Cambodia is a constitutional monarchy with a parliamentary election system. Since 1993, general elections take place every five years. The National Assembly comprises of 123 seats. The country is ruled by the Cambodian People’s Party (CPP) led by Prime Minister Hun Sen, who is known for his authoritarian leadership style. The last general elections took place in July 2013. For the first time a change in government seemed to be in reach. Following a merger of the two biggest opposition parties, the Sam Rainsy Party (SRP) and the Human Rights Party (HRP), the newly founded Cambodian National Rescue Party (CNRP) was backed by wide public support. According to the National Election Commission (NEC), the CPP won 68 seats and therewith retained power; however, with its worst election
result since 1993. The CNRP won 55 seats but refused to accept the results and take up their seats in parliament, arguing that the elections were not free and fair. The allegations referred to reports of voter intimidation, inaccuracy of the electoral roll, partisanship of the NEC in favour of the ruling party and unequal access to state media for opposition parties. Many complained that the ink to mark voters was not indelible which could have allowed for double-voting. The CPP refused all demands of the opposition to establish an independent commission to investigate flaws in the electoral process. The elections were followed by nationwide protests by CNRP supporters and CPP-critics which often were met with violence by police and security guards. At least one person died. In July 2014, eight key opposition figures were jailed. They were accused of stirring political unrest. Shortly after, following an almost year-long boycott of the election result, opposition leader Sam Rainsy and Prime Minister Hun Sen eventually entered dialogue to overcome the political gridlock. The jailed opposition leaders were released and Hun Sen promised a more balanced distribution of power between ruling party and opposition. The opposition has now taken their seats in parliament.
Over the past two and a half decades the CPP and Hun Sen have ruled the country with a firm hand, not leaving any space for unconstitutional veto players in the traditional sense. Although the Cambodian constitution is actually a very liberal one, with clear civilian control over the military and a system of checks and balances, the dominance of one party has more or less emasculated the division of power.
Although the 1993 constitution guarantees freedom of the press and freedom of expression, the decades-long CPP rule has effectively eliminated these liberties. Broadcasting stations, which are the main source of information for two-thirds of the population, are almost entirely controlled either by the CPP or Hun Sen’s family and business partners. A few independent radio stations exist, but with limited reach. Opposition parties mainly have to rely on foreign media and the internet to spread their messages. The internet and social media networks can be considered mostly free. During the anti-government and garment worker protests at “Freedom Park” in Phnom Penh in 2013 and 2014, several journalists from Cambodian and foreign media were reportedly beaten by security
guards. Some of the attacks resulted in severe injuries. International media watchdogs urged the Cambodian authorities to investigate the cases and to take legal action against those found guilty. The July 2014 announcement by CPP and CNRP politicians to cooperate more closely in the future also included plans for an increased freedom of the media. It remains to be seen if these promises will be followed by action.
In theory the constitution provides for judicial independence and emphasises that the legislative and executive branches of government shall not have judicial power. But the absence of practical safeguards means that the weak judiciary often operates as an extended arm of the CPP.
Cambodia suffers from a severe shortage of legal professionals. Judges often lack proper training and are paid poorly, making them susceptible to bribes. Cash payments often replace proper criminal prosecutions.
Corruption in Cambodia remains rife and is mainly concentrated within the public sector. Almost all interactions with government, from contesting illegitimate traffic offenses to procuring permits often require bribery. Transparency International ranked Cambodia 160th out of 177 countries in 2013. (The Cambodian government has disputed Transparency’s findings, accusing the organisation of being biased.)
Although the Cambodian government has attempted to deal with the issue by passing new laws (e.g. a law on public procurement in 2012), their implementation and enforcement has been deficient.
Cambodia has been slowly increasing the standards of its human rights over the past few years. Cambodia repealed the death penalty for all crimes over two decades ago. That being said, the country still suffers greatly when it comes to people trafficking, child labour and arbitrary arrests and detention. Cambodia is also a source, transit and destination country for human trafficking.
Child labour also plagues the country, encouraged by economic growth and poorly enforced laws. Arbitrary arrests remain the government’s chosen way of intimidating dissenters and civil rights activists.
Property rights are not effectively protected. Land owners can be expropriated by government agencies if it is in public interest (which is often rather broadly defined). The land titling system is deficient; in many cases land owners can’t prove their ownership. Land grabbing and forced evictions happen at an alarming rate and often leave whole communities homeless. Perpetrators are rarely prosecuted. A consultation project with the World Bank was meant to find a solution to this problem, but the Cambodian government decided to withdraw in 2010.
The protection of intellectual property rights is equally lacklustre. Counterfeit goods such as car parts, electronic equipment, pharmaceuticals and apparel are readily available. Relevant laws are rarely enforced.
Government spending (which includes consumption and transfer payments) equals 20% of GDP. Despite increased spending during the past year, Cambodia manages to maintain a balanced budget.
Cambodia’s income and corporate tax rates are set at 20%. (Except for the oil and gas sectors where the corporate tax rate stands at 30%.) Other taxes include value added tax, excise tax, accommodation tax, and a tax on immovable property. Overall tax revenue accounts for about 11% of GDP.
As of 2014, 35 commercial banks operated in Cambodia. Additional financial services are offered by 7 specialised banks and 32 micro-finance institutions. The recent opening of Cambodia’s first private credit bureau has improved access to credit information. Starting, running and closing a business are subject to a number of regulations. In its 2014 Doing Business report, the World Bank ranked Cambodia at the 137th position out of 189 countries (down from 133rd in 2013). Starting a business takes 11 procedures and 104 days (compared to previously 9 procedures and 85 days). The process has become more expensive since the cost for getting registration documents approved and stamped by Phnom Penh Tax Department has been increased. Getting a license is a time-consuming process of 21
procedures, which on average take 652 days. Inflexible and ineffectively enforced labour regulations thwart job creation and productivity growth. The non-salary cost of an employee is low, but regulations regarding work hours are rigid.
The weighted average tariff rate stands at 9.5%. Cambodia’s trade regime has undergone two decades of gradual trade policy liberalisation. An ASEAN member-country, Cambodia also joined the ASEAN Free Trade Zone which has led it to reduce tariffs on imports from other member countries. A number of non-tariff trade barriers have been removed, but some import bans and restrictions, non-automatic import licensing, a weak intellectual property rights protection system and an inconsistent customs administration still pose obstacles to international trade.
With the ASEAN Economic Community (AEC) a single regional market of more than 600 million people will be created by the end of 2015. The AEC will provide for a free flow of goods, services, investment capital and skilled labour.
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