The 21st Century Chinese Maritime Silk Road-Impacts on Cambodia

Royal University of Phnom Penh
Institute of Foreign Languages
Department of International Studies
IS 409: Foreign Policy II (Cambodia Focus)
Research Report
The 21st Century Chinese Maritime Silk Road: Impacts on Cambodia
Class: E4.2
Group members:
1. MORM Kulkitya
2. THONG Meng David
Lecturer: AN Sokkhoeurn
Academic Year
2014 – 2015

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Contents
Abstract ............................................................................................................................................2
Chapter 1: Introduction ....................................................................................................................3
i. Background ...........................................................................................................................3
ii. Research Questions ...............................................................................................................4
iii. Significance of study.............................................................................................................4
iv. Research Methodology..........................................................................................................4
v. Scope and limitations ............................................................................................................6
vi. Report structure .....................................................................................................................6
Chapter 2: Literature Review ...........................................................................................................7
Chapter 3: Impacts of the 21st Century Chinese Maritime Silk Road on Cambodia’s economy ....8
i. Opportunities.........................................................................................................................8
ii. Threats.................................................................................................................................12
Chapter 4: Impacts of the 21st Century Chinese Maritime Silk Road on Cambodia’s security/
defense............................................................................................................................................14
i. Opportunities.......................................................................................................................14
ii. Threats.................................................................................................................................16
Chapter 5: Impacts of the 21st Century Chinese Maritime Silk Road on Cambodia’s Politic and
Diplomacy......................................................................................................................................17
i. Opportunities.......................................................................................................................17
ii. Threats.................................................................................................................................18
Chapter 6: Conclusion....................................................................................................................19

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Abstract
During the official visit to Indonesia in October 2013, Chinese President Xi Jinping made
a shock decision by announcing the creation of “The 21st Century Chinese Maritime Silk Road”.
After the announcement, many countries, especially ASEAN countries, welcomed that ambitious
plan while some other stressed the concern and reluctant to be part of that Silk Road. Thus, this
paper is going to look for the impacts, both opportunities and threats, of “The 21st Chinese
Maritime Silk Road” on Cambodia in terms of Economic development, security/defense, and
politics/diplomacy. Based on the findings, this Silk Road facilitates economic growth in
Cambodia, strengthens Cambodian economic connectivity and integration, and increases
Cambodian people’s income. However, this Silk Road also brings threats to Cambodia by
making the Cambodian economy into risky and under the domination of Chinese products. In
terms of security, this Silk Road enhances Cambodia’s defense sector on sovereignty or territory
and social order while, at the same time, it increases chances of being reduced the military aids
from other countries. Last but not least, in terms of politics, the Maritime Silk Road can
indirectly increase Cambodian Foreign Policy bargaining power due to the significant attention
from other countries to counter China. However, this does have its backdrop because it might
lead to the erosion of Cambodian Foreign Policy autonomy from China.

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Chapter 1: Introduction
i. Background
During the official visit to Indonesia in October 2013, Chinese new President Xi Jinping
made a shock proposal to build “The 21st Century Chinese Maritime Silk Road” in order to
further cooperate with other countries in ASEAN. Under the theme “1 Road 1 Belt”, this
Maritime Silk Road, known shortly as 1 Road, is the initiative complementing to the “Silk Road
Economic Belt”, known as 1 Belt, initiated by President Xi during his official visit to Kazakhstan
in September 2013 (Xinhua, February 2015).
The “21st Century Chinese Maritime Silk Road” uses the system of linked ports and
infrastructure projects to connect Asia and Africa with Europe continent. It starts from cities on
China’s southeastern coast of Fuzhou, to Vietnam, Indonesia, Bangladesh, India, Sri Lanka, the
Maldives, and East Africa. This Maritime Silk Road, then, connects to some countries along the
African coast such as Kenya, Djibouti, Tanzania, and Mozambique before crossing the Red Sea
and Suez canal to the Mediterranean. Finally, 1 Road crosses Athens, city of Greece and meets
with the land-based initiative known as 1 Belt at Venice, city of Italy (Blystone, 20 April, 2015).
. This initiative touches upon six major areas including i) Development connective
infrastructure aiming to build high speed railways, highways and economic corridors along the
Silk Roads, ii) Multifaceted development of connective infrastructure aiming to increase the trade
volume of China covering many sectors, iii) Strategy for greater use of local currencies in cross-
border exchange aiming to make Renminbi as international transactions and reserve currency, iv)
Cultural exchange aiming to promote people-to –people connection and mutual views, v) Cross-
border exchange with government of participating states aiming for policies coordinating and,
lastly, vi) Converting the special bonds and low-cost financing into real money (Rao, May 30
2015).
China claimed that the aims of this Maritime Silk Road are to boost inter and intra-
regional connectivity and trade relations among member countries. However, this initiative has
been viewed as the tool for consolidating China’s hard and soft power. Some elaborated that the
major strategic purpose of this initiative is to restore China’s bad images and relations with its
neighboring Asian countries such as Vietnam and the Philippines which had been damaged
because of the South China Sea dispute. Moreover, such trade ambitious initiative is viewed as to

