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Cambodia's Hun Sen Vows to Crack Down on Corruption as Aid Donors Meet

Cambodia's prime minister has told aid donor countries he will step up efforts to curb corruption in his country. Mr. Hun Sen's comments were made as donor countries and international institutions met in Cambodia.

Prime Minister Hun Sen, speaking at the start of two days of talks with the international donor community in Phnom Penh, said his government planned to pass anti-corruption legislation, simplify the tax system, and eliminate excessive regulations.

Corruption has been a chief concern of donors in preparing for their first meeting in Cambodia in two years.

A U.S. government study estimated losses in Cambodia from corruption at up to $500 million annually. Other international institutions and non-government groups also are pressing the government on graft.

The New York-based Human Rights Watch called on donors to reduce aid unless Cambodia improved both its human rights record and curtailed corruption.

The World Bank, a major donor, says Cambodia has come what it terms "a crossroads," with the risk of falling back into an authoritarian state unless reforms are made.

Cambodia this week is seeking $1.8 billion in development aid over the next three years. The last donors' gathering in 2002 generated commitments of $635 million. The government relies on international aid to fund about half its budget.

But Tim Smyth, a business consultant in Phnom Penh with the firm Indochina Research, says donors are unlikely to cut assistance to Cambodia now.

"I don't think you're going to see realistically a drastically reduced overall contribution," he said. "Maybe phased in differently, structured differently, but I just can't see how the donors would have such a turnaround and drastically reduce right now when the government is starting - a little bit - to fulfill its end of the bargain."

Mr. Smyth expects more aid will focus on the agricultural sector and small and medium enterprises.

Cambodia is one of the world's poorest nations. More than half the 13 million population live on less than a $1 per day and calls are being made that development programs to focus more on the very poor.