Inclusive development is still possible in Cambodia, Comment by BABC Executive Director David Pred
The test of whether the governor's logic holds up to the principles of justice is simple: Is he prepared to give up his land and home for a small fraction of the market price in order to develop Phnom Penh? That is, after all, what he is demanding of urban poor and middle class homeowners who have the misfortune of being situated in the path of progress and development.
A summary of the interview on City Hall's website says the governor distinguished two types of development: one based on public investment in infrastructure and another based on private investment related to "buying-selling between private companies and land owners...under free market price." In the case of both public and private development projects affecting landowners, the governor said the policy was to pay market-price compensation.
It is instructive to apply Mr Chuktema's explanation to the current land dispute between City Hall, private developer Shukaku Erdos Hung Jun Property Development and families living around Boeung Kak lake.
This project appears to entail a combination of public and private developments. A private company has been granted a 99-year lease over the 129-hectare area and has been granted the right to develop it for private profit.
The city and the developer have set monetary compensation policy at $8,500 per household, regardless of the size or type of house or whether they are living on the lake, which is state public property, or the land around the lake, which is legally possessed by the lakeside residents.
Eviction and demolition orders have also been given to homeowners living outside of the leased area to make way for public access roads into the development zone. In most cases, these households, like those living on the land in the lease area, are legal possessors who were unlawfully excluded from the systematic land registration process that took place in the area in 2006 to 2007.
Nevertheless, the 2010 Expropriation Law is clear that legal possessors have the same right to market-based compensation as titled owners.
Despite these guarantees, the cash compensation being offered to Boeung Kak families is a tiny fraction of what their homes are worth.
I have met families who paid up to $200,000 for their property and were forced to accept $8,500 as compensation as they watched their homes disappear under a deluge of mud from Shukaku's sand pumping machine.
A market survey of the land values of privately held plots around the lake suggests property prices before development range from $1,500 to $3,000 per square meter. This is interesting since Shukaku paid a mere $79 million for that land and the 90-hectare lake that is now being filled.
Altogether, once the lake is filled, the entire lease area will be worth a minimum of $1.941 billion. Shukaku was thus awarded the property at about 4 percent of its market value, while the residents, who are being compensated out of the $79 million rental fee, are forced to accept between 5 and 10 percent of their property values in compensation.
If compensation was paid to the legal possessors based on the lowest range of the market price, the developer should be paying out at least $450 million to the residents just for their land. Yet, the compensation payments amount to little more than $36 million in total for both land and structures.
You may have gotten lost in the math but the bottom line of this equation is the theft of about a half billion dollars in private property.
Is it starting to make sense now why these people are protesting nearly every day outside City Hall and blocking roads because they cannot get a meeting with the governor?
It is of course not just that their property is being taken from them at a fraction of the market price that has the residents up in arms. It is that they simply cannot buy another home in the city with the compensation on offer. They face not just the loss of their homes but also their livelihoods and their right to enjoy the services and amenities of the city.
It is for this reason that the remaining families at Boeung Kak have put forward a proposal to resolve the land dispute in a manner in which everybody wins--the developer, the residents and the city. They have even put forward their own development plan for standardized, upgraded housing and have sought out their own donor financing for the construction. All they are asking for from the State is 15 hectares of land, which is approximately half of the land around the lake that they already rightfully own.
Unfortunately, Mr Chuktema, the governor, rejected the community's proposal and on Thursday the remaining 10,000 people living around the lake were served with a seven-day deadline to accept compensation or get nothing.
If the government were to seize this opportunity, it could lay the foundation for a more just and inclusive society, where development projects and policies strike an appropriate balance between economic growth and individual rights.
One thing is certain: whatever is built on the site of Boeung Kak will forever be a symbol of the nation's development. It now rests with Cambodia's leaders to decide if that symbol will be a source of pride or shame for future generations.
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In an interview that aired last week on Channel News Asia, Phnom Penh governor Kep Chuktema said it was inevitable that some people would suffer because of development but that this should not deter authorities from developing the city. The rest of world, he said, is moving on and Phnom Penh cannot lag behind. Many people hold this utilitarian view of development--that is, until they themselves become the ones who are harmed.