Cambodian politics in 2019 was characterised by tension and uncertainty. A contentious election in July 2018 in which the ruling Cambodian People’s Party faced no serious competition has been followed by a progressive habituation to a de facto one-party system. But a ‘new normal’ has yet to settle in.
Uncertainty emanated from the European Union launching an investigation under the procedure for a possible temporary withdrawal of its Everything But Arms (EBA) trade preferences in February. The investigation was triggered by the dissolution of the opposition Cambodia National Rescue Party (CNRP) and the arrest of its president Kem Sokha on treason charges in 2017.
The Cambodian government has pursued a two-pronged strategy where it sought to maintain Cambodia’s EBA status through diplomacy, while projecting a facade of complete indifference over the EBA’s future. This was a bid to project strength and raise its bargaining position, but also reflected confidence as the government has readied itself for a post-EBA scenario. Measures include reserving US$3 billion for fiscal stimulus, raising tax revenue by 20 per cent by 2020, and negotiating a free trade agreement with China.
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