According to a FT.com report "Cambodia faces the loss of World Bank funding for its troubled forestry programme after Phnom Penh expelled an environmental group that was monitoring efforts to combat illegal logging.

Long-simmering tensions over Phnom Penh's half-hearted efforts to improve forestry management boiled over last month when the Cambodian government told aid donors it was terminating its contract with Global Witness, supposedly for defaming the country and inciting violence.

Global Witness - which has earned praise for its determined tracking of illegal logging in Cambodia's remote jungle areas over the last decade - was hired by Phnom Penh in 1999 to document the government's efforts to strengthen regulation of companies holding logging concessions.

But in their detailed reports the London-based group has repeatedly accused Prime Minister Hun Sen's government of ignoring the rampant illegal logging by influential companies with financial and familial links to top politicians and officials responsible for overseeing forest use.

Both the World Bank and the International Monetary Fund have made sustainable forestry management a condition for loans for Phnom Penh, including a $30m (£19m) World Bank structural adjustment loan, which has been stalled for months.

The World Bank has expressed "regrets" at Phnom Penh's decision to expel Global Witness, saying the group had made a "valuable" contribution to forestry reform. The bank said it would have to reconsider its financial support for forestry reform.

Since April the bank has repeatedly postponed disbursement of the second $15m tranche of Cambodia's $30m structural adjustment loan because of the government's failure to comply with conditions of the forestry project."