The Cambodian Higher Education Association has claimed that 113 private educational establishments are facing bankruptcy because of their inability to pay rent and staff salaries in light of nationwide school closures caused by the Covid-19 outbreak.
It said the financial trouble started when the Ministry of Education, Youth and Sport shut down education services on March 17.
“During the temporary suspension, 113 private educational establishments have run into financial difficulty.
“They’re not able to continue paying staff salaries, building rentals, loans and other expenditures,” the association said in a statement.
It appealed to landlords to help lower or delay rental payments, and to bank owners to reduce and delay interest payments.
Meanwhile, teachers and staff have had to take pay cuts.
Mengly J Quach Education (MJQE) founder, chairman and CEO, Dr Mengly J Quach told The Post on Wednesday that both his schools – the Aii Language Center (Aii) and the American Intercon School - were losing income fast.
Despite the loss of income, he said he’s still paying staff their normal salaries, which amounts to nearly $1 million a month for a staff strength of over 1,400.
Besides, he said the school spends about $1.5 million on annual building rentals and nearly $2 million on loan interest per year.
He said: “I tried negotiating with the building owner, but he shouted at me and refused [to delay]. Other school owners have also tried negotiating with the owners, and they experienced the same results.”
If landlords don’t sympathise with their predicament, Quach said, most owners of private educational establishments will go bankrupt, since many of them took loans to open their schools.
He said if the Covid-19 situation isn’t alleviated later this month, his schools will have to lay off all staff or temporarily suspend their work because he wouldn’t be able to pay their salaries.
Quach said he requested support from the ministry at an association meeting last Friday. He said private educational establishments make up about 50 per cent of all such establishments in Cambodia.
At a press conference on Tuesday, Prime Minister Hun Sen requested landlords to sympathise with their tenants and lower rental costs because a majority of businesspeople have lost income due to the pandemic.
Educational establishments should act on the announcement of the prime minister, ministry spokesman Ros Soveacha said. They could negotiate with their landlords and hope they sympathise during this difficult time.
He said: “Private educational establishments could request direct negotiations with building owners. Samdech Prime Minister made an announcement requesting the owners to lower their prices.
“But the private educational establishments need to know how to negotiate with the owners and relevant parties themselves.”