Gov’t Begins Investigation of Rural Development Spending

The Ministry of Finance has formed a special investigative team to probe possible double billing and questionable road-construction activities by the Min­istry of Rural Development.

Finance Minister Keat Chhon reported to Prime Minister Hun Sen in a letter dated Aug 4 that he put on hold a $570,000 disbursement request by the Min­istry of Rural Develop­ment pending the completion of the probe later this month. The funds were to come out of Japanese aid money.

According to the letter, the investigation was prompted when Japanese Embassy officials and an inter-ministerial team last month found that one of the road projects appeared to be built for private use, and two other rural projects bore signs indicating they already were built and perhaps paid for by a German-funded program.

“This finding demands the Ministry of Rural Development to clarify whether there is double financing on the two road projects,” Keat Chhon wrote.

In addition, Keat Chhon ex­pressed concern in his letter that the controversy might cause the Japanese to withhold or reduce aid pledged at the major donors meeting earlier this year.

“The Japanese government has received strong political pressure from the public, especially from political parties,” he wrote. “This could affect Japanese aid, especially the new commitment pledged in February in Tokyo.”

Japan, Cambodia’s largest bilateral donor, has committed about $500 million since 1993 and pledged another $100 million in February.

Japanese Ambassador Masaki Saito said Monday his government needs to be sure the money collected from its taxpayers is not being used for corruption.

“The first thing to do is to find out the truth, what actually happened,” Saito said. “We will decide what we’re going to do after we see the investigation results.”

Several aides to Hun Sen said Tuesday they were not aware of the Finance Ministry probe. “I don’t have any documents on the issues,” said Yin Kim Sean, adviser on rural development, agriculture and environment. “I cannot answer any of your questions.”

In May, the Rural Develop­ment Ministry requested the Finance Ministry disburse the money for six public road projects because, it said, the work was almost complete. In the disbursement requests, the ministry ex­plained it needed the money to begin paying the private companies hired to do the work.

But when Japanese Embassy and government officials toured the sites last month, they found that one of the roads—a 7 km stretch on the outskirts of Phnom Penh—was surrounded by barbed wire and two gates. The team also found that two road-project sites in Kompong Cham province had signs bearing the name of TRIP, a German-funded road improvement program, according to Keat Chhon’s letter.

A Cambodia Daily investigation of the six projects last month found that all of the projects were actually completed two years ago, before Japan had approved them.

nd government officials toured the sites last month, they found that one of the roads—a 7 km stretch on the outskirts of Phnom Penh—was surrounded by barbed wire and two gates. The team also found that two road-project sites in Kompong Cham province had signs bearing the name of TRIP, a German-funded road improvement program, according to Keat Chhon’s letter.

A Cambodia Daily investigation of the six projects last month found that all of the projects were actually completed two years ago, before Japan had formally approved them.

Rural Development Ministry Secretary of State Yim Chai Ly, who requested the disbursement, admitted in an interview last month that he submitted false documents as if to indicate the projects were under construction. But he maintained that the ministry is rightfully owed the money.

The Ministry of Finance investigation team started its probe last week, collecting documents and interviewing officials involved in the projects, Finance officials said this week.

The investigation is expected to be completed by Aug 20. A detailed report will be submitted to Hun Sen and the Japanese Embassy by the end of this month, officials said.

The Japanese Embassy had requested the Finance Ministry to investigate the projects if there was any indication of wrongdoing. (Additional reporting by Ham Samnang)

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