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counter the American projection power to Southeast Asia, specifically US’s Pivot to Asia (China
U.S. Focus, 4 February, 2015).
Although there are different views on this Silk Road project, after the announcement,
many countries, especially ASEAN countries, welcomed that ambitious plan while some other
stressed the concern and reluctant to be part of that silk road.
ii. ResearchQuestions
The main objective of conducting this research is to find out opportunities and threats that
Cambodia gain from the launch of the 21st Century Chinese Maritime Silk Road.
ResearchQuestion:
What are the impacts of the 21st Century Chinese Maritime Silk Roads on Cambodia?
A. Sub – ResearchQuestions: Does the 21st Century Chinese Maritime Silk Road impact
Cambodia’ economy?
B. Does the 21st Century Chinese Maritime Silk Road impact Cambodia’s security/defense?
C. Does the 21st Century Chinese Maritime Silk Road impact Cambodia’s politic?
iii. Significance of study
Despites various existing studies on Sino-Cambodia Relations, a few gaps have been
found in those previous researches. First, those studies provided knowledge on Sino-Cambodia
relations, but most of the studies covered a large scope without limiting the timeframe. Thus, this
research study is of paramount important for providing comprehensive knowledge on Sino-
Cambodia Relations in the context of the “21st Century Chinese Maritime Silk Road”.
Second, previous researches did not pay attention to opportunities and threats that
Cambodia could receive from the launch of the Chinese Maritime Silk Roads of the 21st Century
due to the fact that this initiative was just launched less than 2 years ago. This means that
previous researches did not provide comprehensive information on whether Cambodia should
welcome or withdraw apart from this initiative. Hence, this research paper, by studying
opportunities and threats on Cambodia’s economy, security, and politic from this initiative, will
complement previous research studies.
iv. ResearchMethodology
a. Study Design

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This research paper is the qualitative study with the aims of assessing opportunities and
threats that Cambodia gains from being a part of the new China’s initiative, which is “The
Chinese Silk Road of the 21st Century”. The methodology used for this research study is
Retrospective Study design.
b. Measurement procedure
To conduct this research in a fruitful report, it is important to operationalize some key
terms. Four key terms which are Impacts, Economy, Security, and Politics will be operationalized.
The term “Impacts” refers to any opportunities or threats that Cambodia gains from being a part
of the 21st Century Chinese Maritime Silk Roads. The term “Economy” devotes to the trade and
investment, physical infrastructure, and tourism while the term “Security” devotes to military
assistant. Finally, the term “Politics” in this research paper refers to Foreign Policy bargaining
power.
c. Data Collection
In this study, both primary and secondary sources are employed so that this research can
maintain the originality, reliability, validity, and accuracy of the study. To proceed with data
collection, In-depth Unstructured Interview is utilized for primary data collection as this method
provides flexibility and allows for the extraction of useful information as much as possible from
the interviewees. Six interviewees have been approached to gather primary data for this research
paper. Those 6 interviewees are lecturer Roth Vathana, Cheunboran Chanborey, Chheang
Vannarith, Heng Sarith, Lak Chansok, and Oudom Deth. Moreover, Content – Analysis from
highly discerning sources such as articles, journals, publications from the recognized and
accredited organizations and authors will be used for secondary data collection.
d. Sampling Design
The sampling of this research study is various think – tanks or scholars who have
experiences in this field. This study utilized Non – Probability Judgmental or purposive sampling
design because such sampling design may prove to be effective in the circumstance that only
limited numbers of people, who are think – tanks or scholars, can provide useful primary data.
Moreover, such sampling is low-cost and requires less time to select the interviewees compared
to other sampling methods.
e. Data Collection Process

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In the data collection process, the team members, altogether, went to interview each
interviewee via either face-to-face or Skype in the case that any of those scholars were at abroad.
The interviewees were asked to answer their academic perception regarding “The Chinese
Maritime Silk Roads of the 21st Century” and its impacts toward Cambodia. Once the team
members get all the data from the interviewees and cross-checking them with secondary data, the
analysis part started aiming to answer the sub-research questions and the main research question.
v. Scope and limitations
Our scope of study will focus only on the period from October 2013 onward. The reason
for choosing such timeframe is that the research topic and questions focus only on the time from
the announcement of the Chinese Maritime Silk Roads of the 21st Century onward. This means
that the timeframe prior to the launch of the Chinese Maritime Silk Road of the 21st Century is
not deemed necessary in this topic and out of the study scope.
Regarding the dimension of the study, this research paper will look only to the 3
paradigms – Economic, Diplomatic/Politics, and Security/Defense.
Within the research process, two major limitations have been found. One of the main
obstacles of our study is difficulties in reaching the respondents due to the fact that those are
think – tank and scholars who rarely has enough time for us to conduct the interview. Moreover,
due to time and resources constrained allocated for this research, our primary source of data,
mainly the number of interviewees, is too small resulting in the lack of saturation points of
information.
vi. Report structure
This research paper will try to answer the research question in a systematic way by
dividing the whole research paper into 6 paragraphs such as:
Chapter 1: Introduction
i. Background
ii. Research Questions
iii. Significance of study
iv. Research Methodology
v. Scope and limitations
vi. Report structure

