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Reuters

Sok An, minister in the Council of Ministers, slammed the report in the English-language Cambodia Daily newspaper as "defamation".

"It's defamation, a very heavy case of defamation, so I'm thinking how to deal with it appropriately," Sok An told reporters. He declined further comment.

The Cambodia Daily cited an anonymous "government insider" as saying the cabinet had approved the deal to import the waste from Taiwan industrial giant Formosa Plastics Corp late last year.

Government officials were paid between $3 million and $6 million under the deal, the paper cited its source as saying, but added that officials did not realise the material was toxic.

The discovery of the waste late last month near Sihanoukville, 200 km (125 miles) southwest of Phnom Penh, sparked riots there. One person was killed as protesters sacked offices of local officials they blamed for allowing its import.

Four other people died in a panicked exodus of more than 10,000 residents fearing contamination.

The Cambodia Daily cited its source as saying that Sok An, who has previously handled international economic matters, knew about the deal and that "a substantial amount" of the funds generated went towards election campaign costs of the ruling Cambodian People's Party of Prime Minister Hun Sen.

"The party and the PM are very embarrassed - they were not told it was toxic waste, only that it was waste," the source was quoted saying.

Earlier on Thursday other cabinet ministers denied that the cabinet had approved the dumping deal.

"The government never approved it," Minister of Commerce Cham Prasidh told Reuters. "I'm a member of the government but I never heard of any $6 million deal to ship it in."

Minister of Environment Mok Mareth also told Reuters he was not aware of any official approval to import the waste.

Formosa Plastics has agreed to remove the waste from Cambodia and have it sent to Europe or the United States. The waste has been cleared from the site where it was dumped near Sihanoukville and stored in metal drums ready for removal.

A World Health Organisation official said earlier this month that tests had shown the waste was contaminated with extremely high concentrations of inorganic mercury.

Separate tests by Singapore laboratory Matcor Technology and Services showed mercury concentrations of 675 parts per million - far above safe levels.

Formosa Plastics had the waste shipped to Cambodia in late November. It said the cement-like material was tainted with mercury but had been certified by Taiwan's Environmental Protection Administration as safe for landfill disposal.