Who’s Helping Cambodia Weather COVID-19?

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Who’s Helping Cambodia Weather COVID-19?

In explaining Cambodia’s relative COVID-19 success, it is vital to acknowledge the foreign aid and local donations that have poured in.

Who’s Helping Cambodia Weather COVID-19?

Chinese Ambassador to Cambodia Wang Wentien, left, hands over a donation box to Cambodia’s Health Minister Mam Bunheng during a handover ceremony in Phnom Penh, Cambodia, March 28, 2020.

Credit: AP Photo/Heng Sinith

About six months into the COVID-19 pandemic, Cambodia has not been spared. Although the country has appeared to succeed in controlling the spread of COVID-19 — with just 10 active patients and no reported deaths as of July 8 — its economy is faltering. The World Bank has predicted that Cambodia’s economy will register its slowest growth rate since 1994. In particular, the Kingdom’s GDP growth is projected to drop from an average growth of 7 percent per annum to about 2.5 percent in 2020, and in the worst-case scenario, Cambodia’s GDP growth could fall by between 1 and 2.9 percent.

Despite the economic shock, Cambodia has been fortunate when it comes to fighting COVID-19. The country’s response efforts to contain the coronavirus have been strongly supported by both local donors and international partners. So far, Cambodia has received a variety of foreign aid and local donations to support its battle against the pandemic. There has been technical and financial support from different development partners such as Australia, China, the European Union, France, Germany, Japan, South Korea, the United States, and Vietnam. Russia has also expressed its willingness to assist Cambodia in containing COVID-19. Other international organizations including the World Bank, the Asian Development Bank, the World Health Organization, and UNICEF have also provided both financial and technical assistance to support the Kingdom’s COVID-19 responses. In a sense, Cambodia is blessed with foreign aid and local donations amid COVID-19.

Of all the development partners, China seems to stand out from the rest. Prior to the pandemic, the Asian giant had already invested $7.9 billion in Cambodia within a span of just four years, from 2016 to 2019, as part of its Belt and Road Initiative (BRI). Chinese investment has heavily focused on infrastructure development. For example, China has invested in the construction of a $2 billion Phnom Penh-Sihanoukville expressway, a new international airport in Siem Reap, and a number of Special Economic Zones. Chinese investment has also been concentrated in other areas such as hydropower plants, garment factories, real estate, banking, and casinos. As part of its larger development initiatives, China has encouraged Chinese investors do business in Cambodia, particularly in the Cambodian coastal city of Sihanoukville. The sleepy beach town over the last few years transformed into a glittering gambling hub, before it became almost like a ghost town when online gaming was banned last year.

In the midst of the COVID-19 crisis, China has stepped up its support for Cambodia. In late March, China sent seven Chinese medical experts together with medical supplies to the Kingdom. On April 1, China donated another set of medical supplies; in total, through late April China donated about 16 tons of medical supplies to Cambodia. In early May, the Blue Sky Rescue Team, a Chinese NGO, sent 10 volunteers together with medical supplies to Cambodia. Then, in early June, China provided another batch of medical supplies to the Kingdom.

Meanwhile, in March, China sent 1,000 containers of raw materials to Cambodia to support the latter’s garment industry as supply chains were disrupted amid the coronavirus outbreak. Prime Minister Hun Sen later announced that Beijing would continue to deliver raw materials to Phnom Penh despite the pandemic.

It is important to note that all the Chinese support during COVID-19 might be part of China’s efforts to reduce the growing anti-Chinese sentiments among many Cambodians unhappy with the adverse consequences of Chinese investment on Cambodian society. Chinese aid is also a bid to strengthen Sino-Cambodian ties – a bond China needs to advance its core interests in the region and beyond.

China’s support provided to Cambodia to combat COVID-19 is billed as a friendly gesture and a sign of the solidarity both countries try to show to each other in times of critical needs. For instance, in early February Hun Sen made the headlines with his special visit to China to showcase Cambodia’s support to China during the peak of the coronavirus outbreak.

Thus far, China’s COVID-19 support for Cambodia may arguably have helped to reduce some negative local views toward China over recent incidents linked to Chinese people, such as the collapse of a Chinese-owned seven-story building in Sihanoukville in June 2019 and the various crimes committed by the Chinese nationals living in Cambodia. However, it may also add fuel to the speculation that China has signed a secret deal with Cambodia allowing it to use part of a navy base in Sihanoukville for military purposes. As allegations and speculations have kept resurfacing, Cambodia’s image has been greatly undermined and the country may potentially fall victim to the superpowers’ strategic competition for dominance in the Asia-Pacific.

