P AILIN - A barefoot military policeman stood atop a five-meter high mound of gravel,

just off Pailin's main dirt road. He was sorting through a handful of small stones

he'd just picked up.

"Find anything?"

"Mmmm," he frowned, holding up his hand to say "wait a bit."

He worked something around his mouth, then carefully spat out onto his free palm

three sharp crystal-blue sapphires, just like he might have a couple of big grape

seeds, cleaned by his own tongue.

"Tbong," he smiled. Gems.

At the foot of another hill, past a pair of excavators, two water pumps, a separation

cylinder and two conveyor belts - all belching smoke and noisily working - a Royal

Cambodian Armed Forces (RCAF) oldier squatted by a dirty reservoir and compared his

discoveries with a mate. A couple of rough sapphires, one pretty big, and a half

dozen smaller watery-red rubies.

"Would you want to live here?"

"Yes, it's very good," he replied.

He put his stones into a plastic bag, slung a B-40 rocket launcher over his shoulder,

and headed across the moonscape of this typical Pailin industrial gem field. "I

would like to be here. It is very rich."

Very rich.

No-one has scientific data on Pailin's gem reserves, but raw stones have been mined

here since beyond memory and there is no sign they are drying up now. In fact, it's

just the opposite - all the stories that have made Pailin famous are being repeated

this very moment, day and night.

Rubies lie buried in the dirt of the streets. Houses are built on hidden sapphires.

Money can be eked out of the ground seemingly at will, and with luck.

The "big one" - a stone whose carats that can be measured along half the

length of a man's thumb - can make overnight legends. One such legend lives in a

small house on the main street, with 1.5 million baht ($60,000) socked away somewhere

that he got for a big haul in a single afternoon "back in '93."

Soldiers from the 911 regiment - who suffered hard during the recent dry season offensive

against the Khmer Rouge - returned mid-October for a couple of days as Second Prime

Minister Hun Sen's protection force. As they squatted in a field waiting for a helicopter

to return them home they poked around in the dirt for gems.

In the town's center square, in the shade of trees, midday was for small groups to

prospect for stones. Often there would be a soldier or policeman - DNUM or government

- wandering head down, occasionally stopping to sift through rubbishy pebbles and

dirt and coming up with a sapphire or ruby.

Ask a DNUM soldier about gems and he will pull from his wallet a plastic bag containing

his gatherings of the past few days.

Two reporters who asked whether there were a lot of gems in Pailin were promptly

each given a bag containing a dozen or so stones.

Very few locals wear jewelry, such as rings. Certainly none of the men were seen

with rings. The women seem to prefer a touch of gold, but nothing ostentatious.

Everyone seems to have a jeweler's eye. A local can turn over a stone to catch the

sunlight, look at its size and purity, and in seconds grunt a reply whether it's

good or not. Lucky RCAF soldiers who found gems turned to their former Khmer Rouge

enemies to ask for on-the-spot appraisals. The DNUM experts were happy to help.

Pailin locals aren't prone to exaggeration. The proof is scattered all around town

anyway.

"I can't sell my house," said one man, sitting on his porch at dusk, talking

with neighbors about the extraordinary day when Hun Sen came into town. "It

is too expensive. There are tbong everywhere," he said, waving his hand over

a front yard ringed by jungle.

"We used to be paid 500 baht a month up till 1993," explained one DNUM

soldier. Who paid? "Y Chhean," he said.

Payment of cash stopped, he said, though Chhean - indisputably the boss of all that

is Pailin - continues to provide rice and food, though the soldiers say their paymaster

is "the government."

"If it's really necessary, the government will still give us money," said

19-year-old Muot.

The soldiers make money "when we have free time from protection duty" by

finding gems. They say they are allowed access to wherever they wish, even the industrial

sites - about 20, in total, they say - being worked by mainly Thai companies, all

around Pailin and its surrounds.

