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Report / July 7, 2016
HOSTILE TAKEOVER
How Cambodia’s ruling family are pulling the strings on the economy and amassing vast personal fortunes with extreme consequences for the population.
Few prime ministers have served for as long as Cambodia’s Hun Sen, in power for 30 years. Even when democratically voted out he has refused to step down, and has systematically quashed political opposition including through the murder, torture and arbitrary imprisonment of his critics.
Hun Sen’s family have been key to the longevity of his political career. They hold key posts across the state apparatus - in politics, the military, police, media, and charities - sectors that prop up the premier’s ruling party through propaganda, political donations or brute force.
Our new exposé, Hostile Takeover, reveals the economic dimensions of this regime, shedding light on a huge network of secret deal-making and nepotism that emanates from the Hun family and underpins the Cambodian economy.
We show how Hun family members are amassing vast personal fortunes in Cambodia’s private sector, and wield significant control across most of its lucrative industries, with links to major international brands including Apple, Nokia, Visa, Procter & Gamble, Nestlé and Honda.
I think that within two years my assets will decrease, there won’t be a gain. And besides my salary I don’t have any other income. But I think my children will support me, they won’t let me starve.
- Prime Minister Hun Sen first declared his assets publicly in 2011, claiming that his US$ 13,800 annual salary was his sole source of income.
Formerly a Khmer Rouge commander, Hun Sen rose to premiership in 1985. Cambodians voted him out in 1993, but he famously refused to step down. Since then, each and every election has been marred by violence or the promise of it. Credit: The Phnom Penh Post.
A child collecting recyclable rubbish at a dump in Siem Riep. 40% of Cambodians live below or close to the poverty line. The Hun family meanwhile have a combined wealth estimated to total between $US 500 million and US$ 1 billion. Credit: The Phnom Penh Post.
Prime Minister Hun Sen’s wife Bun Rany is president of the Cambodian Red Cross, Cambodia’s largest charity. This allows the Huns to fundraise for projects such as digging wells, repairing bridges and building schools - charitable work that the ruling party then claims credit for. Credit: The Phnom Penh Post.
iOne is Cambodia’s leading Apple retailer, and chaired by the wife of Hun Sen’s nephew. This is just one of the many international brands members of the Hun family have business links to, including Nokia, Visa, Unilever, Procter & Gamble, Nestlé, Durex and Honda. Credit: The Phnom Penh Post.
The Hun family includes a shady cast of characters. Among them are members once implicated in a $1 billion heroin smuggling operation, shoot-outs, a fatal hit-and-run, and land grabs that have caused mass displacements and destitution among Cambodia’s rural poor.
One person died and several were shot in a 2012 state crackdown on garment workers at the SL Garments factory in Phnom Penh. Hun Sen’s younger sister is said to be the company's Director General. Credit: The Phnom Penh Post.
Among the most egregious examples is an agriculture company linked to the Hun family that is accused of using arson attacks and cobras to evict people from their homes. This has been filed as one of a huge dossier of cases at the International Criminal Court, as evidence that Cambodia’s ruling elite has committed land grabbing at such scale that it amounts to crimes against humanity.
Global Witness was unable to find a single case where a member of the Hun family has been prosecuted or held to account for their part in any alleged wrongdoing.
These findings should sound alarm bells with Cambodia’s business partners - the Hun family are major gatekeepers to the influx of foreign capital into Cambodia, and the litany of abuses they are linked to pose significant legal, financial and reputational risk to companies and investors.
The UK is the second largest foreign investor in Cambodia after China. The US is Cambodia’s biggest trading partner and export destination, receiving a third of Cambodian exports, worth almost US$3 billion a year.
These relationships have helped lift Cambodia from the ashes of the Khmer Rouge genocide that killed millions in the 1970s, making it one of the world’s fastest growing economies, on course to forge the leap from a low- to middle-income country. But the benefits are enjoyed by a small elite – while the Hun family have a combined wealth estimated to total between US$ 500 million and US$ 1 billion, 40% of Cambodians still live below or close to the poverty line.
A day in the life of a Phnom Penh resident
Cambodians might resent this closed circle of immense and ever-growing wealth, but they are inextricably locked into it. One of the cruellest ironies of Hun Sen’s model of dictatorship is that his family has Cambodia’s economy so sewn up that Phnom Penh residents are likely to struggle to avoid lining the pockets of their oppressors multiple times a day.
Scroll through our comic strip to see how.
Foreign investors, on the other hand, can and should opt out of bankrolling a regime that kills, intimidates or locks up its critics. At a time when Hun Sen is proactively courting investors from overseas, Hostile Takeover shows how the lax regulations and cheap labour force he promotes to the business community are symptomatic of the cronyism and oppression at the heart of the Cambodian economy, and the shocking inequalities of wealth and opportunity that they entrench.
Cambodia Corporates
Our investigation was based on official data on company ownership in Cambodia – information that the government has recently restricted access to - that shows who owns or controls private companies registered there. We scraped the data and turned it into an online, fully-searchable database called Cambodia Corporates that investors, activists and investigators can use without fear of censorship or prosecution.
For more information on the Hun family check out our illustrated family tree.