Friday

Cancellation of 41.2 USD million loan, Cambodia

CAMBODIA informed Thailand on Friday it was canceling a US$41.2 million (S$57 million) loan from Bangkok meant to finance the upgrade of a highway from the Thai border.

Cambodian Foreign Ministry spokesman Koy Kuong said his country didn’t need the loan and could afford to build the road on its own.

The decision comes during a period of bad relations between the two countries over Cambodia’s recent welcome to former Thai Prime Minister Thaksin Shinawatra, a fugitive from Thai justice.

Thai-Cambodian relations took a turn for the worse when Cambodia recently named Thaksin an adviser on economic affairs. The subsequent visit by Thaksin, and Cambodia’s rejection of a formal request from Bangkok to extradite him, drew a negative reaction from Bangkok.

Each country has recalled its ambassador and Bangkok has canceled an agreement to negotiate on joint development of offshore territory claimed by both countries. It also said it would review all other assistance agreements and projects with its neighbor.

The secretary to Thailand’s foreign minister, Chavanond Intarakomalyasut, downplayed the importance of Phnom Penh’s cancellation of the loan to upgrade the 117-kilometer road stretching from Cambodia’s northwestern border with Thailand to the province of Siem Reap.