During the Vietnam War, even as US B-52 Stratofortress aircraft were carpet-bombing the Cambodian countryside, the US lent hundreds of millions of US dollars to Cambodia’s flailing government to feed and clothe refugees fleeing the chaos.
Now the US wants that money back — with interest.
For decades, Cambodia has refused to repay the debt, which has grown to more than half a billion US dollars. It says the US, if anything, owes Cambodia a moral debt for the devastation it caused.
Washington says a loan is a loan.
However, Cambodian Prime Minister Hun Sen, an admirer of US President Donald Trump, has appealed to him to forgive the debt.
“Oh, America and US President Donald Trump, how can this be?” Hun Sen said in February, according to the Cambodia Daily. “You attacked us and demand that we give money.”
Between 1965 and 1973, as it fought what would prove to be a losing war in neighboring Vietnam, the US dropped about 500,000 tonnes of explosives on eastern Cambodia. The bombardment started covertly as part of an effort to cut off supply routes used by the Viet Cong.
In 1969, under then-US president Richard Nixon, it expanded into full-fledged carpet-bombing, meant to buy time for US troops to pull out of South Vietnam, while halting the advance of the ultra-communist Khmer Rouge rebels fighting the Cambodian government.
Rice farmers fled the fighting and the bombs in large numbers, abandoning their fields for Phnom Penh. As a food shortage ensued, the US — which was backing the anti-communist government led by then-Cambodian prime minister Lon Nol — lent the country US$274 million to buy US rice, wheat, oil and cotton.
“Many, many people came to Phnom Penh from the countryside, so there was nobody to produce food,” Chhang Song, who was the Cambodian minister for information under Nol, said by telephone from Long Beach, California, where he lives. “There were 2 million, many, many, and we had to provide food for these people.”
The loan, made under a program called Food for Peace, was an afterthought for both countries, which were far more focused on the deteriorating security situation. In April 1975, the US pulled out of Cambodia just before the Khmer Rouge seized power, ushering in a brutal period of starvation, forced labor and mass murder during which up to 2.2 million people died.
However, in the 1990s, as Cambodia began to emerge from decades of war, the US said the money was still owed, with interest and late fees, though it offered rescheduling on favorable terms. Since then, the debt has swelled to US$506 million.
“We lack the legal authority to write off debts for countries that are able, but unwilling to pay,” US embassy in Phnom Penh spokesman Jay Raman said in an e-mail last month. “These legal authorities do not change from one administration to the next, absent an action from [US] Congress.”
Cambodia argues that the loan is invalid because Nol’s government, who seized power in a 1970 coup that deposed then-prince Norodom Sihanouk, was illegitimate.
However, the US Department of State said the international financial system would fall apart if governments cannot be held responsible for their predecessors’ debts.
The US has also disputed arguments by Cambodia that it cannot afford to repay the debt. Once one of the world’s poorest countries, Cambodia graduated to lower-middle income status last year, with a GDP of about US$19 billion, according to the IMF.
Refusing to service the US loan has impeded its ability to borrow internationally.
“I look around me, and to me Cambodia does not look like a country that should be in arrears,” US Ambassador William Heidt told local journalists in February.
He said that the US wanted to “work out a deal that works for both sides,” but that completely canceling the debt was not an option.
“From time to time, for reasons I don’t think that we really fully understand, the Cambodian government feels the need to publicly criticize the US,” Heidt said. “I think that reflects some kind of political dynamic inside of Cambodia.”
Hun Sen, who has been in power since the 1980s, has long resented the US for the bombing and for its support of the Khmer Rouge at the UN after a Vietnamese invasion ousted it in 1979, said Sebastian Strangio, author of Hun Sen’s Cambodia.
Strangio said it was “clear that he’s testing the mettle of the Trump administration.”
Just days after Trump’s inauguration, Hun Sen’s government made international headlines by announcing it would evacuate a village to remove two unexploded US barrel bombs, containing tear gas, that had been discovered behind a pagoda. It later emerged that the bombs had long been known about and evacuation plans were quietly dropped.
A month later, two other bombs were removed from a pond where they had been known to be lying for decades, accompanied by a flurry of commentary in pro-government news outlets that accused the US of hypocrisy over the debt.
David Chandler, a professor emeritus at Monash University in Melbourne, Australia, who has written several books about Cambodian history, said that the bombings were a “deeply sordid” chapter in US history, but that they did not do much to advance the Khmer Rouge’s cause.
Chandler also said he doubted Cambodia would pay the debt.
“In fact, in international law they probably should pay it, because it’s a debt incurred by a previous regime, but the point is the way these regimes changed hands and what they stood for makes it impossible,” he said.
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