[Cambodia] Fund scandal not enough to deter donors

While key foreign donors to Cambodia have said that government officials implicated in an internal Global Fund probe that exposed bribe-taking in the Ministry of Health must be investigated and brought to justice, a toughening of aid conditions does not appear to be a step any are willing to take.

In largely identical statements to the Post, the EU delegation and the Swedish, German and British embassies backed the Global Fund’s strong stance against corruption but did not respond to whether their own oversight procedures for development assistance to Cambodia had been strengthened since the report’s findings emerged.

“The amounts misused must be recovered, the individuals brought to justice, and the companies sanctioned if they are found to have breached the strict supplier code of conduct of the Global Fund,†they said.

The Anti-Corruption Unit has said it is investigating the report’s findings – which exposed a network of kickbacks and sponsorships from mosquito-net suppliers in exchange for contracts – but has yet to determine whether former officials at the National Malaria Center (CNM), the National Center for HIV/AIDS, Dermatology and STDs (NCHADS) and MEDiCAM are guilty of corruption.

US embassy spokesman John Simmons said the US government was keeping an eye on the Anti-Corruption Unit (ACU).

“The US government is monitoring the actions of the Anti-Corruption Unit, and we continue to encourage the ACU to conduct a full and transparent investigation,†he said. “The US government is ever-mindful of the potential for misuse of development assistance funds, no matter to which country provide.â€

He emphasised that most US-supported programs in Cambodia were implemented by civil society and the private sector.

Germany, the Global Fund’s third-biggest bilateral donor, warned that “donor confidence and motivation depend on cooperation free of corruption and fraudâ€.

“The determination of the Royal Government of Cambodia in pursuing this matter will no doubt be an important signal for the donor community,†German ambassador Joachim Baron von Marschall said.

French embassy first secretary Nicolas Baudouin said that France would continue to “monitor the situation closelyâ€.

All foreign donors that responded to the Post pledged continued support of the Global Fund, and praised its efforts to bolster financial oversight.

Since preliminary investigation findings emerged in July last year, the Fund replaced the CNM as a principal recipient for malaria grants, appointed an external fiduciary agent to control NCHADS expenditure and has required pooled procurement for all health products in Cambodia.

The Asian Development Bank, Cambodia’s current lead donor partner, expects to provide more than $500 million in loans and grants to the government between 2013 and 2015.

“ADB applies very stringent safeguards to ensure all funds administered by ADB are used for their intended purposes,†country director Eric Sidgwick said.