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Cambodia Laos 1996-97

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Cambodia Laos 1996-97 COUNTRY PROFILE Cambodia Laos Our quarterly Country Report on Cambodia and Laos analyses current trends. This annual Country Profile provides background political and economic information. 1996-97 The Economist Intelligence Unit 15 Regent Street, London SW1Y 4LR United Kingdom The Economist Intelligence Unit The Economist Intelligence Unit is a specialist publisher serving companies establishing and managing operations across national borders. For over 40 years it has been a source of information on business developments, economic and political trends, government regulations and corporate practice worldwide. The EIU delivers its information in four ways: through subscription products ranging from newsletters to annual reference works; through specific research reports, whether for general release or for particular clients; through electronic publishing; and by organising conferences and roundtables. The firm is a member of The Economist Group. London New York Hong Kong The Economist Intelligence Unit The Economist Intelligence Unit The Economist Intelligence Unit 15 Regent Street The Economist Building 25/F, Dah Sing Financial Centre London 111 West 57th Street 108 Gloucester Road SW1Y 4LR New York Wanchai United Kingdom NY 10019, USA Hong Kong Tel: (44.171) 830 1000 Tel: (1.212) 554 0600 Tel: (852) 2802 7288 Fax: (44.171) 499 9767 Fax: (1.212) 586 1181/2 Fax: (852) 2802 7638 Electronic delivery EIU Electronic New York: Lou Celi or Lisa Hennessey Tel: (1.212) 554 0600 Fax: (1.212) 586 0248 London: Moya Veitch Tel: (44.171) 830 1007 Fax: (44.171) 830 1023 This publication is available on the following electronic and other media: Online databases CD-ROM Microfilm FT Profile (UK) Knight-Ridder Information World Microfilms Publications (UK) Tel: (44.171) 825 8000 Inc (USA) Tel: (44.171) 266 2202 DIALOG (USA) SilverPlatter (USA) University Microfilms Inc (USA) Tel: (1.415) 254 7000 Tel: (1.800) 521 0600 LEXIS-NEXIS (USA) Tel: (1.800) 227 4908 Copyright © 1996 The Economist Intelligence Unit Limited. All rights reserved. Neither this publication nor any part of it may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, electronic, mechanical, photocopying, recording or otherwise, without the prior permission of The Economist Intelligence Unit Limited. All information in this report is verified to the best of the author’s and the publisher’s ability. However, the EIU does not accept responsibility for any loss arising from reliance on it. ISSN 1364-3525 Symbols for tables “n/a” means not available; “–” means not applicable Printed and distributed by Redhouse Press Ltd, Unit 151, Dartford Trade Park, Dartford, Kent DA1 1QB, UK Contents 1 October 31, 1996 Contents Cambodia 3 Basic data 4 Political background 4 Historical background 7 Constitution and institutions 8 Political forces 10 International relations and defence 12 The economy 12 Economic structure 13 Economic policy 15 Economic performance 16 Regional trends 17 Resources 17 Population 18 Education 19 Health 20 Natural resources 20 Economic infrastructure 20 Transport and communications 22 Energy provision 23 Financial services 25 Other services 26 Production 26 Industry 26 Mining and semi-processing 27 Agriculture, fishing and forestry 29 Construction 30 The external sector 30 Merchandise trade 31 Invisibles and the current account 32 Capital flows and foreign debt 33 Foreign reserves and the exchange rate 35 Appendices 35 Sources of information 36 Reference tables EIU Country Profile 1996-97 © The Economist Intelligence Unit Limited 1996 2 Contents Laos 49 Basic data 50 Political background 50 Historical background 51 Constitution and institutions 52 Political forces 54 International relations and defence 55 The economy 55 Economic structure 55 Economic policy 59 Economic performance 61 Regional trends 61 Resources 61 Population 62 Education 63 Health 63 Natural resources 64 Economic infrastructure 64 Transport and communications 65 Energy provision 67 Financial services 68 Other services 69 Production 69 Industry 69 Mining and semi-processing 70 Agriculture and forestry 71 Construction 72 The external sector 72 Merchandise trade 74 Invisibles and the current account 74 Capital flows and foreign debt 75 Foreign reserves and the exchange rate 77 Appendices 77 Source of information 78 Reference tables EIU Country Profile 1996-97 © The Economist Intelligence Unit Limited 1996 Cambodia: Basic data 3 Cambodia Basic data Land area 181,035 sq km Population 10.3 million (1995 World Bank estimate) Main towns Phnom Penh, 691,000 (mid-1993 official estimate); Battambang, 573,900 (1993 estimate) Climate Tropical; rainy season, May-October; dry season, November-April Weather in Phnom Penh Hottest months, March-April, 27°C average annual temperature (daily maxi- mums of 32-40°C); coldest month, January, 25.6°C average annual temperature; wettest month, October, 256 mm average rainfall; driest month, January, 8 mm average rainfall Language Khmer Measures Metric