In addition to the Chinese support to help Cambodia fight COVID-19, China’s major competitors, particularly Japan and the United States, have also increased their engagement with the Kingdom. The Japanese government has pledged $6.3 million for emergency assistance to the Kingdom to support Cambodia’s COVID-19 response measures. Japan’s Cambodian engagement may be grounded in humanitarian consideration; however, it may also be considered as part of Japan’s strategy to balance China’s influence in Cambodia.

Likewise, the United States announced it has committed a total of $11 million to assist Cambodia in fighting COVID-19 and addressing its consequences. Humanitarianism has been one of the central foci for U.S. aid, yet balancing China’s increasing influence in Cambodia is also vital for America’s strategic interests in the Asia-Pacific amid and after the pandemic. What is more, since Cambodia-U.S. relations have been strained by a series of accusations levied by both sides, the recent engagement through aid may have helped to restore and improve their bilateral ties.

For the EU, although it has decided to partially suspend Cambodia’s trade privileges under the “Everything But Arms” (EBA) scheme due to the perceived deterioration of human rights situations in the Kingdom, it has committed 443 million euros (approximately $483 million) in grants and loans to help Cambodia address the social and economic impacts caused by the COVID-19 crisis. Recently, the EU has been criticized by the Cambodian side for its double standards, as it seems to treat Cambodia unfairly. However, the EU’s support for Cambodia during the pandemic appears to demonstrate that the EU may not be practicing double standards but giving credit where credit is due. In other words, while the EU punishes Cambodia for its perceived deterioration of human rights and democratic backsliding, it offers support in times of crisis, regardless of Cambodia’s political developments.

Amid the pandemic, other countries have also pledged to support Cambodia. The German government provided the Pasteur Institutes of Cambodia with $1.6 million for prevention, detection, and response measures to COVID-19. France also provided a grant aid of about $2 million to the Cambodian Pasteur Institutes, while Australia has provided financial, technical, and capacity building support to empower Cambodia’s COVID-19 response project as well. And finally, Vietnam, an emerging middle power, has also supplied medical equipment to assist Cambodia and other countries in containing the spread of COVID-19. Despite being a developing country, Vietnam seems to be trying to challenge China’s mask diplomacy by donating medical supplies to many countries in Europe and Southeast Asia, including Cambodia.

Similar to the support Cambodia has received from many partners, the World Bank has approved $20 million in credit to finance Cambodia’s Emergency Response Project. The credit is used to support the construction of isolation and treatment centers, increase the capacity of laboratories and hospitals to diagnose, isolate, and treat patients, and finance the purchase of medical supplies and equipment needed to combat COVID-19. To support Cambodia’s responses to the pandemic, especially to support small and medium enterprises as well as poor families, the ADB has worked with the Cambodian government to finalize a $250 million loan program. The WHO and UNICEF have also assisted Cambodia in fighting COVID-19 and mitigating risks caused by the pandemic.

In addition to the financial and technical support from development partners and international institutions, Cambodia has received considerable support from various local donors. Notably, King Norodom Sihamoni and the Queen Mother have contributed $2.3 million in separate donations. Many civil servants have volunteered to donate through pay cuts following a call by Hun Sen who, in early April, pledged to donate seven months’ worth of his salary (roughly $17,000) to support the country’s National Committee for Combating COVID-19. Other donors, including civil society groups and tycoons, have also donated to support the government’s pandemic responses.  On top of this, the Cambodian government has also saved approximately $400 million by reducing national expenses to prepare for COVID-19 interventions.

In short, amid the COVID-19 crisis and the potential economic fallout, Cambodia is blessed with generous support from both local and international donors. As a small country with limited resources and power, both soft and hard, Cambodia may not have the capacity to fight COVID-19 alone. The country needs technical, financial, and moral support from all its citizens and development partners. So far, such support has been provided at a time when Cambodia needs it the most. In this respect, in explaining Cambodia’s relative COVID-19 success, it is vital to acknowledge the foreign aid and local donations that have poured in during the crisis.

Moving forward, while trying to cope with the impacts of the COVID-19 pandemic, it is crucial that Cambodia think ahead and plan for the post-pandemic future. The country simply cannot afford to lag behind its neighbors and other countries in the region. The post-COVID-19 world will clearly be a challenging world for Cambodia to bounce back, continue its deep reforms, and strengthen its capacity in all areas.

Kimkong Heng is a Ph.D. candidate at the University of Queensland in Australia. He is a recipient of the Australia Awards Scholarship and a Visiting Senior Fellow at the Cambodian Institute for Cooperation and Peace (CICP).

Len Ang is an Independent Analyst and a Research Associate at the Cambodia Development Resource Institute (CDRI).