Business

Q1 exports to Thailand soar

Wed, 16 May 2012 05:01:00 +0100

Cambodia's exports to Thailand jumped 55 per cent year on year in the first quarter of 2012 on what experts and officials said was a smoother political relationship between the countries, as well as an easing of Thai border regulations.

The Kingdom shipped US$85.4 million in agricultural products, recycled metal and fish to the western neighbour, data from the Thai Embassy’s Foreign Trade Promotion Office to Phnom Penh showed.

On par were increases in imports from Thailand, which dominated the bilateral trade relationship.

Worth $1.05 billion, imports of petroleum, processed goods, cement and consumer products from Thailand increased 58.4 per cent during the same period.

“Now Cambodia’s economy is doing well and Thailand’s economy is improving. But more important is that the political relationship between the two countries is improving,” Jiranan Wongmongkol, an official at the trade promotion office, said yesterday.

Trade, particularly energy exports to Thailand, were set to increase during the next three years.

The completion of a $3 billion coal-fired power station in Koh Kong province, a joint venture between Cambodian tycoon Ly Yong Phat and Thailand’s Ratchaburi Electricity Generating Plc, would see Cambodia’s first energy exports.

In early February, thousands of tonnes of cassava and other agricultural exports were stopped from entering Thailand, the Post reported at the time. Since then, border restrictions have been resolved, but not before diverting trade to Vietnam.

Thai business associations most likely created the stoppage, not government directives, business and economics lecturer at the University of Cambodia Chheng Kimlong said yesterday.

Such regulation would violate World Trade Organization rules, he said.

“If we could show that it was the government that was backing [the regulations], this would be against WTO policy. So we could accuse them of this.

But this wasn’t the case,” he said.

Further diversification of Cambodian exports would lead to less trade with Thailand, Chheng Kimlong said. Exports to Vietnam, China, and Malaysia – which officials have hailed as more stable markets – would take priority over exports to Thailand, he said.

Despite political progress, there was still uncertainty over the future of the Cambodia-Thailand relationship, Chheng Kimlong added.

To contact the reporter on this story: May Kunmakara at kunmakara.may@phnompenhpost.com

TTY to open $6m rice milling plant in 2013

Wed, 16 May 2012 05:00:50 +0100

Cambodian-owned TTY corporation will invest US$6 million in a rice milling plant in Kampong Speu province, company officials said yesterday.

Heng Sarath, TTY deputy director, said the factory would be built on national road 6, and would mill 20 tonnes of rice per year. Construction is hoped to be completed in 2013.

Equipment would be imported from Thailand and China, he said.

“If there are no obstacles, it will be in operation quickly. But this work is not easy and it will need more money,” he said.

TTY signed an agreement with China’s Sinograin in December for shipments of 200,000 tonnes of milled rice per year, the Post reported.

Phou Puy, president of the Federation of Cambodian Rice Millers Associations, said the recent increase in rice-milling facilities was a positive step, but there were still concerns on the quality of Cambodian rice.

“I am concerned that there is huge growth in rice-milling machines, but the amount of quality [rice] for export is not high enough. We have to resolve this issue quickly,” he said.

Yang Saing Koma, president of the Cambodian Center for Study and Development in Agriculture, said yesterday that the continued construction of rice mills was needed to cut down on the amount of unmilled rice that is currently exported to neighbouring countries without value-added processing.

To contact the repoter on this story: Rann Reuy at reuy.rann@phnompenhpost.com

Hotel owner looks to help

Wed, 16 May 2012 05:00:40 +0100

Paul Ouk's parents fled Cambodia during the Khmer Rouge regime. Ouk has returned to Cambodia as a hotel operator. Photograph: supplied

Mates are more important than anything else for Paul Ouk, an Australian-born and raised ethnic Khmer.

“It’s not about the money, it’s about the people,” says Ouk, who owns Me Mates Place, a guesthouse on Street 90 and a restaurant and bar on Street 88 called, appropriately enough, 88.

Ouk was born in Melbourne, where his parents had settled after fleeing the Khmer Rouge. During his school years, he never felt motivated and was unsure what to do with his life.

“I thought I wanted to be a businessman, but I had no idea what a businessman was” he says.

When he finished school, Ouk worked as a landscape gardener on weekends and washed dishes in a reception centre at night.

During this time of doing odd jobs, he got a job as a mail clerk at the National Bank of Australia.

“I tried to get the job at the bank. It was something I thought I could get a career out of, because I had no idea what I wanted to do with my life” Ouk says.

Luckily for him, the manager of the bank saw potential in him and offered him an internship to study there.

“I studied finance and worked in debt collection and litigation for three years until I finished my studies.

“After that, I was hired and worked as a financial planner, but I soon realised that kind of life wasn't for me. I hated it,” Ouk says.

He decided to travel to Canada with his Canadian partner, but stopped in Cambodia to visit his ethnic homeland. While here, he and his partner designed, and began building, Me Mates Place, the guesthouse they now own.

When they returned to Cambodia from Canada, Me Mates Place was ready to be up and running.

“I wanted it to be clean, comfortable, have good info and good food,” Ouk says.

“I didn’t come here for the money. I came here to develop the place, and my business allows me to bring in young Khmer guys and give them skills they wouldn't get anywhere else.”

Four years later, Me Mates Place had become very successful and young Khmers were lining up to work for Ouk. “I needed another project, because I wanted to employ more people, so I opened 88,” he says.

“I wanted a place with a relaxed atmosphere, and I think I've achieved that at 88.”

The bar has a pool table, a swimming pool and a fine selection of food and drink, but the defining feature is the relaxed atmosphere.

Ouk works as a consultant for people trying to do similar things. He works on many things, from property to agricultural development, and is currently helping with the construction of a school on Diamond Island.

To contact the reporter on this story: Abe Becker at newsroom@phnompenhpost.com

PM pushes edible exports

Tue, 15 May 2012 05:00:30 +0100

An employee of Khmer Brewery, the producer of Cambodia Beer, looks inside brewing equipment at the company's facility outside Phnom Penh. Photograph: Pha Lina/Phnom Penh Post

Prime Minister Hun Sen yesterday urged Cambodian food and beverage companies to look to export markets.

The call, made at the opening ceremony of the Khmer Brewery, came in the wake of similar exhortations from international organisations for Cambodia to diversify its exports.

“Now, we are not only expanding our locally made products in the domestic market. We have to promote export products and beverage abroad,” Hun Sen said. “The big problem for us is to make sure that we what produce is good quality and affordable at that segment of the market.”

In 201, the food and beverage industry contributed about US$1 billion to gross domestic product, 40 per cent of it from the brewing industry.

