The United States Sanctions Chinese State-Owned Entity for its Role in Corruption in Cambodia
Michael R. Pompeo, Secretary of State
September 15, 2020
China is the world's largest emitter of environmental pollution including of greenhouse gases and the exploitation of natural resources around the globe. Today, the United States again took action by imposing sanctions on the People's Republic of China (PRC) state-owned Union Development Group, Ltd. (UDG) under Executive Order (E.O.) 13818, which builds upon and implements the Global Magnitsky Human Rights Accountability Act, for its role in corrupt activities in Cambodia.
Today's action demonstrates how the Chinese Communist Party coopts companies to expand its influence, including by working through corrupt officials to use military force against innocent people in a blatant attempt to secure illicit financial gains. There are credible reports that the coastal development project at Dara Sakor could be used to host PRC military assets, and if so would go against Cambodia's Constitution and could threaten Indo-Pacific stability, possibly impacting Cambodia's sovereignty and the security of our allies.
The government of Cambodia granted UDG a 99-year lease in 2008 for the development of the Dara Sakor project on a site that encompasses almost 20 percent of the country's coastline. UDG was founded as a wholly-owned PRC corporation, but became a Cambodian enterprise in order to receive the lease for nearly 90,000 acres of land. The company then went back to being PRC-owned after acquisition of the lease and resulting land.
In conjunction with a former Cambodian Army official, the Cambodian military cleared the leased land by force using violent tactics. Then Royal Cambodian Armed Forces chief of staff, Kun Kim (Kim), reaped significant financial benefit from this relationship with UDG. Kim was previously designated by the United States for his role in corruption under the Global Magnitsky sanctions program in December 2019. The land in question is also considered part of Botum Sakor National Park, a protected natural area.
The United States stands with the Cambodian people and calls on the world to join us in condemning corruption and environmental degradation.
For more information regarding this action, please see the press release issued today by the Department of the Treasury: https://home.treasury.gov/news/press-releases/sm1121
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