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Cambodian railway rehab affected families ask for ADB's assistance on their skyrocketing debts

Updated: Jan 12, 2019

The Royal Cambodian Railway is already operational offering several services including passenger accommodation going to different destinations of Cambodia. In fact, large numbers of people who ride the train are tourist going to Sihanoukville, 221.7 km away from Phnom Penh. The place known as Krong Preah Sihanouk and is popular for its beaches, tropical islands and the mangrove jungles of Ream National Park.

However, more than 4000 families are still in dire condition due to the lack of compensation that was given to them by the Asian Development Bank (ADB) and the government. A large number of families are now in so much debt that they have resulted to mortgage their relocation homes even without the presence of the land title. An immobile resident from Poipet, a relocation site 411.3 km from Phnom Penh, near the borders of Cambodia and Thailand depressingly narrated how she is now asking/waiting for scraps of food from her neighbors because she can no longer support herself. Invalid from the waist down, alone and without any support from her family she compared her situation before she went to the relocation site, according to her “at least when I was in my old place, I can grow vegetable, corn, root crops and that would be enough for me to survive. The next day I do the same because I get by…”.

This is not a new story for most people in the relocation site, aside from problems that go with the territory of being relocated like access to transportation, job availability or another source of income and livelihood, electricity and clean drinking water, what makes the Cambodian affected families “unique” is that they are indebted to different lending agencies and even persons. Some families even took a second mortgage to pay off the first mortgage, until it has become a vicious cycle. Also, the presence of informal lenders, who let the affected families borrow money using the resettlement plot as collateral makes the situation even more complicated. This resulted in the call of the people regarding the government promise of granting the ‘land title’ after 5 years of living in the resettlement site. A community leader from one of the resettlement site said that it has been due since 2013 because they have been living there since 2007, but four years have passed there is still no word on the land title. He even claimed that on their part they have followed up diligently to the Ministry of Land Management, Urban Planning and Construction (MLMUPC) regarding the matter but they were not addressed properly, worst they feel that their grievance is being ignored.

A father of three who’s only source of income is driving a cab around the city barely makes 100,823 KHR (about 25$) a day, and he has to pay 100,823 KHR (250$) a month for his 24,197,500 KHR (roughly 6000$), the same story goes with the woman who has roughly 4000$ and has to pay the 200$ a month, her source of income is making rags, that sells 2,016.45 KHR (50¢) a piece. In a day they can make between 50 to 60 pieces that are if they will work none stop for 12 hours.

The loan situation is so alarming that VisionFund Cambodia – supported by the Government of Australia – has implemented a program to help ease the loan problems of the families in the 5-resettlement sites. But VisionFund has terminated its program and will end it this year (2016).

VisionFund Cambodia found out that the most affected households do not meet the requirements or eligibility criteria to participate in the program. The eligibility criteria include-​

  1. Adequate income earnings to be able to repay the monthly installments

  2. Continuous residence in the resettlement site

  3. Indebtedness level which should not be too high so that debt workout can be achieved within the financial envelope and the

  4. The willingness of informal lenders to sign off the agreement.

When the affected families were asked on how to address or solve their dreadful situation, they humbly asked the government of Cambodia and the Asian Development Bank (ADB) to help them in any way they can. A community leader and a mother of 4 added that they “comply with the recommendation of the government, the ADB, and the Australian Aid to relocate because they were promised that their lives would be better” and these are agencies which they trust initially, but after years of struggle and making ends meet they are too tired in doing the same thing over and over again. And they are even more afraid that their children, grandchildren would encounter the same. As a matter of fact, most youths in the relocation sites has stopped their education taking on the responsibilities of putting food on the table.


Written by Jen Derillo. Jen is NGO Forum on ADB's Program Coordinator for Communications.


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