Tuesday, 9 February 2010

Cambodia asks US to cancel $339 million debt

U.S. Deputy Assistant Secretary of State Scot Marciel smiles during a meeting with Cambodian Foreign Minister Hor Namhong in Phnom Penh, Cambodia, Tuesday, Feb. 9, 2010. Cambodia asked the United States on Tuesday to cancel US$339 million in debt that dates back to loans from the 1970s, or consider converting most of it into development aid for the impoverished country.(AP Photo/Heng Sinith)  

U.S. Deputy Assistant Secretary of State Scot Marciel, right, and U.S. Ambassador to Cambodia Carol A. Rodley meet with Cambodian Foreign Minister Hor Namhong, unseen, in Phnom Penh, Cambodia, Tuesday, Feb. 9, 2010. Cambodia asked the United States on Tuesday to cancel US$339 million in debt that dates back to loans from the 1970s, or consider converting most of it into development aid for the impoverished country. (AP Photo/Heng Sinith)

Cambodia asks US to cancel $339 million in debt from 1970s

via CAAI News Media

Tuesday February 9, 2010

PHNOM PENH, Cambodia (AP) -- Cambodia asked the United States on Tuesday to cancel $339 million in debt that dates back to loans from the 1970s -- or consider converting most of it into development aid for the impoverished country.

The proposal, which came during a visit by U.S. Deputy Assistant Secretary of State Scot Marciel, was the latest in a long-running exchange about how to handle the debt and what the money was used for 40 years ago.

"Cambodia has asked the United States government to cancel the debt but if it cannot do that, at least turn 70 percent of the debt into aid for the social development of the country," Deputy Foreign Minister Ouch Borith said after a meeting with Marciel. He said if the latter option were accepted, Cambodia would discuss repayment plans for the remaining 30 percent.

Marciel, who is the U.S. ambassador to ASEAN, was expected to brief reporters later in the day.

The U.S. provided low-interest loans to Cambodia during the regime of Gen. Lon Nol in the early 1970s that financed rice, cotton and other agricultural commodities.

Lon Nol came to power in a 1970 coup that ousted Prince Norodom Sihanouk. The United States was the main financial and military supporter of Lon Nol's regime until it was toppled by the genocidal Khmer Rouge movement in April 1975.

Cambodia's current government says the money was also used to "buy weapons and support the war, which caused great suffering to the Cambodian people," Ouch Borith said.

The two countries have not yet come up with a repayment plan, partly because the Cambodian government refuses to accept responsibility for debts incurred by the Lon Nol regime, and partly because of a disagreement over the amount of debt owed.

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