WASHINGTON—Ant Technology Group, the parent company of China’s largest digital payment platform Alipay, is set to go public this year, even as the company’s ties to the Chinese Communist Party (CCP) could pose significant risks to U.S. investors. Controlled by billionaire Jack Ma, founder of Alibaba, the Chinese financial technology company is preparing for an […]
Crown Resorts has apologised to shareholders for governance and risk management failures unearthed by a NSW inquiry, while an investor revolt prompted a director to resign. “Let me say clearly that I unreservedly apologise for the failings,” chairman Helen Coonan told the gaming and casinos group’s virtual annual general meeting on Oct 22. “Having a gaming licence is a privilege that we as an organisation do not take for granted.” The NSW Independent Liquor and Gaming Authority has been looking into Crown’s fitness to operate a new Sydney casino. Australia’s financial watchdog is investigating possible breaches of anti-money laundering and counter-terrorism laws. Shareholders cast a protest vote against three directors who stood to be re-elected, and served a “first strike” on pay. One director, John Horvath, had 31 percent of votes cast against him. He said he would retire. Horvath acknowledged investors did not support him but for the sizeable vote of Consolidated Press Holdings, owned by James Packer. Another director, Consolidated Press boss Guy Jalland, called the 41 percent of votes against him “significant and serious”. “I’m doing everything I can at the Crown board to have the company do better,” Jalland said. The other director who stood for re-election, ANZ Bank director Jane Halton, had 24 percent of votes against her. She joined Crown in 2018. The executives’ remuneration report attracted a 34 percent protest vote. The result does not stop payments, but puts pressure on directors to retain their jobs next year. Under the `two strikes’ rule, if more than 25 percent of shareholders vote against two consecutive remuneration reports, it triggers a board spill. Chair Helen Coonan and directors faced critical questions from shareholders. Some worried the NSW inquiry may lead to Crown being stripped of its Sydney casino licence. Crown has a 99-year lease on the site and Coonan said she was confident Crown could deal with any eventuality. Crown this year appointed her as non-executive chair and Ken Barton as its first CEO. Executive chair John Alexander will retire in January. On Wednesday, Crown severed a services agreement with Packer’s Consolidated Press and a controlling shareholder protocol. Both arrangements allowed the billionaire, who holds 36.8 percent of Crown through his private company, access to information not available to other investors. Critics argued the arrangements blurred the lines between the board and management of the companies, particularly after Packer stepped down as a Crown board director in 2018. “CPH remains a significant shareholder, and I appreciate that this relationship needs to be appropriately managed,” Coonan said. “I want to assure our various stakeholders that we are listening and changes will be made.” Earlier this month, Packer appeared before the NSW inquiry. He agreed that after leaving the board he continued to communicate with directors and management on issues such as asset sales and cost-cutting. The billionaire indicated he may sell down his voting shares. Earlier this week, AUSTRAC began investigating possible breaches of anti-money laundering and counter-terrorism laws. The NSW inquiry was triggered by media reports last year accusing Crown of doing business with casino “junket” operators who had not been vetted for organised crime links. Shares were up 2.39 percent to $8.58 at 1550 AEDT. Sydney
BRUSSELS—The European Commission launched infringements procedures Tuesday against Cyprus and Malta over their “golden passport” programs, in which wealthy people can acquire EU citizenship in exchange for an investment. The EU’s executive said the lucrative schemes are in violation of EU law and undermine the “essence of EU citizenship.” Cyprus recently announced that it was ending its program amid allegations that a top state official and a veteran lawmaker were trying to bypass strict vetting rules. Cyprus says it will end its program from Nov. 1, though the Commission notes that the country plans to continue processing current applications. The Cypriot program was introduced in the wake of a 2013 financial crisis that brought the country to the brink of bankruptcy and forced it to accept a financial rescue program from creditors. Like a similar program in Malta, it has attracted many foreigner investors because a passport from those EU countries automatically grants the holder access to the entire 27-nation European Union. Around 4,000 Cypriot passports have been issued to investors under the program, generating more than 7 billion euros ($8.25 billion). In