The Kingdom of Cambodia recognizes the growing global threat posed by money laundering and terrorism financing to international security and financial stability. These illegal activities not only damage the global economy but also threaten state sovereignty and the rule of law. In this context, Cambodia acknowledges the crucial role of the International Monetary Fund (IMF) in mitigating these threats by promoting financial transparency, delivering technical assistance, and applying economic safeguards to United Nations countries (International Monetary Fund, 2025a).
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As a developing nation, Cambodia has made strides in strengthening its anti-money laundering and counter-financing of terrorism frameworks. The country has been an active member of the Asia/Pacific Group on Money Laundering (APG) since its formation and is aligned with the recommendations of the Financial Action Task Force (FATF). Locally, the Cambodian Financial Intelligence Unit (CAFIU), operating under the National Bank of Cambodia, plays a crucial role in detecting and reporting suspicious financial activities within Cambodia’s jurisdiction (Asia/Pacific Group on Money Laundering, 2025). Despite these developments, challenges remain, especially in effectively regulating digital assets (cryptocurrency), strengthening financial transparency in rural and informal sectors, and improving institutional enforcement.
Cambodia believes that the IMF must respond to the growing complexity of illegal financial flows with both targeted and inclusive strategies. The evolution of digital assets such as cryptocurrency has introduced vulnerabilities. Furthermore, the misuse of IMF loans in fragile states underscores the urgency to improve surveillance, conditionality, and regional cooperation. Cambodia calls for practical and equitable reforms that recognize the unique challenges of developing economies while upholding collective financial integrity. In line with this, the Kingdom of Cambodia proposes the following recommendations:
- Capacity Building and Technical Support
The IMF should expand its technical assistance programs, particularly through its Financial Sector Assessment Program (FSAP), to include post-evaluation support and field-based capacity-building missions. Training for local regulators, prosecutors, and financial institutions in emerging economies should be prioritized (International Monetary Fund, 2025a). - Global Cryptocurrency Regulation Framework
The IMF, in collaboration with FATF and APG, should create a global regulatory sandbox to evaluate and test digital surveillance tools tailored to cryptocurrencies. Such a framework should support states with limited technological resources and guide them in establishing effective digital asset policies (Financial Action Task Force, 2025). - Conditional Payment of IMF Loans
Cambodia supports more stringent due diligence and phased payment processes in IMF lending. Loans to countries with documented corruption or governance issues should be released in stages, contingent upon transparent and monitored use of funds (Breen, 2013). - Incentivized Compliance Through Voting Reform
The IMF should explore reforming its voting structure by linking voting power to demonstrated AML/CFT compliance. This would encourage powerful economies, especially those ranked high in the Financial Secrecy Index, to adopt and enforce stronger regulations (Tax Justice Network, 2022). - Southeast Asia Real-Time Financial Intelligence Exchange
Cambodia proposes the creation of a regional reporting and intelligence-sharing platform among Southeast Asian nations, supported by the IMF. This initiative would enable real-time monitoring of suspicious activity and enhance cross-border cooperation among central banks and financial watchdogs.
The Kingdom of Cambodia concludes its commitment to international cooperation in combating financial crimes. Cambodia believes that through balanced reforms, technology-enabled regulations, and regional partnerships, the IMF can be more effective in preventing illegal financial flows and upholding global financial security. With the support of the international community, Cambodia remains committed to playing an active role in promoting a stable and transparent financial system.
Works Cited:
- Asia/Pacific Group on Money Laundering. (2025). Overview of APG members. https://apgml.org/members-and-observers/
- Breen, M. (2013). The politics of IMF lending. Palgrave Macmillan.
- Financial Action Task Force. (2025). Myanmar. https://www.fatf-gafi.org/en/countries/detail/Myanmar.html
- International Monetary Fund. (2025a). Anti-money laundering and combating the financing of terrorism (AML/CFT). https://www.imf.org/en/Topics/Financial-Integrity/amlcft
- International Monetary Fund. (2025b). IMF timeline. https://www.imf.org/en/About/Timeline
- Tax Justice Network. (2022). Financial secrecy index 2022. https://fsi.taxjustice.no/fsi/2022/world/index/top
- Financial Action Task Force. (2025). Cambodia’s progress in strengthening measures to tackle money laundering and terrorist financing. https://www.fatf-gafi.org/content/fatf-gafi/en/publications/Mutualevaluations/fur-cambodia-2023.html
April 2025 IMF PP/IMF/KHM/AS0025