Khmer Brewery, one of six breweries in the country, planned to export its Cambodia Beer brand, company chairman Leang Khun said yesterday.

“We will soon start exporting Cambodia Beer to developed countries such as Japan, the US and the European Union,” he said.

The $60 million local investment has produced beer since late last year.

Yesterday was the official opening of the factory, which is located in Phnom Penh’s Dangkor district.

Ngov Heng Fish Sauce Cambodia exported its sauce to the US until 2009 when the company ran into some capital constraints, owner Chan Sitha said yesterday.

He said more government support was needed for small- and medium-sized enterprises (SMEs) to succeed on the international market.

“We did not have any problem with our exports to [the US] in terms of quality, something that was recognised as being good. But, the problem for us was the money. This business takes time and more money,” Chan Sitha said. “Of course, I plan to resume my exports but now I need to seek more capital. The government should help us if they want SMEs to export more.”

General director at the Men Sarun Mee Yeung noodle factory Linh Thorn told the Post earlier this year that his factory would look to export to the United States and Europe in the near future.

Cambodia’s domestic food and beverage industry was strong, Suy Sem, the Minister of Industry, Mines and Energy, said at yesterday's ceremony.

When the country’s garment industry was ailing during the global financial crisis in 2009, the value of the food and beverage industry had continued to rise, he said.

To contact the reporter on this story: Mom Kunthear at kunthear.mom@phnompenhpost.com

Chinese telco gears up for an August 4G launch

Tue, 15 May 2012 05:00:20 +0100

Xinwei Cambodia, China’s first step into the Kingdom’s telecoms market, planned to launch fourth-generation mobile services in August, according to officials and a company statement.

The Beijing-based firm will deploy its homegrown network technology, McWiLL, and was expected to launch top-to-bottom operations that, according to the statement, would be backed by China Development Bank.

Minister of Posts and Telecommunications So Khun said yesterday that Xinwei has been testing operations.

He said he expects to receive next week a formal letter from the company detailing its operation plans.

Deploying the 4G mobile connections that Xinwei claims it will offer would require a US$100 million investment, So Khun said.

“I know this service will be a step up with 4G. But I don’t know if it will succeed. This will depend on [Xinwei’s] promotion and pricing,” he added.

Despite Xinwei’s presence in 21 countries – including North Korea, Myanmar and the United States – regional telecoms analysts have said there is little information available on the company.

Cambodia will see the first international deployment of McWiLL for mobile services, although Xinwei was also working on networks in Papua New Guinea, Zimbabwe, Ukraine and Brazil, according to the website.

The company has not put a dollar figure on its Cambodian operations, and representatives have routinely denied requests for interviews.

China Development Bank visited the firm in Cambodia late last month and intends to “fully support the globalisation” of Xinwei networks, according to the statement.

The state-owned bank was cited in an early 2011 US-China Economic and Security Review Commission report as providing an unfair pricing advantage via noncompetitive to China’s Huawei and ZTE, the world’s two largest technology device manufacturers.

To contact the reporter on this story: Don Weinland at don.weinland@phnompenhpost.com

Stung Treng looks to revamp jungle airport

Tue, 15 May 2012 05:00:10 +0100

Officials in the northeastern province of Stung Treng hope future travellers will trade their bus seats for plane tickets.

No fuctional airport exists in the province, but local officials are demarcating, and looking to revamp, a landing strip that was installed when Cambodia was a protectorate of France.

Stung Treng governor Loy Sophat said local authorities had finished measuring the size of the airport late last year.

The majority of the 560-hectare airport was covered in forest and farmland after more than half a century of disuse, he said.

“If it is developed, this airport will mostly serve the tourism sector, because goods have other means of transportion such as roads and railways,” Loy Sophat said.

He did acknowledge that the scale of the airport might not pique investor interest.

“We think a small-size airport will not attract investors because we see other countries have airports with other facilities such as golf courses.

We have to think in the long term. Our land is so huge. If we don’t plan, some day we won’t be able to use it.”

Soy Sokhan, under-secretary of state for Civil Aviation, said officials were registering airport properties in other provinces where they used to exist.

Demarcation of the Stung Treng airport had not been completed, and the effect on villagers in the area was still unknown, Soy Sokhan said.

Keo Mom, a 50-year-old resident of Sre Por village, which is located on the airport site, said villagers were asking local governments and NGOs to help them gain compensation for the land they could lose.

To contact the reporter on this story: Rann Reuy at reuy.rann@phnompenhpost.com

Solving problems brings in wealth

Mon, 14 May 2012 05:01:40 +0100

Din Somethearith, co-founder and executive director of Frangipani Villa Hotels, holds up a copy of Unfair Advantage, one of many self-help books on alternative methods of financial development and thinking by his favourite author, Robert Kiyosaki. Photograph: Stuart Alan Becker

One of Cambodia’s true rags-to-riches success stories is that of Din Somethearith, co-founder and executive director of Frangipani Villa Hotels.

Frangipani, named for the blossoming tree, is a chain of boutique hotels, one of which is located just off Street 178 at number 43, down a narrow lane which opens into an outdoor garden and dining area with adjacent hotel reception.

A student of alternative financial thinking and an avid reader of self-help author and financial literacy activist Robert Kiyosaki, Din believes in 10-year rental agreements, focusing on the people, a stand against sex tourism and distinguishing between “good assets” and “bad assets”.

“Cambodia was poor so I want to make my country better. I don’t want my country to be remembered as poor and for the Khmer Rouge. I want it to be prosperous with smiling faces,” he said.

“We work with orphanages and we give bicycles. We have charity box where our guests and donate and we give another two thirds after that. If the guests give one dollar, we add double with two.”

While Din and his two partners are enjoying steady income from four villa hotels today, they started out far less fortunate, borrowing what they could from relatives and friends, building their way forward step-by-step.

Born in Phnom Penh in 1974, Din was ten months old when the Khmer Rouge took over. Now he’s 38 years old, with a Thai wife and a son.

With a mother from Kampong Cham and a father from Prey Veng, young Din was forced with his family to move to his father’s town in Prey Veng. His father had worked for the government, so he was sent away for “re-education” and was never seen again.

“I knew him only through photos.”

Din and his one elder sister survived as small children through the Khmer Rouge period.

“My mother worked very hard, 10 hours per day on the farm and it was very tough to survive because we were city people.”

When Din’s mother was asked to go to another province where the soil was fertile and the living was easier, she recognized one of the Khmer Rouge soldiers was wearing a shirt that belonged to one of the people she’d seen earlier who had left on a similar trip to Pursat or Battambang to a “prosperous land” and a “better life”.

She made a cover story that the kids had diarrhea and saved the family.