Malta, the program was among the topics investigative reporter Daphne Caruana Galizia had reported on before she was blown up by a car bomb while driving in 2017. “The schemes remain in place for the time being, in both member states concerned and could be replaced by similar investment schemes” said EU Commission spokesman Christian Wigand. “Malta has in fact informed the Commission that it envisages a prolongation of citizenship foreign investment.” The commission set a two-month deadline for both countries to reply to letters of formal notice and can ultimately decide to refer the matter to the Court of Justice. Anti-corruption watchdog Transparency International welcomed the commission’s decision, saying the scheme served “corrupt interests, not the common good.” In a report last year, the commission also criticized Bulgaria for offering passports in exchange for money to investors without any real connections to the country. Wigand said the commission has also sent a letter to Bulgarian authorities asking them to phase out their citizenship scheme and provide detailed information about the program within a month. Transparency International asked the EU Commission to scrutinize other similar schemes across the bloc, mentioning Portugal and Austria in particular, to determine whether they are legal. By Samuel Petrequin
The United States announced on Monday at the governmental summit of Eastern and Central European countries held in Estonia that it will match 30 percent of investments to develop north-south connectivity between the Baltic, Adriatic, and Black Seas. The infrastructure in that region was underdeveloped because of Soviet domination during the Cold War. U.S. Under Secretary of State for Economic Growth, Energy, and the Environment Keith Krach said at the Summit that the U.S. International Development Finance Corporation announced its intent to match 30 percent of Three Seas Initiative countries’ combined investment, up to $1 billion. The goal is to stimulate investments in each member country so the more each country invests, the more that the United States will invest, Krach added. The heads of state and ministers of 12 Eastern and Central European countries participating in the Three Seas Initiative, as well as representatives of the United States and the European Union, convened at a summit in Tallinn, Estonia on Oct. 19. U.S. Under Secretary of State for Economic Growth, Energy, and the Environment Keith Krach at the Three Seas Initiative Virtual Summit in Tallinn, Estonia on Oct. 19, 2020.(Courtesy of Three Seas / Annika Haas) The Three Seas Initiative focuses on cross-border infrastructure projects in the development of transportation, energy, and digital infrastructure within Central and Eastern Europe (CEE). “Our aim is to help the fund reach $3.4 billion. So we can invest all of that $1 billion in all types of infrastructure that can go for roads, bridges, railways, 5G, ports, and energy projects,” Krach said at the Three Seas Summit press conference. However the United States will only support “trusted clean infrastructure, as described in the blue dot standards,” Krach said. Blue Dot Network, launched by Australia, Japan, and the United States is “a globally recognized seal of approval for major infrastructure projects, letting people know that projects are sustainable and not exploitative,” according to the U.S. government website. Its mission is to promote “quality, market-driven, and private-sector led investment.” Blue dot standards which set “high standards for governance, transparency, environmental, and financial sustainability” and benefit local countries’ workforce are in stark contrast to the Chinese Communist Party’s (CCP) initiative “One Belt, One Road,” also known as Belt and Road Initiative (BRI), Krach said. BRI projects are “financed by the Chinese government, Chinese banks,” Krach said, they use Chinese workers, and are designed only to benefit the Chinese Communist Party. There are stories around the world about the secret agreements, the forced collaterals related to BRI, he added. U.S. Secretary of State Mike Pompeo speaks during a news conference in Washington, on Sept. 21, 2020. (Patrick Semansk/POOL/AFP via Getty Images) U.S. Secretary of State Mike Pompeo encouraged all members of the initiative to contribute to it when speaking at the Summit, “The United States has skin in the game, and we look forward to every member of the Three Seas Initiative contributing as well.” Since the Three Seas Summit last year, the Polish state-owned development bank and the Romanian export-import bank created the Three Seas Investment Fund, which “is run by a private entity, free of political influence,” Pompeo said. Most of the countries have already either invested in it or committed to invest. The two banks have made initial investments of a total of more than €500 million ($588 million). President of the Polish State Development Bank (BGK), Beata Daszynska-Muzyczka announced at the Summit that the bank board committed to increasing the investment to €750 million ($883 million). However the number of infrastructure needs in the region requires investments of about €600 billion ($706 billion), Daszynska-Muzyczka said. Seven more Three Seas members decided to join the fund, Polish President Andrzej Duda said at the press conference. “Those member-states that have not yet invested in the Fund should do so now, and other member-states should make additional investments,” Pompeo said, adding “government investments in the Investment Fund are useful, but nothing can match the financial might of the private sector. You, we, must grow the Fund by attracting private capital and investment.” Pompeo also warned the countries against favoring state-owned enterprises or putting politics in the way of private investments. He also advised the countries to establish a Three Seas Secretariat to “ensure continuity and greater progress” between summits. He also urged the member–states to move projects quickly “from concept to shovel-ready stage.” “As you move forward, you should know you will not be alone. America is with you,” Pompeo said. What Is the Three Seas Initiative Romania’s Midia port on the Black Sea before it embarks its passengers: thousands of sheep to be shipped to Libya for the Eid al-Adha holiday on July 30, 2019. (Daniel Mihailescu/AFP via Getty Images) Launched as a flexible political platform at the governmental level by Croatia and Poland, the Three Seas Initiative has been joined by 12 members of the European Union which with the exception of Austria used to be a part of the Eastern communist bloc. Due to exploitation by their communist rulers and Soviet domination, the infrastructure of the CEE countries was underdeveloped and focused only on interconnections along the East-West axis which became an impediment to their economic growth and the economic integration with Western Europe. Despite the European Union’s large investments in transport infrastructure projects in CEE countries, the gap between them and Western Europe is still significant and has yet to be bridged. The shortfall in investments in the infrastructure, energy, and digital fields as estimated by the International Monetary Fund (IMF) has grown over the years to as much as €1.15 trillion ($1.36 trillion). The average GDP per capita in the Three Seas countries was 78 percent of the European Union average in 2018 but their average economic growth rate during 2015-2019 was 3.5 percent compared to 2.1 percent in the European Union, according to the Three Seas website. The IMF forecast that in 2020 it will continue to be higher than in the European Union. Although costs to build infrastructure are high the benefits are sizeable, IMF Managing Director, Kristalina Georgieva said at an event at the Atlantic Council. The short-term benefit is job creation and an increase in economic resource utilization. In the long term, improved interconnectivity will increase the overall production of goods and services, she said. Benefits of Infrastructure Improvement Due to the impact of the CCP (Chinese Communist Party) virus pandemic, some European countries may move some of their supply chains out of China to the Three Seas region. “The Three Seas region with its qualified workforce and improved infrastructure can play an important role in creating new supply chains,” President Duda said at the press conference. Mark Menezes, Deputy Secretary of Energy said at the press conference that the United States “encourages member nations to commit to creating economic conditions that boost private sector investment in energy infrastructure.” It will not only bring “direct economic benefits, like jobs, and lower energy costs for consumers, but also energy security benefits, reducing reliance on any single supplier for energy,” he added. Edward Lucas, a Nonresident Senior Fellow at the Washington-based Center for European Policy Analysis (CEPA) wrote that the Three Seas Initiative’s “implicit aim, backed by the United States and the European Union, is to compete with the 17+1” grouping of Central and Eastern European countries led by Beijing to promote its infrastructure projects in the region. Two U.S. Representatives Marcy Kaptur (D-Ohio) and Adam Kinzinger (R-Ill.) introduced in the House a bipartisan resolution in support of the Three Seas Initiative that has been passed out of the Committee on Foreign Affairs. The Initiative will “boost the resiliency of European infrastructure, energy, and digital security in the face of growing Russian and Chinese threats to democracy,” Kaptur said in a statement. “The Three Seas Initiative will undoubtedly bolster energy independence and infrastructure security in the region, and show strong U.S. support in the face of increased Russian and Chinese influence over these countries,” Kinzinger said in the statement.
