How Long Will Sihanoukville tourism Remain under Chinese Influence?

Cambodia, China, Sihanoukville, gambling, casinos, airports

Sihanoukville city centre in 2016

While prosperity in Sihanoukville over the last decade has been exclusively driven by China, authorities start slowly to realize that it has been maybe to quick and to much. The city is facing difficult times with recent flooding, safety problems while new restrictions on gambling is suddenly driving away the Chinese population…

Over the last six months, Sihanoukville has been a focus of world media attention. The seaside and port city, which has seen its population growing from 60,000 to over 300,000 in less than a decade, has been turned over the years into Cambodia’s entertainment town as Chinese companies have invested heavily into town.

Sihanoukville used to be known over a decade ago only by western backpackers attracted by the laid-back atmosphere in town. It is all over these days. In the last decade, Cambodian government policy largely opened Sihanoukville to Chinese investors with little control from local authorities. Figures from Sihanoukville Mayor indicates that the city has about 80,000 Chinese residents today. And these are only official figures…

The influx of Chinese money and tourists is driving the economy of the city but also made the area totally dependent of Chinese money. Cambodia largest English-speaking newspaper, the Phnom Penh Post, reported in July that out of 156 official registered hotels and guest houses, 150 were in Chinese hands while ouf of 62 casinos, 48 belonged to China. 95% of all restaurants belong to a Chinese company or individual… The government contracted recently Chinese firms to build up the new expressway linking Sihanoukville to Phnom Penh. Due for completion in three years time, it will be refinanced by tolls collected by a private Chinese firm over the next 50 years…

However, the boom in hotels and casinos has not gone without issues. While it had a definitely good impact on tourism – the province has seen close to 2 million foreign travellers last year-  and on prosperity for the local population, who is earning twice as much as the Cambodian average in Sihanoukville.

Out of the 1.8 million international tourists arriving in Sihanoukville in the first three months of 2019, 680,000 were Chinese, representing an increase of 35% year-on-year. Total international arrivals could reach a record 2.6 million by the year-end, making over a third of all international arrivals to the country.

The government just approved the expansion of the airport to accommodate 10 million passengers a year as traffic is soaring. Sihanoukville now is receiving over a million passengers a year, while three years ago, traffic was less than 200,000 passengers. Traffic at Sihanoukville’s airport rose by 210% in the first half of this year, reaching 755,000 travellers.

The expansion will be carried out in several phases. Phase 1 will begin early next year. It will see the extension of the runway from 2,500 m to 3,300 m and the terminal extended to cope with a traffic of 3.6 million passengers. The next phase will begin in 2022.

But Chinese presence also brought a lot of problems. Rents are skyrocketing – they have been multiplied by five on average in just three years- driving away locals. Many casinos are controlled by the Chinese mafia which translated into a rise in crimes and violences around town. The collapse of a new building and flooding in town -due to construction sites everywhere and the erosion of the coast- has put in question the quality of the development of the city…The collapse of a building last April -which killed 30 Cambodian workers- forced to the resignation of the governor while even Cambodia Prime Minister Hun Sen finally admitted that something was going wrong there. The police also arrested Chinese nationals involved in kidnapping cases.

On August 18, Prime Minister Hun Sen issued a directive banning all online and arcade gambling in the kingdom in a bid to safeguard security and public order. “Some foreigners have used this form of gambling to cheat victims inside and outside the country,” reported the newspaper Khmer Times quoting Hun Sen. “The Royal Government has decided to stop issuing licenses for such operations within and from outside the Kingdom with immediate effect.”

Hun Sen reiterated his instructions for authorities to eliminate all online and arcade gambling by the end of the year, stating that tourism in Cambodia had to be based on nature and culture rather than gambling.

After the order was issued, the Kingdom recorded until September 10 the departure of around 140,000 departures of Chinese nationals. Maybe the start of a much-expected normalisation of tourism activities for the Kingdom…