World Bank May Vote to Lift Punitive Ban on Funding to Cambodia

Five years ago, the World Bank decided to freeze lending to Cambodia in protest of the government’s practice of forced evictions for public projects. The World Bank may vote this week to remove this ban, effectively allowing it to resume lending money to the nation to continue a project for landless families that has experienced major funding shortages.

Five years ago, the World Bank decided to freeze lending to Cambodia in protest of the government’s practice of forced evictions for public projects. The World Bank may vote this week to remove this ban, effectively allowing it to resume lending money to the nation to continue a project for landless families that has experienced major funding shortages.

Although the Bank ceased its lending of new funds, it continued to administer projects it started before the lending ban. It also allowed money held in trust by the bank for other countries to pass through to the nation despite the ban. It refrained, however, from lending any of its own money to the Cambodian government since 2011, when the Southeast Asian nation began mass evictions in Phnom Penh’s Boeng Kak neighborhood.

A number of groups, including some of the displaced Cambodian residents, have asked the World Bank to require Cambodia to help the evictees before it resumes lending. Some believe, however, the Bank’s Board of Directors may disregard these pleas and vote to resume funding when it meets in Washington, D.C. this week. The Bank may view the larger needs of the entire Cambodian populace as outweighing concerns about the displacement of a relative few.

The Bank has a proposed Country Engagement Note for Cambodia on its agenda for this week’s meeting. The Country Engagement Note is an outline of the Bank’s plans for dealing with Cambodia over the next few years. The Bank may wish to move forward on the proposed second phase of the $25 million Land Allocation for Social and Economic Development (LASED) project.

The first phase of that project concluded in 2015 after seven years. It spent $13 million to set up eight land concession areas for poor families that did not have land of their own. Despite the forced evictions, the World Bank considers the rest of the project an enormous success.

The World Bank’s decision, however, is being complicated by a number of rights groups that believe the LASED project has been anything but a success and, instead, see it as a huge human rights crisis. According to a survey conducted by the human rights group, Licadho, hundreds of the families that were supposed to benefit from the LASED project were not able to actually move onto the land due to a variety of problems.

These issues included poor soil, competing land claims by other people, and many more. As a result, these groups believe the World Bank should not approve a second phase of LASED, even if the forced eviction issues could be ignored entirely. In their opinion, the project has failed on its own merits.

“LASED should not be considered a sustainable project, nor is it a replicable model for social land concessions to the landless,” the Licadho survey result added. “Accordingly, further investment in this project as it stands is the wrong way forward.”