Cambodian military and police forces shot and killed 14 year old Heng Chantha on May 16, as part of a forced eviction of Prama village in Kratie Province. According to the Phnom Penh Post, one officer who spoke on the condition of anonymity said they were commanded to raid the village by a committee on behalf of Casotim, a firm that received a land concession near Prama, and another unnamed company. Security forces reportedly used sprays of automatic gunfire in response to villagers armed with axes and crossbows.

This is just one in a series of incidents demonstrating the underlying problems with rule of law pervasive throughout Cambodia. As the country seeks to attract foreign investment, develop its economy, and move beyond its catastrophic past, incidents like these are detrimental to its advancement. Good governance and effective rule of law are key indicators for potential investors. Companies will be concerned not only with their reputations, but also the reliability of stable institutions, including courts and regulators, to be fair arbiters with capable enforcement. Cambodia’s record is poor; Cambodia’s rank in the World Bank’s Ease of Doing Business survey is a low 138 out of 183 countries in 2012, and an even lower contract enforcement ranking of 142 out of 183.

Manifestations of these problems abound from the killing of environmental activist Chut Wutty April 26, to the high profile protests of Borei Keila over forced evictions, to labor disputes. A workers’ protest February 20 at a PUMA supplier factory turned violent when a town governor, Chhouk Bandith, fired into the crowd, shooting three people. Despite confessing to this crime on March 15, he was not charged until April 20, and then only with causing “unintentional harm.” Though removed from his post as governor, he has yet to be arrested. The slow pace of the police and courts led PUMA to launch its own investigation, and PUMA paid for the medical costs of the victims. In another incident, mass fainting in April at a Nike supplier factory resulted in the company flying in top level officials to meet with factory managers and government, and requesting the International Labor Organization’s industry monitoring body investigate.

In response to recent outcries over forced evictions, Cambodian Prime Minister Hun Sen issued an immediate, indefinite moratorium on all land seizures April 27, which includes land concessions that were already granted. Details of if or how companies will be compensated, or how disputed property rights will be managed are unclear.

While the increased protection for populations vulnerable to land grabbing was welcomed, it is unfortunate that the “solution” was a decree by Cambodia’s ruler, as opposed to the development of an institutionalized mechanism that can resolve these issues fairly, consistently, and in the long term. The shooting of Heng Chantha demonstrates that enforcement remains ineffective.

Cambodia sits at a crucial point in its development, and it has certainly seen much improvement in the past decade. Poverty is falling, and growth has recovered from its 2008 slump. Investor interest is growing.  Ford announced in March plans to open an assembly plant in Sihanoukville to meet Cambodia’s growing consumer car market. But companies want to rely on the mechanisms within a country to address problems, and avoid flying in to fix them, as PUMA recently did.

Cambodia is the 2012 chair of ASEAN, and President Hun Sen has said that priorities are development of less developed ASEAN countries, which include Cambodia, and closing economic gaps within ASEAN as the countries approach economic integration in 2015. A crucial component of this will need to be addressing its severe problems with impunity from the law, stemming corruption and eliminating cronyism. Otherwise the promising potential of Cambodia’s economy will likely go unrealized.

Kathleen Bissonnette is a research intern for the CSIS Southeast Asia Program.