China and Cambodia have signed nearly 20 deals on the sidelines of the Lancang-Mekong Summit. Chinese aid and investment have been major factors in Cambodia’s economic growth, transforming it from one of the world’s poorest nations to a developing one.
CGTN’s Martin Lowe reports.
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Relations between Beijing and Phnom Penh have never been better. China is both the biggest foreign investor in Cambodia and the provider of most overseas aid.
Chinese investment by late 2017 had reached $12.5 billion, around 36 percent of all investment in the country. Aid provided by Beijing totals around $250 million a year, much of it going to infrastructure projects such as roads, bridges, irrigation and electrical transmission – in line with China’s Belt and Road policy.
“The last 20 years our economy and GDP has maintained a steady growth of seven per cent plus, and it’s come from foreign direct investment from China,” Phay Siphan, a Cambodian government spokesperson said.
Phnom Penh appreciates the fact that China’s aid comes with no strings attached. While other countries have imposed political conditions in return for aid, China has made no such demands.
China has agreed to triple the amount of rice it buys from Cambodia, helping the country grow its rice exports by almost 70 percent over the past five years. And production at Cambodia’s largest sugar mill – opened in 2016 after a $360 million investment by Chinese owners – is running at record levels, providing work for local people and valuable contracts to farmers.
It has also joined international efforts to preserve the Angkor Wat temple complex, the largest religious monument in the world, which is key to Cambodia’s tourism industry.
The two countries have set a target to have 2 million Chinese tourists visit Cambodia annually by 2020.