U.S. Ambassador to Cambodia W. Patrick Murphy has held a rare meeting with Cambodia’s Minister of Defense General Tea Banh in the wake of sanctions Washington leveled against a Chinese developer operating in the Southeast Asian nation. The Union Development Group (UDG)—which is building the U.S. $3.8 billion-dollar Dara Sakor project including a seaport, resorts, and casinos in Cambodia’s Koh Kong province —was sanctioned by the Treasury Department on Sept. 15 under the Global Magnitsky Human Rights Accountability Act for land grabs, rights abuses, and corruption in the country. The Department also raised concerns that Beijing may be using the project to secretly build a naval base and airstrip for military use as part of a bid to secure its territorial claims in the disputed waters of the South China Sea. Tea Banh, who last week said that UDG had been targeted unfairly and is operating in line with Cambodia’s laws, met with Ambassador Murphy on Monday at the Office of the Council of Ministers in the capital Phnom Penh to hold talks attended by senior officials of both the Defense Ministry and the U.S. Embassy. In a post to Facebook on Tuesday, the U.S. Embassy said Murphy “had a productive meeting” with Tea Banh, also Cambodia’s deputy prime minister, “to discuss a range of potential areas of strengthened security cooperation, as well as ongoing efforts to preserve Cambodia’s sovereignty.” U.S. Embassy spokesperson Arend Zwartjes told RFA’s Khmer Service in an email Wednesday that Washington is “hopeful that we can find a way to expand military-to-military cooperation” as a result of the talks. Cambodia’s Defense Ministry abruptly suspended annual “Angkor Sentinel” joint exercises with the U.S. military in 2017. The government had claimed it was too busy preparing security for commune elections in June 2018 to take part in the exercises, but they have yet to be reestablished. Observers said at the time that the moves indicated Cambodia was pivoting away from Western influence in favor of better relations with other countries on the rise in Asia, such as China. In April, Prime Minister Hun Sen said that his government would welcome resumed military drills with the U.S. but urged Washington to stop suggesting that Phnom Penh was responsible for ending the exercises. The possibility that China could establish a military foothold in Cambodia has long worried Washington. Vice President Mike Pence in 2018 wrote a letter to Hun Sen expressing fears that Cambodia might be planning to host Chinese military equipment at the Ream Naval Base in the coastal city of Sihanoukville, but Hun Sen dismissed the concerns. Ream base was at the center of controversy last year after The Wall Street Journal in July cited U.S. and allied officials as confirming a secret deal to allow the Chinese to use part of the base for 30 years—with automatic renewals every 10 years after that—and to post military personnel, store weapons and berth warships. The reported deal, which would provide China with its first naval staging facility in Southeast Asia and allow it to significantly expand patrols on the South China Sea, was vehemently denied at the time by Hun Sen, who said permitting foreign use of a military base in the country would “be in full contradiction to Cambodia’s constitution.” Cambodia's Dara Sakor airport is shown under construction by China's United Development Group (UDG) in a June 9, 2020 photo. Planet Labs, Inc. Reports dismissed Cambodia’s Ministry of Defense posted a statement on its website Tuesday saying Tea Banh reiterated that reports Cambodia will allow a Chinese military presence on its territory are unfounded. “Samdech Tea Banh said that Ream Navy Base is small and shallow and cannot accommodate big ships or big vessels,” the statement said, referring to the minister with an honorific title and adding that any development of the site will be “for Cambodian naval use only.” However, Tea Banh noted that development at Ream Navy Base had been studied over the last 10 years and upon completion would “welcome any ship.” “Tea Banh stressed that Cambodia’s constitution won’t allow any foreign military base on Cambodian territory,” the statement said. “Related to the U.S. concerns over Ream Navy Base, Tea Banh stressed that it will be solely reserved for Cambodian usage, not for foreign militaries.” Speaking to RFA, political analyst Em Sovannara said Washington routinely brings up the possibility of a foreign navy base to counter Chinese influence in Cambodia and to ensure Hun Sen’s government honors the country’s constitution. He said Cambodia should “show the world it is impartial and welcome all stakeholders.” “Cambodia should show it is not leaning toward any particular powerful nation and should open cooperation to all countries in a gesture of goodwill,” he said. Reported by RFA’s Khmer Service. Translated by Samean Yun. Written in English by Joshua Lipes.
