The government has postponed a top-level meeting with its foreign donors scheduled for November, a move that comes just over a week after a displeased World Bank revealed its decision to freeze all future loans to Cambodia.
In an Aug 17 letter to World Bank country manager Qimiao Fan, Finance Minister Keat Chhon asked the Bank to inform the country’s donors that the Cambodia Development Cooperation Forum would be postponed indefinitely.
Held roughly every 16 months, the Forum is a chance for donors to assess the government’s progress on development targets on everything from school enrollment rates to anti-corruption reform, and to pledge their financial support for the coming year.
Cambodia’s donors pledged a total of $1.1 billion in 2010, just under half the government’s annual budget.
“While the Royal Government and development partners had been preparing for the [Forum] …new developments emerged on the global economy and the state of development partnership that warrant consideration,” Mr Chhon said in his letter, a copy of which was obtained yesterday.
The finance minister said the economic slowdown affecting many of the country’s donors had mired their public finances in “crisis,” and that ongoing efforts to reform the delivery and management of development aid to Cambodia were “still way off.”
“The Fourth High Level Forum on Aid Effectiveness is approaching,” Mr Chhon wrote.
“Yet overwhelming number of development partners and partner countries are still way off from agreeing on a set of commitments toward strengthening and improving the quality of development partnership with partner countries, including reforming the manner development assistance is delivered, managed and executed,” Mr Chhon said.
“On this basis, the Royal Government of Cambodia decided to postpone the conduct of the Fourth Cambodia Development Cooperation Forum to a later date.”
CPP lawmaker Cheam Yeap, chairman of the National Assembly’s Economy, Finance, Banking and Audit Committee, conceded yesterday that the delay to the donor meeting would hurt, but added that the government had reserves to make up for at least some of the funding donors might pull.
He denied that the decision to postpone the Forum was related to the World Bank’s move to freeze lending over evictions of poor families from the Boeng Kak lake area.
“I think the government just steps back to think about what promises we have made with the donors,” Mr Yeap said.
At the last Forum in June 2010, Elena Tischenko, country director for the UN Development Program, said that the current setup the donors and government used to monitor progress on their development targets was allowing some key issues to fall between the cracks.
“As a result,” Ms Tischenko said at the time, “areas such as extractive industries, economic land concessions, protection of indigenous people’s land prior to registration…for instance, are not effectively covered or supported.”
Local and international non-government groups have been complaining about the slow pace of government reform in those areas, and more, for years.
Ms Tischenko suggested in 2010 that the government and its donors find a way to improve the set-up and hear back on the progress of those efforts at the next Forum, which would have been this November.
The postponement decision also follows some unusually harsh criticism from donors the last time they met with the government about aid and development targets in April.
At that meeting, which was a precursor to the Forum, the country mission director for the US Agency for International Development, Flynn Fuller, warned the government that the US could freeze aid levels to Cambodia if it passed, in its current form, a draft law aimed at regulating non-government groups.
The draft of the NGO law has yet to make it through the Council of Ministers, though few changes were made to the third and latest version.
NGOs still complain that it would overburden the smallest of them, preclude many grassroots groups from forming, and allow authorities to bar or shut down groups they did not like with little explanation.
Earlier this month, the government suspended one land rights NGO and delivered warnings to two others over allegations that they were “inciting” families to oppose a state-sponsored railway project. More than 100 NGOs have condemned the move, while the Asian Development Bank has publicly stood up for the suspended group.
In his letter to the World Bank, Mr Chhon said lower-level meetings with donors would continue as before, but it remained unclear what effect the postponed Forum meeting would have on present and pending donor projects.
The World Bank declined to comment and referred all questions to the Center for the Development of Cambodia, which hosts the Forums.
Officials at the CDC declined to comment or could not be reached.
Donors were also reluctant to comment on the postponed Forum yesterday.
The US Embassy said it was aware of the decision but declined to answer questions on it.
Embassy officials for Japan, last year’s largest donor, also declined to answer questions about the postponement but said Japan “respects its decision.”