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Airport deals in the spotlight

Cars enter Phnom Penh International Airport yesterday afternoon where construction is under way to expand current facilities.
Cars enter Phnom Penh International Airport yesterday afternoon where construction is under way to expand current facilities. Vireak Mai

Airport deals in the spotlight

Opposition lawmaker Son Chhay has requested the government release its concession arrangement with the French company that controls Cambodia’s three international airports, alleging the Kingdom might be getting ripped off under the deal.

Following a site visit to Phnom Penh International Airport two weeks ago, Chhay, deputy chair of parliament’s Finance Commission, this week wrote to Deputy Prime Minister Sok An requesting the Council of Ministers disclose details of its agreement with Vinci-Airports, the main shareholder of Societe Concessionnaire de l’Aeroport (SCA).

Also known as Cambodia Airports, SCA is responsible for operating and developing the Phnom Penh, Siem Reap and Preah Sihanouk sites.

Chhay’s letter, signed by National Assembly President Heng Samrin on Tuesday, speaks of “irregularities” in Vinci’s concession and also cites complaints about “strict management” of fees charged to people dropping off passengers.

Speaking yesterday, Chhay said he was concerned that the company – which is currently upgrading capacity at Phnom Penh and Siem Reap airports to the tune of $100 million – was “unfairly” exacting far more profit from the concession than it was contributing through investments.

He estimated based on growing passenger figures – which, according to Vinci, increased 12.8 per cent last year to 5.7 million – the SCA stood to make more than $4 billion before its concession agreement finished in 2040.

“The numbers are shocking . . . you spend $100 million and you make more than $4 billion in 25 years, it’s ridiculous . . . It looks like it is robbing the nation,” Chhay said.

Chhay added that more information was needed on the current renovations, the bidding process for contractors and how much tax was paid under the concession agreement.

“The contract is done in secret with no bidding process. This is not appropriate for such a major government contract,” he said.

Granted a concession to develop and manage Phnom Penh International Airport in 1995, SCA is 70 per cent owned by Vinci, a French company handling concessions and construction in some 100 countries. The remaining 30 per cent is controlled by Muhibbah Masteron Cambodia, a joint Malaysia-Cambodian venture.

It was later given concessions for Siem Reap and Sihanoukville.

Responding via email yesterday, SCA spokesman Norinda Khek said the company’s initial concession was decided by a government comprising a coalition of parties following an international tender.

Khek said Siem Reap airport was integrated to “maintain the equilibrium of the concession” following the Asian economic crisis in 1997, while the Sihanoukville airport concession was added so the government would have a “reliable airport operator” to help develop Cambodia’s two key tourism landmarks.

He added: “The contract concession and its addenda contain all provisions regarding the economy of the airport concession including revenues sharing, payments of taxes [and so on].”

“We are audited on a regular basis by services of the Ministry of Economy & Finance, international reputable accounting firms and international development agencies.”

According to Vinci’s 2014 annual report, new terminals built at Siem Reap and Phnom Penh airports by a joint-venture led by Vinci Construction Grand Projets, will double both airports’ capacity to 5 million passengers when they finish next year.
Sin Chan Serey Vutha, spokesman for the state Civil Aviation Secretariat, said the company’s initial contract was amended from 30 to 40 years as a continuation of the agreement, without a bidding process.

He said the Secretariat wasn’t involved in overseeing the upgrades.

“All contractors within the airports, we don’t know. They select it. We don’t interfere in their work.”

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