Cambodia-China Ties

China has been consistently making efforts to strengthen its partnership with Cambodia and the latter has been reciprocating with equal enthusiasm. The Cambodia-China Cultural and Creative Park in Siem Reap, the large resort with casino and golf courses in Koh Kong, the Blue Bay resort in Sihanoukville, the new national stadium in Phnom Penh, the development of hydropower dams across Cambodia and the excessive construction of real estate in Phnom Penh are only a few instances of Chinese investment in the country. It is clear that the Cambodian government is encouraging a constantly deepening involvement of China in the Cambodian economy, infrastructure, development and urbanization. Prominent transformation of the Cambodian landscape has been occurring since the arrival of the Chinese. 

An influx of Chinese investors, entrepreneurs, traders and job-seekers has transformed the profile of Cambodia’s population. Gambling is thriving, especially in Sihanoukville, while it is still against the law for Cambodian locals to gamble. A China-Cambodia tax-free economic zone has been carved out to facilitate Chinese engagement. The purchasing of government-owned land and property has expanded to purchases directly from Cambodian citizens by Chinese investors. There are more than a hundred Chinese-run factories and this number is on the rise. China’s presence in Cambodia takes many forms – expressways, airports, skyscrapers, bridges, hotels, restaurants etc. Chinese entrepreneurs have invested heavily in the energy, footwear and garment industries. In addition, China has also delved into Cambodia’s finance, communications, agriculture and banking sectors.

On one hand, there is apparent infrastructure development, increase in foreign direct investment and urbanisation leading to modernization, in Cambodia. On the other hand, Cambodian citizens are becoming increasingly hostile to China’s presence. The percentage of Chinese residing in Cambodia is rapidly increasing. This has altered the social fabric of the country. The cost of living has spiralled upwards due to intensive development. Rural-urban migrants have returned to their villages because they are unable to afford a city lifestyle.

Income inequality is progressively widening the gap between the rich and the poor. China’s projects in Cambodia employ mainly Chinese citizens. There are claims that the benefits of Chinese investment are being enjoyed by only the Chinese. There are also claims that locals have been forced to evict their land in order to make way for Chinese development projects.  It has been alleged that China is using Cambodia to attain its strategic objectives in Southeast Asia and beyond, especially since Thailand, Myanmar and Vietnam have not been as welcoming to the Chinese as the Cambodian government. 

There is more internal migration in Cambodia than international migration. Most migration is rural-rural, though there is significant rural-urban migration. Phnom Penh houses half of Cambodia’s rural migrants. The migrant pool is also significant in Siem Reap, Battambang and Kampong Cham. Being heavily agriculture-reliant, this country is especially susceptible to climate change effects. A lack of investment in rural infrastructure development has led to the waste of a large pool of young rural labour, who eventually move to cities in search of employment.

However, these workers are compelled to leave the cities due to a demand for new skills in the job market, insufficient opportunities, exorbitant costs of living, lack of adequate skills and the crowding-out effect caused by new entrants. They desperately need education and reskilling. They need to participate in their country’s economic growth. The fruits of development and urbanisation should be distributed throughout Cambodia’s rural and urban populations. There should be more investment in human capital and rural infrastructure so that rural-rural and rural-urban migrants do not become a lost generation. Economic prosperity should be shared among all, not just a privileged few.

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