Friday, June 4, 2010

Keynote Address at the International Conference on Extractive Industries Under the Theme of “Cambodia’s Opportunity”

Phnom Penh, May 26, 2010

Excellencies Ambassadors and Representatives,

Mr. Douglas Broderick, United Nations Resident Coordinator and UNDP Representative in Cambodia,

Excellencies, Oknhas, ladies and gentlemen distinguished national and international guests!

It is my pleasure to be here in the International Conference on Extractive Industries under the theme of “Cambodia’s Opportunity”, being jointly held for the first time in Cambodia by the Ministry of Industry Mine and Energy and UNDP Cambodia.

On behalf of the Royal Government of Cambodia and on my behalf, I highly value the initiative to organize this event as Cambodian mine officials and other stakeholders will be able to exchange experiences, lessons and best practices on the management and development of mining industry to bolster mining activities in the country, especially the oil and gas sector. The presence of Excellencies, ladies and gentlemen national and international experts, representatives of national and international organizations, institutes, development partners, NGOs, oil companies and all the stakeholders attest to our common concern on the management and development of natural resource in Cambodia as well as on the necessary support needed to make the sector an important source of revenue for national development and poverty reduction.

This event also shows the Royal Government’s commitment to the development and management of its resources, as sated in its political agenda during the 4th Legislature of the National Assembly that the Royal Government promotes investment in the oil and gas sector by conducting the feasibility study and assessing its potential toward commercializing this sector by linking it with the environmental, natural and social preservation initiatives so that revenues will be efficiently utilized in a transparent and accountable manner to improve socio-economy and for poverty reduction.”

The aim and determination of the Royal Government are indeed to strive for better living standard of its people and a bright future of the nation. Moreover, the Royal Government is determined to stick to its reform programs to serve the country and people. In this context, existing reform programs will be broadened, deepened and firmly implemented to ensure efficiency and effectiveness in the pursuit of growth, poverty reduction, equitable distribution of growth, environment sustainability, especially through sustainable management and utilization of its resources.

To serve the social development purpose, countries all over the world are extracting their natural resources and process them into various goods to meet the demand of the people and for constructing various infrastructures in the society. In that sense, natural resources play a key role in promoting people’s living standard and for socio-economic development. In particular, some oil-rich Arabian countries have maximized the gain from the oil and gas sector, as a result their countries grew very fast and the people’s standard of living was improved. Until now, Cambodia has not yet benefiting from the sector and has been developing the country with empty hands. If we are fortunate enough to gain from the sector, we will use the revenue in a very responsible way to preserve the nation’s benefits and speed up poverty reduction, especially to ensure that the country receive blessing from such resources.

In this spirit, the government will continue to effectively strengthen all kinds of revenue collection measures, for that purpose the Ministry of Economy and Finance will have to rigorously examine all kinds of agreements and concession contracts and must continue to strictly implement existing fiscal tax law and law on public financial system to achieve efficiency, transparency and accountability of revenue, particularly those revenues proceeding from mining and oil business. In parallel, Cambodia will have to make use of its other potentials such as agriculture, tourism, garment and construction sectors without entirely depending on the mineral resource. This is a firm stance of Cambodia in its national socio-economic development journey.

Apparently, Cambodia possesses natural resources, but Cambodia has been late to develop this mining sector due to insecurity at mountainous and jungle areas where mine are stock, lack of human resource and weak institutional capacity. Indeed, the investment in feasibility study on mineral exploration only took place in 1998 when the country had received full peace. Therefore, the investment from the private sector in the study is very important while Cambodia is lack of capital and human resource to conduct the research and to develop the sector by itself. However, we must bear in mind that development of this mining sector is by no means the only option in the course of Cambodia’s development. That is because, besides mine, oil and gas resources which represent the new opportunity for Cambodia, there are many other potential sectors such as agriculture, agro-industry, labor-intensive industry, supporting industries and export products, energy, construction, infrastructure, service and finance and banking, tourism and telecommunication sectors…etc… all of which have been actively contributing to Cambodia socio-economic development.

However, if the development of mining sector is in a positive situation in the socio-economic development process we will not give up this option. Hence, the government will continue tightening its measures which is consistent with existing regulation and mechanism for the management of this sector in order to ensure sustainable development and ensure a favorable environment for conserving cultural patrimony and heritage, history and the growth of biodiversities.