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Chapter 2: Literature review
Chapter 3: Impacts of the 21st Century Chinese Maritime Silk Road on Cambodia’s economy
i. Opportunities
ii. Threats
Chapter 4: Impacts of the 21st Century Chinese Maritime Silk Roads on Cambodia’s security &
defense
i. Opportunities
ii. Threats
Chapter 4: Impacts of the 21st Century Chinese Maritime Silk Roads on Cambodia politics and
diplomacy
i. Opportunities
ii. Threats
Chapter 6: Conclusion
Chapter 2: Literature Review
Sino-Cambodia Diplomatic Relations has been officially established since the 1950s,
although, according to many historical documents, Cambodia was proved to have unofficial
relations with China since the 13th century. There have been many documents studying,
separately, Sino-Cambodia Relations. However, all of those studies focus on the benefits and
drawback that either Cambodia or China gets from this bilateral-relations without limiting the
timeframe. None of the previous research focused on Sino-Cambodia relations in the context of
the “21st Century Chinese Maritime Silk Road”.
Chheang (October, 2009) identified bilateral relations between Cambodia and China
based on historical and economic link. In his work, Cambodia-China relations witnessed by the
official visit of Chinese diplomat Zhou Dakun to Cambodia during the 13th century. This
relations have been sustained up until now. Moreover, bilateral relations between these two
countries was also seen through the presence of many Chinese traders and retailers, as estimated
3%-5% of Cambodia’s population is Chinese ethnic, as well as Chinese-Made Products in
Cambodia.
Besides, a handful of studies of Sino-Cambodia relations based on interests can be found.
According to Burgos & Ear (June, 2010), Cambodia is the strategic location for China to exert

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greater influence in the region, secure abundant natural resources- both in the land and in the sea,
and safeguard or launch a response to security threats from Taiwan or South China Sea. Along
with the study of Sigfrido & Sophal, Heng (2012) and Dahley (August, 2013) argued for other
interests of China on Cambodia such as Economic interest: secure natural resources and export
market; Political interest: support for one China Policy, and Ideological Spread of Chinese
culture. At the same time, various works by Vannarith (September 2014), Sigfrido & Ear (June,
2010), Long (July, 2009), Leifer (January, 1964), and Heng (2012) focused on Cambodia
interests from Sino-Cambodia relations such as Economic interest: trade, investment, donor,
development, infrastructure, and electricity overcome; Political interest: promoting peace,
national reconciliation, diplomatic support, and legitimacy.
Other studies have focused on the major drawback of Sino-Cambodia Relations. Chheang
(September, 2014), Sigfrido & Ear (June, 2010), Ou (03 June, 2011), Heng (2012), and Dahley
(August, 2013) argued for “No Strings Attachments” policy of Chinese government to Cambodia.
Those academicians claimed that No Strings Attachment Policy of Chinese turns blind eyes on
various issues in Cambodia such as the low quality of Chinese development assistance, lack of
transparency and effectiveness, labor abuse, human right violation, livelihood and ecological
disruption of local people et cetera. However, Ou (03 June, 2011) further argued that it does not
come purely without string attachment. In fact, as Ou stated, Chinese trade and investment do
come with string – that are the expecting of free reign in Cambodia both politically and
economically and unconstrained access to Cambodia wealth and natural resources.
Chapter 3: Impacts of the 21st Century Chinese Maritime Silk Road on Cambodia’s
economy
i. Opportunities
The 21st Century Chinese Maritime Silk Road is an ambitious trade initiative by China.
There are many factors pushing China to announce the creation of such ambiguous initiative.
However, in addition to China, other countries, specifically Cambodia, do gain advantages from
this initiative. One of the main aspects that the 21st Century Chinese Maritime Silk Road of Xi
Jinping brings opportunities to member countries lies in the economic paradigm. Within this
paradigm, the first opportunity is the possibility that such ambitious initiative may facilitate
Cambodia’s economic growth. This claim rests on the observations of the inflow of Chinese

