Bank Blasts Graft, Proposes $10 Mln in Aid

Concluding a two-day conference, in which World Bank Pre-sident James Wolfensohn repeatedly stressed the need to curb corruption in Cambodia, the Bank on Friday announced a proposed $10 million contribution to the government to help combat graft and assist economic reform.

The grant depends on a 60-day review of a reform program outlined by Prime Minister Hun Sen earlier Friday, according to World Bank development specialist Magdi Amin.

“The grant will be used for trade facilitation, capacity-building for exporters, work on a new law on public concessions and a project to publicize legal decisions,” Amin said.

Earlier in the day, Wolfensohn said the World Bank had reduced its contribution to Cambodia last year from $70 million to $45 million over concerns over large-scale corruption in the awarding of contracts and concessions.

In January, the Bank threatened to withhold assistance from the government if it didn’t repay funds over a scandal involving the misprocurement of motorbikes in a Bank-sponsored military demobilization project. The government subsequently repaid the Bank $2.8 million.

“We want to stick around to see if we can effect change. But let me say this totally unequivocally: There is no basis on which we support any of the extra-legal acts which go on for the benefit of powerful interests,” Wolfensohn said Friday.

But he said Cambodians would suffer if the Bank left. “We have been under a lot of pressure from sources here and increasingly overseas to pull out, but I don’t think that helps,” he said.

In a speech during the conference, Hun Sen laid out his plan for “good governance,” which was hailed by World Bank officials.

“[O]ur vision for a pro-poor trade strategy requires us to review the functions and structures of our institutions,” Hun Sen said.

The detailed speech promised, among others, the simplification of customs procedures, relaxation of licensing and inspections, tax reform, and establishing of a commercial court. The long list ranged from the development of a national physics lab to “revisiting the generous provisions on overtime, nightshifts and holidays.”

Commerce Minister Cham Prasidh said implementation will begin Monday morning.

“I would like to say that I was quite impressed by the purposefulness of the ministers and by the speech of the Prime Minster this morning…it is for all of us to help him to try to do it,” Wolfensohn said.

 

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