NVDB005_-_CH_3.003._Cambodia’s_Embrace_on_BRI_and_Its_Geopolitical_Implications_-_Dr._Neak-6

25 — DP Vol. 05

Regional Security Dilemma: Trends, Directions, and Illusion

Regional Security Dilemma: Trends, Directions, and Illusion

Cambodia and China agreed to allow Chinese Tech Giant Huawei to provide 5G infrastructure across the Kingdom. The following implementation agreement was signed with the Ministry of Posts and Telecom- munications (MPTC) in 2020 to grant Huawei the right to sell ICT equipment to Cambodian carriers as well as to establish the MPTC’s data center facility, video conference system, and fiber-optic connectivity.

As far as specific details on the Digital Silk Road bilateral cooperation agreement are concerned, there has been almost no mention of such documents. This is despite the fact that there are considerable elabo- rations on communication technology and innova- tions under the Key Area section in the “Outline of the Bilateral Cooperation Plan to jointly Build the Silk Road Economic Belt and the 21st Century Maritime Silk Road between the Government of the Kingdom of Cambodia and the Government of the People’s Republic of China”. On close inspection, Chinese tech giants are not in a prominent position, but more or less play some roles in building a footprint for Cambodia’s digital development and wider connectivity through a market-leading role. 6

Despite the Covid-19 pandemic’s recent disruption of general economic activities, Chinese direct investment in the Kingdom remains high as of 2021, still accounting for USD 2.32 billion, the highest of any single country. This is indicative that, although the Digital Silk Road project has not been completely successful in the Kingdom, the foreign investment, which sustains a continuation of the annual 7.7 percent economic growth rate over the last several decades, has generated certain and significant benefits for Cambodian households, both in urban and remote areas. Such benefits include being able to access the internet and some other basic telecommunications services. 7

Conclusions and Ways Forward

Since the launch of the BRI, China has consistently been the largest financier of Cambodia’s socio-eco- nomic development, as well as the largest ODA provider ahead of other partners like Japan. Cambodia has embraced the BRI thanks to the strategic options

6 Kimlong, Chheng (2019). Linking Digital Silk Road to Cambodian Digital Economy. Khmer Times. https://www.khmertimeskh. com/595096/linking-digital-silk-road-to-cambodian-digital- economy/

7 Ibid.

this small Kingdom has, mutual political trust between Beijing and Phnom Penh, and the country’s commitment to the 21st Century Maritime Silk Road plan in the coastal city of Sihanoukville. Embracing the BRI would further enhance Cambodia’s soft infra- structure projects that primarily fit into the country’s development plan, particularly toward the digitali- zation of the economy and society at large.

Although the presence of the BRI in Cambodia appears to be part of China’s geoeconomics strategy in Southeast Asia, it also provides the Kingdom the ability to make Sihanoukville the engine house driving wider national developments.

The SEZ plan could embed the country within global supply chains to increase industrial diversity, as well as take the lead in socio-economic development and drive common development in surrounding provinces. To fully exploit these benefits, however, the Kingdom must take several factors into consideration. Firstly, a capable regulatory system should be established. Such a system would include drafting laws and regulations on SEZ management, spatial plans, and economic development plans, as well as specific implementation schemes. Secondly, planning should be compatible and pushed forward together with laws, policies, standards, and guidelines through planning management and implementation advancement mechanisms. Thirdly, Cambodia should strengthen the government’s role in the early development of SEZ implementation. This can be done through (1) the purchase and reserve of strategic land resources by the government, (2) the formulation of practical industrial policies, and provision of special policies to introduce pilot projects, and (3) the construction of critical infra- structure, especially trunk pipelines, and (4) guiding the development of strategic regions by government or state-controlled companies to play a leading role in the market economy. Last but not least, it is about efficient execution. That is to have efficient decision- making conducted by high-level special committees authorized with unrestrained power, to facilitate good coordination and cooperation among ministries and departments, and to have a clear division of responsi- bilities between central and local government.