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Logo of Phnom Penh Post newspaper Phnom Penh Post - Busan scandal raises questions for Cambodia

Busan scandal raises questions for Cambodia

ON October 27 last year at Raffles Hotel Le Royal in the capital, managers from Societe des Aeroports, the French operator of Cambodia’s airports in Phnom Penh, Siem Reap and Sihanoukville, were generally upbeat about the country’s airline industry.

Announcing the schedule for the forthcoming high season, CEO Nicolas Deviller and Communications and Marketing Manager Khek Norinda confirmed a host of new flights after what had been a difficult period for the tourism industry during the economic crisis.

There was, however, one issue that cast a shadow over the end of proceedings that day – a journalist’s question regarding rumours of a new South Korean concession to build a competing airport in Siem Reap. Looking somewhat frustrated, the SCA managers declined to comment and instead referred the issue to the Civil Aviation Authority.

“At this stage, we do not have reliable information allowing us to elaborate on the issue,” Khek Norinda told The Post later in early December. The problem is that since that time no-one has said very much at all about the project, which reportedly was due for completion by 2015 courtesy of Lees A&A and its financial partner Camko Airport Company, both of South Korea.

This week the proposed US$1 billion airport project was called into question amid the unfolding corruption scandal at South Korea’s Busan Savings Bank, which has already cast major doubts over the future of Camko City on the outskirts of Phnom Penh, formerly the proposed home of Cambodia’s first stock exchange and a project reportedly backed by Busan.

Although South Korean lawmaker Ooh Che-Chang this week alleged the bank holds the rights to a planned airport in Cambodia in a report in the Korea Times, the Cambodian government has thus far remained silent about what is happening with the project or whether Busan does indeed hold such a concession.

“Now we’re scared of talking about this, we‘re discussing it,” Civil Aviation Authority Chief of Cabinet Long Chheng told The Post yesterday.

“When we’re finished, we’ll report [what is happening].”

Civil Aviation Authority Secretary of State Mao Havanall was unavailable for comment yesterday.

Meanwhile, there are a number of questions the government should be asking about this airport, Camko City and indeed business concessions in Cambodia in general.

Although it’s unlikely the vast majority of government officials knew anything about shady dealings at Busan – after all the South Korean government only just started investigating the bank – to what extent is Cambodia doing background checks on investors, both domestic and foreign? And why is it that Cambodian government officials continue to dole out business concessions and licences as part of what remains a wholly opaque process?

If the Kingdom is to transform itself from a corrupt haven for money laundering into a respectable place to do business then it has to start asking these questions and reforming the way concessions and licences are distributed to companies. After all, if the government fails to initiate reforms in light of what has happened with Busan then it will surely just be a matter of time before we witness the next failed megaproject.

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