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Highway One

Phnom Penh to Ho Chi Minh City Highway Project (ADB Loan 1659-CAM)
---Cambodian Communities’ Struggles to Hold the ADB Accountable for a Failed Resettlement Program

In December 1998, the Asian Development Bank’s (ADB’s) Board of Directors approved a 40 million USD loan to support the Cambodian government’s plan to rehabilitate a section of a national road that runs from Phnom Penh to the Cambodia-Vietnam border, known as “the Highway One (HW1)”. However, the ADB’s lack of proper supervision over the Project’s resettlement program caused serious impacts to approximately 6,000 Cambodian villagers living along the road. Many of them were not fairly compensated for the relocation and became landless, houseless, and jobless.

>>Read more on the Failed Resettlement Program

HW1 project site

More than two years after becoming aware of the resettlement program’s failure, the ADB finally set out to conduct the Project’s audit in November 2004. As results, the ADB admitted the problems with the resettlement for the entire project area and agreed with the Cambodian government in May 2005 that the government should repay to eligible families. The repayment was subsequently made in 2006. However, more than 300 families continued to complain that they had still not been properly compensated.

>>Read more on Resettlement Audit and Unsolved Problems

On 28 July 2007, 63 families in the Kraing Kaok and Steung Slot Communities living in Prey Veng Province, filed a grievance at the ADB’s Office of Special Project Facilitator (SPF). Most of these families were re-compensated in 2006. However, they claimed that they still could not restore their life and livelihood mainly due to the considerable delay for the compensation. They requested, among other things, that the ADB should help them improve their livelihood and solve their debt problems and that the ADB should provide them with a land title for a resettled land. SPF met two community leaders in Cambodia and declared the case as eligible on 19 September 2007. The two communities expected to speak directly with SPF for review and assessment over their complaints. However, SPF never came back to Cambodia. The reason, according to SPF, was that the Cambodian government had not agreed with his visit to the project site for further investigation.

>>Read more on Filed Grievance

Being pressured by SPF’s acceptance of the 63 families’ grievance, the ADB’s Cambodia Resident Mission (CARM) proposed to conduct a new socio-economic survey in the Kraing Kaok and Steung Slot Communities. Earlier, CARM had not been very supportive in addressing some of the HW1 Project’s unsolved problems, the debt and land titling issues in particular, despite repeated complaints voiced by affected villagers through NGOs. In November 2007, two ADB officials visited the two communities and interviewed the 63 families in person.

>>Read more on CARM Pressured

Now that CARM had completed its own survey, the 63 families had to work simultaneously with two ADB Management offices, SPF and CARM. This was very confusing to the villagers. SPF could directly report to the ADB President and thus might be more effective. But SPF was not able to come and visit them in Cambodia to learn more abut their problems. CARM interviewed each member of the two communities face-to-face and recorded their problems in detail. However, it was still very unclear if the CARM survey would actually lead to effective redressing measures. In January 2008, after some discussions with NGOs, the 63 families proposed to SPF that SPF should temporarily postpone the grievance processes until they would learn more about the outcomes of CARM’s survey. In February 2008, SPF agreed with the families and decided to put the case on hold.

>>Read more on SPF Agreed to Postpone the Case

On 5 August 2008, CARM disclosed to the general public a proposal for a 1.8 million grant to launch the Livelihood Stabilization Program (LSP). The proposed amount of the LSP was rather huge. This was because the LSP was designed to support not only the 63 families, but also all the other eligible villagers living along the HW1, as well as those to be resettled by a different section of the same road, which is currently under renovation through the Japanese government’s bilateral grant aid to the Cambodian government. The main purposes of the LSP were to improve project-affected families’ livelihood means and to increase their cash income by micro-finance operations and job skills trainings. The LSP was to be financed by the ADB’s Japan Poverty Reduction Fund. However, the 63 families were not entirely convinced that the LSP would solve their problems, especially the heavy indebted-ness. They requested in response a grant, either from the ADB or the Cambodian government, to pay off all their debt, because the problem had been created by the failure of the Project’s resettlement program, which had resulted from the ADB’s lack of adequate supervision.

>>Read more on the Livelihood Stabilization Program

The 63 families’ situations are not getting better and will not significantly improve without effective external interventions, which the ADB is most responsible for, because the families’ hardships have started from the ADB’s lack of sufficient supervision over the HW1 Project’s resettlement procedures. The ADB should work with the Cambodian government to provide the families with a grant to pay back all the debt, as opposed to merely setting up a micro-credit to continue to tie them with new loans, so that the families can restore their life and livelihood to the pre-project levels. Otherwise, the ADB could not claim that the HW1 Project was implemented in compliance with its Policy on Involuntary Resettlement.

The LSP’s Project Information Document (PID) originally indicated that the ADB’s Board of Directors would approve the LSP in October 2008. Subsequently, the approval date was delayed to 26 January 2009. As of now, the LSP has not yet been approved.

A concrete building was built in the middle of the Steung Slot Relocation Site by one of the creditors on the plot that she had acquired from affected villagers.
The creditor lives here and pressures the debtors. (July 2008)

Materials
>>Overview:
Chronology of Major Events (1987 to March 2007)
Chronology of Major Events (July 2007 to Present)