system. Local measures include: 1 tao=15 kg 1 thang=40 litres (20-22 kg paddy) 1 hap=60 kg 1 king (or ray)=0.16 ha 1 chi=3.75 gm 1 damloeng=37.5 gm Currency Riel introduced in March 1980. Average exchange rate in 1995 CR2,450.8:US$1; end-July 1996 CR2,570:US$1 Time 7 hours ahead of GMT Public holidays January 9 (National Day), April (New Year), April 17 (Victory over American Imperialism Day), May 1 (Labour Day), May 20 (Day of Hatred), September 22 (Feast of the Ancestors) EIU Country Profile 1996-97 © The Economist Intelligence Unit Limited 1996 4 Cambodia: Historical background Political background Historical background The Khmer people trace the origin of their state to the emergence of a rich, coastal state known as Funan between the first and sixth centuries AD. By 802 AD, rival principalities in the Mekong Delta gave way to a highly centralised empire based at Angkor. The empire was supported by intensive agricultural production, made possible by a sophisticated irrigation system. At its peak during the reign of Jayavarman VII (1181-1218), the Angkorian empire incorporated parts of present-day Thailand, Malaysia and Vietnam. However, a period of political decline culminated in 1431, when Angkor was sacked by the emerging Thai kingdom of Sukothai (the capital was moved to its present-day site at Phnom Penh at this time). Vietnam and Siam competed for control over Cambodia; by the end of the 18th century the territory of the old Angkorian empire had been substantially reduced (to about two-thirds of present-day Cambodia) and the kingdom was paying tribute to both Siam and the Nguyen dynasty in Vietnam. The French seize control The Khmer monarch, Ang Duong, asked the French government for protection in a bid to break out of this dependence. He was succeeded by his son, King Norodom, who signed a treaty of protection with France in 1863. The treaty granted France control over Cambodian foreign policy, and a permanent French resident-general was established at the Cambodian royal court. In 1884 a second treaty was forced on King Norodom, establishing French colonial rule. In 1887 Cambodia was fully incorporated into the Indochinese Union. The colonial administration of Indochina gave priority to the economic develop- ment of southern Vietnam. By 1945 Cambodia had no modern industry apart from one large rubber plantation and only a skeletal road network. Sihanouk secures As the Second World War spread into the Pacific, Japanese troops were allowed independence into Indochina; the Japanese removed the French colonial government in 1945. In Cambodia, a Khmer government, under the young king Norodom Sihanouk, was put in its place. Initially King Sihanouk was sympathetic to the Khmer nationalist cause, but he became alarmed at the anti-royalist tendencies of the nationalist movement, and arranged for France’s return in 1946. One year later, a new constitution established a parliamentary system of govern- ment and reduced the power of the king to that of a constitutional monarch. However, seriously concerned by links between the nationalist movement and the communist Vietminh in Vietnam, King Sihanouk soon suspended the constitution and assumed emergency powers. Faced with defeat in Vietnam, France met King Sihanouk’s appeal for inde- pendence for Cambodia in 1953. An agreement was ratified at the Geneva Conference on Indochina the next year. In 1955 in the run-up to elections arranged at the Geneva Conference as part of the French decolonisation process, King Sihanouk abdicated the throne in order to lead his own party in the polls. (He remained as Prince Sihanouk until 1993.) His political vehicle, the Sangkum Reastr Niyum (People’s Socialist Community), trounced all the other parties in the elections, including the Democrats (which had won the first parliamentary EIU Country Profile 1996-97 © The Economist Intelligence Unit Limited 1996 Cambodia: Historical background 5 elections in 1948) and the Pracheachon (People’s) party, which was an electoral front for the communists. For the next 15 years the then Prince Sihanouk dominated the country’s political life, his international and royal prestige allowing him to survive challenges for control from both the political right and the left. The Khmer Rouge take However, in the final years of the Vietnam war, Prince Sihanouk was accused by power his own generals of collaborating with Vietnam and destroying the national economy. A parliamentary vote against him was quickly followed by a coup d’état in 1970 led by the prime minister, Lieutenant-General Lon Nol. The monarchy was abolished and a Khmer republic proclaimed; Lon Nol was elected president in 1972. The Lon Nol regime was opposed by a coalition led by Prince Sihanouk and including the underground Communist Party of Kampuchea (CPK), or Khmer Rouge, led by Pol Pot. The country rapidly descended into civil war. The Lon Nol regime soon began to crumble, despite massive US military and economic assistance against the Khmer Rouge, including saturation bombing of rural Cambodia for six months in 1973.
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