Moneyless economy in Democratic Kampuchea

[Kamil]

Can anyone provide some information on how the moneyless economy of Democratic Kampuchea worked in theory? How did the various government economic ministries cordinate and function and plan without money? and btw....How do you personally see money being abandoned in the final stages of Socialism?

[milk]

In theory and/or practice?

At first, the Cambodian Communists' interpretation of a socialist economy included money, but it was abandoned in 1975. This is related to their hubris in believing that their agricultural bater-based economy in the rural areas, set up to cope with the terrible exigencies of the civil war, was the best way to go about 'building' that 'socialism.' The logic of their rather formulaic politics, however, would perhaps have seen its re-introduction, had the regime survived and actually industrialised. We'll never know, though.

[Kiev Communard]

In theory and/or practice?

At first, the Cambodian Communists' interpretation of a socialist economy included money, but it was abandoned in 1975. This is related to their hubris in believing that their agricultural bater-based economy in the rural areas, set up to cope with the terrible exigencies of the civil war, was the best way to go about 'building' that 'socialism.' The logic of their rather formulaic politics, however, would perhaps have seen its re-introduction, had the regime survived and actually industrialised. We'll never know, though.

Considering the fact that former "ultra-left" Khmer Rouge quickly became open bourgeois nationalists after 1980 and participated in opiate trade in the 1980s to the 1990s, the re-introduction of money would not have been too hard to justify for them.

[milk]

I think that has little bearing on why they chose to do away with money in 1975, though, and that is linked to the huge gains made by them with Vietnamese assistance during the 1970-75 conflict. It encouraged them to believe that their revolution could advance quickly.

The use of money was still used for outside trade, indeed the DK government established the Khmer Company for Foreign Trade (FORTRA) in order to find markets for the country's agricultural surpluses. The revenues of course were to be used for productive investment, ploughed back into the economy. The moneyless system they had in the country, the closed cooperative system with land collectivised and controlled for the purpose of primitive capital accumulation, also in method was merely the 'war communism' of the civil war period, by which new infrastructure would be built to increase agricultural production. 'Agriculture is the base, industry the leading factor.'

[Kiev Communard]

I think that has little bearing on why they chose to do away with money in 1975, though, and that is linked to the huge gains made by them with Vietnamese assistance during the 1970-75 conflict. It encouraged them to believe that their revolution could advance quickly.

Perhaps, but I think their original decision to abandon money was hardly co-ordinated with the Vietnamese.


The use of money was still used for outside trade, indeed the DK government established the Khmer Company for Foreign Trade (FORTRA) in order to find markets for the country's agricultural surpluses. The revenues of course were to be used for productive investment, ploughed back into the economy. The moneyless system they had in the country, the closed cooperative system with land collectivised and controlled for the purpose of primitive capital accumulation, also in method was merely the 'war communism' of the civil war period, by which new infrastructure would be built to increase agricultural production. 'Agriculture is the base, industry the leading factor.'

As far as I recall, this foreign trade company operated through one of private Hong Kong banks. So much for "ideological purity"...

[Apoi_Viitor]

At first, the Cambodian Communists' interpretation of a socialist economy included money, but it was abandoned in 1975. This is related to their hubris in believing that their agricultural bater-based economy in the rural areas,

I don't understand the correlation between the Khmer Rouge's adoption of a money free economy and their belief in establishing the Cambodian economy through agriculture.

[milk]

The agricultural cooperative system was seen as the best way for increasing agricultural production post-war.

[milk]

Perhaps, but I think their original decision to abandon money was hardly co-ordinated with the Vietnamese.

Not perhaps, definitely. The Vietnamese moved further into the country in 1970 following the Lon Nol coup, and until 1972-73, helped the Cambodian rebels make sweeping gains throughout the country, and helped place large areas under their control, where they couple implement their radical changes. They would be cooperating but also competing forces.

The decision to do away with money was taken in 1975, and prior to that there had been new bank notes printed and tentative plans for reorganising the national bank after the war was over.


As far as I recall, this foreign trade company operated through one of private Hong Kong banks. So much for "ideological purity"...

Part of it did. The Ren Fung trading house was used to make trade links with non-socialist countries. Hardly unheard of for other more established countries of the socialist world bloc.

[Kiev Communard]

I don't understand the correlation between the Khmer Rouge's adoption of a money free economy and their belief in establishing the Cambodian economy through agriculture.

As milk has already noted, they seemingly believed that the agrarian barter economy does not need money-form exchange medium.

[Apoi_Viitor]

As milk has already noted, they seemingly believed that the agrarian barter economy does not need money-form exchange medium.

Did they effectively function without a currency during the civil war?

[milk]

It depends on location, but generally after a certain point, yes.

Money was retained for outside use, to trade for things which the cooperatives could not produce.

[Kamil]

I read in a book by Kiernan that a high level cadre named So Phim described the decision to do away with money as "provisional". He said this at an education center for skilled Khmers returning from abroad being re-admitted into the cities, or something along those lines.

One key differentiating fact about Democratic Kampucha was the highly elastic interpretation of Central directives by outer cadres (varied interpretations of orders issued from the Center). This rings true also with the timing of implementing policies. Kiernan's book is rife with reports of the staggered introduction of reforms accross the country, some being being put into practice before it became an official decree and in other areas not until well after. The book reports that the officially witheld new Kampcuhean currency was used in the Eastern Zone.

I also read in Anatomy of a Nightmare that the Center (Pol Pot, Nuon Chea, Khieu Samphan, Ieng Sary, and a few others) had made a decision to reintroduce the previously withheld "revolutionary currency" back into certain areas, making So Phims remarks perhaps seem a bit more viable.

[milk]

Yep. The policy decisions from the 'Party Centre' (or central government) and the implementation of such policies by the zonal administrations were diverse and at times opposed.