This article critically examines the assumption that economic globalisation inevitably promotes peace, security and prosperity in post-conflict societies. Taking Cambodia as an example, it is argued that imposing rapid marketisation on a weak political and legal framework can increase socio-economic insecurity among vulnerable groups. Post-war reconstruction focusing on macro-economic stability exacerbated political tensions, while donors’ desire to down-size the civil service conflicted with one of the key stabilising features of the first post-war coalition: The integration of members of the two incoming parties into the administration and security apparatus. The Cambodian example suggests that post-war reforms need to be part of a broader strategy to strengthen political governance and restore socio-economic security.
Following the Paris peace agreements, Cambodia was extremely dependent on external donors, leaving its government with little control over the reconstruction agenda, and resulting in a programme that was incompatible with Cambodia’s socio-economic and political needs. Donors approached recovery with over-realistic expectations and pre-conceived ideas, but little intimate knowledge. Consequently:
- Down-sizing the civil service was prioritised but lacked high-level or civil-service support and overlooked the fact that service jobs were a source of vital (licit and illicit) income
- Cambodia is a nation with no tradition of power-sharing, and a system resulted whereby there were two parallel administrations staffed by members of the two leading parties – a key aspect to securing the peace
- Rapid economic liberalisation mainly benefited urban areas and the elite and increased rural insecurity
- Because rule-of-law did not accompany the process entrepreneurs aimed at quick profits (often from illegal activity) rather than long-term investment, and violence has become the main arbiter in disputes
- Most profits from economic activity were either channelled into the war with the Khmer Rouge or used to bolster the power-bases of the leaders of government factions
Donors must distinguish between what is desirable and what is feasible within post-conflict societies, and recognise that attaching conditions to aid cannot substitute for weak institutions or a lack of political consensus, and may further exacerbate political conflicts. A World Bank report has highlighted the harmful effect of unleashing market forces on an immature political and legal environment:
- In the absence of effective rule of law, patron-client relations become a stronger source of security and support – one of the reasons why jobs in the state bureaucracy are at such a premium
- Unwieldy powersharing systems can reduce the government’s ability to push through difficult reforms, because it becomes necessary to compromise reform to ensure equality and stability between factions
- Greater efforts to strengthen the legitimate economy are essential so as to increase state revenue and finance administrative reform. Security and welfare of surviving and outgoing civil servants is essential if these reforms are to be carried through.
- Unless a strong regulatory framework is instituted, the post-conflict state will be more likely to attract investors interested in pillaging its resources rather than in strengthening the productive base of the country, restricting the benefits to elites
- Only if economic benefits begin to spread throughout the wider population will social and political reform succeed
