For the past 46 months, Keat Chhon has had one of the more difficult jobs in Cambodia.
As the country’s top finance official, he has been in charge of putting policies and laws into effect that have not always been popular with other members of the government. Then he has had to face international donors when those policies failed to be implemented.
With his tenure in the current administration drawing to a close, Keat Chhon on Friday gave his efforts a mixed review, proud of his achievements, but disappointed that some policies failed to draw the political will to enforce them and that most of the country’s poorest have benefited little.
On Friday the prominent CPP member launched an English- and French-language version of his book “45 Months at the Ministry of Economy and Finance.”
The text, published by the Cambodian Institute for Cooperation and Peace, details laws and policies that have been implemented, analyzes the results, and recommends what steps the government still needs to take.
The book reflects the rocky road Cambodia’s economy has had to travel since Keat Chhon became finance minister in October 1994—the first years marked with strong growth, single-digit inflation, steady investment and the passage of key legislation, such as the budgetary and national bank laws; and the final year stagnant.
Perhaps the high point was in early July 1997, at the Consultative Group meeting in Paris, when international donors heaped praise on Keat Chhon’s management “under difficult economic and political conditions”—plaudits that apparently meant a lot to the finance minister.
“I think most successful has been macro-economic stabilization,” the 64-year-old said, adding with a happy laugh: “I dare to say that because during the CG meeting…the International Monetary Fund, World Bank, and Asian Development Bank commended me.”
But with factional fighting that erupted just days later, quickly followed by a regional currency crisis, growth and investment ground to a halt. International aid slowed and the IMF, tired of the government’s failure to end illegal logging, improve revenue collection, and implement other reforms, suspended the remaining installments of its $120 million loan.
Keat Chhon acknowledged Friday that his main problems have been putting into effect the policies he set in motion, especially in the area of revenue collection.
“We need strong discipline in the fiscal and budgetary management, for my part,” Keat Chhon said. “And linked to that, we need to have also a strong political will to overcome illegal logging, the armed illegal logging, the armed smuggling.”
One Western diplomat agreed that Keat Chhon’s main failure has been on the issue of collecting revenues, but noted the government has not always thrown its support behind the policies. “It is not especially his failure,” the diplomat said.
Despite an inability to increase revenue and rein in the logging industry, one economic analyst said Keat Chhon’s fiscal management was “pretty good” given the state of the treasury, and said he dug in his heels to keep the country’s monetary reserves untouched.
“On the whole,” an economic analyst said, “he has been a model of honesty in a sea of corruption.”
What comes next for Keat Chhon is still unknown, although he seemed doubtful when asked Friday if he thought he would still hold his post in the next government. But his advice for the next government is to focus on restarting the country’s economy.
And despite the hurdles, he is optimistic. His book, citing a London economic analyst, forecasts Cambodia’s GDP growth as jumping 3.5 percent in 1998 to a phenomenal 7.8 percent next year, with growth rates averaging 8 percent for the next four years.
But Keat Chhon cautioned that such growth is only possible if illegal logging is curbed and revenues are funneled into the treasury.
“We will have immediately $100 million if there is no evasion, no diversion of resources to private pockets,” he said.
“I hope the next government has a grace period to show the political will to solve these problems.”