Many observers, alarmed at Cambodia’s renunciation of us aid and the recent anti-Western demonstrations in Phnom-Penh, have suggested that Cambodia is abandoning her neutrality and moving into the Chinese camp. Perhaps surprisingly, these observers have failed to notice that the renunciation of us aid was coupled with moves towards socialism inside the country. The day after Sihanouk told the Americans to stop anti-Cambodian intrigues or get out of the country, he also announced the impending nationalization of Cambodia’s foreign trade and banking. In fact, neither the rejection of us aid nor the nationalization programme indicate any retreat from the policy of active neutrality that Cambodia has followed for eight years.

There are strong economic reasons behind Sihanouk’s nationalization moves. Cambodia’s foreign trade still follows a ‘colonial’ pattern: the import of manufactured goods from developed countries is (partially) paid for by the export of raw materials and agricultural produce. Exports are mainly rubber—produced by French companies—and rice: the rice trade and rice-milling are controlled by Chinese residents in Cambodia. Neither of these groups has invested heavily in manufacturing. Their capital has been confined largely to retail and speculation. (I estimate that less than 5 per cent of the total investment by ethnic Chinese is in industrial production.)

Cambodia has had a consistently unfavourable balance of trade since 1955: 3,400 million riels (about £35 million) in all between 1955 and 1961, or one fifth of the value of imports during the same period. This excludes military supplies, mostly given by the us. The imbalance has been made up by foreign aid in various forms, but it was clear that—with or without us aid—the economy could not long support such a load. Prices of domestic foodstuffs in Phnom-Penh had risen by 30 per cent over the same period and went on rising even faster in 1962–63. By 1963 the black market rate for the riel was less than half the official rate. Clearly, something had to be done to rationalize imports and move capital to production from commerce. The solution is typical of the spirit of ‘Buddhist socialism’ that Sihanouk espouses: rather than expropriate, certain sectors of the economy were declared state concerns, leaving the displaced capital to seek profits in other sectors, notably in domestic production. Significantly, the huge French rubber plantations were explicitly excluded. For Sihanouk the essence of ‘Buddhist socialism’ is that socialism can come about through national effort, without struggle between classes, from the co-operation that is traditional in the peasant culture of Cambodia. Cambodia, in marked contrast to Vietnam, is free of landlordism: almost all peasants own the land they till. There are three main historical reasons for this: 1. Most rice is grown on flood-land—not irrigated land—so that a minimum of starting capital is needed for cultivation. 2. There is no land shortage in Cambodia. 3. Until 1904 all land belonged to the king and could not be alienated to foreigners, the only groups who had enough capital to buy land.

There is a further important reason why ‘Buddhist socialism’ is not just dreaming for Cambodia, but makes national co-operation credible. For six centuries, since the Khmer kingdom ceased to control the Indochinese peninsula, Cambodia has been a battleground for Thai and Annamese armies. Every struggle between contending groups within Cambodia has been exploited by one or other neighbour. Both Thai and Annamese monarchs took part in the coronation of the Khmer king Ang Duong in 1841 and it is quite conceivable that had not the existence of a Cambodian kingdom been to the advantage of French colonial interests in the 1860’s, Thailand and Vietnam would today share a common frontier along the Mekong River, and Cambodia would have passed into the long list of once powerful but now extinct states. It is no wonder that the main long-run political preoccupation of the Cambodiansand particularly of Sihanoukis the maintenance of Cambodian independence and national integrity in the face of constant threats from both Vietnam and Thailand. The emphasis placed on the throne in Cambodia can be understood in this light—where else but in Cambodia would one find a royal socialist youth movement, such as the Jeunesse Royale Socialiste Khmère?

Cambodian policy—whether internal socialism or external neutrality—can only be understood in the light of Cambodian fears of domination by its neighbours. The Vietnamese are prone to think (wrongly) of Cambodia as a hinterland to their coastal civilisation. A remark made to a friend of mine by a Vietnamese is typical: ‘North or South, the Vietnamese will certainly govern Cambodia one day, for they cannot do it themselves.’ It is not surprising that buffalo raids or mistaken swoops across the jungle frontier by airplanes are seen by Cambodians as important incidents. On occasion there have been deliberate armed intrusions by the South Vietnamese army (accompanied by us ‘advisors’) verified by the International Control Commission. In April a South Vietnamese military airplane was shot down by the Cambodian Air Force.