BATTAMBANG - The provincial capital of Battambang has the potential to be an
important staging post along a strategic route between Bangkok and Ho Chi Minh
City. But eight months after the UN-organized elections there seems little hope
of that potential being realized, with the current economic outlook bleak and
Developed by the French as a regional center and educational
hub, today Battambang remains a government headquarters but is primarily a
market town. It has few outstanding tourist attractions though it is a
delightful riverside town with faded colonial architecture and attractive old
Chinese shop houses..
Several distinct strands define Battambang
economically, its proximity to the Thai border, the Pailin gem mines, the rich
agricultural areas at the head of the Tonle Sap, the Khmer Rouge controlled
timber areas and National Route 5 running to Phnom Penh.
The town also
boasts the country's only jute factory but most of the urban economy consists of
car and motorcycle repair and the retailing of hardware and simple domestic
goods. There are also a number of hotels, several of which opened during UNTAC's
tenure. All have remained open though at reduced occupancy rates and at lower
Several NGO sources say the provincial government has been
operating in a economic policy vacuum since the May elections. One said: "the
economic situation is highly anarchic here, and most of the economy is
Economic experts at NGOs in town are posing two key
questions: "Is there local money available for investment and are there
incentives for local investors?"
Clear answers to these questions have
yet to emerge. But two dramatic incidents indicate there is more money around
locally than may have been thought. The incidents produced repercussions that
may have driven investment money even further underground.
incident occurred late last year. A Thai businessman set up Battambang
Investment Company promising rates of interest of up to 20 per cent, which
attracted up to $2 million in deposits. He had already established a "flash"
restaurant, which attracted plenty of UNTAC customers, according to one NGO
The promises of high returns proved bogus when the Thai
businessman was caught making off to the border with the money.
resides in the town's jail awaiting trial and the money is tied up with the
The effect of the scam on townsfolk and in particular investors
has been two-fold, observers say. Firstly, it has heightened distrust of Thai
businessmen. After the word got out about the trickster's attempted getaway,
there were anti-Thai demonstrations and a protest march on the jail had to be
halted by police. Secondly, it has driven available investment money back
underground, with people hoarding their money or buying gold.
official said, "There is an undercurrent of resentment against Thais in any
case, but this incident certainly reinforced it."
Discussions with NGO
officials indicate that many of their workers invested savings from the UNTAC
period. "It is likely that high government officials will get their money back,
but these small investors will probably not be refunded," one NGO official
The second incident occurred last month when four gold dealers from
Battambang were ambushed on their way from Battambang to Phnom Penh. A B-40
rocket is said to have struck the rear of their vehicle, killing three of the
Aside from lack of opportunity, and available funds,
potential investors might be most concerned about security in Battambang. One UN
official said: "There is still a state of war out here."
three-day visit to the town by this reporter indicated no obvious troop
movements and no state of tension. Aside from the busy central market place, the
town is sleepy. But there are security risks for potential investors.
NGO source pointed out that the United Nations Development Program office had
lost two vehicles to bandits. And though the vehicles had been recovered by the
local police "with help from UNDP", police have been unwilling to release the
vehicles without payment, UNDP officials say.
The cases have now gone to
court in Phnom Penh and Battambang. UNDP sources say that the Battambang police
still hold a dump truck that they had recovered, but are refusing its return to
UNDP without the payment of $25,000.
Entrepreneur Richard Rowat has a
different view. He set up the Rowat Computer Group in town and says that he
personally feels more secure in Battambang than in Phnom Penh. "Security inside
the city is getting better," he said, "there have been no attacks against
westerners." But he has had a car stolen.
Rowat tracked it down and found
an army general that had taken possession of it. The general offered to sell it
back for $5,500. Rowat declined the offer.
Overseas Development Agen-cy
consultant David Boyd recalls attending a lunch meeting between foreign
businessmen in the town and British Ambassador David Burns in which the
consensus was that the streets of Battambang were safer than those in
Cambodians have a different outlook Boyd believes. He said,
"There is a general sense of insecurity with respect to the prospects of long
term prosperity." That is reflected in the attitude toward the riel. "Every
transaction over $50 is in gold," he said.
There are rumors of shady
financial deals being done in the town. One Westerner said that Thai money is
being laundered in Battambang, but that claim could not be substantiated. "It is
difficult to trace how money flows in and out of Thailand," a local UN official
Much of the real money in the town is in the hands of government
officials and businessmen in the timber trade. Gem merchants in town also have
access to significant cash, as do the mostly Chinese rice mill owners.