Cambodia’s government on Wednesday condemned the U.S. Department of Treasury’s decision to sanction a Chinese developer building a massive project in the country’s Koh Kong province over graft and rights abuses, calling the allegations “false” and saying the jungle resort plan was going ahead. The Treasury’s Office of Foreign Assets Control (OFAC) on Tuesday sanctioned Union Development Group (UDG) for the “seizure and demolition of local Cambodians’ land” during construction of the Dara Sakor project, prohibiting the company from doing business with any U.S. citizen and cutting it off from the U.S. financial system. The Treasury said that in order to obtain the land for the U.S. $3.8 billion-dollar project—which includes an airport, deep water seaport, and casino resort as part of an investment zone in the middle of the jungle—UDG falsified its registration to say that it was Cambodian owned before reverting to its true Chinese ownership and continuing to operate without repercussions. UDG was designated under the Global Magnitsky Human Rights Accountability Act for “acting for or on behalf of a current or former government official, who is responsible for or complicit in, or has directly or indirectly engaged in corruption”—in this case, a Chinese-owned company acting on behalf of a Chinese official. The Treasury said some of UDG’s “seizure and demolition” of land for the Dara Sakor project was conducted through Kun Kim, a former senior Royal Cambodian Armed Forces (RCAF) who the agency sanctioned in December last year for corruption. It said Kun Kim had directed military forces to prevent villagers from planting rice paddy fields on disputed lands, as well as burn down their houses and control their movements. The agency also raised concerns that Beijing may be using the project to secretly build a deep-water port naval base and airstrip for military use there as part of a bid to secure its territorial claims in the disputed waters of the South China Sea. It noted that Cambodian government spokesperson Phay Siphan has said Dara Sakor could be converted to host military assets. On Wednesday, Phay Siphan posted a message on his Facebook page denouncing the Treasury’s “false allegations” and said the agency had misquoted him. “It is an exaggeration,” he said of the statement. RFA’s Khmer Service was unable to reach Phay Siphan for comment on the sanctions. Calls to Kun Kim also went unanswered on Wednesday. Sok Ey San, spokesperson for Prime Minister Hun Sen’s ruling Cambodian People’s Party (CPP), told reporters that while Washington acted within its rights in leveling sanctions against UDG, the company’s project plan was vetted and approved by the Cambodia Development Council and would proceed as planned. “What we have done is a matter of sovereignty,” he said. “Foreign sanctions will have no impact as the development is moving forward without any obstacles.” Sok Ey San said he did not expect that the Treasury’s decision would affect bilateral relations between Washington and Phnom Penh. Sanctions welcomed The Dara Sakor project has been mired in controversy ever since UDG’s parent company, Tianjin Wanlong Group, was granted a 99-year lease to 90,000 acres along 20 percent of Cambodia’s coastline in May 2008. The lease, which was handed to Tianjin Wanlong without an open bidding process, provided the company with more than triple the size of any concession allowed under Cambodia’s land law and exempted it from any payments for a decade. UDG soon began clearing large swathes of forest from Botum Sakor National Park that was included as part of the land lease and forcing hundreds of families to relocate—many of which have yet to receive compensation they were promised as part of the deal 12 years ago. Meanwhile, much of the Dara Sakor project remains unfinished, and structures that wee built—such as the casino and hotel—have been largely left to rot. Few tourists visit the area and not many companies have signed deals to set up a presence in the investment zone. Thorng Chandara, Koh Kong provincial coordinator for local rights group Adhoc, told RFA that the project has affected residents of two of the province’s districts, “more than 1,000 families” yet to receive compensation for being uprooted. He said residents were never informed about the development or given the opportunity to discuss how it should proceed. Alejandro Gonzalez-Davidson, the founder of domestic environmental watchdog Mother Nature, welcomed the sanctions, saying Washington had sent Hun Sen a message that there will be more to come if he continues to abuse human rights and destroy Cambodia’s natural resources—and particularly if he allows China to build a military base in the country. “If the government allows Chinese military installations, not only will Try Pheap or Kun Kim be targeted, sanctions will affect Hun Sen’s family as well,” he said. “This is a message for Hun Sen to back down.” Rampant timber trafficking in Cambodia led the Treasury Department to sanction Try Pheap, a business tycoon with close ties to Hun Sen, and 11 of his registered entities at the same time as Kun Kim. Treasury cited his establishment of “a large-scale illegal logging consortium that relies on the collusion of Cambodian officials, to include purchasing protection from the government, including military protection, for