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investment to Cambodia and trade volume at Sihanouk Ville Autonomous Port. Chinese
investment in Cambodia has increased since the announcement of this new Silk Roads.
According to Xinhua (20 January, 2014), the investment from China in 2013 was U.S.$427
million, up 62% in compared to the U.S.$263 million. China’s investment projects to Cambodia
have been focused on all sectors such as garment and manufacturing industries, banking and
finance, mining, energy, real estate, tourism, telecommunication, transport, and agriculture.
Moreover, not only investment but also trade volume has been increasing. Container volume at
the Sihanouk Ville Autonomous Port was increased by 19%, from 98 635 Twenty-Foot-
Equivalent Units (TEUs) in the first four months of 2014 to 117 676 TEUs in the same period of
2015. At the same time, Containerized Cargo Tonnage also rose from 1.18 million tons to 1.29
tons, equivalent to 9% increase and oil import increased to 440 070 tons from 410 792 tons,
equivalent to 7% increase (Xinhua, 28 May, 2015). The increase of Chinese investment in
Cambodia and trade volume reflects the positive contribution of Chinese’s investment in the
developing Cambodian economy as Chea Vuthy, deputy general of the Cambodia Development
Council, and Ok Bong, secretary of state at the Cambodian Ministry of Commerce stated in
Xinhua (20 January, 2014). V. Roth (personal communication, June 06, 2015), also support such
argument. According to V. Roth, the 21st Century China Maritime Silk Road is the sea port trade
based initiative. Thus, by being a part of this initiative, Cambodia would be able to increase its
investments and trade volume with China as well as other countries along the Road.
Furthermore, another opportunity Cambodia might gain from being the member of the
21st Century Chinese Maritime Silk Road is the strengthening of Cambodia’s Economic
connectivity and integration. This new Silk Road is the multidimensional purposes supported by
some newly-created-financial-institutions such as the BRICS Development Bank, the Asian
Infrastructure Investment Bank (AIIB) and the Silk Roads Fund. Those institutions are rich in
financial resources as, for example, the BRICS Development Bank, announced by Brazil, Russia,
India, China, and South Africa in July 2014, partakes 100 billion US dollars as the start-up
capital, AIIB, to be established by the end of 2015, possess the initial fund of $100 billion U.S
dollars, 50% of it is from China’s fund, and the Silk Road Fund possess the initial financial
contribution of $40 billion U.S. dollars (Xinhua, 05 March 2015). The latter two, AIIB and Silk
Road Fund, would serve as the major cornerstone for supporting Cambodia infrastructure
development since the aims of AIIB and the Silk Road Fund are to Finance infrastructure

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development in countries along the Road, to boost intra-regional and inter-regional connectivity
and economic integration as well as to complement the role of Asian Development Bank (ADB)
and World Bank (WB) in capital lending. Thus, as the founding member of AIIB, Cambodia
must surely benefit from infrastructure development and regional connections projects such as
roads, rail, sea ports, telecommunication, electricity power grids projects et cetera. Benefits will
go more beyond that as Cambodia, with the support from AIIB and the Silk Road Fund, would be
able to concretize its economic reform agenda and grasp benefits from regional economic
integration as well as strengthen its economic competitiveness (Chheang, 09 April, 2015).
Moreover, during the inauguration of hydroelectric dams in Koh Kong in January 2014,
Cambodia’s Prime Minister HUN Sen stressed that “Lack of Capital is a main obstacle for the
developing countries, including Cambodia, in the development of infrastructure and the Asian
Infrastructure Investment Bank (AIIB) and the Silk Road Fund will fill the shortage” (Chheang,
09 April, 2015). Similarly, VA Sim Sorya, a spokesman for the Cambodia Ministry of Public
Works and Transport, state in Xinhua (26 March, 2015) that the major challenge for developing
Cambodia infrastructure is the capital and Cambodia hope to get more capital for connectivity
development from the AIIB and Silk Road Fund”. Sorya further added about the slow
development of railways and waterways in Cambodia (Xinhua, 26 March 2015). Thus, as part of
the Chinese Maritime Silk Roads, and in addition to the AIIB and Silk Roads Fund, Cambodia is
expecting to get financial support on the construction of a new railway under the “Pan-Asian
High-speed Railway” project linked China to Myanmar, Laos, Thailand, Cambodia, Malaysia,
and Singapore (Yang, 09 May 2014). The already-operational Singapore-Kunming line runs from
China’s southern provincial capital of Kunming of Yunna China to Vientiane, Capital city of
Laos, to Bangkok, Capital city of Thailand, to Malaysia and ending up in Singapore. However,
Cambodia is working with China to gain financial aid to build a new railway from Phnom Penh
to Vietnamese border in order to complement the missing line of Singapore-Kunming railway
(Loeung, 23 January 2014). This new railway, length about 255 Km with an estimated cost of
$686 million U.S, would serve as the important rail facilitating travel and transportation of goods
inside and outside Cambodia. In the same line, V. Roth & C. Cheunboran (Personal
Communication, June 06, 2015) also stressed the important of the 21st Chinese Maritime Silk
Roads in logistical development. Cheunboran further said that “The $100 billion of AIIB and $40