“My mother was very smart. She recognised the shirt that had belong to someone they killed.”

Finally, after liberation in 1979, the family with 4-year-old Din came back to see their old house in Tuol Kork, which was abandoned, but the area was a kind of Vietnamese army camp.

“They allowed us to come into our house but we could not live there because it was like a military camp. A few months later during the early the place had settled down. Din and his family lived at street 188 in Boeung Keng Kang 1.

“During that time there was no water supply, no electricity. We got our water from the river,” he said.

Few people had shoes to wear in those days but gradually the Phnom Penh markets started to carry them.

“My mother bought some shoes for me, but they got stolen the next day at school because none of the other kids had shoes.”

“We were not clear if the Khmer Rouge would come back or not, and we didn’t trust the Vietnamese either. We stayed with my uncle and my mom in a shop house until 1989.”

Din enrolled in Sisowath High School, graduating in 1992. He remembered that when the United Nations arrived, Cambodia really changed.

“People rented out villas to the UN staff and some people got money very quickly. Demand for housing was very high and land prices increase dramatically at that time.”

Din won a competition to learn architecture on a scholarship at the Institute of Khmer Habitat. He worked closely with Danish-trained architects and designed a lot of social projects including health centers.

Following his graduation in 1999, Din went to work full time for UN habitat, working as a technical officer on a lot of different projects before winning a scholarship to the Asian Institute of Technology in Bangkok where he earned a master’s degree in Urban Environment Management.

During his two years in Bangkok he met the lady who would become his wife, Saranya, who is a landscape architect and teacher at Thailand’s prestigious Chulalongkorn University. The couple have one son, Supicha, age 7.

After his schooling in Thailand, Din returned to Cambodia and worked for the Asian Development Bank, the World Bank and JICA all as a consultant in urban development. The Cambodian government offered him jobs, but he refused. In 2007, Din became country manager for UN Habitat.

“The work was very tough, dealing with city issues, evictions, and my life was difficult dealing with officials.”

Able to save a few thousand dollars, Din began thinking about building a small boutique hotel. They found a villa dating back to 1960 along Street 252, which happened to be owned by one of his friends’ mothers. Because of not much money between Din and his partners, it took eight months to complete the renovations.

Within six months the rooms were mostly full of foreigners, from Europe, America and Australia. From the very beginning, they insisted on good behaviour in the hotels: no smoking and strictly no sex tourism.

All Frangipani Villa hotels have solar heating systems as well.

The second property Din and his partners acquired was on Street 71 near the World Vision office.

“We made 15 rooms, took more loans from the banks, and borrowed some money from relatives. I and my partners kept working during that time.”

In 2009 Din and his partners found an opportunity in Siem Reap at a time when a lot of guest houses there were closing and materials were cheap.

Today, the Frangipani Villa Hotels group has five properties, totaling 140 rooms, all of which are leased for a term of 10 years. Din and his partners intend to buy the properties when the leases are up.

Din is influenced heavily by the work of Robert T. Kiyosaki, a Japanese-American from Hawaii who promotes alternative thinking in finance.

“He teaches us to start out small and use leverage. He said if you want to be rich, you have to serve a lot of people, and you have to be able to solve many problems. You have to know how to use debt and distinguish between good debt and bad debt.”

According to Din, good debt is that which somebody pays for you -- like servicing a loan with rent payments -- and bad debt as that which you have to pay yourself.

“Our customers pay our debt.”

Din agrees with Kiyosaki against investing for capital gain like a gambler, encouraging instead a business that creates money by using information.

All of the Frangipani Villa Hotels are finished in tasteful architecture, environment friendly, with solar hot water systems throughout.

“We run the business to solve people’s problems. Foreigners who come want to have a clean environment with social responsibility. We don’t run the business for money. We want to build jobs for my people.”

Din is proud to be Cambodian and encourages others who are poor to have ideas, invent new businesses, use leverage and realise their dreams.

“The power of financial education is that you realise you don’t need to own it. You don’t need a 30-year lease. That’s a lot of your life. Ten years is enough. To run a business, it is not about money; it is how you use your idea. You don’t require that your parents are big business people. I keep telling people that I came from poor family with no father and no shoes to wear. “

To contact the reporter on this story: Stuart Alan Becker at stuart.becker@gmail.com

Cambodia prepares for G20

Mon, 14 May 2012 05:01:20 +0100

If it were a Group of 180 nations meeting, Cambodia would be invited.

But the Kingdom’s chances of attending the so-called G20 summit, which brings together the world’s largest economies, are unlikely, says Mey Kalyan, a government adviser who last week became the first Cambodian to sit in, and speak at, a preparatory meeting for the yearly event.

At the G20 summit in Los Cabos, Mexico, next month, Prime Minister Hun Sen will be the first Cambodian head of state to pose for photographs with the likes of Chinese President Hu Jintao and US President Barack Obama under one roof – at a time when the country is looking to secure a non-permanent seat on the United Nations Security Council.

“In the end, I don’t know what it will lead to,” Mey Kalyan, a senior adviser on the Supreme National Economic Council, said yesterday of the Kingdom’s attendance.

“These things are incremental. We are improving our access to the world, linking Cambodia to the map. This is image-building.”

But Cambodia’s presence was far from ceremonial.

The Kingdom, along with West African state Benin, will represent many of the developing world’s low-income countries before a host of economic powerhouses.

The ASEAN chairmanship, held by Cambodia this year, has been routinely invited to attend.

Mey Kalyan, who said he “spoke a lot” during the three days in Mexico, delivered a pointed message to the meeting that focused primarily on infrastructure, food security and a combination of sustainable and inclusive growth.

The developed powers of the world were devising a new lexicon of terminology for such things, but these phrases were far less important on the ground in countries such as Cambodia, he said.

“Development doesn’t happen in an air-conditioned room. The international community makes a lot of new terms. As a poor country, we’re constrained by these terms. They confuse us. I told them, ‘Stick to a few concepts. Grab the bull by the horns.’ ”

Mey Kalyan said the concept of “inclusive green growth” was important and pertinent, but the phrases, which were becoming increasingly convoluted, meant little for countries in the throes of basic development.

Cambodia and Benin’s presence brought some practicality to the discussion, he said.

It was also an opportunity for Cambodia to give back to the countries that had given billions of dollars in development aid, Mey Kalyan added.

The country could share its development experience from a failed state to a growing destination for foreign direct investment, he said.

Hun Sen would likely point to ways G20 countries could include emerging and frontier markets in global growth, Cambodian Institute for Cooperation and Peace executive director Chheang Vannarith said.

“I think the message the Prime Minister may bring is how to reduce the development gap between rich and poor countries,” he said.

