Cambodian casinos may soon be allowed to admit local residents as similar moves in neighboring countries put pressure on the government to respond. In June, government ministers confirmed that work had commenced on revising Cambodia’s gaming laws in a bid to attract more international investment. But just days after this news broke, Prime Minister Hun Sen used his personal Facebook page to remind everyone that Cambodia’s casinos remained off limits to “Khmer citizens.”
On Thursday, Ministry of Economy and Finance spokesman Ros Phirun told the Phnom Penh Post the government was investigating the ramifications of relaxing its ban on locals in casinos. The change of heart reflects a need to keep pace with Vietnam, where the government is talking about relaxing its own locals ban. Seems President Eisenhower’s 1950s-era ‘domino theory’ was bang-on, except what was spreading across southeast Asia was gambling, not communism.
Like Vietnam, Cambodia is saying that lifting the ban will cause more international casino operators to inquire about setting up shop. But Cambodia is also looking to mitigate the expected decline in its current casino clientele when Vietnamese citizens stop traveling to Cambodia’s border towns, where a number of small-scale casinos greet them with open arms.
The Royal Group-owned Titan King Casino in Bavet says it attracts between 500 and 1k Vietnamese gamblers every single day. Casino adviser Tok Kimsay said “there will be big trouble for us” if Vietnam pushes ahead with its law changes and Cambodia doesn’t follow suit. Seriously, if a bus trip to Ho Chi Minh City or Hanoi is the same distance as the Cambodian border – and you no longer risk kidnapping and torture to get your gamble on – who needs Cambodia?
Phirun said Vietnam’s legal changes would likely need to be matched by Cambodia if the country wants to compete on an equal footing in wooing international investors. Gambling is “an international industry. So now we too have to internationalize the gambling industry.” To brace for the challenges ahead, “we must get the gambling law done – especially with regional integration, we have to be ready.” The law could be finalized by the end of the year, although sometime in 2015 appears more likely.
QUEENCO LEISURE SEEKS PARTNER
That may be too late for Queenco Leisure International’s Queenco Casino and Hotel in Sihanoukville. The Queenco property, located in southwest Cambodia’s coastal area, reported a €900k loss in the six months to June 30 despite revenue rising 11% over that span. Queenco is looking for a partner to help fund an expansion project – which may include a hotel, casino, commercial center and a convention center – on a nine-hectare parcel of land adjacent to its existing casino.
Trouble is, the casino’s parent company lost €3.9m in the first six months of 2014, and Queenco Leisure isn’t ruling out the possibility that it may simply sell the undeveloped land in order to raise some quick cash. The company is considering some other capital-raising options, such as issuing equity or debt, which would allow it to hang on to the property until the right investment partner appears.