IPU Finds Assembly Has Little Loans Oversight

Cambodia’s National Assembly is lacking, compared to other countries’ parliaments, in the oversight it exercises over new loans taken out by the government from international financial institutions, according to a new report.

The study, published Tuesday by Geneva-based Inter-Parliamentary Union (IPU) and the World Bank, found that Cambodia is one of only 41 percent of countries where the Parliament is not legally required to ratify loans from the World Bank or the International Monetary Fund.

The results are based on an eight-month survey of 100 developing countries, completed in December 2011, designed to highlight the extent to which democratically elected parliaments are fulfilling their accountability duties.

The survey’s results on Cambodia show that while the National Assembly plays a part in loan approval during negotiations, it does not have a role in overseeing the World Bank’s development policies in country, does not employ committees to scrutinize loans and does not get in the way of loans put forward by the executive.

In a statement Tuesday, the IPU said even though most parliaments do have the legal authority to decide on loans, their involvement varies. “Parliamentary oversight of country loans is important because loans often come with conditions requiring changes to policy or legislation which may adversely impact the lives of ordinary citizens, as can be seen in the case of fiscal austerity, market deregulation and so on,” IPU secretary-general Anders Johnsson said in the statement.

“MPs [members of Parliament] should be able to decide if a loan is really needed and consider whether it is a burden on the country’s budget. While financing deals are made with a country’s government, the loan repayments often rest in place long after the government has changed.”

The CPP-dominated National Assembly has often been criticized during its five-year mandate for simply rubber-stamping laws put forward by the executive, and offering little room for debate or opposition involvement.

During the mandate, the World Bank froze new loans to Cambodia over the handling of evictions from the Boeng Kak lake area.

This year, Canadian construction firm SNC-Lavalin was barred from winning new World Bank contracts after an investigation found that the company paid bribes to officials, including in relation to a $5 million Bank-funded power project in Cambodia.

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