Cambodia will repay a debt of several million dollars owed to a French company that leased three aircraft to the defunct national carrier Royal Air Cambodge, Prime Minister Hun Sen said Tuesday in Kandal province.
Hun Sen said the airline owed $32 million to several companies when it ceased operations in 2001 and that he had asked the Finance Ministry to pay the outstanding charges on the rentals from Avions de Transport Regional, now part of European Aeronautic Defense and Space Company.
He also blamed poor management for the company’s difficulties.
“Our Royal Air Cambodge died several years ago [in] bankruptcy,” he said. “Whenever they started the engine, it made no profit. They always rang for dollars, dollars, dollars,” he added.
He said that the repayment agreement was reached during discussions with French President Jacques Chirac in September, and that the debt was being paid to avoid lawsuits.
The prime minister also encouraged those interested in starting new air carriers in Cambodia but warned that they would be responsible for their own profits or losses.
Civil Aviation Secretariat Cabinet Chief Him Sarun confirmed that the Finance Ministry had so far paid $760,000 of the $3 million owed to ATR. Further payments will be made every six months, with the next installment in June, he said.
Cheam Yeap, chairman of the National Assembly Finance and Banking Commission, said the Assembly had budgeted $22.5 million for all government debt payments for 2006.
“All borrowing and lending shall be done according to the law,” he said.
French embassy spokesman Laurent Lemarchand welcomed the news.
“We only knew that discussions on resolving this old disagreement were underway,” he said. “A resolution to this disagreement, if it is confirmed, would be excellent news.”
Royal Air Cambodge began operating in 1993 but ceased operations after a parent company took back the carrier’s only remaining aircraft in October of 2001.
The company suffered its most public embarrassment in July of 2000 when a plane that then-King Norodom Sihanouk was preparing to board for a flight to Beijing began pouring fuel onto the tarmac at Phnom Penh International Airport.