Indonesia, ASEAN’s largest economy and a permanent G20 member, would also be in Mexico next month, and could deliver a similar message, Chheang Vannarith said.

But Cambodia would have the opportunity to demonstrate that poor nations can have their say on the issue, he said.

“It shows that small and big countries are coming together here to shape the world’s economy.”

To contact the reporter on this story: Don Weinland at don.weinland@phnompenhpost.com

City sweeps up trash in bid to rake in tourism cash

Mon, 14 May 2012 05:01:10 +0100

The government will try to reduce the amount of trash on Phnom Penh's streets as it implements a project officials say could boost tourism.

It was hoped that a national referendum on paper and plastic waste management and reduction would “make a city without paper and plastic flying around in the air”, Tourism Minister Thong Khon said last week at a tourism seminar.

The project, however, would require the participation of average Cambodians to get to what tourism officials have called “green gold”, or the lucrative potential of eco-tourism, Thong Khon said.

“It’s difficult to get this to work. There needs to be participation from the public. Trash is a big challenge for developing green tourism,” he said.

The project would ask Cambodians to cut back on their use of plastic and paper products.

Cambodia imported almost 56,000 tonnes of plastic last year, up 21 per cent from the year before, according to a document that detailed the project.

More than 18 per cent of Cambodia’s waste is inorganic, and the project would focus on reducing this percentage of the trash, Thong Khon said.

Of Phnom Penh’s 1,300 tonnes of sitting waste, nearly 16 per cent was plastic and three per cent paper.

“We can’t eliminate plastic in the short term, but reduction is very important. If we want to reduce it, we have to know about management,” Thong Khon said.

Sarun Sambo, chief of the Solid Waste and Hazardous Substance Management office in the Ministry of Environment, said Cambodia lacked many of the facilities needed to collect and control waste.

“Operations at the dump site don’t comply with technical standards, meaning that this leads to people around the site being affected,” Sarun Sambo said.

To contact the reporter on this story: Don Weinland at don.weinland@phnompenhpost.com

CEDAC sours on honey prices

Mon, 14 May 2012 05:01:00 +0100

A vendor holds up honeycomb at Phsar Kandal market in Phnom Penh last year. Photograph: Hong Menea

CEDAC, a domestic agriculture development organisation and the Kingdom’s largest distributor of natural honey, will shrink its purchases of the commodity in the face of rising prices, the company’s president says.

Yang Saing Koma said the group would not reach its goal of buying 7,000 litres of honey from Cambodian bee-keepers, as prices had climbed past US$11.50 a litre.

Honey cost just $9 a litre last year.

“Our capital is limited, and if the price rises any more we are afraid we will not sell out of what we’ve bought,” Yang Saing Koma said.

He pointed to an increasing demand in the Kingdom for natural honey, with the number of buyers continuing to grow.

As a result, CEDAC plans to purchase only between 3,000 and 4,000 litres in 2012, down from the 4,200 the company bought last year.

The organisation had so far bought 2,000 litres of honey, mostly from Preah Vihear and Ratanakkiri provinces, Yang Saing Koma said.

Moeng Mean, president of the Cambodian Federation for Bee Conservation and Community-Based Wild Honey Enterprises, said CBHE had seen gains in the sector, at least in part from demand in the tourism industry.

“The honey price increases as buyers go to purchase from farmers directly and take it to sell at big hotels,” Moeng Mean said. CBHE had signed a contract to supply CEDAC with the 7,000 litres of honey in February at the $11.50 a litre rate, he said.

But another 2,000 litres would be shipped to other partners as well, Moeng Mean said.

Despite the burden that higher prices had put on CEDAC, Moeng Mean said the trend was positive for CBHE members, as higher revenues would lead to higher standard of living.

At the same time, the growth might prompt bee farmers to push for greater protection of Cambodia’s forests, he said, although he was concerned that illegal logging could hurt the sector in the future.

To contact the reporter on this story: Sieam Bunthy at bunthy.sieam@phnompenhpost.com

Beeline parent names new country head as firm’s future unclear

Mon, 14 May 2012 05:00:50 +0100

Cambodian mobile operator Beeline has made an official announcement of the replacement of its general director, who the Post confirmed left the job on May 4, according to a company statement from the brand’s owner, Vimpelcom.

Siddhanta Kothari, former chief financial officer at GTEL Mobile, Vimpelcom’s Vietnam company until last month, when it sold off its 49 per cent stake, took the general director’s position two weeks ago, according to a Beeline Cambodia spokesperson.

Gael Campan, the company’s general manager until May 4, told the Post last week he had left the company.

He declined to discuss his departure or the future of Vimpelcom in Cambodia.

Vimpelcom’s Amsterdam-based spokesman, Bobby Leach, said in an email on Friday that Campan had left Beeline to “pursue new challenges elsewhere”.

Leach also declined to comment on potential mergers or acquisitions of the company, after Vimpelcom sold its Vietnam assets and took a US$527 million impairment charge on its Cambodian and Vietnamese operations in March.

Analysts told the Post last month Beeline’s exit from Cambodia was “imminent”.

A Russian newspaper reported that the company, one of the world’s largest mobile operators, was considering a sell-off of its Cambodian business.

In Beeline’s statement, however, Kothari was quoted as saying the company was looking to develop new services in Cambodia.

“We are surely going to launch unique and interesting products in the near future,” he said, according to the statement.

The statement also claimed Beeline Cambodia had more than one million subscribers, which would put its user numbers more than 370,000 above the 630,000 reported in November, according to data obtained by the Post earlier this year.

To contact the reporter on this story: Don Weinland at don.weinland@phnompenhpost.com

Beeline manager exits

Fri, 11 May 2012 05:01:00 +0100

A customer speaks to a Beeline mobile service representative at the company’s office on Norodom Boulevard in Phnom Penh. Photograph: Will Baxter/Phnom Penh Post

The general manager of Cambodian mobile operator Beeline has left the company, following brand-owner Vimpelcom’s selloff of Vietnamese assets and a more than US$500 million over-valuation of its Cambodia and Vietnam markets.

General manager Gael Campan’s departure raised questions about Amsterdam-based Vimpelcom’s future in the Kingdom, which analysts have said will not be long-lived.

Campan said he had left Beeline last week, but declined to give a reason for his departure. “I can’t say why, but it’s none of your business for sure,” he said by phone yesterday.

Vimpelcom director of communications Bobby Leach said early yesterday in Amsterdam he was not aware of Campan’s exit.

Further calls and emails concerning new leadership arrangements for Beeline Cambodia went unanswered.

Beeline’s yellow-and-black logo will disappear in Vietnam during the next six months, according to a Vimpelcom statement late last month.

