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Foreign Firm Launches New Lottery

Foreign Firm Launches New Lottery

Khmers will now be able to legally indulge their well-known penchant for gambling,

to the benefit of the State of Cambodia, which recently granted a license for the

country's first new lottery to a Singaporean-Indonesian group.

Officials of Cambodia Pools Ltd. refused to reveal the percentage of gross proceeds

that will be paid to the State of Cambodia as a tax, or the amount that has already

been taken in since the gaming windows were opened on October 28.

"That's secret," said company chairman Dr. Peter Chen, 55. "But the

response has been great-it has exceeded our expectations and we calculate our contribution

to the government will be very significant."

The company decided to set up operations after initial research revealed widespread

illegal gambling lotteries in Cambodia, many based on state-run operations in Vietnam.

A one-week survey turned up more than 300 lotteries in Phnom Penh alone.

Cambodia Pools will operate four different lotteries, all based on a sequence of

numbers picked at random, paying out prizes from 25 to 200,000 times the size of

the bet that can be placed in dollars or riels. The largest are the "Big Sweep"

and the "Millionaire," which will pay U.S. $100,000 and $200,000 respectively

on a U.S. $1 bet on the six-digit entry.

Bets are currently averaging 2,000 riels, company officials said.

The draw for the Millionaire is at 5:30 p.m. each day (365 days a year), with purchases

at the 150 agent outlets to which the company pays a small commission. Betting windows

close at 4:30 p.m. Draws are done in public and notarized by rotating witnesses.

Winners are also announced by radio at 6:30 p.m. and on T.V. later in the evening;

winners have one week to make their claim.

Within a few months time, Chen said he expected to have 800 agents in major towns

throughout the country.

Chen, who says he is an economist, explained the company's strategy: "In the

beginning we want as many people to win as possible because they will come back to

buy more, not only to buy more but to place bigger bets-that's human nature. As the

pool gets bigger, then we can take more profits."

He said the size of the prizes, combined with the fact that the winnings can be taken

in dollars, are major attractions. He said the company would like to sell their tickets

in Vietnam but would only do so if the authorities there agreed.

The Indonesian partners, who Chen refused to identify, have decades of experience

in lotteries, he said.

Sixty Indonesians are currently in Phnom Penh setting up the system, complemented

by 10 Singaporeans. Cambodia Pools says it will employ about 200 Khmers, including

30 security personnel.

Big Boss

Chan said it was not difficult to sell the Phnom Penh regime on the idea of a lottery,

although settling on the terms and conditions took about three months.

"In other countries for this type of project I would expect the same [process],"

he said. "There are a lot of concerns-we understand and are not frustrated by

the experience. We consider it quite normal."

Government ministries that Cambodia Pools needed to approach for approval included

the National Committee for Investment, the Finance Ministry, and the Council of Ministers.

Vice Minister of the Interior Sor Kheng presided over the opening ceremony held Sunday,

Nov. 1 and made the first draw.

Chen's own investment group is primarily involved in real estate, which he said has

invested about U.S. $20 million so far in Phnom Penh.

In addition to the two 25-room Paris I & II hotels, they are also building the

four-star, 300-room Holiday Hotel on Street 84, expected to open at the end of the


The company also plans to introduce what it claims will be the most luxurious nightclub

yet in Phnom Penh-going by the name of Club B, for Big Boss, which is modeled on

a namesake in Hong Kong.

Located opposite the Nippon Hotel, the 12,000 square foot Club B will have a nightclub

upstairs and 20 individual karaoke rooms downstairs, catering to deal-making by Chinese

businessmen from the region.

Chen said the group has spent $600,000 on renovations, though the land alone is probably

worth U.S. $1.2 million, double the price of one year ago, according to K.L. Khoo,

another principal.

The company also has a travel agency will soon be opening a Thai massage emporium

with 40 Thai massage "specialists."

Chen said he has had to make large deposits with several banks to cover potential


He expressed confidence in the basic continuity of the government after elections.

Even if there are changes, he said he expected the new government would honor the

Council of Ministers' decisions.

"Otherwise it would be disastrous," he said. "We are confident that

after the elections we will continue to expand our business."

He emphasized that his firm is not here just to make money and that the company would

be looking for ways to make contributions to both "national development and

community charities."

He said at first the company would respond to State of Cambodia requests until other

worthy voluntary organizations could be identified as recipients.


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