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Czech Republic Cancels Cambodian Debt

Cambodia will be excused a debt of more than $3 million it ran up during the Cold War of the 1980s, Czech Republic officials said Tuesday.

The debt was canceled at a singing ceremony Monday, officials said.

The debt was a holdover from the former communist Czechoslovakia, Czech Deputy Finance Minister Toma Zibek told a press conference Tuesday.

“After half a year of communication between our officials and experts from the Cambodian Ministry of Finance, we agreed on this amount of money and we’ve solved it,” he said. “We have told the Cambodian government it does not need to pay this money back to our country.”

Cambodia owed the money for the purchase of arms and other supplies for its domestic needs.

The Czech cancellation would also come with a package for development projects for energy, the environment, health care and education, Finance Minister Keat Chhon said.

Cambodia remains in debt to other countries. It owes the US about $339 million from the government of Lon Nol. It owes Russia $1.5 billion, though it has asked for the cancellation of that debt as well.

The International Monetary Fund, meanwhile, has canceled $82 million in debt, claiming that Cambodia had maintained poverty reduction strategies, public administration and control of public spending.