the movement of his illegal products.” The possibility that China could establish a military foothold in Cambodia has long worried Washington. Vice President Mike Pence in 2018 wrote a letter to Hun Sen expressing fears that Cambodia might be planning to host Chinese military equipment at the Ream Naval Base in the coastal city of Sihanoukville, but Hun Sen dismissed the concerns. Ream base was at the center of controversy last year after The Wall Street Journal in July cited U.S. and allied officials as confirming a secret deal to allow the Chinese to use part of the base for 30 years—with automatic renewals every 10 years after that—and to post military personnel, store weapons and berth warships. The reported deal, which would provide China with its first naval staging facility in Southeast Asia and allow it to significantly expand patrols on the South China Sea, was vehemently denied at the time by Hun Sen, who said permitting foreign use of a military base in the country would “be in full contradiction to Cambodia’s constitution.” Beijing decries ‘unwarranted allegations’ On Wednesday, Chinese foreign ministry spokesman Wang Wenbin told reporters at a regular press briefing in Beijing that the Chinese government requires overseas Chinese companies to abide by local laws and regulations and stressed that bilateral cooperation between China and Cambodia is “open, transparent, mutually beneficial and equal.” Wang said the U.S. “has repeatedly used unwarranted allegations that China’s relevant projects in other countries could be transformed into military bases to discredit and attack our normal cooperation with relevant countries.” “However, the United States itself has hundreds of military bases in more than 150 countries around the world,” he said, calling Washington’s approach “hypocritical.” Wang alleged that Washington has been “violating international law … to illegally impose sanctions on Chinese companies” in order to “contain and suppress China” and vowed that Beijing will “take necessary measures to resolutely safeguard the legitimate rights and interests of its own enterprises.” The Chinese Embassy in Phnom Penh issued a statement on its Facebook page Wednesday claiming that the Trump administration had “exaggerated the truth” in order to sanction UDG, calling the action a violation of Cambodian sovereignty and demanding that Washington reverse course. Reported by RFA’s Khmer Service. Translated by Samean Yun. Written in English by Joshua Lipes.
The U.S. Department of Treasury on Tuesday sanctioned a Chinese developer for the “seizure and demolition of local Cambodians’ land” during construction of the Dara Sakor project in Cambodia, which has been touted by Beijing as one of the key pieces in its Belt and Road infrastructure initiative. The sanctions by the Treasury’s Office of Foreign Assets Control (OFAC), which target perpetrators of serious human rights abuse and corruption under the Global Magnitsky Human Rights Accountability Act, prohibit Union Development Group (UDG) from conducting business with any U.S. citizen and cuts it off from the U.S. financial system, the agency said in a statement. Additionally, land granted to UDG as part of a lease by the Cambodian government extends into Botum Sakor National Park, a protected area which can only be handed over by royal decree. The Treasury Department said that in order to obtain the land, UDG falsified its registration to hide its Chinese ownership. “After falsely registering as a Cambodian-owned entity in order to receive land for the Dara Sakor development project, UDG reverted to its true ownership and continued to operate without repercussions,” said Secretary Steven Mnuchin. “The United States is committed to using the full range of its authorities to target these practices wherever they occur.” The Treasury Department said that it had designated UDG for “acting for or on behalf of a current or former government official, who is responsible for or complicit in, or has directly or indirectly engaged in corruption”—in this case, a Chinese-owned company acting on behalf of a Chinese official. Tuesday’s action was not the first taken by the Treasury Department against entities in connection with the U.S. $3.8 billion-dollar Dara Sakor project, which includes an airport, deep water seaport, and casino resort as part of an investment zone in the middle of the jungle in Koh Kong province. In December last year, the agency sanctioned former senior Royal Cambodian Armed Forces (RCAF) general Kun Kim for corruption, noting that he was “instrumental in a development in Koh Kong province and had reaped significant financial benefit from his relationships with a People’s Republic of China (PRC) state-owned entity.” On Tuesday, the Treasury confirmed that some of UDG’s “seizure and demolition” of land for the Dara Sakor project was conducted through Kun Kim. “Specifically, with the assistance of Cambodian military forces provided through Kim, UDG prevented local villagers from planting rice paddy fields on the disputed land and was also accused of burning down the houses of villagers with whom it had conflicts, and of using private security and Cambodian military forces to control the movements of local villagers,” the statement said. “Cambodia’s Council of Ministers issued a directive ordering UDG