5 Aug 2013
FORTUNE (Phnom Penh, Cambodia) -- Cambodia's promoters fanning out to money centers and markets worldwide pitch the Southeast Asian nation's economy as practically booming, a regional pivot point, and wide open for global business. Labor is cheap, land available, and natural resources ready for exploitation.
But the same country courting corporations ranks tenth as the most corrupt country on earth and scores just as high among human rights abusers, adding to the deep scars of its brutal past.
With Cambodian voters protesting this week's national election results -- the most controlled and corroded in the country's history -- the nation's leaders cannot evade the rampant scandals, economic hardship, and systemic corruption the campaign thrust into the spotlight. It's a laundry list that includes inhumane working and housing conditions for low-skilled workers in local and foreign-owned factories; violent "land grabs," forced evictions and unbridled transfers of Cambodian land to local and foreign investors; and the delayed prosecution of former Khmer Rouge leaders charged with enslaving, starving, and slaughtering some 2 million Cambodians during the 1970s Communist revolution.
Should those eyeing Cambodia's market simply factor these realities as costs of doing business in an emerging market?
American enterprises are poised to enter the country. Chevron (CVX), Ford (F), and General Electric (GE) are already there. But even advocates of moving into Cambodia equivocate on whether now is the right time to make a move. A recent communiqué from the US-ASEAN Business Council, a blue chip group chaired by ConocoPhillips (COP), updates members on commercial opportunities in Cambodia, along with reports about throngs of protestors pushing for free and fair elections, tragic worker fatalities due to unsafe factory conditions, and stymied regulatory reforms.