The World Bank has frozen funding to Cambodia, making good on its threat in March to reconsider aid levels to Cambodia in response to the ongoing eviction of thousands of Phnom Penh families from Boeng Kak lake, a Bank official confirmed yesterday.
“The World Bank’s last loan to Cambodia was in December 2010,” said World Bank Country Director Annette Dixon in an e-mailed statement. “Until an agreement is reached with the residents of Boeng Kak lake, we do not expect to provide any new lending to Cambodia.”
Some 3,000 families have had their lakeside homes flooded with sand or otherwise been forced to abandon land some had lived on for decades in the wake of a high-end real estate project at Boeng Kak headed by CPP Senator Lao Meng Khin.
Both the senator’s Shukaku Inc and Erdos Hong Jun Investment, the Chinese firm backing the project with a $2.17 billion plan approved by the government’s foreign investment board earlier this year, have remained silent in the face of the escalating controversy over the forced evictions.
Government officials have done the same.
“We are continuing to encourage the Government of Cambodia to reach an agreement to provide on-site housing for the remaining residents of Boeng Kak lake. Discussions between the government and residents are ongoing and we look forward to an early resolution of the issue,” Ms Dixon said.
“The government is continuing to implement existing programs and we are working with the government to ensure that all its legal obligations under those projects will be met,” she added.
European Commission charge d’affaires Rafael Dochao Moreno said the World Bank had informed the EC of the freeze several months ago.
“What we have is a decision by the World Bank, indeed, to freeze future activities,” Mr Dochao Moreno said. “The projects as they are are not canceled, just the new ones are frozen,” he said. “The decision was taken…concerning Boeng Kak lake.”
Housing rights groups have deemed the Boeng Kak project illegal on numerous fronts, from moving ahead without an approved master plan to ignoring a 2001 Land Law that should have guaranteed some of the older lake residents a chance to apply for land titles.
It was those elusive land titles that drew the World Bank into the fray.
In March, the World Bank’s executive board in Washington backed an independent report concluding that its own poorly designed, ill supervised—and now defunct—$24.3 million land titling project, which was implemented by the government, had helped to strip the Boeng Kak families of their land rights by denying them land titles.
In a report released at the time, the Bank’s country team in Phnom Penh said it would consider stemming funding unless the government stepped up its efforts to help the Boeng Kak families, especially the 1,000 or so still hanging on at the lake in hopes of getting the on-site homes they have been asking for.
“If there is continued lack of willingness to cooperate on addressing the [Boeng Kak lake] resettlement issue, management would anticipate reviewing all current and proposed support to the government in the land sector and carefully take into account the government’s position in considering the magnitude and focus of future Bank support to Cambodia,” the World Bank country team said in the report.
Until yesterday, the World Bank had declined to comment on what it had been doing to press the case on Boeng Kak.
According to its country website, the World Bank has not approved a project in Cambodia since Jan 31. Three projects worth a total of $128 million have all been awaiting approval since then.
Government officials assigned to oversee those projects confirmed that the funds had yet to arrive but said they had no idea why the World Bank had not dispersed the funds.
Council of Ministers spokesman Phay Siphan said he was uncertain about the status of Bank funds, but he conceded that the government’s relations with the World Bank have been bitter since at least late last year.
“We are looking for a partner to develop the country. They put pressure on the government to do this, do that,” Mr Siphan said.
Tep Vanny, a representative of several hundred lakeside residents who are holding out against their ordered eviction, said World Bank Country Manager Qimiao Fan announced the freeze of funds to the government during a July 26 meeting with lakeside residents.
“Our people are happy the World Bank has suspended funds to Cambodia to help us find a solution,” Ms Vanny said.
“But we don’t want them to suspend funds forever,” she added, “just until there is a solution.”
(Additional reporting by Chhorn Chansy and Simon Marks)