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Rethinking Cambodia’s Foreign Policy towards China and the West

As the US-China trade war appears to be further escalating, Cambodia should rethink its foreign policy towards China and the West.

While Cambodia’s ties with China have substantially improved with time, its relations with the West have reached a new low in the last few years. Its fluctuating relationship with the United States seems to be less amicable, if not worse.

The US has, for example, imposed visa and financial sanctions on some key Cambodian government officials and cut aid commitments, following the dissolution of the major opposition Cambodian National Rescue Party (CNRP) in 2017 and the highly criticised general election in 2018. The US has also frequently voiced its concern regarding the Kingdom’s drift away from democratic values and its worsening human rights record.

Aligning itself with US actions against individuals who were “involved in undermining democracy in Cambodia,” the European Union has also taken harsh measures against the Kingdom in an attempt to reverse the deterioration of democracy and respect for human rights in the Southeast Asian country.

In February 2019, the EU began a six-month period of “intensive monitoring and engagement” as part of an 18-month process which will decide whether or not to continue to grant Cambodia preferential access to the EU market under the Everything But Arms (EBA) trade scheme. Cambodia’s EBA status will be revoked if no concrete measures are taken by the Cambodian government to improve its human rights record in the Kingdom.

The EBA scheme allows Cambodia and many least developed countries (LDCs) to export products, with the exception of armaments, to the EU market duty-free and quota-free. The EBA beneficiary countries of the EBA trade scheme, however, have to respect the principles of core UN and International Labour Organisation Conventions on human rights and labour rights.

Cambodia has economically benefited from the EBA scheme since 2001. In 2018, Cambodia exported roughly $6 billion worth of goods to the EU, accounting for 40% of Cambodia’s overall exports. As of now, the EU is Cambodia’s largest export destination, particularly for the Kingdom’s textiles, footwear, and agricultural products.

While relations between Cambodia and the West, the US, and EU in particular, has become strained recently, Cambodia’s ties with China have strengthened. China has pledged to provide assistance to Cambodia in the event of EBA withdrawal. In January 2019, China promised nearly $600 million in aid to the Kingdom from 2019 to 2021.

On the sidelines of the second Belt and Road Forum in China in April this year, China additionally granted about $90 million in aid to support Cambodia’s defense sector. Beijing has also committed to import 400,000 tons of Cambodian rice and aims to increase investment and bilateral trade with Cambodia.

The two countries, in effect, are engaged in an effective reciprocal relationship which has politically and economically benefited both sides.

While Cambodia has embraced China and helped the Asian giant to expand its local and regional ambitions, China has reciprocated by increasing its political support, concessional loans, and development aid to Cambodia.

China is now Cambodia’s largest foreign investor and donor. China is also Cambodia’s closest ally and largest military benefactor. The two countries have become comprehensive strategic partners since 2010, while leaders of both countries have recently been described as “bestie.”

With increasing pressure and uncertainty from domestic politics and Western sanctions, Cambodia is placed in a position to further embrace China and willingly jump on the Chinese bandwagon. This seems to be a natural and practical course of action for Cambodia because Cambodian Prime Minister Hun Sen may see the value of Cambodia’s close alignment with China amid uncertainty and pressure from the West.

Cambodia’s increasingly close relationship with China, however, should be of great concern. China has always turned a blind eye to Cambodia’s human rights and political rights issues. Aligning closely with China will effectively facilitate the Kingdom’s drift into a one-party authoritarian state.

Cambodia’s increasing tilt towards China has also caused discomfort in the Trump administration, particularly with respect to rumours of a potential Chinese naval base on a 99-year land concession in Koh Kong, a coastal Cambodian province. Although the Cambodian government has repeatedly denied the allegations of the possible Chinese base on its coast, analysts are skeptical of the denial. Obviously, these rumors, true or not, have soured Cambodia-US relations.

The Kingdom’s closer embrace of China, moreover, has important implications for ASEAN. As Cambodia has twice blocked the association from issuing joint statements that condemned China’s growing assertiveness in the South China Sea, given strong Sino-Cambodian ties, the country might continue to protect Chinese interests in exchange for more aid, concessional loans, and political backing. In fact, ASEAN centrality has been under increasing pressure because of the rise of China and Chinese influence in Southeast Asia in recent years.

Cambodia’s close ties with China has invited analysts and critics to describe China-Cambodia relations as a patron-client relationship, with Cambodia generally seen as a Chinese client state. Cambodia’s international image, in this respect, has been undermined.

As a small state with limited capacity and resources, Cambodia has less strategic room to maneuver while its foreign policy dynamics encounter considerable challenges. Despite the challenges, however, it is important that Cambodia balance all major powers and try to sustain good relations with its neighbours, particularly Thailand, Vietnam, and other ASEAN members.

The fact that Cambodia’s foreign policy tends to be heavily oriented towards China at the expense of the West, is not a good thing. Cambodia will likely end up being too reliant on China and become a real Chinese vassal state. This is not to mention another potential issue of concern, China’s debt trap. Thus, it is crucial that Cambodia rethink its foreign policy towards China and the West by trying to strike a healthy balance and adopt flexible diplomatic policies.

An inclusive and sustainable way forward requires Cambodia to carefully and strategically manage its relations with China, the West, and other countries, both in ASEAN and beyond.