Hanoi suspends investments in Cambodia further pushing Phnom Penh into Beijing’s arms
Border disputes and divergent views over the South China Sea have cooled relations between the two countries. Vietnam is Cambodia’s fifth trading partner. However, “losses in investments will [not] have major consequences in Cambodia, because China will be happy to step in and feel the vacuum," source told AsiaNews. In return, the Chinese “will want to decide Cambodia’s foreign policy.”
Phnom Penh (AsiaNews) – Cambodia and Vietnam are at loggerheads. Now "Phnom Penh will end up increasingly in China’s sphere of influence," a source, anonymous for security reasons, told AsiaNews.
In recent months, tensions between the two countries have led Vietnam to suspend its investments in Cambodia. Border disputes and divergent political views over the South China Sea have cooled relations.
Vietnam, Cambodia’s fifth largest trading partner after China, South Korea, the European Union and Malaysia, has not invested in the Cambodian market in the first six months of 2016.
According to the Council for the Development of Cambodia (CDC), bilateral trade in 2015 reached US$ 3.37 billion, with Cambodian exports to Vietnam amounting to US$ 954 million and imports at .41 billion. Investments from Vietnam in Cambodia were expected to reach US$ 6 billion by 2020.
Some Cambodian financial analysts expressed deep concerns over the sudden end of Vietnamese investments. However, for CDC Deputy Secretary-General, Chea Vuthy, “It does not matter if we do not have any Vietnamese investment coming in, though we are a bit baffled”.
Various commentators believe that Hanoi wants to impose a price on Phnom Penh for its foreign policy. Two issues dominate relations.
The first concerns the 1,228 km land border between the two countries whose demarcation has never been agreed. The second relates to disputes in the South China Sea.
During the last ASEAN* summit, Cambodia vetoed any criticism of Beijing's policy in disputed waters. Phnom Penh succeed in keeping any reference to China out of a joint statement. Conversely, Vietnam has been complaining for months over China’s harassment in the seas.
After this, " the friendship between the Vietnamese and the Cambodian governments could not continue,” the source said.
“However, I do not believe that losses in investments will have major consequences in Cambodia, because China will be happy to step in and feel the vacuum for Phnom Penh. It has already done so in the past."
Beijing’s influence in Cambodia will thus increase. "The Chinese have already built roads and bridges for free. In return, they will want to decide Cambodia’s foreign policy."
Despite strong anti-Vietnamese sentiments, the source said, "there are many Vietnamese companies in Cambodia. Now, however, they will have to close. Already unpopular, most Vietnamese workers will have to leave the country."
* Association of South-East Asian Nations.
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16/05/2024 14:58
