Right to Relief

Many of the families in the Dok Por community moved to the area prior to the Khmer Rouge regime. Community members began growing corn, cassava, fruit and rice, and harvesting non-timber forest products (NTFP) such as vegetables and fish from the forest and stream nearby. But a company owned by ruling party Senator Ly Yong Phat seized their land, and pollution from its operations made the stream unusable. The effects of this land conflict, coupled with heavy debt, have led many community members to migrate for work. More than 60% of families have at least one member working in a factory.

In 2011, Phnom Penh Sugar Company cleared the community’s farmland and destroyed many community members’ crops. Most people lost between 1 and 5 hectares of farmland to the company, and much of the communally used land – land around a stream and lake where villagers would collect NTFP – has been heavily polluted. Since then, community members have advocated through local authorities, the Senate and National Assembly, and several ministries, as well as the Anti-Corruption Unit, to seek justice and fair compensation. Despite promises to address their problem, there is still no solution.

Community members said debt levels in the village was “overwhelming”, and an estimated 90% of families have borrowed a microloan. Borrowers said they feel the burden of this debt and the intense pressure from credit officers, which has manifested in debt-driven land sales, migration, child labour, and predatory practices from credit officers. Most borrowers can’t read or write Khmer and don’t fully understand the terms and conditions of these loans. MFI credit officers did not offer the option of restructuring loans or delaying payments during the Covid-19 pandemic. In some cases, credit officers told borrowers that restructuring a loan would instead increase their overall debt burden and not be helpful.

• Often if a borrower is late, 3-4 credit officers will go to their house at the same time.
• One borrower changed jobs, and the date she received her salary changed to after her MFI loan due date. She asked to change the repayment date, but the CO refused. After 3 months of late repayments due to the change, the credit officer told her to sell her land.

• About 10 families have already sold land to repay debts, and 2 more plan to sell land to repay debts.
• It is not uncommon for children aged 13 to 15 to leave school to begin working to help repay debts. An estimated more than 20% of families have had children leave school to work to repay debt.
• Dozens of community members have migrated to Phnom Penh and other provinces to find work to repay debt.

The Right to Relief

Microloan providers and their international investors, including many of Europe’s and the United States’ largest development banks, have a moral obligation to address human rights abuses and provide proper remedy and redress. Cambodian borrowers must have the right to relief, or else they will continue to face debt-driven hunger, child labour, migration, coerced land sales, and many other human rights abuses raised as part of this project.

Research Background

Who We Are

Equitable Cambodia (EC) and the Cambodian League for the Promotion and Defense of Human Rights (LICADHO) are human rights NGOs registered in Cambodia. Both organisations are dedicated to amplifying the voices of grassroots communities and highlighting human rights abuses perpetrated by private and public actors in Cambodia.

What We Did

This project is based on the principles of community-based research, where community members play an active role in producing knowledge and act as co-researchers. Information was gathered from both focus-group discussions with community members as well as individual interviews. All the information in this report comes from discussions with community members and was verified with community representatives. This project is not meant as the only true source of information about microloans, but rather is meant to accurately reflect the lived experiences of community members. Many of these issues have been raised before in previous reports issued by human rights NGOs in Cambodia.

Why We Did It

Many Cambodians are drowning in microloan debt, which is leading to drastic and serious human rights violations across the country, and many people are suffering in silence. To quote one community representative who participated in this project: “I’m happy that our sadness is finally being publicised. We have kept it hidden for so long. The way [the MFIs] act is the opposite of the way they speak. Debt is the biggest problem faced by communities across the country.”

Publications