi Okonjo-Iweala,

World Bank representative and Chair of the meeting.

The government was positive about the donor decisions.

"The meeting was very successful for Cambodia, and we are very happy because

we have been offered a lot of money for rehabilitation in all areas," said Khieu

Thakvika, government spokesman.

The issues under discussion were familiar ones for Cambodia-watchers; demobilization

of the army, forestry reforms, economic management and rule of law. The World Bank,

which has pledged $75 million over the next year, noted that economic stability had

been largely maintained, despite the 1997 coup and general Asian economic crisis.

However, they said prospects were bleak unless "As a centrepiece to a broad

reform program for economic growth, the government. . . tackles the problem of governance,

and greatly enhances transparency and accountability."

These concerns were reflected by all the donors, especially in the area of demobilization

of the armed forces. The delegates underscored the importance of "closely and

regularly monitored transparency and accountability at every stage of this complex

process, starting with monitoring and verification of the already commenced registration."

Part of the deal agreed by government and donors was a series of quarterly meetings

for the two parties to share information and monitor progress. The format of these

meetings is still unclear, but the first is scheduled to be held at the end of May.

The $470 million pledge is close to the amount pledged at the last CG meeting in

July 1997. However, the actual disbursement of this money was much lower, in part

due to the after-effects of the 1997 coup, with some cdonors pulling out for political

reasons, others delaying projects due to safety or stabiity concerns.

Not all donor nations have yet released final pledges, but by far the largest was

Japan, which promised $100 million, as well as the resumption of Yen loans, which

have been frozen for the last 31 years.

Japan has been a harping point for the opposition Sam Rainsy Party, who have claimed

recently that the country is content to pour aid into the corrupt coffers of the

Cambodian government. But Rainsy himself, who attneded the Consultative Group meeting,

said he was pleased with the remarks of the delegates, and felt that this would be

a watershed for Cambodia.

"The drastic reforms promised by Hun Sen in front of the donors will soon bring

Cambodia to the moment of truth and to a crucial turning point," he wrote in

a February 26 press release. "This regime. . .cannot implement any reforms leading

to the creation of a modern and democratic state without undermining its very foundations

and provoking its entire and final collapse."

The World Bank Chair was a little more sanguine in her remarks at the meeting: "We

know it is a long journey for Cambodia, but as the Chinese say, 'the longest journeys

start with a single step.' Cambodia has, in our opinion, taken that first step. Let

us now assist it to continue steadfastly down the road."