If the 600 million dollar deal proposed by Australia’s former finance minister Peter Costello goes ahead, it will be the largest agricultural sector deal in Cambodia’s history. It will see crops such as rice, sugar, palm oil, teak and bananas grown for export.

The food price rises of 2008 awakened international investors to the profits made from leasing tracts of land in poor countries that have water and fertile soil.

“I think agriculture is going to come back into its own as an investment in the decades that lie ahead and of course that's a great opportunity for Cambodia,” Costello said.

He added that the deal would bring improved agricultural methods into the country and boost productivity. It would also generate 150,000 jobs.

80 percent of Cambodia’s population lives in rural areas

Around 80 percent of Cambodia’s 14 million people live in rural areas, relying mainly on farming for a living. But land ownership in Cambodia is a highly controversial topic, ever since the Khmer Rouge nationalized all land and destroyed all records of ownership.

Previous agro-deals involving companies from Cambodia, China and Vietnam have resulted in clashes between the authorities and rural populations.

Human rights workers say numerous deals have seen rural poor thrown off their land. The courts typically rule in favor of the rich and powerful, leaving the landless with no legal avenue to pursue their rights.

250,000 Cambodians affected by land disputes

Matthieu Pellerin works for local human rights NGO Licadho, which recently reported that over 250,000 Cambodians had been affected by land disputes in the past five years.

He said even the most well-intentioned investors ran into problems because of a “well-established system of corruption and a lack of checks and balances to ensure that poor and indigenous communities are not victimized by major agro-industry deals where sizeable pieces of land are sold to private companies.”

“The collusion of all state actors from the village up to the national level – all of these factors make it very difficult, if not impossible, to abide by the book. I think that if one wants to really abide by the book, Cambodia in 2010 is not the place to come.”

Government rejects UN calls to suspend land evictions

During his recent visit to Cambodia, the UN’s special rapporteur on human rights, Surya Subedi, asked the government to suspend all land evictions until proper legal safeguards were put in place. However, the government refused, arguing that such a restriction would hold up development.

Mr Subedi also expressed his concern about the vagueness of key concepts in an expropriation law that recently sailed through parliament, which is controlled by the ruling Cambodian People's Party.

“What do we mean by public interest?” he asked. “If land can be acquired in the public interest, how do you define it? Who defines it?”

One executive involved in the Costello-fronted project said the deal – which at this stage remains a possibility rather than a certainty – would not go ahead if corruption came into play.

Author: Robert Carmichael (Phnom Penh)
Editor: Thomas Bärthlein