Corruption in Cambodia

Corruption in Cambodia

Transparency International released a study in 2013 naming Cambodia the most corrupt country in South East Asia overall ranking it 160 out of 177 countries. These results were based on seven data sources, including the World Bank and the World Economic Forum. Even though there clearly is space for error in this statistic it also is equally as alarming, because the Corruption Perception Index (CPI) holds each country to the same standards. The Cambodian government obviously is dismissing this study claiming it to be flawed and not scientific.

Many hold Cambodia’s inability to pass key reforms accountable for its poor outcome in this recent study. There is also an absence of a clear checks and balances system for the public sector, which makes corruption very easy.

Despite the United States’ demands for reform attached to its aid, Hun Sen yet has to respond to these demands. However, a recent article in Xinhua news has expressed its worries about the corruption level in Cambodia and might lead to more deeply routed reforms. The article based its accusations on a recent study conducted by the Cambodian Federation of Employers and Business Associations (CAMFEBA). The study revealed that around 58% of 300 businesses interviewed admitted to never having refused to pay a bribe, while one third of the firms took no action when faced with corrupt practices. The businesses furthermore admitted that if they would have only used legal means in a business transaction that they would have not gotten the service needed or experienced an incredible delay.

Corruption impacts any economy negatively, because like we can see in Cambodia’s case, much needed money for the public sector never reaches it, but instead stays within the pockets of the top 10% income bracket.

Another major issue is that corruption heavily affects foreign business investments. Vietnam and Thailand have seen an exponential increase in foreign businesses, whereas most foreign firms are still apprehensive about entering Cambodia’s market.

One of Cambodia’s goals is to move out of the ‘developing country’ status by no later than 2030 and even though it has had major successes with moving people out of poverty, corruption is a major set back. If Cambodia wants to rid itself of its current status it needs to become less dependent on loans and the only way to achieve this is to increase foreign investments not directly related to resource extraction.

Many Western countries have already attached demands of solving the corruption issue to aid, but little has been done about this. Now that China plays such an important role in Cambodia many are hoping that the issue might once again be raised.

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