An interministerial task force has been established to ease simmering tensions between Cambodian and Chinese business owners in the coastal resort town of Sihanoukville, the latest sign that a huge influx of Chinese investment is causing problems on Cambodia’s coast.
The group was created last Wednesday, the same day that Preah Sihanouk Provincial Governor Yun Min wrote a letter to Interior Minister Sar Kheng highlighting problems with Chinese investment in his province. It was established following a meeting between various ministry officials that was intended to address how to best protect Cambodian business interests in the provincial capital.
Taing Socheat Kroesna, director of the provincial Department of Tourism and an attendee at the meeting, said yesterday that the task force’s purpose would largely be to implement existing laws and regulations.
“This new task force will help the local business and alleviate their challenges, since we will check on [Chinese] business management and operation,” he said, specifically mentioning casino shareholding arrangements, business registrations and potential violations of World Trade Organization treaties.
Kroesna said the task force’s membership had not yet been finalised, but would include representatives from local police and relevant ministries.
Chinese investment in Sihanoukville has skyrocketed in the past year, causing a number of headaches for local authorities and businesses. Police have noted an uptick in illegal casinos and human trafficking cases, and business owners say that the massive increase in Chinese tourism has largely benefitted Chinese businesses, hotels and restaurants to the exclusion of locals.
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Cambodian business owners contacted yesterday were sceptical that the task force would bring any meaningful change, noting that laws and regulations already existed and were regularly ignored.
Chay Piseth, owner of the Nice Ocean restaurant, was evicted from his former location on Ochheuteal beach due to a Chinese development project. He said yesterday that almost all of Sihanoukville appeared to be run by Chinese investors, and local people and businesses simply couldn’t keep up.
“It is good that the authority and ministry are taking action to serve the benefits of local businesses, but I have no confidence it will be effective in benefitting us,” he said.
“As far as I can see, measures have always existed . . . but they are used to promote self-interest.”
By Vanny, a 61-year-old who runs Beautiful Beach 168 restaurant, said that the Chinese investors had already pushed out local businesses, and she didn’t believe anything could be done to fix the situation.
“I don’t know what will happen, but our future is not stable anymore,” she said yesterday. “I’ve lost all my confidence in the future now.”
Contacted yesterday, Sok Song, vice president of Preah Sihanouk Chamber of Commerce, encouraged authorities to look into whether Chinese businessmen were paying taxes and following Ministry of Commerce rules.
“We should start to check on whether they comply with the procedure for operating businesses or not,” he said, adding that Cambodian businesses would also have to become more competitive in order to exist alongside their Chinese counterparts.
But competing with Chinese businesses may prove difficult, according to Ngeth Chou, a senior consultant at Emerging Markets Consulting, who called on the government to enact policies that would help even the playing field.
“Our local business capacity is still limited to compete with the coming of Chinese businessmen,” Chou said, proposing that tax breaks and training programs be implemented for Cambodian business owners.
For some businesspeople, the task force and any other future government actions may be a case of too little, too late.
“Those who depend on renting their businesses, they can’t survive anymore,” Vanny said yesterday. “They have already packed up and moved back to the countryside.”