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billion of Silk Road Fund would serve as financial support for physical infrastructure
improvement lacked in Cambodia”.
In addition to the positive development in Trade/investment and physical infrastructure
improvement in Cambodia, tourism sector is also projected to gain positive sign when Cambodia
engages in the 21st Century Chinese Maritime Silk Roads. This will earn Cambodia the
opportunity to further reduce poverty rate and increase population’s income through the increase
of jobs from tourism sectors. Many tourism experts and officials, for example Thong Khon,
Cambodian Minster of Tourism, Zhao Yily, Chief Strategy officer of Qunar travel agencies in
China, Louk Lennaerts, Chief Visionary Officer of Serenity Holding in Vietnam, and Michael
Parnwell, a professor of Southeast Studies and regional tourism at the University of Leeds,
believe and argue for such ideas since the trend of improving tourism sectors has already been
leveraged after the announcement of the 21st Century Chinese Maritime Silk Roads. Cambodia is
one of the Southeast Asia Countries abundant by touristic sites – both naturally, such as the four
coastal provinces with long white beach, many beautiful islands at Southwestern of the country,
national park, Durian Plantation, waterfall at the Northeastern part of the country, and culturally,
such as Angkor Wat temple, Bayon temple, as well as other marvelous temples our ancestors
have built (Lak, n.d). Such rich in touristic sites gives comparative advantages for Cambodia to
attract more tourists, especially tourists along the new Silk Roads, making Cambodia’s state
revenue share by tourism sectors increase yearly as just the 1st quarter of 2014 revenue from this
sectors reach $700 million U.S (Lak, n.d.). One of the best evidence is the increase of Chinese
tourists 20% year-on-year, as stated by Thong Khon, Cambodian Tourism Minister, making the
number of Chinese tourists to visit Cambodia reach 560 000 in 2014, accounting for 12.4% of
international visitors to Cambodia. This data makes China became the 2nd largest source of
foreign tourists to visit Cambodia (Xinhua, 13 February 2015). As Khon further expressed,
Cambodian Ministry of Tourism predicted that Chinese tourists will further increase to 700 000
in 2015 and to 2 million by 2020. Another positive sign in Cambodia’s tourism sectors is the data
from China, the most populous country in the world with population about 1.357 billion people.
According to the data from China National Tourism Administration and World Tourism
Organization, extracted by Yanzi (October24, 2015), the number of Chinese tourist travel abroad
has been increasing by 20% over the last 4 years, accounted to about 100 million in 2013. China
is the world number one of tourism source with $129 billion U.S spent by Chinese tourist in 2013.

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As the startup of the 21st Chinese Maritime Silk Roads, many travel agencies in China is now
designing new tour program in order to boost the number of Chinese to visit Southeast Asia.
Those tour agencies, for example Qunar, one of China’s most popular online travel agencies, are
now collaborating with travel service providers to offer more diverse and interesting travel routes
to explore the culture along the new Maritime Silk Roads, specifically Southeast Asia, with an
affordable prices (Yanzi, October24, 2015). Michael Parnwell, a professor of Southeast Studies
and regional tourism at the University of Leeds, stated in Yanzi (October 24, 2014), there is a
significant shift in lifestyle among Chinese people. Chinese people are now enjoying incentive
and opportunity to travel, making Chinese tourists travel abroad to spread further, especially to
Thailand, Cambodia, Malaysia, and Vietnam. The increase in Chinese tourism does not only
increase state’s revenue and economic growth, but also contribute to the poverty reduction in
Cambodia via the creation of more jobs and opportunities brought by this sector. As Khon further
elaborated, many Chinese tourists are now wealthy and, as estimation, by 2020, about 630
million Chinese people will be in middle-class range. Those people will expand their demand
beyond their daily basic needs and turn to other demands such as enjoyment and travel. Moreover,
those tourists will purchase quality products and souvenirs, eat in lavish restaurants, and stay in
stars-range hotels during their travel (Xinhua, 13 February 2015). This will enable more jobs in
Cambodia, for example, souvenir selling, tour guide, Touk-Touk driver, run restaurants and
hotels et cetera, as to fulfill the demand of those tourists. As a result, it contributes to the poverty
reduction in Cambodia. According to the Lak (n.d), tourism sector plays a major role in poverty
reduction in Cambodia as Cambodia GDP per capita rose from $760 in 2008 to over $1 000 in
2013.
ii. Threats
Although the 21st Century Chinese Maritime Silk Road brings opportunities to
Cambodia in term of Economic paradigm, this new initiative also brings threats to Cambodia’s
economy. One of the main threats that this trade ambitious initiative would bring to Cambodia is
the heavy reliance on Chinese products. The 21st Century Chinese Maritime Silk Road,
announced by Xi, called for good maritime cooperation between China, Southeast Asian
countries, Sri Lanka, other counties in Indian Oceans, Africa and Europe. As estimated, this
would encompasses around 4.4 billion people, equal to about 63% of the world’s population and
aggregate Gross Domestic Production (GDP) of about $2.1 trillion U.S, equal to 29% of the

