Cambodia’s online gambling ban slows Sihanoukville economy


Cambodia’s online gambling ban is having economic ripple effects that go well beyond local casino operators.

On January 1, Cambodian authorities began inspections of 91 licensed casino operators to ensure they were complying with the online gambling prohibition ordered last year by Prime Minister Hun Sen. One week later, officials said all 91 casinos were in compliance, but warned that followup checks would ensure that compliance continued.

cambodia-sihanoukville-online-gambling-ban-impactOn Thursday, the Khmer Times reported that police in Preah Sihanouk province were now checking apartments and rental houses to snuff out small-time online gambling operations that failed to heed the authorities’ warnings. Provincial police arrested 36 Chinese nationals and 20 locals for illegal gambling activity last week.

Major General Chuon Narin, the province’s top cop, said “most of the casinos here became bankrupt” after the online ban took effect. The government previously stated that there were over 70 casinos in the Sihanoukville region before the ban but that number has since dwindled to around 20 as owners determined that their operations – some of which derived up to 90% of their revenue online – were no longer profitable.

The Sihanoukville casino closures reportedly threw as many as 8k local residents out of work but the resulting exodus of tens of thousands of Chinese nationals who’d flocked to the area for gaming-related work is having catastrophic ripple effects.

Over 800 restaurants that used to cater to hungry Chinese customers have reportedly shut their doors as daily orders fell by over 80%. The overheated property market, both commercial and residential, has slumped to its pre-boom levels, leaving many owners holding mortgages that far exceed the current value of their property.

Construction workers have found themselves in limbo after Chinese investors simply abandoned their projects and left the country rather than deal with arranging severance pay or ensuring a proper clean-up of their work sites. Sihanoukville’s already chaotic cityscape has effectively been carbon-frozen in a mix of half-finished buildings and ripped up streets.

Cambodia’s online ban was widely viewed as a way of staying in China’s good books, since most of the online casinos’ clients were based on the Chinese mainland. China has promised to provide additional investment capital to smooth Cambodia’s transition but that cash better arrive sooner rather than later.