The company, one of the world’s largest mobile operators by customer numbers, announced in April the selloff of its 49 per cent stake in Vietnam’s GTEL Mobile Joint Stock Co for $45 million to GTEL Transmit and Infrastructure Service One Member Co.

Coupled with an impairment charge of $527 million for Cambodia and Vietnem issued by Vimpelcom in mid-March, Marc Einstein, an independent telecoms analysts based in Tokyo, said in April that a selloff of the company’s Cambodian business was “imminent”.

“They have finally realised that they messed up. They went into a market that was way too competitive . . . and it didn’t work,” Einstein said at the time.

In late April, the Russian newspaper Kommersant reported that sources close to Vimpelcom’s Russian shareholder had said the company was considering the sale of its Cambodian operations.

Beeline struggled to gain a significant market share in Cambodia after entering the country nearly three years ago.

The operator had 630,000 subscribers as of November, and has consistently been grouped among the market’s four smallest service providers, according to data obtained by the Post.

The 1.45 million Beeline, Mfone, qb and Excell users accounted for less than 10 per cent of the total market in November.

The company lost and regained customers in 2011, according to the data.

Minister of Posts and Telecommunications So Khun said yesterday he was unaware of a potential Beeline selloff, but he stressed the important role mergers and acquisitions would play in a slowing telecoms market.

“If [Beeline] cannot carry on with their business here, they should co-operate with another company,” So Khun said.

“There’s no room for more telecom operators because subscriber numbers have slowed down.”

Frequency space for new operators was also unavailable, So Khun added.

To contact the reporter on this story: Don Weinland at don.weinland@phnompenhpost.com

Insurance claims drop in Q1

Fri, 11 May 2012 05:00:55 +0100

Firemen attempt to extinguish a fire at the June Textiles factory in Phnom Penh last year. Photograph: Hong Menea/Phnom Penh Post

Claims on Cambodia’s six biggest insurance companies declined year on year by more than 90 per cent in the first quarter of 2012, data from the General Insurance Association of Cambodia (GIAC) shows.

The value of claims in 2011 was raised by fires that gutted two garment factories early last year.

There were US$2.1 million in claims between January and March this year, down from $24 million during the same period in 2011.

Insiders said increased industrial performance and safety had reduced the number of incidents in the Kingdom this year.

“During this time last year, we had two big garment factories, River Rich and June Textile, that cost about $22 million in fire damages.

“But early this year, we did not face any big accidents, so things got a bit better,” Ty Atith, the deputy director of operations at GIAC, said yesterday.

Several claims worth about $500,000 each were filed this year, the majority being related to engineering accidents and health claims, GIAC data shows.

Asia Insurance (Cambodia) Plc awarded River Rich Textile garment manufacturer $1.1 million for their destroyed company warehouse in Kandal province.

Despite a substantially lower claim value, premiums collected hit about $9.4 million, a year-on-year average increase of 39 per cent, as more businesses bought into insurance.

Fire insurance premiums increased by 27 per cent, data showed.

Motor insurance premiums rose by 21 per cent and health insurance by 16 per cent.

David Carter, chief executive at Infinity Insurance, said in an email his company’s insurance premiums had risen by 36 per cent during that period.

“We have seen a major increase in medical and property premiums. This reflects a combination of an increase in economic activity, more employers seeking coverage options beyond the mandated scheme, and more clients moving to Infinity,” he said.

“Our clients still come from across all industries with the notable exception of the garment industry, where we have taken a very conservative approach.

“We are seeking to maintain our market position, but most importantly to achieve market-leading profitability, while continuing to serve our clients well.”

Youk Chamroeunrith, the general manager of Forte Insurance, said claims had not increased early this year and premiums had risen by 30 per cent.

“We did not get any significant claims over that period of time. We’ve had bad claim experiences over the past three years, mainly caused by fires,” Youk said.

To contact the reporter on this story: May Kunmakara at kunmakara.may@phnompenhpost.com

Guesthouses rebut calls for fair prices

Fri, 11 May 2012 05:00:50 +0100

Hotel and guesthouse operators have pushed back against government calls to avoid price increases during holidays, claiming group booking, as well as supply and demand, dictated the price of accommodation.

Government officials, including Prime Minister Hun Sen, have recently tried to dissuade operators from raising the cost of rooms over such holidays as the King’s Birthday and Khmer New Year.

The Premier said unfair jumps in price hurt the industry as a whole.

Kim Chantha, the owner of a 20-room guesthouse in Sihanoukville, said price increases to the end customer were beyond her control.

Group tour operators often booked the entire guesthouse and charged customers prices higher than the normal rate, she said.

The mark-up on a room was often US$10 on top of the original $15, as they will be on the King’s Birthday weekend, which begins on Sunday and lasts three days, Kim Chantha said. She said she refused to double the price.

“Price increases don’t happen all the time, just during the holidays,” she said.

At a Ministry of Tourism meeting yesterday, Secretary of State Ros Ren said operators lied to customers during Khmer New Year about how many rooms were available in the hope of making more money.

He called on provincial authorities to crack down on unfair prices, which he claimed could ruin trips for travellers.

“It’s a festival, and we have that festival only one time [a year],” Ros Ren said.

Price increases at hotels had been limited, Cambodian Resort Hotel sales and marketing manager You Sokkeng said yesterday, adding that any climb in price was “related to marketing theory”.

“When there is more demand, price will increase.”

Preah Sihanouk province deputy governor Phai Phan said controlling private sector prices was difficult.

He also agreed that some increases were unavoidable in his province.

“Sihanouk province is different from the other provinces because it needs to import almost all meats and vegetables,” Phai Phan said.

To contact the reporter on this story: Rann Reuy at reuy.rann@phnompenhpost.com

Cedac report to help farmers

Fri, 11 May 2012 05:00:40 +0100

As the rainy season approaches, Cedac, a Cambodian agricultural organisation, is appealing to farmers this week to increase their rice yields, according to a Cedac report directed toward growers.

The report established a six-step order of operations that would ensure increased output during the most intense growing season of the year, Cedac president Yang Saing Koma said yesterday.

The report is hoped to spread a new awareness among farmers, and increase the country’s total rice output, he said, although he admitted most farmers were not yet prepared to start with the process.

Chey Siyat, a farmer in Kampot province, said the instructional report has helped her prepare for growing.

“Readiness for the farming season will enable us to take advantage of the season and get more output,” she said.

