Donors Mum On Aid Forum Postponement

Cambodia’s foreign donors are staying largely mum about the government’s decision to indefinitely postpone November’s high-level aid meeting, though one donor conceded that the move had caught it off guard.

Economists also said yesterday that a delay in holding the donor meeting would have little effect, but they worried about what might happen if the forum were put off for too long.

Held roughly every 18 months, the Cambodian Development Co­operation Forum is the most senior meeting between the government and its donors to assess Cambodia’s progress toward re­form targets, to update those targets, and for the donors to make their pledges of aid to the country.

In an Aug 17 letter to the World Bank, Finance Minister Keat Chhon said he was postponing the next Forum, citing the economic slowdown among some of Cambo­dia’s donors and lagging efforts to reform the aid process itself.

The short letter gave no other reasons. But the letter came less than two weeks after the World Bank revealed that it had put an indefinite hold on all future loans to Cambodia to protest a government-approved real estate project that evicted thousands of poor families in Phnom Penh.

Cambodia’s major development partners—the UN, European Union, US, World Bank, Den­mark, Japan and Sweden—have de­clined to comment on the postponement.

The Asian Development Bank, however, said that the postponement would have no impact on its aid to Cambodia because it had just locked into a three-year plan, regardless of this Forum or the next.

“In terms of the ADB’s investment program and other activities in Cambodia, the postponement of the [Forum] will have no effect,” the bank said in a statement yesterday.

“ADB recently launched a Coun­try Partnership Strategy 2011-2013 that describes all ADB projects and activities over these three years, including the annual financial commitments to Cambodia.”

Senior country economist Peter Brimble said the ADB had its own sector-by-sector framework for gauging the success of its projects, taking the Forum’s reform targets into account but focusing more on the government’s own goals.

“It’s our own way of measuring progress,” he said. “The [Forum]… is just one meeting,” he added.

In his letter announcing the postponement, Mr Chhon noted that lower-level meetings with donors, such as the monthly “working groups” that focus on particular sectors, would go ahead as before.

Suzuki Hiroshi, chief economist at the Business Research In­stitute of Cambodia, said there were no laws or rules barring the donors from making their aid pledges outside the Forum.

“Without this kind of meeting, each donor could provide its pledge to the government separately,” he said.

But Mr Hiroshi said losing the Forum was not completely without its drawbacks.

“It means donors will not have a good chance of dialogue with the government,” he said.

A senior official of one donor country said the postponement had caught him and other donors by surprise. “This was not in the pipe­line,” said the official, who spoke on condition of anonymity, as he was not authorized to speak to the media.

“Frankly, we are very surprised and we have to readjust,” he said.

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