Search form

Logo of Phnom Penh Post newspaper Phnom Penh Post - Border dispute keeps Thai businesses away

Border dispute keeps Thai businesses away

Border dispute keeps Thai businesses away

RECENT fighting on the border between Cambodia and Thailand has had a minimal impact on the country’s economic interests in a direct, measurable way. But the fallout comes from the fear factor generated as a result of the clashes, a much more difficult outcome to assess.

Speaking on the sidelines of a press conference on Wednesday confirming that a Thai trade fair would go ahead in Phnom Penh next week despite the fighting, representatives of companies including Thai Airways and Siam Cement Group said they had experienced little or no adverse effects.

Thailand’s national carrier has seen only 100 cancellations on outbound flights to Bangkok for this month as a direct result of fighting, said Narinthorn Purnagupta, Thai Airways general manager in Cambodia, which represents just 1 percent of traffic.

Inbound flights had seen even fewer cancellations, he added, just 40 so far.

Siam Cement Group (Cambodia) Managing Director Patham Sirikul said the company’s joint venture Kampot Cement had not seen any impact. SCG imports construction materials mostly through the Poipet border crossing which has remained open throughout.

A few cancelled holidays by Thai tourists does not represent a major dent to business ties between Cambodia and Thailand, but tensions translate into a lack of economic development in the border area around Preah Vihear and a lack of enthusiasm among Thai investors who may have otherwise considered Cambodia.

“The first thing is the feeling of their security,” Jiranun Wongmongkol, Thailand’s commercial counselor in Cambodia, said of the main impact on Thai investors here.

In August last year B-Quik, a Thai vehicle service chain, announced it planned to delay opening its first outlets in Phnom Penh until the end of this year because the company’s senior management were concerned about the attitude of Cambodians towards Thais in the wake of border clashes.

Whether or not other Thai companies have decided against expansion into Cambodia for the same reason is difficult to gauge, but clearly the current tense climate does not bode well for investment.

Cambodia’s trade with Thailand climbed 54 percent last year to US$2.6 billion, a sign that the Preah Vihear dispute has hardly had an impact, but clearly other countries in the region such as Vietnam and China have much better business relationships with the Kingdom than Thailand.

From Cambodia’s perspective this is unfortunate. As the second-largest economy in Southeast Asia, Thailand as a neighbour of Cambodia should be much more involved in the domestic economy than it is at the moment.

The reason behind this stuttering economic relationship is obvious. Reluctance in doing business derives directly from tensions at Preah Vihear.


  • Breaking: PM says prominent human rights NGO ‘must close’

    Prime Minister Hun Sen has instructed the Interior Ministry to investigate the Cambodian Center for Human Rights (CCHR) and potentially close it “because they follow foreigners”, appearing to link the rights group to the opposition Cambodia National Rescue Party's purported “revolution”. The CNRP - the

  • Rainsy and Sokha ‘would already be dead’: PM

    Prime Minister Hun Sen on Sunday appeared to suggest he would have assassinated opposition leaders Sam Rainsy and Kem Sokha had he known they were promising to “organise a new government” in the aftermath of the disputed 2013 national elections. In a clip from his speech

  • Massive ceremony at Angkor Wat will show ‘Cambodia not in anarchy’: PM

    Government officials, thousands of monks and Prime Minister Hun Sen himself will hold a massive prayer ceremony at Angkor Wat in early December to highlight the Kingdom’s continuing “peace, independence and political stability”, a spectacle observers said was designed to disguise the deterioration of

  • PM tells workers CNRP is to blame for any sanctions

    In a speech to workers yesterday, Prime Minister Hun Sen pinned the blame for any damage inflicted on Cambodia’s garment industry by potential economic sanctions squarely on the opposition party. “You must remember clearly that if the purchase orders are reduced, it is all