To contact the reporter on this story: Sieam Bunthy at bunthy.sieam@phnompenhpost.com

Corporate social responsibility in Cambodia

Fri, 11 May 2012 05:00:20 +0100

Daniel Mitchell, CEO of Grandis Timber Limited and founder and managing director of SRP International Group Ltd. Photograph: supplied

Frontier and emerging economies such as Cambodia present companies with a specific set of challenges and risk, both real and perceived, beyond those found in more developed markets.

A risk category getting ever- increasing attention is that of “social risk”, roughly defined as the risk of waking up one morning to find your company’s name in the media for the wrong reasons.

Such unhappy media events present risk to the investor’s reputation or a company’s brand as a result of investment or operations in a given market. These risks are why all of the tuna sold in North America and Europe is marked as “Dolphin Safe”.

Unlike traditional business risk, where high risk results in a higher required rate of return, social risk tends to be a bipolar event, wherein a company will simply deem a market too risky to consider investment, even at high rates of financial returns.

Multinational branded firms and institutional investors including pension funds, insurance companies and university endowments are particularly sensitive to these issues, and for good reasons. As has been demonstrated in case after case involving household brand names, how a company shows up in the media matters a great deal.

Corporate Social Responsibility (CSR) is the label assigned to the collective set of activities companies use to ensure that what they do is perceived as ethical, sustainable and generally having positive impact on their stakeholders and the communities within which they operate, and minimisation of these risks.

Looking at the historical context, CSR is not a new idea. There are those who would argue that issues related to CSR, or rather lack of it, helped to bring down the British East India Company in the mid-1800s. During the century that followed, Upton Sinclair’s 1905 novel The Jungle called attention to conditions in the Chicago slaughterhouses that led to the passage of the Meat Inspection Act and the Pure Food and Drug Act of 1906 in the US.

In the 2007 book Colons & Coolies: The Development Of Cambodia’s Rubber Plantations, author Margaret Slocomb describes the issues faced by the French concessionaires developing Cambodians first rubber plantation during the 1920s and 1930s and shows that they are not significantly different from descriptions encountered by concessionaires in the media today.

While the old issues remain, new issues have emerged. Today CSR’s definition has broadened, encompassing concepts as diverse as philanthropy, treatment of animals, green house gases, corruption and employee relations to name just a few. Sometimes just making an investment into a market, whatever it is, can be seen as socially irresponsible, as in Myanmar only a year ago or South Africa during the Apartheid era.

In this age of social media, news of an incident in Cambodia such as a shooting at a garment factory or an economic land concession can be seen around the globe in a matter of minutes. Historically, most companies took a reactive approach to CSR. A reactive model, however, is risky and fundamentally insufficient for today’s participants in emerging markets.

CSR as a concept is not without its critics. How does a manager tasked with “maximising shareholder returns” reconcile the risks of entry into a frontier market in a socially responsible and environmentally sustainable manner? He or she does so through the analysis of the potential CSR related risks and, yes, rewards.

Most risks in frontier and emerging markets are magnified. CSR risks are no exception. “Exploitation,” rightly or wrongly, is a term more likely to stick when related to a Cambodian garment worker than to a member of the auto workers union IG Metall in Germany.

Investment and operations in emerging markets carry higher reputational risks to firms and brands. The density and aggressiveness of NGOs are typically inversely proportionate to the level of economic development of a market, resulting in a greater number of watchdogs monitoring government and commercial activities.

A core element of any CSR framework is the concept of “social cost”; the indirect “costs” of an enterprise spread across the community within which it operates. Regulation of these costs is the responsibility of the government institutions in developed markets. In their book Winning in Emerging Markets, Tarun Khanna and Krisha Palepu cite key characteristics and opportunities found in emerging markets that they call “institutional voids”.

One of these voids is weak government institutions and regulatory enforcement. Inconsistency in enforcement of regulations can make it difficult for companies to comply when others are not in compliance.

From a competitive standpoint, a strong CSR policy can result in a company effectively being forced to compete at a significant short-term disadvantage.

If a company has the same legal status as a “person”, it is not unreasonable for it to be held to the same social and ethical standards as a citizen of the communities it impacts.

The issue is that in frontier markets, the investors face a wider range of values that they need to accommodate. Ethical behaviour has subjective elements that generate risk. Certain stakeholders in a process may not feel the company is going far enough in its efforts, and they criticie accordingly. Stakeholder engagement is key to any successful CSR model, but because of the increased diversity of the stakeholders the tendency is to be more critical of less developed economies.

The American business community in Cambodia has recognised this and as a result AMCHAM formed a CSR Committee earlier this year. A key objective of the committee is to improve the communication and engagement between the businesses and NGO community.

Ethical behaviour is also subject to cultural context. Local managers may not view all of their actions in the same ethical light as their peers who are accustomed to operating in more developed markets. Whatever strategic CSR model is applied, communication of expectations and training in acceptable behaviour must be included.

There are significant potential rewards to a strong CSR programme but they are best described within the context of the basic models of CSR used in practice.

Most companies in developed markets operate with a mix of the two basic models of CSR that are in widespread practice today with varying degrees of effectiveness.

The institutional voids previously described provide many varied philanthropic opportunities for companies.

Historically philanthropic model based on donations to organisations or parties outside of the business entity itself. These efforts may or may not be of strategic benefit to the company. This model is typically self-described as “giving something back,” implying that the business has “taken” something from society.

This model has evolved in reactive manner to compensate for social costs of a business operation and efforts to improve a company’s image in an era of limited government regulation and management of social costs.

The reward companies typically enjoy is the image of being good corporate citizens. Critics and cynics might say that they are trying to hide something or that if their business practices were better in the first place they would not need to do this.

The flaw in this criticism is that companies do not have to do these things, but they place a value on the opinion of their stakeholders and as such take measure to positively influence those opinions.

In cases of donations to NGOs and other organisations, it effectively amounts to outsourcing CSR effort to organisations better able to achieve the desired results.

An excellent example of this is Starbucks Coffee, which has partnered with Conservation International to ensure the sustainability of its coffee sources and support its overall conservation efforts as part of its “Shared Planet” programme.

A second model, more strategic in its approach, and called Creation of Shared Value (CSV), has been championed by leading strategic thinkers including Michael Porter and Robert Kramer of Harvard Business School.

Fundamental to the model is the philosophy that for society to be successful it needs healthy commercial enterprises, and these enterprises should reflect the values of society or more specifically segments of the society, in which they operate.

This model integrates CSR into the core operations of the company and integrates the business into the community and/or society at large. Several of today’s leading brands were launched with CSR elements as part of their core business model, including Ben and Jerry’s Ice Cream, The Body Shop and Starbucks Coffee.

The inverse of social cost is social benefit; the benefit a company’s activities produce indirectly for which a company is not directly compensated .These companies have chosen to focus on one or more key areas and expect a premium for their product as a result.