to stop destroying villagers’ property; however, UDG ignored the directive and continued the destruction.” Controversial project The Dara Sakor project has been mired in controversy ever since UDG’s parent company, Tianjin Wanlong Group, was granted a 99-year lease to 90,000 acres along 20 percent of Cambodia’s coastline in May 2008. The lease, which was handed to Tianjin Wanlong without an open bidding process, provided the company with more than triple the size of any concession allowed under Cambodia’s land law and exempted it from any payments for a decade. UDG soon began clearing large swathes of forest from Botum Sakor National Park that was included as part of the land lease and forcing hundreds of families to relocate—many of which have yet to receive compensation they were promised as part of the deal 12 years ago. Meanwhile, much of the Dara Sakor project remains unfinished, and structures that are—such as the casino and hotel—have been largely left to rot. Few tourists visit the area and not many companies have signed deals to set up a presence in the investment zone. It is not entirely clear why Dara Sakor appeared to have been adopted as a Belt and Road project in 2017, when the China Development Bank told China’s official People’s Daily newspaper that it had underwritten a U.S. $15 million “Belt and Road” bond to support UDG’s building of a resort on Cambodia’s coast. The report did not mention Dara Sakor by name. The project was also included in a 2017 Belt and Road yearbook published by an affiliate of China’s Ministry of Commerce, describing it as “the biggest project of the Belt and Road initiative so far.” On Tuesday, the Treasury said that UDG-funded activities “have forced Cambodians from their land and devastated the environment, hurting the livelihoods of local communities, all under the guise of converting Cambodia into a regional logistics hub and tourist destination.” “As is too often the case with Beijing’s One Belt One Road initiative, these activities have disproportionately benefitted the PRC, at the expense of the Cambodian people.” Villagers in a land dispute with UDG protest in front of Beijing's embassy in Phnom Penh, Cambodia, July 8, 2019. RFA Military use The opacity of the project has led to fears, particularly in Washington, that Beijing may secretly be building a deep-water port naval base and airstrip for military use there as part of a bid to secure its territorial claims in the disputed waters of the South China Sea. The Treasury said Tuesday that China “has used UDG’s projects in Cambodia to advance ambitions to project power globally,” noting that Cambodian government spokesperson Phay Siphan has said that Dara Sakor could be converted to host military assets. “A permanent PRC military presence in Cambodia could threaten regional stability and undermine the prospects for the peaceful settlement of disputes, the promotion of maritime safety and security, and the freedom of navigation and overflight,” it said. Vice President Mike Pence in 2018 wrote a letter to Prime Minister Hun Sen expressing fears that Cambodia might be planning to host Chinese military equipment at the Ream Naval Base in the coastal city of Sihanoukville, but Hun Sen dismissed the concerns. Ream base was at the center of controversy last year after The Wall Street Journal in July cited U.S. and allied officials as confirming a secret deal to allow the Chinese to use part of the base for 30 years—with automatic renewals every 10 years after that—and to post military personnel, store weapons and berth warships. The reported deal, which would provide China with its first naval staging facility in Southeast Asia and allow it to significantly expand patrols on the South China Sea, was vehemently denied at the time by Prime Minister Hun Sen, who said permitting foreign use of a military base in the country would “be in full contradiction to Cambodia’s constitution.” Pivot to China Increased ties between the militaries of Cambodia and China, which now include annual joint military exercises, come as Phnom Penh has increasingly pivoted towards Beijing since finding itself ostracized by Western governments over significant rollbacks on democratic freedoms. In November 2017, Cambodia’s Supreme Court ruled to ban the main opposition Cambodia National Rescue Party (CNRP), months after its president, Kem Sokha, was arrested for an alleged plot to overthrow the government. The dissolution of the CNRP was part of a wider crackdown by Hun Sen on the opposition, NGOs and the independent media, which paved the way for his ruling Cambodian People’s Party (CPP) to win all 125 seats in parliament in the country’s July 2018 general election. While relations with the West have increasingly soured in the aftermath of the ballot, Cambodia’s government has since touted improved ties with China, which typically offers funding without many of the prerequisites that the U.S. and EU place on donations, such as improvements to human rights and rule of law. Chinese investment now flows into Cambodian real estate, agriculture and entertainment—particularly to the port city of Sihanoukville—but Cambodians regularly chafe at what they say are unscrupulous business practices and unbecoming behavior by Chinese residents and worry that their country is increasingly bending to Beijing’s will.