South Korea's ruling party axes Cambodia loan aid linked to former first lady

By Candice Kim Posted : July 6, 2025, 14:32 Updated : July 6, 2025, 14:32
Former First Lady Kim Kun Hee Yonhap
Former First Lady Kim Keon Hee/ Yonhap

SEOUL, July 06 (AJP) - South Korea’s ruling Democratic Party has scrapped the entire budget for development loans to Cambodia, as special prosecutors are investigating whether a former official from the Unification Church lobbied former First Lady Kim Keon Hee to support church-backed projects in the Southeast Asian country.

The 80 billion won ($58 million) in official development assistance (ODA) loans, originally allocated for civil cooperation in Cambodia, has been cut, the party said on Sunday. The decision targets a sharp increase in loan support that took place during the administration of former President Yoon Suk Yeol.

The move comes amid an ongoing special counsel probe into alleged behind-the-scenes influence by the controversial religious group.

In April, prosecutors raided the home of Yoon and Kim as part of the investigation. A search warrant reportedly cited lobbying related to the “Mekong River Development Project” in Cambodia — a project linked to the Unification Church.

Under Yoon’s leadership, South Korea raised its ODA loan ceiling for Cambodia twice: first from $700 million to $1.5 billion in June 2022, then to $3 billion following a summit with Cambodian Prime Minister Hun Manet in May 2023.

One former ranking Unification Church official, identified only by the surname Yoon, claimed during a church event in May 2022 that he had met with then-President-elect Yoon Suk Yeol to discuss development aid. The Finance Ministry approved the first increase in loan limits just weeks later.
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