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Logo of Phnom Penh Post newspaper Phnom Penh Post - Khmers sidelined as construction picks up

Khmers sidelined as construction picks up

C AMBODIA'S construction industry is starting to emerge from the doldrums - but all the big contracts are going overseas.

Khmer companies have no experience in running the big jobs of $5 million and more, according to local businessmen.

Companies from Thailand, Malaysia, Japan and Australia are dominating.

Kim Chhean, chairman of KC Gecin Enterprises, said his company now runs only small projects like building or repairing houses, or construction jobs which cost less than $1 million.

For projects worth $1 million or more, foreign companies have the right to bid, Chhean said.

Chhean explained: "For projects costing $5 million or more the government sees the contract bid and rejects those companies with no experience."

While agreeing with the government, he said he wanted to have joint-ventures with foreign companies.

"Cambodian business can't grow until the government promotes joint-ventures," he said.

"When foreign companies gain profits, they take them back home."

Only 20 or fewer of Cambodia's more than 100 construction companies were any good, he said. Many had closed shop.

Soth So Panha, managing director of Seaboard Cambodian Development Company, said his company only accepts contracts worth under $3 million.

Panha said that his company had a problem compensating a client whose building was spoiled by unskilled Khmer workers.

He said his company now liked to hire Thai or Vietnamese workers who had experience in construction.

Meanwhile, increasing real estate business is pushing up commercial prices, though housing prices remain sluggish, said King Realty manager Ieng Sothera.

Sothera said lands around Monivong Blvd and Norodom Blvd now costs between $80 to $100 a square meter, an increase of up to 30 percent.

Land prices on commercial tracts along Route 4 were up 70 percent and up 50 percent on Route 6, he said. Kompong Som land prices - anywhere between $1 to $30 a square meter - have also increased, though the percentages were unknown.

Real estate business has been on the move since August's release of the new Investment law as businessmen see the country's situation stablize, he said.

They have begun buying properties for their businesses such as hotels, shops, restaurants and banks, Sothera said.

However for the non-commercial districts, prices of real estate properties were stagnant, he said.

Om Nakary from Ankor Thom real estate said: "Many property owners in Phnom Penh have registered with the company to sell their properties."

Nakary said about 20 to 30 properties have been registered per day and about ten to 12 transactions were made in October.

Sothera said: "This month our company has made 12-15 transactions for sale and for rent. Most of the buyers are local while foreigners only rent.



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