This model, or a variation of it, is best suited for frontier and emerging markets.

Dr Mogen Pederson of International Woodlands Company of Denmark has supported the development of corporate social responsibility policies and programs for the company’s frontier market investments throughout the world, including Cambodia.

It is specifically focused on rural development. In his model, any CSR programme has to have mutual benefit to the local community and the company.

The core philosophy is to optimise the benefits to the community, which take the form of economic, social or environment impact and the benefits to the company in the form of “top line”, which means higher revenues, more product sales, premium prices, and “bottom line”, which means lower cost structure and lower “risk”, meaning lower potential impact of an identified issue.

What results is a symbiotic relationship between the company and the community through which the company provides key developmental capital and in many cases, social services typically provided by governmental institutions in developed markets.

The community provides a stable work force. Collectively, this framework lowers potential for conflict and more importantly, when conflict does arise, motivation for both parties to resolve it systematically, without violence.

There is an additional benefit not mentioned in his model: access to investment capital. The mitigation of reputational risk through successful implementation of such model makes a company more attractive to international investors sensitive to these types of issues.

For these investors, investment itself, and taking the incremental risk where few are ready to invest, may be seen as a CSR activity, creating jobs and demanding responsibility and sustainability in operations.

Successful CSR programs improve financial returns through enhanced brand image and awareness, premium pricing, attracting better people and reducing risk.

Daniel Mitchell is the CEO of Grandis Timber Limited and founder and managing director of SRP International Group Ltd, an investment firm focused on developing opportunities in emerging Asian markets.

Regional health insider talks Cambodian medical care

Thu, 10 May 2012 05:05:50 +0100

International SOS regional managing director for South and South East Asia Philippe Huinck. Photograph: supplied

A French doctor established International SOS between Jakarta and Singapore 27 years ago. The company conducted emergency airlifts for patients to Singapore due to the lack of quality health services available in Indonesia at the time.

The French-owned company now has a presence in 74 countries and employs 10,000 people, 3,000 of which are medical professionals. SOS has been in Cambodia for 14 years. Regional Managing Director for South and Southeast Asia Philippe Huinck spoke with The Phnom Penh Post about the international health business and Cambodian hospitals.

What are the main areas of interest for your company?

Our end user is the business traveller and the expatriate. We have very simple requests, like: “I broke my glasses, where can I find an optometrist?”

But we also handle very serious cases: an obese man in his 60s is having chest pains. Sounds like a heart attack. We handle over 4.5 million cases a year. Out of the 4.5 million cases, 19,000 result in a medical evacuation. It’s very small percentage-wise. We are in the business of prevention.

This is the key business that we do. Grown out of this, we also provide medical services. This basically consists providing medical staff to remote sites. A remote site could be an oil rig or a mining site.

We also do medical consulting. We do site health reviews, which are very popular in Cambodia.

How do operations work for SOS in Cambodia?

In countries where the level of health care is not that good … there we have decided to set up our own clinic, like Cambodia. In some locations we don’t need a clinic because the local health care is really good.

At most locations we don’t have one. We have 27 clinics around the world. We have lot of them in Africa, many in Asia.

Where are clients generally airlifted in times of crisis?

Bangkok is typically the first base from Cambodia. Bangkok has developed rapidly as a centre for medical excellence. We first of all would evacuate people to Bangkok. But, let’s say the patient is from Germany, they may want to be evacuated to Germany. We can also organise that.

What do you make of health care in Cambodia?

Like in any emerging market, the development goes very fast, and typically goes in the right direction. But what we still see lacking in Cambodia is regulation. If you are a doctor and you travel to Cambodia and you wake up one day and say: “I’m going to start a clinic”, you can start a clinic. So who checks it? Who checks the credentials? The quality?

These start-ups would probably provide something better than what’s available. But what are the risks? What are the liabilities? But it can be very cheap. It’s very important that this develops. It’s important the government puts regulations in place.

What is the principle behind the “duty of care” study that SOS had commissioned?

The duty of care principle started to evolve in the US as a result of court cases. Something happens, then a employee sues his company. The company pays US$1 million. Then legislation starts to appear, or preventative measures. That raised the care level to employees and it has become standard over the past 20 to 30 years.

What did the report say about Asia?

One of the key findings when this whole study was conducted, it showed a discrepancy between the execution of duty of care in the West and that in Asia. And that was interesting for us and we started to find out why is is.

There are a few possible reasons why. In Asia, companies tend to look at the cost side. They see the execution of duty of care more as a cost. If you don’t execute on duty of care, you may save on the short term, but not necessarily in the long term.

Dragon building roars to life

Thu, 10 May 2012 05:01:10 +0100

Oknha Sam Ang and Madam Chhun Leang, chairman and president of Vattanac Properties Ltd, attend a topping-out ceremony yesterday to mark substantial completion of the Vattanac Capital Tower. Photograph: Chhim Sreyneang/Phnom Penh Post

Champagne greeted the movers and shakers at the highest level of Cambodia’s tallest building yesterday in a ceremony that marked substantial completion of the structure of Vattanac Capital Tower.

Designed in the shape of a dragon with particular attention to the Chinese art of placement for maximum fortune called feng shui, the 39-storey building faces the riverside with the chairman’s office in the dragon’s head.

Hosted by Oknha Sam Ang and Madam Chhun Leang, chairman and president of Vattanac Properties Ltd along with Vattanac Properties’ executive director and son Mr Sam Ang Vattanac, speeches followed a Buddhist ceremony with some of Cambodia’s important monks.

After remarks by the building’s project manager Kit Freeman, British Ambassador Mark Gooding told the crowd how delighted he was that so many British companies were involved in the new building.

“With British architects and engineers, this is a very British occasion,” Gooding said.

“The Vattanac Capital Tower symbolises British excellence and combines innovation with beauty, functionality and sustainability,” he said. “This development places Cambodia squarely on the map, and it is exciting to see this truly iconic building emerge on the Phnom Penh Skyline.”

Also on hand was Scotsman John Campbell of architects TFP Farrells along with many others making special visits for the occasion, along with Korean contractor company Posto E&C’s representatives Hyoung-Pil Kim and Yung-Kul Park.

Campbell said the tower was Korean contractor Posto’s first Cambodian job and a “massive learning curve” especially with understanding the local labour market and skills level. Campbell said of Posto: “They are doing very well.”

One of Campbell’s roles was monitoring the quality of the external façade, each unit of which is prefabricated in a factory in Shanghai.

“These are double-glazed units, solar-performing, the joints and sealants done in the factory,” Campbell said.