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world’s aggregate wealth. Some leaders, for example Sultan Hamegkubuwono X, Sultan of the
historic Yogyakarta Sultanate in Indonesia, the Governor of the modern Yogyakarta Special
Region, shared the concerned that the new Maritime Silk Roads from China to other countries
along the road might lead those countries became the consumer market of Chinese goods and
services forever (Rao, May 30, 2015). In line with those leaders, V. Roth (Personal
communication, June 06, 2015) and S. Heng (Personal Communication, June 14, 2015) also
stated that this new Silk Roads initiative will bring the domination of Chinese products on a
whole region, specifically Cambodia’s market. The concern goes beyond the fall of countries,
along the Silk Road’s market to China. V. Roth (personal communication, June 06, 2015) further
elaborated the concern about Chinese market. Although the aim of Maritime Silk Road is to boost
connectivity and trade activities along the road, he added, Chinese authority still practice “Infant
Industry Concept” meaning that Chinese authority still applies protectionism policy against
international competition to protect and encourage domestic products. Yet, Chinese people are
not willing to be open-mined.
Another threat to Cambodia’s economy is the risk of economic. There is a general
agreement that the 21st Chinese Maritime Silk Road will enable more and more Chinese investors
to Cambodia. However, Chinese investors may bring both opportunity and threat to Cambodia.
The concern of the inflow of Chinese investors to Cambodia rests on the fact that some of those
investors are footloose companies which come to developing countries for the quest of natural
resources with low Cooperate Social Responsibility (CSR) obligation (V. Roth, personal
communication, June 06, 2015). This means that Chinese investors operate their companies
without national loyalties which are flexible in moving their operations anywhere very quickly.
Chinese investors are well-known for such footloose industries as witness during the increasingly
rising labor costs in China that hundreds of manufacturing factories in China were closed and
transferred to lower-wage countries such as Cambodia and Vietnam (Galbraith, July 20, 2011).
This posts a major concern for Cambodia. Some scholars and lawmakers have expressed their
concern that Chinese investors come to Cambodia to enjoy low labor wage and trade quotas, for
example, Generalized System of Preference (GSP), AFTA/CEPT that Cambodia gains from US,
EU, Japan and regional association as the name of low income county. Since those Chinese
investors are well-known as footloose companies, Cambodia might get a risk of the outflow of
Chinese investors and the closure of hundreds of factories when Cambodia status is moved up to

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lower-middle income country because those Chinese investors or companies would not further be
able to enjoy zero or reduced export tariff quotas under the name “Made in Cambodia”. As a
result, Cambodian unemployment rate will increase because of such massive closure, leading to
the turmoil of Cambodia’s economy. Moreover, some of the Chinese investors come to
Cambodia for the quest of natural resources with low sense of CSR. John Ciorciari, a public
policy professor at the University of Michigan, and Son Chhay, Cambodian National Rescue
Party Lawmaker, stated that China provided investments to Cambodia in the aim of accessing to
natural resources and labor, resulting in worse havoc of environment and ecology of Cambodia
(Phon, 23 December 2014). Currently, there are many Chinese’s investments operated in the field
of mining resources and hydroelectric dams, for example, the investment in hydropower at Stung
Areng and Ta Tai dams which was constructed by Chinese mega-company in Koh Kong
Province named Sinohydro Resource Ltd. The construction of these two hydropower electric
dams badly destructed thousands of acres of forests because of the logging activities during the
construction process (Vandenbrink, September 7, 2013).
Chapter 4: Impacts of the 21st Century Chinese Maritime Silk Road on Cambodia’s
security/ defense
i. Opportunities
Similar to economic aspect, the 21st Century China Maritime Silk Road also brings
opportunities to Cambodia’s security/defense. By collaborating with China and other member
countries of this ambitious project, Cambodia would be able to further strengthen its defense
sector and enhance social order in society. Through the “21st Century Chinese Maritime Silk
Road” initiative, Cambodia is able to receive more and more military aids and cooperation from
China. Chinese military aids are one of the main contributors to enhance and strengthen
Cambodian military power and improve technological capacity for the protection of territorial
and sovereignty due to the fact that more powerful neighbors such as Vietnam and Thailand have
always targeted Cambodia sovereignty since ancient time (C. Cheunboran, personal
communication, June 06, 2015 & S. Heng, personal communication, June 13, 2015). In 2013,
China provided 1,000 guns and 50,000 ammunitions to Cambodian General Commissariat of
National Police Force with the signing Memorandum of Understanding between Cambodia
National Police Force, Neth Saveorn, and Chinese Deputy Chief of General Department of

