Japan Gives $18M Grant Aid, Despite Rural Road Scandal

The Japanese government on Tuesday officially presented $18 million of grant aid to Cambodia, saying efforts have been made to clean up the rural development ministry after a scandal last year.

Japanese Ambassador Masaki Saito signed an official document of the funds called non-project grant aid with Foreign Affairs Minister Hor Namhong.

“We hope to support the Cam­bodian government’s efforts in various reforms, including fores­try, demobilization and administration reform,” said Consular Eiji Yamamoto after the ceremony.

Aiming to support the government’s balance of payments, the grant is not tied to specific projects but instead goes directly to the national treasury. The money will be managed by the Cam­bod­ian government without firm strings by Japan.

Previous grants under this scheme became controversial last year when the Japanese government found wrongdoing by some senior officials at the Rural Development Ministry.

Several officials applied for $570,000 in disbursement from the grant for six rural road projects, some of which had either already been built on private property or al­ready funded by another donor.

Saito along with Finance Min­ister Keat Chhon urged the Rural Development Ministry to punish officials involved in the scandal late last year, but the ministry only shuffled responsibilities. So far no one has been punished, a ministry senior official said Tues­day on a condition of anonymity.

However, Japan acknowledged Cambodia’s efforts to prevent corruption in the future.Yamamoto noted an improvement in the grant aid monitoring system and verbal warnings given to officials.

At the ceremony, Hor Nam­hong assured Japan that the funds will be used in a transparent fashion.

Prime Minister Hun Sen  who was attended the ceremony, said he hopes to use some of the money to improve the primary road from Takeo province to the Viet­nam­ese border.

Japan had given $61 million between 1994 and 1996 under this grant scheme. It halted the grant when the International Monetary Fund withdrew from Cambodia in late 1996. But Jap­anese Prime Minister Keizo Obu­chi promised to resume the aid when he visited Cambodia in January.

His visit marked the first visit to Cambodia by a Japanese head of state in more than 40 years.

“We recognize the Cambodian government has taken several measures to prevent [officials’ wrongdoing],” said


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