Local retailers say they are feeling the effects of the global economic crisis as traditionally robust sales of luxury mobile phones, vehicles decline
Photo by: Heng Chivoan
Ry Srei Ya, 17, talks on her mobile phone on the Phnom Penh riverside this week.
AS OFFICIALS and international analysts scramble to assess the local impact of the global economic crisis, retailers in Phnom Penh say sales of high-end mobile phones, automobiles and motorbikes have plummeted as the capital's middle classes tighten their belts.
Luxury mobile phone sales - a largely youth-driven economic indicator - have dropped substantially as more people do without or settle for cheaper models.
"This year's sales at my shop have dropped 70 percent compared to last year," said Heng Vantha, owner of Asia Phone Shop in Phnom Penh.
Average sales used to be about 15 phones per day, she said. Now she moves only about two or three per day - mainly inexpensive models.
"Last year, customers were buying phones that cost US$100 and up. This year, they are buying models that cost $30 or less," she said.
Automobile sales have also proven vulnerable to the global economic slide, as more and more professionals trade in their luxury cars for cheaper modes of transport.
Real estate agent Chea Chansangha, 27, used to drive a late-model car and routinely spent a small fortune on the latest mobile phone technology. Falling land sales, however, have forced him to forgo his accustomed luxuries.
I recently sold my $300 mobile phone and bought a cheaper one instead.”
"Now, I'm almost broke. I don't have money for new phones or cars to look trendy and fashionable, as I did last year," he said.
"I've not been able to sell any plots of land [this year]. Last year ... I made a lot of profit, but now the land market is quiet," he added.
Kong Nuon, president of Cambodia's only Toyota distributor, TTHK Co Ltd, said sales of Toyota vehicles had fallen almost 50 percent since May.
A drop in land sales has dried up cash streams that in previous years were swollen by the property boom, realtors say, adding that price fluctuations have made consumers much more conservative in their spending - a trend that one property expert says will take time to reverse.
"It will take about one or two years for land prices to return to normal," said Sung Bonna, head of leading property firm Bonna Realty.
In the meantime, some consumers have begun to look for ways to cut their losses by sacrificing flash for practicality.
"I recently sold my $300 mobile phone and bought a cheaper one instead," real estate agent Chea Chansangha said, adding that he gave up his car in favour of a motorbike.
Nom Leanghim, owner of the Blue Heart Phone Shop in Kandal market, said he sees signs of growing economic hardship every day.
"Young people do not have money now. Some of them have exchanged their expensive phones for cheaper models," he said, adding that many have given them up altogether.
"I am now buying back more mobile phones from young people than I am selling to them," he said.
The World Bank on Wednesday predicted economic growth of only 4.9 percent in Cambodia in 2009, down from 6.7 percent projected this year.