Cambodia's oil wealth must benefit community: senior economist
Updated
One of the Cambodian government's most senior economists has warned the country must turn its emerging oil and gas wealth into community benefits - or risk social uprising.
Companies such as Chevron and BHP Biliton are exploring in Cambodia, and oil alone is estimated to be worth billions of dollars once drilling begins. But critics have warned that Cambodia may succumb to the so-called "oil curse' - where poor countries misuse the sudden wealth from the resources.
Presenter: Liam Cochrane
Speakers: Dr Hang Chuon Naron, Vice Chairman of the Supreme National Economic Council of Cambodia and Secretary General at the Ministry of Economy and Finance.
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HANG: Since 2005, the Cambodian government has embarked on a public financial reform program and as part of this program I have visited Australia to learn experience of reform. And recently, the Ministry of Finance and also the Cambodian National Petroleum Authority adopted what we call the reporting standard in line with the principle of extracting industry transparency initiatives. Though Cambodia is not a member, but we agree to have the reporting standard, especially on oil and gas, be published on a monthly basis and with a separate headline for revenue type non-tax revenue from oil and gas.
COCHRANE: But there have been some worrying signs with transparency, according to some reports. A recent one talked about significant, what it described as "signature bonuses" that were paid by companies as a bonus for getting exploration rights. These ran into millions of dollars and yet, they haven't shown up on budget, in the government budget. Where has this money gone to?
HANG: As far as I know, when the government signed any agreement the money go for social programs. For example, the one signed with BHP it went to the construction of irrigation systems that was implemented by the government. But in the future, we will ensure that everything is shown up because for example the recent uprising in Peru, you know, the Indian does not benefit from the oil and gas exploration in Peru because even if you show it in the budget but the implementation of the project is not used for the benefit of the local community. I think that social program that is provided through the bonus signature should be used to benefit directly the project of the local community. I think that's very important. Even if we use for the national program but that would not have immediate implication to directly to the community, that could create future problems, uprising. I think especially for Cambodia when the social security is not yet very much settled, that ensures that there's a direct impact of the oil and gas on the community.
COCHRANE: I mean, you speak of social security and the difficulties in Cambodia; there've been some recent reports discussing the effects of development and specifically evictions from city areas mostly, but also from rural areas, saying that these really hurt the poor and benefit only the rich, and they're done in the name of development. Do you think that development is being used to make the rich richer?
HANG: Overall, if you look at the development over the last decade the money used for infrastructure like schools, hospitals, that benefits tremendously the local community. However, there are a number of small so-called development projects, that some developer, some company that they try to move people out of that. And I think personally on a personal note I think there needs to be fair compensation for the people affected.
COCHRANE: For somebody who's involved in trying to increase the revenue in the government budget, would it help you to have an anti-corruption law?
HANG: The government is working on that and this agenda for the government.
COCHRANE: They've been working on it for ten years or more. Is there any real political will to pass this law?
HANG: I think I would leave that to the politicians, but at our level, I think we are working in order to strengthen the public administration and also to ensure transparency.
COCHRANE: One of the trickier parts of that law, would be politicians and senior lawmakers having to declare their assets. Do you think many of Cambodia's politicians would be open to that sort of level of transparency?
HANG: I will leave that question to the politician.
