T HAI Defence Minister General Chavalit Yongchaiyudh's influence in business and politics

along Cambodia's western border is the subject of growing speculation in Phnom Penh.

British environmentalists Global Witness have questioned whether Chavalit is "protecting

and enhancing" the interests of Thai timber companies now cutting wood - illegally

- inside Cambodia.

Those companies are now engaged in a "massive and uncontrolled logging frenzy"

in Battambang, Pursat and Koh Kong provinces, Global Witness alleges.

The firms are dealing with both hardline Khmer Rouge and Ieng Sary's faction - all

"legitimized" by Royal Government rules to control the timber trade, say

Global Witness, though the rules are not being met.

Global Witness, diplomats and international bankers in Phnom Penh are asking "who

stands to profit?" from the sudden resumption of large-scale logging.

Chavalit negotiated and signed the "million meter" timber deal earlier

this year with both Cambodian PMs on behalf of 11 Thai companies wanting to take

timber from Cambodia.

The secret deal was discredited when exposed, pressuring Phnom Penh to assure aid

donors that strict auditing and verification rules would be enforced to ensure that

only "old" logs - those cut before a logging ban came into force - were

exported.

However, the fifth investigation undertaken this month of the Thai/Cambodian border

by Global Witness shows that Thai companies are now cutting fresh timber, and expect

it out and ready for sale by December.

Chavalit, the New Aspiration Party leader who Sept 14 indicated he would take the

Thai prime ministership without waiting for the next election if current leader Banharn

Silapa-archa resigned, "needs money in the fight for the top job," said

one Western diplomat in Phnom Penh.

"This whole [break] with Ieng Sary is all about money," said an Asian diplomat.

Both envoys asserted that Chavalit "steered" Ieng Sary toward Second Prime

Minister Hun Sen.

"Hun Sen [via CPP General Pol Saroeun] was first to Sary. Funcinpec only later

got to Sary through [General] Nhek Bun Chhay. Ieng Sary found that he was being courted

from both sides, and could play off one against the other to get the best deal,"

the Western diplomat said.

Chavalit, said another source, is able to deal with all parties in Cambodia. In addition

to pointing Sary to deal with Hun Sen, Chavalit struck the "million meter"

deal with Funcinpec's Agriculture Minister Tao Seng Huor, and has more than once

received Bun Chhay in Bangkok while the Sary negotiations were moving.

"Assuming everyone is avaricious," said another source, "it becomes

simply a question of where the money was going before, and where it's going now.

"If you assume that much of the business was done on a local level, between

the Khmer Rouge, the Thai military and the RCAF, it makes sense that senior levels

of both [Thai and Cambodian] Governments would want to work out arrangements on how

to control this themselves.

"The ['million meter' deal] was the start of regularizing this border trade,"

he said. "It's inevitable that people are going to make money at this stage

of a country's development."

Global Witness, however, disagrees. "It's too simple to say this trade was localized.

It is worth millions upon millions of dollars, and reaches to the highest levels

of the [Thai and Cambodian] government and military," Simon Taylor of Global

Witness said.

"The Thai firms presently logging in Cambodia have been guaranteed by higher

powers that the wood they're cutting will come out," said Taylor.

"And who's going to gain in all this?" he said. "For the past year,

under US pressure, the Thais seem to have been honest in keeping the border closed.

So the Royal Government has been losing out; the KR have been losing; the Thai logging

companies have been doubly squealing because they've also invested so heavily; and

the Thai military have been losing."

The Government, in its 1997 national budget now being struck by the Finance Ministry

with World Bank supervision, does not expect much income from timber, other than

what little it may make from selling confiscated logs.

"It doesn't take a leap of faith to see that a change of flag - from KR to the

DNUM [Sary's Democratic National Union Movement] - would see this [logging] legitimized,"

Taylor said. "It's at least part of the puzzle.

"And it's very hazy. These Thai companies have spent millions of dollars gearing

up with heavy machinery and big new rest areas. Some are working from Pailin and

Malai [Sary's area] and others with hardliners" under Timber Committee 909,

run by Ta Mok, according to KR passes obtained by Global Witness.

"It's still going to be impossible to verify what logs are coming from where,"

he said.

The Thai loggers were keen to sell new wood to Global Witness investigators posing

as buyers. "They told us they were cutting; we saw all the new machinery; and

it's in their interests to sell fresh cut logs because it's better quality and more

profitable," Charmian Gooch of Global Witness said.

"On what basis do these companies have the confidence to invest so heavily?

Are they looking to Chavalit who was involved in the original 'million meter' deal

to protect and enhance their interests?"

The Royal Government, to keep its committment to aid donors and the IMF, should immediately

revoke all timber deals, the group said.

There had been no committment to ensure that Thai companies confirm their stockpiles

and verify their claims to already-cut timber by August 30, as the government promised

donors would happen. "This is because they can't do it," Taylor said.

Agriculture Minister Tao Seng Huor could not be reached for comment on the latest

claims by Global Witness.