Indeed, both the concession awardees who invested in the feasibility and assessment study in Cambodia’s mining sector and the Royal Government of Cambodia are eager to know what types of mineral resources Cambodia has, in what amount, if it is economically viable, to what extent it could cast adverse impact on the society, the environment and deforestation, or if it is better to preserve those mine deposit area as wealth for next several dozen generations in the future. Undeniably, extracting the natural resources without conservative philosophy will manipulate the history, lose cultural heritage and cause environmental instability, which can transform a green area into a deserted, polluted and destabilized area because the natural resources are under great destructive pressure.

Through this, development must take great consideration of natural resource conservation, especially natural resource in dry land, Tonle Sap and areas surrounding Tonle Sap…etc… Obviously, natural resource preservation is clearly inscribed in the constitution of the Royal Kingdom of Cambodia which requires the state to ensure a rational utilization of the resources along with environmental protection, in order to achieve the principle of sustainable development whereas laws and legal standards have been prepared in conformity to the essence of the constitution including law on investment of the Royal Kingdom of Cambodia, law on management and mining business, law on environment and natural resource management, law on taxation, land law, sub-decree on environmental pollution inspection, sub-decree on social and environmental impact assessment. And at the moment, we are preparing a tax regime and excise on mining business in addition to law on taxation and law on management and mining business.

According to agenda of the conference, the Ministry of Industry, Mine and Energy will present the conference with the context and current situation of mining sector in Cambodia in order to provide a clear understanding of law, legal standard and the current situation of the management and development in Cambodia’s mining sector. In overall, I would like to highly value the topics which are carefully selected by the Ministry of Industry, Mine and Energy and the United Nations Development Program, to be presented by national and international experts in this conference.

Through this, I certainly hope and believe that this conference will provide all participants the chance to share experience and knowledge relating to the management, technique, law and legal standards that other countries are implementing for the sector, global mining market trend, tax regime that is applied in this mining sector, the participation of community and minority in the sector, the employment generation at locality, the conservation and development, the eradication of anarchic mining business and environmental protection. In order to achieve above mentioned goals, I would like to take this opportunity to provide some recommendations as follows:

1. The MIME must continue its cooperation with related ministries/institutions to implement monitoring mechanism and strictly monitor the research and mining business activities. We must take urgent measures to withhold and stop the abnormal exploration and mining business activities that could harm the environment and national socio-economy. Along with that, the Ministry of Industry, Mines and Energy and the Council for the Development of Cambodia must continue to pay high attention to the analysis and evaluation of the impact assessment in order to ensure sustainable development and to be able to prevent every risks that may occur incidentally in doing this mining business.

2. The Ministry of Education, Youth and Sport must cooperate with the Ministry of Industry, Mines and Energy in searching for the possibility of producing more experts on physiology and geology through short course training and providing scholarship to study abroad, and reopen the University of Geology-Mine.

3. The Ministry of Industry, Mines and Energy must continue its cooperation with related ministries/institutions, local authorities, all kinds of armed forces in order to ensure that every activities of mining business would not destroy, disturb, and violate sacred places or other noble places, cultural and historical sites that have been there for a very long time ago. Those resources are truly valuable for development, yet it is not the only choice that we have, such violation will make us the prisoner of history, betraying the people’s will, who have voted for us to support and protect their interest. Therefore, these reasons are enough for us to take a long-term view.

4. The Ministry of Industry, Mines and Energy, related ministries, local authorities, and armed forces must use all means to eliminate every activity of anarchic mining business within their competent locality as well as condemning all related culprits according to the existing laws, rules and regulations.

In this spirit, although we have tremendous opportunities in front of us, I would like to request all colleagues to put these recommendations into highly effective implementation with fruitful result for the sake of socio-economic development. In this regard, I strongly believe that Cambodia will move ahead with optimism, progress and prosperity base on a more extensive and favorable foundation together with peace, political stability, national harmonization and sustainable development.

Once again, on behalf of the Royal Government of Cambodia, I would like to take this opportunity to deeply thank the United Nations Development Program in Cambodia who have cooperated with the Ministry of Industry, Mines and Energy in initiating the conference today for Cambodian officials in charge of mines sector and related stakeholders to be well aware about the context of management and development of mine sector and the process of the mining business operation starting from the feasibility studies to the final stage, which can extract the benefit from the underground mineral resources to build and develop the nation. At the same time, I would also like to thank the Australian Aids for International Development Agency and the Cambodian Association of Mine Research and Business Companies that have jointly sponsored this conference.

At the end, together with the opening of the International Conference on Extractive Industries under the theme of “Cambodia’s Opportunity” now, I would like to wish Your Excellencies, Ladies and Gentlemen, national and international guests who have participated in this conference the four gems of Buddhist blessing: Longevity, Nobility, Health and Strength, and may I wish this conference a success with fruitful results.

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