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International Cooperation, Li Zhuqun (The Phnom Penh Post, 2013). By increasing aids to
Cambodia, according to Mr. Li Zhuqun, China would like to be in good hand with Cambodia
counterpart in promoting and protecting social order. Since “Chinese Maritime Silk Road”
mainly focuses on economic perspective, it means that there will be more Chinese investors
investing along the “Chinese Maritime Silk Road”. Therefore, it is of necessary for Cambodia to
be able to maintain domestic stability and security within the territorial. Hence, with more
Chinese military aids, Cambodia will be able to increase its capacity to maintain stability and
safety of Cambodian citizen as well Chinese investors and workers that are currently living and
working in Cambodia.
Actually, China has become the second biggest world economy in 2010 and has strengthened
its power through both economic and security/defense sector. Hence, China requires more
cooperation between regional partners especially ASEAN countries. To China, Cambodia is one
of the most favor countries for future strategic interest such as defense and diplomatic
cooperation. China has become Cambodia biggest military assistance provider in early 2013. In
1998, China had established a military institution 80 km from Phnom Penh in Kompong Speu
province where China paid most of construction and operation (Alfred & Prak. 2015). Since then,
the institution had provided numerous training to Cambodia Royal Arm Forces with four-year
course under the supervision of China Defense Minister and Chinese advisers who supervise
local military officers. Moreover, Cambodian Defense Minister Tea Banh and China Defense
Minister Liang Guanglie (R.F.A, 2012) had signed a memorandum of understanding in Phnom
Penh for more military assistance to Cambodia with the military provision of $17 million dollar
to construct a military training facility. Adding to the memorandum, on 25 November 2013, 12 of
Chinese Z-9 helicopter arrived in Cambodia through Chinese $170 million loan (English People,
2013). Additionally, Chinese ambassador Bu Jinguo handovered some 44 vehicles, 20 forklifts,
2,000kg of unspecific chemicals and $10,000 spare part value to Royal Cambodia Army under
Defense Minister Tea Banh on May 2015 (Parameswaran, 2015). According to Alfred & Prak
(2015), the Chinese military school had been built in around 148 hectare with more than 70
building since 2002. The buildings have been strengthening Cambodia military forces through
various trainings and seminars under the Chinese supervision.

16
ii. Threats
Alongside the opportunities Cambodia might get from this initiative, Cambodia also
faces the threat which is the reduction of military aids from other countries. As mentioned above,
Cambodia has received huge amount of aids and military assistance from China in recent years.
According to S. Heng (personal communication, June 13, 2015), those aids and military
assistance outruns the U.S military assistance; thus, it would affect Cambodia foreign military
aids greatly. The increasing aids from China would means the reduction of military aids from U.S,
which U.S would consider providing aids to Cambodia’s neighboring countries such as Vietnam
and Thailand or other ASEAN countries such as Indonesia, the Philippines and so on. As a result,
it would lead to the reduction of Royal Cambodia Armed Forces capacity and professionalism.
Cambodia and United States have conducted numerous military drills such as Angkor Sentinel
and Naval military drill inside Cambodia territorial. United States once suspended military aids to
Cambodia in 2010 due to the fact that Cambodia government sent back Uighur refugees to China
under China’s demand. It was a huge blow to Cambodia military assistance because United
States military aids are more high-tech and better quality than those of China military assistance.
Furthermore, Cambodian image would be painted badly in the long-term due to the
tremendous Chinese military aids. The acquisition of Chinese military aids to Cambodia
explicitly showed that Cambodia is becoming a backbone military puppet for China to defense
against Vietnam and other claimant states of the South China Sea. The increasing assertiveness of
Chinese military activities in South China Sea by building more islands and active naval patrol
around Paracel and Spratly Islands signal the China commitment in protecting its sovereignty and
resources (Deth, personal communication, June 12, 2015). Through “21st Century Chinese
Maritime Silk Road” plan, China requires one or more countries partner to secure the trading
route and secure the China interest within the ASEAN region. Hence, by accepting more China
military aids would mean Cambodia support China provocative action in South China Sea area.
As Carl Thayer, Southeast Asia security expert at Australia Defense Force Security, stated in
Alfred & Prak (2015) that “For China, it's the beginning of a long-term strategy of winning
influence in the Cambodian military by cultivating these people. China keeps very deep
intelligence files on everybody.”

17
Chapter 5: Impacts of the 21st Century Chinese Maritime Silk Road on Cambodia’s Politic
and Diplomacy
i. Opportunities
The 21st Chinese Maritime Silk Road also paves the opportunities for Cambodia’s politics
and diplomacy. By participating in this Silk Road of Xi, Cambodia would be able to leverage its
important regionally and internationally and its foreign policy bargaining power. This is because
of the attention from other countries to have better relations with and better influence on
Cambodia. In order to attract Cambodia, in addition to economic cooperation and military
assistances, China also provides Cambodia with political support such as party-to-party, domestic
stability and international supporter in international arena. The goals are to promote bilateral
relations in the field of socio-economic development, political and military cooperation between
the two countries (C. Lak, personal communication, June 09, 2015 & S. Heng, personal
communication, June 13, 2015). Actually, Sino-Cambodia relations could be traced back to 13th
century when a Chinese scholar, under Chinese Emperor’s degree, visited Cambodia and reported
back to the Emperor (Cheang, 2011). After the domestic turmoil in Cambodia during 1997, China
and Cambodia had exchange official visit for numerous of times to promote bilateral relations,
economic and social development between the two countries. On 7 November 2014, Cambodia
Prime Minister Hun Sen paid an official visit to China and met with Chinese President Xi Jinping
at the Great Hall of the People. According to Chinese Ministry of Foreign Affair (2014) wrote in
the national website:
“China is wiling to, together with Cambodia, maintain high-level exchanges and inter-
party communication, exchange experience on governance and administration of state
affairs, boost cooperation in such fields as connectivity, agriculture, hydropower,
economic special zone, education, medical care, telecommunication and tourism, and
promote the building of the Silk Road Economic Belt and the 21st Century Maritime Silk
Road.”
The hugely support from China would capture attention from other countries in ASEAN
and other superpower countries such as U.S., Japan, and India on Cambodia. This means that
Cambodia has become the important actor that China, U.S., Japan, India and other countries want
to have good relations with and to reduce the influence of China to Southeast Asia. Actually,

