PHNOM PENH, Sept 4 China has pledged more than
$500 million in soft loans and grants to Cambodia and Prime
Minister Wen Jiabao thanked it for helping Beijing maintain good
relations with the regional grouping ASEAN, a Cambodian junior
A summit of the 10 members of the Association of Southeast
Asian Nations (ASEAN) in July failed to issue a joint communique
for the first time in the group's 45-year history after
disagreement over the wording of a section on territorial claims
in the South China Sea.
Cambodia, which chairs ASEAN meetings this year, was accused
by some countries in the group of stonewalling in support of its
The South China Sea has become Asia's biggest potential
military flashpoint. China's claim over the huge area has in
particular set it against ASEAN members Vietnam and the
Four loan agreements for unspecified projects worth about
$420 million were signed when Cambodian Prime Minister Hun Sen
visited China over the weekend, Secretary of State for Finance
Aun Porn Moniroth told a briefing late on Monday.
Another three loan agreements, worth more than $80 million,
are expected to be signed this year, Aun Porn Moniroth said,
adding that Wen had also promised a grant of 150 million yuan
($24 million) as "a gift" for Cambodia to use on any priority
"The Chinese government also voiced high appreciation for
the part played by Cambodia as the chair of ASEAN to maintain
good cooperation between China and ASEAN," Aun Porn Moniroth
According to China's Xinhua state news agency, Wen said
China "will closely coordinate with Cambodia and support the
country to make the upcoming series of meetings for East Asian
leaders a success". Those meeting are in Cambodia in November.
Chinese investment in Cambodia totalled $1.9 billion last
year, more than double the combined investment by ASEAN
countries and 10 times more than the United States, which is
trying to extend its influence in the region.
Aun Porn Moniroth said Premier Wen had given "positive
consideration" to Hun Sen's proposal that China provide new
loans of between $300 million to $500 million per year for the
next five years for unspecified projects.
He also said a Chinese firm planned to invest $2 billion to
build a steel plant in Cambodia employing about 10,000 people
and with the capacity to produce 3 million tonnes of steel a
year. He gave no details so it was not possible to verify how
far advanced the plans were.
(Reporting by Prak Chan Thul; Editing by Alan Raybould and