This is a response to Sam Rainsy’s Letter to the Editor Chinese investments in Cambodia: Win-win-lose, and guess who’s the loser published in The Phnom Penh Post on April 30.
Sam Rainsy, president of illegal Cambodia National Rescue Movement, is misleading the world and discrediting Cambodia for its fast development. He is carrying out an anti-China campaign in order to damage the image of China as well as to challenge the legitimacy of the Cambodian government, which has cemented close ties with China. Sam Rainsy is not consistent, does not respect his own words. In his interview with Phoenix Television – a Hong Kong-based broadcaster – in 2014, Sam Rainsy said, “CNRP is an ally of China.”
He even firmly expressed his support of “China’s assertion of sovereignty” over the South China Sea and “CNRP stands with China”.
China is not a threat to Cambodia and the region. The rising China has benefited and will continue to generate opportunities for the whole world. Cambodia has the advantage in seizing the opportunities due to geographical proximity to the gravity of economic centre of the world.
The concerns over increasing economic presence and influence of China in Cambodia are legitimate however, and we need to understand that every country wants to build a close relationship with China, particularly with regard to economic interest. For instance, the Belt and Road Initiative (BRI) proposed by China in 2013 is a new catalyst of global growth. BRI is an intercontinental economic venue for more than 60 countries to cooperate and connect.
Sam Rainsy has raised concerns over debt service issue. Let’s apply statistics here. Cambodia’s debt to GDP ratio remains low at 37 percent in 2017– it is below the average ratio for a developing country, which is 40 percent. From 1996 to 2017, the debt to GDP ratio was at 35 percent.
We shouldn’t be too much worried that about the fact that 60 percent of Cambodia’s debt is owed to China. This is due to the economic size of China. Such debt would not make Cambodia become a “province of China”. Instead it will strengthen complex interdependence between the two countries. China has more stakes in Cambodia. Both countries and people will benefit from a bilateral partnership. Historically, China does not pose any threat to Cambodia.
There is little evidence proving that Chinese investments adversely affect Cambodia’s ecological balance. Concerning the hydroelectric power plants, the benefits outweigh the costs. Cambodia needs cheap electric power supply to accelerate economic growth. The cost of electricity has continually dropped to less than $0.20 per kilowatt hour. Energy security is critical for the development of Cambodia. China is the main producer of solar panels. Future cooperation on solar energy will help diversify the sources of energy of Cambodia.
Chinese investments in Cambodia concentrate on labour-intensive industries, particularly the garment sector, which provides about 1 million jobs to Cambodian workers. The current minimum wage is $170 per month. If a worker wishes to work overtime then he or she can earn nearly $300 per month.
The salary rate is relatively higher than that of Laos, Myanmar and Bangladesh. China has started investing more in semi-skilled and skilled manufacturing sector. Technology and knowledge transfer is taking place although at a slow speed. China has a great source of knowledge to transfer to Cambodia as China is pursuing an innovation-led development model.
Chinese aid has significantly contributed to the improvement of the living standard of the local people. For instance, early this year China pledged to provide 100 Cambodian children who have congenital heart disease with free surgery in three years in a program called “China-Cambodia Love Heart Journey”. Every year, China provides about 200 scholarships to Cambodian students to pursue their higher education in Cambodia.
Cambodians should not be afraid of the rising economic presence and influence of China. They need to adapt and explore ways to grasp the opportunities stemming from China’s economic powerhouse. Of course to optimise the benefits from China either through development assistance or trade and investment, Cambodia needs to strengthen its governance and capacity. Both the public and private sectors in Cambodia need to enhance their capacity to better grasp the opportunities generated by China, particularly under the new initiatives such as Belt and Road Initiative and Mekong-Lancang Cooperation Mekong.
Concerning the future areas of cooperation, both countries should focus on innovation, technology transfer, clean energy (solar energy), human resource development (skill development), and digital infrastructure development. The Cambodian people will greatly benefit more from the increasing economic presence, innovation and knowledge of China.
Yara Suos Member of the National Assembly