INTERNATIONAL ROADTRIP: THE GROWING CAMBODIAN MARKET

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Cambodia is one of the fastest growing casino markets in the world with a large surge in licences issued in both 2017 and 2018. The nation’s Ministry of Economy and Finance has released figures showing a 53% increase in 2018 over the number of casinos in 2017.

Though Cambodian nationals are not allowed to gamble, growth of casinos has been significant. With 52 casino licenses issued in 2018, the total number of casinos in the country has reached 150, up from 98 at the end of 2017. A significant portion of the surge is from the southern coastal province of Preah Sihanouk, where they have 88 casinos in this province alone.

The country’s gaming industry has benefited greatly from several factors: a) a world renowned integrated resort (NagaWorld) in its capital, b) a neighboring country that prohibits casinos and gaming (Thailand), c) a neighbouring country that significantly restricts their citizen’s ability to gamble (Vietnam), and d) a very lenient policy allowing significant investment to come in from China.

NagaWorld – Phnom Penh

Cambodia’s trend-setting integrated resort, NagaWorld, is one of the country’s largest five-star hotels and the only luxury premium casino in the country. Based in the capital city, Phnom Penh, the resort has 1,658 luxurious rooms and suites and caters to an international clientele of both business and leisure guests. NagaWorld encompasses most of what travellers need and desire under one roof: 27 Food & Beverage outlets and clubs, two all-suite luxurious spas, shopping gallery including China Duty Free Group, extensive entertainment services including gaming facilities and premium meeting spaces with state-of-the-art facilities.

NagaWorld enjoys a 70-year casino license that will run through 2065, as well as a 41-year monopoly within a 200-kilometer (120-mile) radius of Phnom Penh that expires in 2035, guaranteeing its position as Cambodia’s flagship integrated resort.

Border Casinos – Thailand / Cambodia

Located in Southeast Asia, Cambodia is bordered by Thailand on the west and north, Laos on the northeast, and Vietnam on the southeast. The southern part of the country is a seashore on the Gulf of Thailand.

Since casinos and gambling are banned in Thailand, there is a vibrant casino market within each of the provinces on the Thai-Cambodia border – most notably in Poipet (Banteay Meanchey province) and Koh Kong province, which serve as busy border points with significant vehicular traffic between the two countries. Poipet serves as the busiest border point between Thailand and Cambodia, linking Bangkok with the cities of Siem Reap and Phnom Penh. It’s also a common point for expats making a visa run.

Mere steps across the border, there are a handful of casinos servicing mostly Thai gamblers. As casinos are banned in Thailand, these casinos thrive by feeding off the Thai, much to the chagrin of the Thai government.

One example of the tensions happened just last year in 2018, when the new Saitaku Resort and Casino had its soft opening in Oddar Meancheay just across from Thailand’s Buriram region. The intent of this casino was to rely almost exclusively on an influx of gamblers from Thailand. The Thai authorities, however, barred their citizens from crossing through the Chong Sai Taku checkpoint to visit the casino. While hundreds of invited VIP guests were allowed to attend the casino opening, Thai border agents prevented non-invited guests from making the trip.

Days later, the Cambodian authorities retaliated by blocking their citizens from crossing over into Thailand. The tit-for-tat restrictions wreaked havoc with non-gaming businesses on both sides of the border because they depend on the steady stream of tourists for the bulk of their income.

Border Casinos – Vietnam / Cambodia

The chief border point between Vietnam and Cambodia is at the Bavet crossing point. The most common traffic through Bavet are: a) vehicles traveling between Ho Chi Minh City (Saigon) and Phnom Penh, and b) local Vietnamese crossing the border to gamble.

Though the casino industry is also growing in Vietnam, the government has restricted Vietnamese nationals from gambling. Until only recently, Vietnamese were not allowed to gamble, which resulted in many traveling across the border to gamble in Bavet and other locations. This resulted in the loss of significant revenues in Vietnam as their citizens crossed the border.

Recently, however, the Vietnamese government has approved licenses for several casinos to allow locals to gamble – though the licenses are typically on the coast and far from the Cambodian border. The draw of Vietnamese to the casinos in Cambodia has only been slightly impacted.

Earlier this year I spent a few days at a rather small border crossing – Binh Hiep International checkpoint, a crossing that has been open less than two years. There are three casinos there at the moment, each rather small and catering nearly exclusively to Vietnamese. The Vietnamese side of the border is paved, but the Cambodian side is mostly still a dirt road as construction trucks continue to build a fourth, larger casino right on the border.

I found it an interesting dynamic to watch, as it was quite easy for Vietnamese gamblers to cross back and forth over the international border. Typically, they’d cross from Vietnam to Cambodia on motorbike, and wouldn’t need to go through standard immigration processes. Rather, they would simply get a blank “arrival card” from the Cambodian border guard, which they would then return to the guard on their way out. Quite often the motorbike would not stop, but simply roll through as they took the card from the immigration/customs agent.

The process was quite more thorough, however, when I crossed from Cambodia into Vietnam, as visas were checked, my baggage checked and my passport stamped. At this crossing it was simple for them to cross (many likely without a passport).

Spending some time outside the casino, I noticed there were certain types of deliveries coming in from Vietnam to the gamblers. Often, the gamblers preferred their meals from home, so it was common to see Vietnamese meals delivered by motorbike to the gamblers, which they were allowed to consume within the casino. There were no passport checks for those delivering meals as it was a common enough event, likely dozens of times a day.

On a couple other exchanges, I’d watch as an older person arrived at the casino on motorbike, and connect with one of the gamblers (a friend or family member). The person arriving would hand them a baggie of cash – likely further funds to allow the gambler to continue placing bets well into the evening. There were no ATMs at these border casinos, so the additional funds needed to come in from across the border. As long as the funds were coming in from Vietnam, the border control was a bit relaxed.

Sihanoukville – The Former Sleepy Coastal Town

Sihanoukville was once a very relaxed coastal town, well off the beaten path. Typical travelers here were backpackers and nomadic beachgoers. Local foods and beer on the beach and a decent sunset drew the adventurous here for some time off-the-grid.

The coastal town now has changed significantly and is booming with construction of new casinos – largely backed by Chinese investors. Most of the casino licenses approved, 2017 to present, are for new projects in this southern coastal town. The complexion of the town has changed, as it is almost exclusively an enclave for Chinese investors and tourists. The Sihanoukville airport has also added multiple direct flights from China.

There are several factors that are leading to the expansion here. One is that the Cambodian government has been willing to embrace the investment by Chinese to help develop the southern province. Aside from the private investment into Chinese casinos, the Chinese government is assisting in development of roads and infrastructure in the province. Chinese companies now have more than $4 billion worth of power plants and oil operations just off-shore. Sihanoukville is Cambodia’s only deep-water port, and it has become part of a vital trade route for China and a focal point for Chinese investment.

Growth in the Cambodian casino industry is likely to continue for the foreseeable future, with most of the focus to remain on border casinos and Sihanoukville. The gaming environment is a bit foreign to the typical westerner, but can be enjoyed by the open-minded, thrill-seeking nomad.

Based in Bali, Bill Healey has been consulting, installing, and supporting solutions in the global golf and leisure industry since 1982. He has been involved with over 1,000 systems installations in 40+ countries from North America to Africa to Asia and Australia.

READ MORE IN THE SUMMER 2019 EDITION OF GAMING & LEISURE MAGAZINE.

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