Fellow native of Edinburgh, Scotland, project director Julie Mackenzie, also of TEP Farrells, said the building had been originally designed by another architect.

“We came on board in early 2009 and feng shui had a big influence,” she said.

“The building shaped like a dragon for good luck. The shape of the tower, the way it curves down into the podium and the small building on the back represents the pearl on the dragon and the way the dragon faces the river is also very important. That’s why it is oriented toward the river, for good luck,” Mackenzie said.

Within the building there are no floors with the number four, no fourth or 14th or 24th, she said.

“Any building for this market has to be flexible, and you’ve got to cater for offices, serviced apartments, maybe even trading floors, which involves a lot of IT and cabling, and that all had to be designed in from day one as well.”

Mackenzie said the project was a challenge for the façade engineers.

The actual façade engineer was on hand, Nigel Lo of Ove Arup Engineering.

“The challenge was the geometry of the dragon,” Lo said. “We did 3-D modelling on computers and had the façades prefabricated in Shanghai. The main challenge was to panelise everything to that it repeats itself every time and is easier for manufacturing.” Lo is a structural engineer trained at Leeds in England.

The chairman’s son and Vattanac Properties’ executive director, Sam Ang Vattanac, said the tower had reached a height of 172.7 metres with 14.6 metres remaining of high steel structure, which will complete for a total height of 187.3 metres.

“Vattanac Capital will act as a catalyst to spur many more similar developments around Cambodia,” he said, noting that Vattanac Capital had already received a pre-certification in Leadership in Energy and Environmental Design (LEED) by the US Green Building Council.

He said the building would have 134,000 square metres of space including Grade A offices, luxury retail and world-class serviced apartments. “This will soon be the home of international luxury brands and companies, both locals and multi-nations,” he said.

He thanked Prime Minister Hun Sen for his leadership before inviting the crowd to ascend to the top floor where wet concrete was shovelled by important guests to “top out” the highest floor in the building, followed by champagne.

Also present were Kep Chuketema, governor of the municipality of Phnom Penh, Prime Minister Hun Sen’s daughter Hun Mana, one of Cambodia’s most important monks, Nun Ngeth, and many other distinguished guests.

The podium area of the tower will contain 11,500 square metres of premium retail space and levels 25 to 33 will contain about 150 serviced apartments. CBRE is the sole agent for the leasing of offices at Vattanac Capital Tower. The first phase of the project is scheduled for completion at the end of this year.

To contact the reporter on this story: Stuart Alan Becker at stuart.becker@gmail.com

Exports to Korea jump 80pc

Thu, 10 May 2012 05:01:00 +0100

Cambodia's first-quarter exports to South Korea soared nearly 80 per cent year-on-year, driven mostly by garments and agriculture products, but imports still accounted for most of the trade between the two countries.

Total exports to South Korea jumped to US$30 million for the first three months of 2012, up 76 per cent from $17 million in the year-ago period, according to data from the Korea Trade-Investment Promotion Agency (KOTRA) in Phnom Penh.

At the same time, Korean imports reached $130 million from $101 million, a 29 per cent year-on-year gain, KOTRA said.

Total trade between the two countries in the quarter rose 36 per cent to $159.9 million compared to $117.3 million last year.

“We got increases in the garment industry, with around 20 new garment factories from Korea opening in the last year,” KOTRA manager Kim Dohyun said. “That’s the main reason for the export increase.”

Garments and footwear exports were up 204 per cent to $4.9 million for the period, according to KOTRA.

More Korean investors are eyeing Cambodia as rising labour costs make China and Vietnam less attractive destinations for garment enterprises, he said.

While there have been wage increases in the Kingdom as well, they have not outpaced other countries in the region.

Korea Chamber of Commerce in Cambodia chairman Kang Nam-shik agreed, saying there has been a rush of garment factories to Cambodia over the past six months.

“Cambodia is still attractive for both its labour quality and wages to Korean investors,” he said.

KOTRA’s Kim Dohyun noted that the Kingdom’s resurgent economy and a free-trade agreement between the two countries helped to drive the numbers.

“Cambodia’s economy is growing, and people have money to spend,” he said, adding that the FTA had streamlined the trade relationship.

The Kingdom’s agricultural products also played a role in the growth in trade between the two countries, though these products, such as milled rice and cassava, were just starting to find a market in Korea, Kim Dohyun said.

The Kingdom, meanwhile, imported raw materials for its garment and textile industry, vehicles and foodstuffs, according to KOTRA.

Kim Dohyun did say that the recurring factory strikes could weigh on the industry by scaring away investors.

“If workers are still on strike, maybe it can cause some problems for investors, making them more interested in Myanmar,” he said.

International Monetary Fund deputy managing director Naoyuki Shinohara told the Post last month that the opening up of Myanmar’s political and economic systems would put the company in better position to compete with Cambodia for investment.

“Myanmar could provide a very good base for the garment industry,” he said.

To contact the reporter on this story: May Kunmakara at kunmakara.may@phnompenhpost.com

Oxen oracles foresee crack corn, bully beans

Thu, 10 May 2012 05:00:40 +0100

Cambodian corn and bean farmers yesterday watched with pleasure as six oxen chose their crops over rice, water and wine during the Kingdom’s annual Royal Ploughing Ceremony, held beside the Royal Palace.

The selection presaged a hearty corn and bean harvest this year. If the oxen had taken the water, the country could have seen an excess of rainfall, Cambodian tradition dictates.

If the beasts of burden had lapped up the wine, an excess of thievery, debauchery and gangsterism may have descended on the Kingdom.

“Khmer have looked to the ceremony for encouragement for generations,” Meas Loeun, a 53-year-old farmer in Pailin province, who watched live coverage of the ceremony, said yesterday.

However, he added that Cambodians cannot rely on the auspicious event alone for farming success.

Many farmers turned to cassava last year as prices for the crop jumped, but Meas Loeun said he was confident that domestic demand for beans and corn would make for a strong market this year.

The royal oxen also ate grass at the ceremony yesterday, an omen of disease and potential pestilence.

Chea Chansophoan, the director of Battambang province’s agricultural department, said that farmers in Battambang province grew corn on 100,000 hectares of lands last year and received about 500,000 tonnes of output.

Cassava cultivation increased from 30,000 hectares in 2010 to 70,000 hectares in 2011 because of a sharp price increase, he said.

While not promoting the superstitious event, Chea Chansophoan said the outcome of the Royal Ploughing Ceremony should have a positive affect on corn yields this year.

“I believe the ceremony will encourage our farmers to grow more,” he said.

“Our officials have prepared some techniques to educate farmers when there are some problems.”

To contact the reporter on this story: Rann Reuy at reuy.rann@phnompenhpost.com