The abrupt cancellation of this year’s Water Festival has had an economic fallout on small businesses that see the annual event as a windfall for their marketing and sales efforts, and had already invested in promotional materials.
The cancellation marks the fourth time in five years that the government has pulled the plug on the three-day annual celebration, which traditionally draws hundreds of thousands of people to the capital for its boat races on the Tonle Sap river.
Prime Minister Hun Sen signed a government directive on Saturday stating that the cancellation was due to the river’s low water level and drought concerns. Pundits, however, suspect the decision was aimed at preventing opposition parties from mobilising the expected flood of visitors to their advantage.
The festival was held last year for the first time since 2010, when a stampede on the final day of festivities killed more than 350 people and brought about a suspension of the event.
While the crowds were thin last year, organisers and businesses hoped this year’s Water Festival, scheduled for November 24 to 26, would be a commercial bonanza.
The boat races are the festival’s main attraction, and the crowds they draw to the capital’s riverside traditionally result in a surge of income for local businesses.
Hym Piseth, production director of Confirel, a local producer of pepper and palm sugar products, said the company’s marketing efforts at last year’s Water Festival resulted in many new customers. This year’s cancellation would result in significant “opportunity costs”.
“We planned to book a space for promoting our products, but then found the event was cancelled,” he said.
“We’ve lost an important market opportunity, as this is a huge event that draws a lot of people.”
Veot Sophorn, sales and marketing assistant for the local arm of Cheers, a Malaysian beverage-maker, said the company had booked four booths in front of Wat Botum to promote its products during the festival.
He said it might be possible to recover the deposit on the booths, but the money it sunk into printing special festival banners, leaflets and advertising materials would be lost – and so would its opportunity to gain market share.
“We were sorry to hear that this national festival was cancelled on such short notice,” said Sophorn. “We were expecting to gain an additional 50 per cent more customers from our competitors during the festival.”
Long Dimanche, spokesman for Phnom Penh Municipality, said companies and vendors had leased booths and arranged advertising with the festival’s three main concession-holders: SeaTV, Bayon station and Hong Meas station.
He said the municipality had informed the concession-holders that the boat races were cancelled, but other activities could continue as planned.
“We informed them already about the cancellation [of the festival’s boat races] and we will not be offering them any additional compensation,” Dimanche said.
“Some of them are discussing whether to continue without the boat races by holding concerts instead.”
Sreat Mom Sophear, director of local travel company Sophiya Travel & Tours, said her company had played it cautious since the 2013 elections due to Cambodia’s volatile political situation, but many others had sold packages to foreign tourists keen to visit the capital to attend the Water Festival.
“We in the tourism sector are always promoting Cambodia’s culture and traditions to international tourists,” she said.
“So if a national festival is cancelled, how are we to promote this sector?”
Beyond the immediate losses, she said, the abrupt cancellation “will have repercussions next year as the private sector will lose confidence in the festival”.
Luu Meng, president of the Cambodian Hotel Association, said the cancellation will have a limited impact on the occupancy rates of the capital’s hotels and guesthouses, and some tourists could see it as a positive thing.
“Mostly, this will impact hotels located along the river,” he said. “However, some tourists did not like the way the festival closed down all the streets, because it obstructed their travels.”