Thailand scraps Cambodia naval pact amid sinking ties

Thailand has formally terminated a 2001 agreement with Cambodia that was meant to provide a bilateral framework for resolving overlapping maritime claims in the Gulf of Thailand, as well as help the countries jointly manage offshore resources.

The pact, known as "MOU 44," had largely failed to deliver results since its signing, despite five rounds of talks spanning more than two decades. Even so, it remained one of the few standing mechanisms for dialogue between the two countries over the disputed maritime space.

Both Thailand and Cambodia claim ownership of the waters around several islands in this area, including Koh Kood. The popular tourist destination, controlled by Thailand, is believed to be sitting atop of considerable — and so far untapped — oil and gas reserves.

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The termination of MoU 44 is a "significant regression in bilateral relations, signaling a shift from collaborative resource management toward unilateral nationalist posturing," Pavin Chachavalpongpun, a professor at Kyoto University, told DW.

Under MoU 44, Bangkok and Phnom Penh agreed to share any energy spoils in return for neither side aggressively asserting their claimed sovereignty over the territory.

Since last July, however, the two countries have been locked in a deadly land conflict over ownership of several pieces of territory along their 800-kilometer (500-mile) border, with clashes killing at least 150 people and displacing hundreds of thousands.

The conflict has triggered a political crisis which ousted the Paetongtarn Shinawatra government in Thailand, with her critics accusing her of being too deferential to Cambodia's Hun Sen. Thailand now has a new prime minister, Anutin Charnvirakul, who took power as a caretaker leader in September before being voted in as the official head of government March.

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Anutin's government insists that the cancellation is not linked to the border fighting. Instead, they argue that MOU 44 failed to move forward after 35 years.

Nationalism rewards hardliners

The conflict over territory between Cambodia and Thailand has become a test of patriotic credentials on both sides.

In Thailand, it boosted the military in its power struggle with civilian authorities. In Cambodia, the ruling Cambodian People's Party (CPP) has cast Thailand as the aggressor while presenting itself as the defender of sovereignty.

"The Thai military benefits from the continuing tensions between Thailand and Cambodia to boost pro-military nationalism among Thai people, which helps to give the Royal Thai Army independence from and insulation against any pushback by the Thai civilian government," Paul Chambers, associate fellow at Singapore's ISEAS–Yusof Ishak Institute, told DW.

"Anutin has shown that he will not try to resist giving a free hand to the Thai military on any issue," Chambers added.

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In December, Thai forces struck Cambodian casino and hotel complexes that Bangkok claimed were being used as scam centers and by the Cambodian military, allegations Phnom Penh rejected as a pretext for violating Cambodian sovereignty.

Bangkok has also used its military and economic advantages to pressure Cambodia.

"Cambodia's position depends heavily on international support because Phnom Penh's strongest arguments are legal and diplomatic rather than military," Sophal Ear, associate professor at Arizona State University, told DW.

"As the smaller state facing a stronger neighbor, Cambodia benefits when the dispute is framed around treaties, maps, international law, and third-party mechanisms," he added. "That is why Cambodia is more willing than Thailand to internationalize the dispute."

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US President Donald Trump helped broker a ceasefire last year after threatening to end tariff talks with both countries unless they stopped fighting. However, that truce lasted less than a few weeks, and Washington hasn't taken much interest in the conflict since.

Cambodia dealing with its own bad image

Phnom Penh has already applied to the International Court of Justice and appealed to the US and China to pressure Thailand to accept international mediation.

Cambodia has previously succeeded against Thailand at the International Court of Justice over Preah Vihear, a disputed temple. The court ruled in 1962 that the temple belonged to Cambodia and clarified in 2013 that Cambodian sovereignty extended over the entire area on which the temple stands.

Last week, Phnom Penh said it would initiate a compulsory conciliation process under the UN Convention on the Law of the Sea (UNCLOS) after Bangkok backed away from MOU 44.

However, Cambodia is trying to fight in the court of international opinion while suffering from "reputational liabilities," Ear said.

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The CPP, in power since 1979, forcibly dissolved the country's main opposition force in 2017 on the spurious charge of plotting a US-backed coup, effectively turning the country into a one-party state. 

The US broke off many relations with Cambodia afterward, while the EU partially suspended Cambodia's trade preferences. Washington was also irritated by reports that the Chinese navy was operating out of Cambodia's Ream Naval Base after Beijing funded the site's reconstruction. Cambodia has repeatedly denied granting China exclusive access.

Today, even those diplomatic issues are overshadowed by Cambodia's association with cyber-scam compounds.

Analysts say Cambodia has become a major hub for transnational scam operations, with reports suggesting the illicit industry could be worth $12.5 billion (€10.6 billion) annually, roughly a third of the country's formal GDP.

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Last year, the US and UK imposed unprecedented sanctions on Prince Group, one of Cambodia's largest conglomerates, and its chairman Chen Zhi. The Chinese-born businessman previously served as advisor to Prime Minister Hun Manet and his father, veteran leader Hun Sen.

Phnom Penh's soft-power problem

Last month, the Wall Street Journal triggered anger in Phnom Penh after using the term "Scambodia" in a headline about cybercrime, prompting Cambodian officials to demand a retraction and apology. The WSJ article remains online as of time of publication, including the "Scambodia" reference.

"Scam compounds and criticism on Cambodia's restrictive political environment have been damaging Cambodia's ability to call out Thailand's aggression internationally, as Cambodia's soft power is probably at its lowest in decades," Virak Ou, founder of the Future Forum, a Cambodia-based think tank, told DW.

Bangkok claims that many of its military strikes on Cambodia are intended to fight the scammers, not to aggressively occupy disputed territory.

Cambodia has tried to push back through diplomacy and lobbying in the United States. However, its room for maneuver remains limited in the West, especially due to its poor image and strong connections with China.

Edited by: Darko Janjevic