How aid dependence can hurt the rule of law

Does the current rhetoric surrounding President Barack Obama’s visit to Cambodia underscore the importance of the rule of law? It certainly does, but it also seems to discount the relationship between judicial integrity and aid dependence. The reports about Obama’s visit highlight rule of law predominately within the context of democracy and human rights. Yet it seems to gloss over the importance of starting a dialogue about foreign aid and its effect on the rule of law. In its essence, foreign aid disrupts the link between the people and their government.

In Cambodia, justice goes to the highest bidder. This is always true except when power is involved and then justice seemingly goes to the most powerful. For example, look at how land titling was done with respect to Boeung Kak Lake, a part of the capital Phnom Penh. The idea was to establish property rights. But it got twisted and captured by the elite, and the idea of protecting property rights was instead used as an excuse to get rid of people. In the end the lake was bought and filled in.

Imagine what happened to the 20,000 people who lived around the lake. Their houses were buried in mud and they were offered the equivalent of US$ 7,500 (if they were offered anything at all) and told to vacate. The same thing happened at Dey Krahom, and the list of occurrences goes on. The process gets captured by the powerful, and instead of helping the rule of law, donors have facilitated land-grabbing by creating a land-titling system that takes land away from the very people that such a system was intended to help.

Judicial institutions face the same challenge. If all you want are courts, judges and lawyers, fine, but will you have judicial independence? Not really. What I have shown in previous research on aid dependence is that, in cross-sectional time series analysis, there was a statistically significant (albeit not super-strong) negative relationship between aid dependence and the rule of law in the more than 100 countries I looked at.

So how can the rule of law be improved in Cambodia?

I submit that the degree of dependence on foreign aid currently enjoyed by Phnom Penh needs to be lessened. Instead, a plan on increasing exports should be adopted. How did South Korea do it? It exported. Park Chung-Hee, who ruled South Korea with an iron grip from 1962 to 1979, touted the mantra “Export or die”. Cambodia needs foreign exchange. It can’t just live by its credo of “Aid or die”.

I’m not, by the way, condoning Park Chung-Hee’s rule. Rather, I’m saying that if you are going to have some sort of leader-for-life arrangement, you might as well have the kind of growth that got South Korea to where it is today. This leads to my final thought.

Governments such as Phnom Penh do not readily shift political or economic policies because regional partners or Western powers strenuously encourage them to change. Rather, there should be a measured and concerted effort to wean Cambodia off aid dependence and allow its people to develop more responsibly. Only then will the balance of judicial integrity shift to a more moderate measure and the link between people and government become re-established.

Author Note: Sophal Ear is Assistant Professor of National Security Affairs at the US Naval Postgraduate School and author of Aid Dependence in Cambodia: How Foreign Assistance Undermines Democracy. The views expressed are his alone and do not represent the views of the US navy or US government. Research assistance for the blog post was provided by Dimitri Randall.

All opinions expressed are those of the author. The World Economic Forum Blog is an independent and neutral platform dedicated to generating debate around the key topics that shape global, regional and industry agendas.

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