18
ASEAN member states and other superpower countries such as the U.S., Japan, India begun to
see Cambodia as a potential country in term of geo-political affairs when Cambodia and China
reached consensus on “Comprehensive Strategic Partnership of Cooperation” in late 2013 during
Cambodian PM Hun Sen visitation to Chinese Premier Wen Jiabao. The Chinese Premier stated
the agreement would forge the Cambodia-Sino relations and increasing mutual and political
interest. Cambodia’s support to Chinese Maritime Silk Road is also the result from the agreement.
In addition, China had been supporting Cambodia when Cambodia was a chair of ASEAN in
2012 financially and technically. As the result, ASEAN successfully adopted the ASEAN
Declaration of Human Rights, ASEAN Region Mine Center and Cambodia was able persuade
Brazil, the United Kingdom and the European Union to ratified the TAC during its ASEAN chair.
More or less, ASEAN member states had directly or indirectly supported Cambodia during
chairmanship was also due to the fact that Cambodia is an important country with the support of
regional superpower, China. Even though some countries such as United States, Vietnam,
Philippines accused Cambodia as China proxy in the South China Sea issues during the failure of
Joint Communiqué during Phnom Penh ASEAN Submit in 2012, Cambodia always respect the
ASEAN Treaty of Amity and Cooperation and respect all state’s sovereignty. Cambodia
government urged all claimant states not to use ASEAN as negotiation tables in South China Sea
issues but solves the problems bilaterally between China and claimant states in ASEAN. Mr Phay
Siphan (Simon, June 2015), Secretary of Council of Minister, Cambodia never would like to see
any clash or conflict within the region between any parties and Cambodia is a friend to everyone.
Additionally, Cambodia and China have never accused each other regarding human rights issues
and always support each other in regional and international agenda. So through Cambodia
support the “21st Century Chinese Maritime Silk Road” initiative, Cambodia could receive a lot
of benefits from China in both strategic and economic interests to further speed up the Cambodia
development and military enhancement.
ii. Threats
Meanwhile, this initiative also enables threats to Cambodia’s foreign policy which is the
reduction of Cambodia’s foreign policy autonomy. Cambodia, as one of the supporters of the 21st
Century Chinese Maritime Silk Road, could further get more aids and loans as well as military
assistance from China. Yet, those assistances are politically motivated. Hence, more or less, it
would affect Cambodia foreign policy formulation. To some extent, some countries see

19
Cambodia’s foreign policies as “Erosion and Unbalance” due to the losing autonomy that are
influenced by China (C. Cheunboran, personal communication, June 06, 2015, C. Lak, personal
communication, June 09, 2015, & S. Heng, personal communication, June 13, 2015). One good
example is the Cambodia Chairmanship of ASEAN Summit in Phnom Penh in 2012. Cambodia’s
secretary of Foreign Ministry of Foreign Affair and Cooperation, Seoun Rathchavy, (Simon,
2015) had conducted a closed door meeting with foreign diplomats on April 2015. The meeting
concluded as ASEAN could not be involved in South China Sea issues; thus the issues must be
solved bilaterally between the claimant states and China. Following the declaration of Cambodia
new position toward South China Sea issues, some critics said that China is using financial
support to buy Cambodia diplomatic support during ASEAN chair in 2012 (Radio Free Asia,
2013). The neutral stance was considered from skeptics as a way to get Cambodia out of South
China Sea issues; thus allow China to further exercise her provocative aggressive in the region.
For fifteen years, Cambodia-China relations has been cemented due to the Cambodian
government and policymakers are able to reap tremendous amount of economic and political aids
from Beijing that is able the incumbent Cambodian elites to consolidate their power, prosperous
through corruption and strengthening political entrenchment (John, 2013).
Chapter 6: Conclusion
In conclusion, the 21st Century Chinese Maritime Silk Road enables both opportunities
and threats to Cambodia. Actually, every initiative always has both good and bad points, but the
importance is how one country is going to maximize the advantages and minimize the drawback
from those initiatives. Similarly, it is not important whether the 21st Century Chinese Maritime
Silk Road produce opportunities or threats to Cambodia. However, it is of paramount important
how Cambodia maximizes the opportunities and minimizes the threats from this ambiguous
initiative. The 21st Century Chinese Maritime Silk Road is regarded as the golden chance for
Cambodia to improve country development. C. Cheunboran, C. Lak, V. Roth, O. Deth and S.
Heng (personal communication, 2015) are all support for this initiative. They further elaborated
that this Silk Road would produce fruitful short-term effects in term of economic, politic, and
security development due to the fast and availability of such “no-string” attached of China
foreign aids. Such aids are more comfortable and fasten the development projects such as
infrastructure development that is very vital for Cambodia economy, especially when ASEAN
Economic Community is created in 2015.

20
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