The US announced at the June 11-13 Consultative Group donors (CG) meeting in Tokyo

that it will resume direct aid to the Cambodian Government for the first time in

almost four years.

The US ceased direct bilateral aid to the Cambodian government after the 1997 coup,

but the embassy retained the discretion to provide some direct funding. The resumption

in direct bilateral aid - to be funneled to HIV/AIDS control efforts - is the first

time that discretion has been exercised.

"I am pleased to announce the United States Government plans to enter into an

agreement with the Government of Cambodia to help it control the HIV/AIDS epidemic,"

US Ambassador Kent Weidemann said in his Tokyo CG meeting address.

The US currently spends around $2 million a year on HIV/AIDS programs in Cambodia

but this new agreement could boost that figure to $9 million. Along with three African

nations Cambodia is one of four "f ocus countries" for US HIV/AIDS assistance.

Weidemann hinted that a further loosening of US aid restrictions to the Cambodian

government would be possible if progress was made toward the formation of a Khmer

Rouge tribunal and if the Feb, 2002 commune elections prove to be both "free

and fair".

In his address Weidemann said that successful implementation of a KR trial and commune

elections would "...have the added benefit, we trust, of further easing our

current legal restrictions, providing the United States Government with more flexibility

in assisting the Government of Cambodia in its development programs."

The US offer capped a successful meeting for the Cambodian government which began

with a speech from Prime Minister Hun Sen mixing contrition and boastfulness with

regard to issues including forestry, women's rights, governance and GDP growth.

By the time the meeting ended donors had pledged $560 million, $12 million more than

in 2000. NGOs also indicated that they would provide around the same as last year's

$55 million.

World Bank Chief Bon-aventure Mbida-Essama told reporters on June 15 that the increase

was due partly to a "substantial" donation from South Korea and increased

funding pledges from the US.

But the price paid by Prime Minister Hun Sen for the windfall in increased funding

commitments were expressions of donor impatience with the conduct of the Cambodian

government in fulfilling both donor expectations and meeting the needs of the Cambodian

people

The tone of the meeting was described by Mbida-Essama as "very frank".

Donors had made their level of frustration with the pace of reform very clear.

"Human rights, the rule of law, impunity, governance, corruption, the KR trial

- you name it, everything was on the table," he said.

Chea Vannath, President of the Center for Social Development and a CG meeting NGO

representative, praised the rhetoric employed by donors at the meeting.

"[Donors] did a superb job in raising all the issues," Vannath said. Donors

had also addressed in no uncertain terms the key NGO concern of consultation for

greater NGO and community involvement in government policy .

"The donors used much stronger language [than previous years] in terms of their

demands for implementation," she said.

Vannath said that donors singled out legal and judicial reform for strong criticism

after Hun Sen had acknowledged a lack of progress in those areas in his opening address.

Mbida-Essama said that a number of outstanding issues had been resolved at the CG,

with military demobilization now fully funded after Japan offered to provide $10

million towards the project.

Donors also agreed to fund the commune elections but stopped short of committing

any specific amounts of money. In addition, donors, the World Bank, RGC and private

sector representatives agreed to seek consensus on the controversial new foreign

investment laws by the end of the year.

Progress was also made on the issue of illegal logging after the RGC reversed a threat

not to table the latest Global Witness (GW) report on forest crimes.

In stark contrast to threats in February to have the visas of foreign GW representatives

revoked, Prime Minister Hun Sen lavished praise on the environmental watchdog organization

and described their role as independent monitor of the donor-funded Forest Crimes

Monitoring Unit as proof of his government's commitment to forestry reform.

"[By] selecting our most vocal critic [Global Witness]...testifies to our determination

in stamping out corruption from the forestry sector," the Prime Minister told

the meeting.