In 2020, Cambodia experienced its sharpest economic contraction in more than a quarter-century as COVID-19 crippled its tourism industry, hampered foreign investment, and reduced demand for exports from its crucial garment and textile sectors. Wary of simmering popular unrest, the government of long-serving Prime Minister Hun Sen sought to support the battered economy with one hand while stifling domestic political dissent with the other. Domestic crackdowns brought further erosion of Cambodia’s ties with the European Union, and relations with the United States and some Southeast Asian neighbors remained tense as Cambodia drifted closer into a dependent relationship with China.

In 2019, Cambodia saw long-ruling Prime Minister Hun Sen tighten his grip on power. Economic growth continued, but with rising risks related to a real estate bubble, mounting debt, and yawning social inequality. Externally, Cambodia deepened its dependency on China, insulating the Hun Sen regime in some respects but contributing to new vulnerabilities.

As China rises, its influence on other states’ policy choices will depend partly on the extent of its “structural power.” This article examines China’s role in Asian monetary affairs and argues that deficient structural power has contributed to a significant gap between China’s waxing economic resources and its policy influence.

In 2010, the Chiang Mai Initiative Multilateralization agreement established a new Asian financial arrangement to help address potential currency or liquidity crises. This article analyzes the origins and basic features of the new arrangement, which reflect both progress and the continuing political challenges of building regional institutions in Asia.