Donors are likely to set up a fifth and new working group dealing with good governance

and the rule of law when they assemble in Phnom Penh at the quarterly meeting of

the so-called Consultative Group (CG) on April 5-6.

Already four working groups exist. They review progress and deficiencies within the

main areas, identified by donors as crucial to development in Cambodia. The four

working groups, which are convened during the quarterly CG meetings, deal with demobilization,

civil administration reform, fiscal reform and logging.

The possible move to set up a fifth working group signifies an increased donor focus

on broader issues like transparency in the administration, corruption and good governance.

"You can deal with the four main areas as separate issues, but behind them all

really lies the matter of good governance," says British ambassador George Edgar.

He predicts that if a fifth working group is not formally set up, donors and organizations

will issue a joint declaration on the subject, as was the case at the last CG meeting

in October.

Another diplomatic source concurs:

"We are now reaching a point at which each of the issues on the CG agenda has

to be put into its proper broader context. The underlying causes have to be addressed.

If this does not happen, the limited progress which has been made, will not be sustainable,"

says the source.

"But the complexity of the issues which have to be addressed is daunting. Even

a sophisticated government would have great problems doing this, certainly if its

donors, like frogs, are still jumping all over the place."

The CG meeting which is scheduled to run over two days instead of normally one, will

also function as a preliminary meeting before the annual donor summit in Paris in

May.

Recently, the government published its 'Public Investment Program', produced with

assistance from the Asian Development Bank (ADB).

The program, which requests foreign funding of $572 million over a three-year period,

is a guideline to what areas of development the government wants to focus on. However,

the publication mentions very few projects within administrative and judicial reform,

and one donor source says that donors will possibly point out this shortcoming to

the government.

"On the other hand it is also possible that the Cambodian government is relying

on bilateral contributions in this area, which could be why it is not mentioned in

the Public Investment Program," the donor source says.

One issue that may - at least indirectly - play a role in focussing on good governance

and rule of law is the UN-Cambodian negotiations about a Khmer Rouge tribunal. As

the diplomatic source points out, the CG meeting takes place less than two weeks

before the National Assembly will debate the tribunal draft law, and the donor summit

is scheduled only a month after the debate.

"Although many donors will not openly admit that they link aid with credible

trials, most of them probably apply it informally or give the beast a different name,

such as 'lack of progress in the governance sector' or 'limited absorption capacity',"

says the source.

Apart from the extra focus on governance and the preparations for Paris in May, the

CG meeting will address the usual four areas of the existing working groups. Among

them, the donor source points to one lagging behind: Reform of the civil administration.

"It is, of course, a long and complicated process. But at the same time, public

reform is the key to many of the other issues, so it is unfortunate that it is behind

schedule," the source says.

The highest-profile issue on the agenda will undoubtedly remain the matter of demobilization.

Although a pilot program was recently implemented, aiming to demobilize some 1,500-2,000

soldiers, progress in this field has been extremely slow, if not completely absent.

One problem has been securing funding for the project, which seems to have stalled

until donor money becomes available. On the other hand, the diplomatic source suggests

the Cambodian government is still not sure of the intentions and motivations of military

reform. This has donors reluctant to cough up financial support.

"But to be fair, the donors have been less than straight-forward with the Cambodian

government about demobilization. The meetings on demobilization belong to the best

attended in Phnom Penh. Everyone turns out, including military attaches, sometimes

more out of curiosity than out of a will to make a financial contribution if the

right format can be found," says the source.

"These large turn-outs have probably given the government the impression that

many donors were eager to contribute. This is not the case. Demobilization is a highly

sensitive political problem and because of lingering tensions in the country, many

are weary to contribute."