The Siem Reap conference highlighted benefits of the rule of law, but where exactly, and to whom, do the rules apply?

COMMENT

JACOB GOLD

THE concept of the rule of law as the key to economic freedom was the guest of honour at the 2009 Economic Freedom Network (EFN) Asia International Conference last week in Siem Reap.

As participants gathered on Friday at the lavish Sofitel Angkor Phokeethra hotel to discuss how failures to protect economic freedoms led to the global financial and economic crisis, armed policemen burned down a village in Oddar Meanchey province.

The land had been subject to a claim by the Angkor Sugar Company since 2008, and that claim was being enforced. After the eviction, 14 dispossessed residents went into hiding, fleeing arrest warrants for “incitement and obstructing the development of Cambodia”. The second charge underscores how “development” in Cambodia can have two different and often contradictory meanings.

The same is true for the concept of “rule of law” being toasted in Siem Reap. Technically, the 100 homes that made up Bos village were situated on what had become someone else’s private property, but the villagers had no say in the transfer of ownership, and notice was not given of the village’s imminent destruction.

The liberalist organisers of the EFN conference, and particularly the Friedrich Naumann Foundation for Freedom, say they are working to create more open, democratic societies. But in focusing solely on an agenda of “economic freedom” – protection of property rights, liberalisation of markets and minimal government regulation — the conference entirely missed the reality : that the convenient rhetorical marriage of capitalism and democracy has been annulled in Cambodia.

It has been easy to advance a rule of law to protect a relatively free practise of capitalism, especially where powerful Cambodian investors are concerned, but a rule of law to protect the democracy has been neglected.

There are some key reasons that Cambodia is not ready for the economic freedom envisaged by the EFN organisers. As Cambodia develops, increases in income and education will fuel a “rising curve of expectation” for a bigger share of newfound prosperity and a larger role in the political and economic process.

What the EFN organisers didn’t ask was, “What if the law tends to limit who is allowed to participate in the economy, and in what way?”

Recent events in the Kingdom have raised questions about the democratic basis of its laws. These include land disputes, factory strikes, student demonstrations and an ongoing debate over judiciary independence. In any country where private property is still emerging as a functional asset and where the pace of development creates a gap between the haves and have-nots, broadening both the distribution of ownership and the accessibility of capital needs to become a priority in order for a term like “economic freedom” to make sense.

And unless Cambodia reconciles the rule of economic law with the rule of civil law, economic development will reach a limit.

The secrecy, impunity and lack of accountability that made the Bos eviction possible will also scuttle any attempt to launch an effective stock market, or develop the insurance industry, or allow mobile-phone operators and airlines to develop a competitive market based on a level playing field. Strong protection of the public good creates a legal framework to keep the private sector playing fairly, not the other way around.