CAMBODIA

China funds fuel tension

Foreign direct investment continues to flood into Cambodia, led by mainland China, though some areas of the country are beginning to push back against rising Chinese dominance.

According to the semi-annual report by the National Bank of Cambodia, FDI inflows into the country were $1.32 billion in the first half of this year, up 14 percent on the same period of 2017. For all of 2017, FDI was $2.8 billion, up from $2.4 billion in 2016.

The majority of the investments have been into finance and real estate, with Chinese FDI last year surpassing all other sources combined, according to figures from Banco Santander.

Cambodia has been benefiting from investments under China’s “one belt, one road” project, which has fuelled a real estate and casino boom.

About 184 casino licenses have now been issued in the country, with 100 of them granted in the past year. Much of the attention has been focused on the coastal town of Sihanoukville, which is now home to some 42 casinos, with plans for one large-scale IR.

However, the influx of Chinese is stirring local resentment. Home now to about 100,000 Chinese nationals, that figure is expected to treble over the next few years, pushing up real estate prices, swamping the local culture and providing few opportunities for residents.

It has also had an impact on crime rates, forcing the government to set up a task force aimed at cracking down on crime and restoring security, Khmer Times reports.

Interior Minister Sar Kheng has said he will provide additional support to provincial authorities to bust crime in the Preah Sihanouk province, including murder, drug trafficking and gambling, leading to extortion and kidnapping.

“It’s very typical that there are good people and bad people of all nationalities. Because the area is not well managed, it is prone to anarchy. So the team must restore the situation and tackle the problems to ensure that this popular tourist site is of good security,” said Kheng.

Cheat Sotheary, who leads a rights group called Adhoc in the province, said that authorities need to set tougher conditions on foreign companies and take serious actions against foreign nationals to curb crime.

“The mushrooming of Chinese businesses has disgruntled some local business people so I think it’s important for the companies to facilitate that local businesses stay open. The authorities should be enforcing the immigration law strictly and suppressing all crimes.” Earlier this year, local Governor Yun Min wrote a letter to the central government warning China’s increasing involvement and investment in the Sihanoukville Province has pushed up the crime rate and brought instability to the province.

The three-page letter, which was sent to the interior minister, said that the influx of Chinese investors had “created opportunities for Chinese mafia to come in and commit various crimes and kidnap Chinese investors, causing insecurity in the province.”

Still, there is no sign of investment slowing into the country’s casino industry.

In September, China’s Tianjin Union Development Group, presented plans for a $1.2 billion Tourism Vacation Town in Koh Kong province. The details were revealed on the Cambodian Ministry of Commerce’s Facebook page for a resort that will feature a “luxury city” featuring high-end hotels and theme parks.

The mushrooming of Chinese businesses has disgruntled some local business people so I think it’s important for the companies to facilitate that local businesses stay open.

It’s the second major tourism venture in the area for UDG, which was granted a 99-year lease on about 40,000 hectares of national park land in the province in 2008. Its other resort is a $3.8 billion mega project known as Dara Sakor, about an hour from Sihanoukville, whose current status is unclear. Gaming Concepts, which says it has developed two studies for the group along with Brad Gordon & Associates and Intelligence Macau, said on its website that construction and master planning began in 2011 and is ongoing.

The project was to include such attractions as multiple golf courses, 1000’s of villas targeting the Chinese market, several hotels and multiple casinos. Although a June report from Reuters suggested the project had stalled, with little progress having been made for three years and risks becoming a white elephant.

Naga appoints non-exec. director

NagaCorp has announced the appointment of Leong Choong Wah as an independent non-executive director of the company from September 10, 2018.

Leong, has worked in a wide range of industries including property development, plantation and manufacturing, with cross-border experience in Indonesia and China.

He has been overseeing the Finance and Corporate Services Division of HCK Capital Group Berhad since May 2015 and has been appointed as an executive director of HCK since October 2015. Prior to joining HCK, Mr. Leong was the senior business controller of Agrindo, an Indonesian palm oil plantation group based in Jakarta, Indonesia from February 2013 to December 2014.

Suncity enters consultancy accord with local operator

Suncity Group Holdings has entered into a strategic partnership agreement to provide consultancy services with a Cambodian casino operator.

Under the agreement, Suncity will provide consultancy services to a planned $360 million integrated resort, which is to be opened by local company Golden Sun Sky.

The resort is expected to have a gross floor area of 650,000 sqm with “certain gaming facilities” and is to open by the end of 2019, according to a filing.