The soldiers (every man in Pailin is, or was, a soldier, or in what are called protection

forces) seem very content with this way. "Khmer dealers can buy stones off anybody.

Thai businessmen come in from time to time to buy stones from the dealers,"

Muot said.

"On a lucky day you can make millions of baht if you can find a good carat stone,"

he said. One of his friends got lucky - 1.5 million baht lucky - "and now

he is a big dealer, a key dealer of gems in town.

"When we have free days we look for stones. They belong to us," he said.

"The money we make selling stones belongs to us, because we sweat so we deserve

the money.

"My best? I remember making 15,000 baht ($600) in a day."

Nobody seemed to mind that their lives - following what they hope will soon be a

"union" with the government - will inevitably change. "There's nothing

to worry about. If people come they will have money to do business. Let them come,"

said one DNUM soldier. "We'll be happy to work together.

"Before it wouldn't have been possible. We would have shot each other."

The DNUM grassroots, formerly Khmer Rouge, have never enjoyed unfettered year-round

access to their home town Pailin. The town was deserted up till three months ago

and only repopulated since the formation and breakaway of DNUM from the hardliners.

The mist-and -jungle shrouded mountains surrounding Pailin were the havens from war

that were just as much home to these people.

The Thai gem dealers have also only recently come back but there are "not many

vehicles, like the thousands there were before," said one DNUM soldier, talking

about the excavators and bulldozers.

But each night, Pailin is ringed with the glow of powerful lights, and from the roof

of Kaong Kang pagoda the yellow excavators can be seen working throughout the night.

In the bigger fields the machines never stop.

Long Norin, personal secretary of DNUM president Ieng Sary, told the Post that DNUM

only had about ten million baht ($400,000) "in the account". Previously,

80 per cent of Pailin's income was sent to Son Sen, and 20 per cent was kept.

The 20 companies working Pailin's gem fields - most of them from Thailand - are given

short-term concessions at the cost of, according to a chief of one battalion, between

30,000 to 40,000 baht ($1,200 to $1,600). It's not clear whether they had to pay

more in "taxes", but the concessions seem ridiculously cheap.

The site workers said they came from Chantaburi, and had been in Pailin for two months.

Asked how much money they earned, one said: "Ha... I don't know." They

said they had "no problems" with the Khmer Rouge.

An advisor to Hun Sen said that five Thai companies had already approached the Royal

government to renegotiate gem deals with Phnom Penh.

"The deals signed by the Khmer Rouge are not interesting," he said. "They

did them with a short term perspective to get money as quickly as possible. We sent

this matter to the Council of Ministers to try to find better deal."

The appearance of the Pailin fields are like ulcers. Surrounding jungle is stripped

and soil and stone is piled up by excavators, then put through a rotating cylinder

where the stones are washed clean with water from a deep well sunk by workers.

The stones are fed by conveyor belt to two separators - huge table-like structures,

where the smaller stones are isolated by water and vibration.

Huge mounds of barren stones, and cleared, useless land, pock the landscape, and

are easily seen from the air. But so much of the land appears yet to have been touched.

The Thai companies don't hire Khmer labor, but bring in their own workers. "We

don't feel disappointed with the Thais coming here," said one DNUM soldier.

"Since we lease or sell a lot of land to the Thais for them to dig gems, the

Thais pay money to our commander. He uses the money to spend on supplies."

The other big earner in Pailin is timber. "All the trees belong to [Chhean's]

government," said Muot, the soldier. "Soldiers are not allowed to sell

timber to the Thais."

"We have our own logging company," said Norin. "But we can't trade

timber with the Thais since 1993, after the election, when the border was closed."

However, other testimony from around town refutes Norin's. "Yes, the government

sells timber," said one soldier. "The soldiers obey the rules, because

if someone ignores the order, all their equipment will be confiscated."

- (Reported by Matthew Grainger, Christine Chaumeau and Ker

Munthit)