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The Political Economy of Tourism in Cambodia

Vannarith Chheangà Cambodian Institute for Cooperation and Peace, Cambodia

This paper provides an overview of the historical development of the Cambodian political economy and the role of tourism in shaping it since the early 1990s when Cambodia opened its door to the world. The paper provides a general overview of tourism products and the government’s policies in tourism development in Cambodia and then examines the perceived impacts of tourism on socio-economic development. It is argued that tourism plays an important role in socio-economic development and national identity promotion, but that proper management of tourism is required to control the spread of HIV/AIDS and child sex tourism.

Key words: tourism, economic development, identity, Cambodia

Introduction important foreign exchange earners and employment providers in post-conflict In the 1960s, Cambodia used to be one of the Cambodian economic development. In most famous tourist destinations in Southeast addition, tourism is also seen as a tool to Asia, with annual tourist arrivals from improve the image of Cambodian culture 50,000 to 70,000 (Lam, 1996); but decades and history with the hope of erasing the Downloaded By: [Chheang, Vannarith] At: 00:48 10 September 2008 of civil war, insurgencies, isolation, and par- images of mass killing fields and land mines. ticularly the genocidal regime of the almost totally destroyed the tourism industry. After conflict resolution in the early Political Economic Development of 1990s and with strong support from the Cambodia: An Overview international community, Cambodia returned to peace and socio-economic reconstruction. The Kingdom of Cambodia is a former French Since the 1990s, tourism has developed very protectorate, which gained independence in fast in Cambodia. The Cambodian govern- 1953. It is located in mainland Southeast ment views tourism as one of the most Asia, covering a land area of about

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ISSN 1094-1665 print/ISSN 1741-6507 online/08/030281–17 # 2008 Asia Pacific Tourism Association DOI: 10.1080/10941660802280414 282 Vannarith Chheang

181,035 km2 with a population of approxi- enriching those in power, particularly those mately 14 million. After gaining independence with power over the privatization of land from France in 1953, Cambodia went through and resources, and created large groups of six major changes in the social, political and marginalized and property-less poor economic system: The Kingdom of Cambodia (Hughes, 2003, pp. 32–33). Only after the (1953–1970); The (1970– establishment of the Kingdom of Cambodia 1975); /Khmer in 1993 under a constitutional monarchy was Rouge Regime from 1975 to 1979; The Cambodia allowed to grow. From 1993 to People’s Republic of Kampuchea from 1979 1996, Cambodia’s GDP grew at an average to 1989, later renamed the State of Cambodia rate of 6.1% in real terms, climbing from from 1989 to 1993; and The Kingdom of US$2.2 to US$3.1 billion. Nevertheless, growth Cambodia from 1993 until now. slumped dramatically in mid-1997 following After decades of civil war, the Cambodian factional fighting in in July and economic and social structure was almost com- the impact of the Asian financial crisis later pletely destroyed. At the end of the cold war, that same year. GDP increased by just 1% in the Cambodian conflict was solved with the real terms in 1997 and 1998. The economic intervention of the five permanent members slowdown, coupled with continued high popu- of the United Nations (, France, Great lation growth, led to a decline in Cambodia’s Britain, Russia and the USA), resulting in the per capita GDP from $292 in 1996 to $247 Peace Agreement in 1991. This peace in 1998. After total peace and national recon- accord allowed the United Nations Peace ciliation were achieved in 1999, economic Keeping Operations Forces to come in to condition recovered considerably between preserve political stability and security in 1999 and 2006, with an annual average Cambodia in order to arrange a general elec- growth of about 8%. tion in 1993. The election allowed Cambodia The Cambodian Prime Minister to establish a new government with a consti- reported in his speech on 14 April 2007 that: tution mandating plural and respect for human rights. In general, the performance of economic and public The Cambodian economic system was finance policies of the Royal Government from transformed from a command or centrally 2004 to 2006 realized annual economic growth rate

Downloaded By: [Chheang, Vannarith] At: 00:48 10 September 2008 to a market-oriented one on average at 8.3%. From 1999, after the country in 1989 under the reform policy of the State has [sic] regained full peace, the average economic of Cambodia. Beginning in 1989, private growth was 9.5% and inflation rate were [sic] kept property rights were introduced, along with low at the rate of 5% per annum. Income per capita privatization of the state-owned enterprises went up 6% on average from $247 in 1994 to $500 and investments, and prices and the exchange in 2006. International reserve increased by 11 folds rate were allowed to float. However, the econ- [sic] from $100 million in 1994 to $1,097 million in omic reform of 1989 was also a key to 2006 ... The total export increased by 8 folds [sic] strengthening the state’s power to mobilize from $463 million in 1994 to $3,556 million in and administer as well as to pursue economic 2006. (Hun, 2007a, section 5). development (Hughes, 2003, p. 21; Peou, 2000, p. 62). The move to the free market The living conditions have also improved quite economy increased social stratification, modestly. Life expectancy at birth increased Political Economy of Tourism in Cambodia 283

from 52 to 60 years for men and from 56 to 65 if the government cannot provide enough years for women, mainly through rapidly employment for the young Cambodian labor declining infant and child mortality. Material force then it creates social problems. living conditions improved substantially The current Cambodian economic develop- according to indicators on housing conditions ment is attributed mainly to the agricultural and ownership of consumer goods; but such sector, textile industry and tourism industry. growth does not benefit all Cambodians. It About 85% of the Cambodian population results in a large gap between the rich and the lives in the rural areas and more than 75% poor (Ministry of Planning, National Institute of them are employed in the agricultural of Statistics, 2004a). sector. From 1993 to 2005, agriculture con- Cambodian demography shows that the tributed about 25% of the gross domestic Cambodian population is still at an early product (GDP) (Lim, 2006, p. 9). The Cambo- stage of a baby boom (Table 1). It implies dian government regards agriculture “as a pri- that the Cambodian labor force is increasing ority sector for the Royal government”. The rapidly, creating both opportunities and chal- agriculture sector has contributed 30% of lenges for Cambodia. The labor force plays GDP and has actively contributed to reducing an important role in economic growth, but (Hun, 2007a, section 6).

Table 1 Population Estimates for Cambodia 1994 and 2004 by Sex and Age

Age Group Total 1994 Total 2004 Men 2004 Women 2004

0–4 1,915,000 1,531,000 777,000 754,000 5–9 1,762,000 1,779,000 902,000 877,000 10–14 1,500,000 1,818,000 925,000 893,000 15–19 855,000 1,705,000 876,000 830,000 20–24 899,000 1,443,000 717,000 726,000 25–29 851,000 815,000 388,000 427,000

Downloaded By: [Chheang, Vannarith] At: 00:48 10 September 2008 30–34 759,000 852,000 407,000 445,000 35–39 560,000 802,000 379,000 423,000 40–44 458,000 710,000 334,000 376,000 45–49 354,000 520,000 214,000 306,000 50–54 290,000 417,000 171,000 245,000 55–59 238,000 313,000 131,000 182,000 60–64 202,000 245,000 103,000 141,000 65–69 153,000 186,000 77,000 108,000 70–74 92,000 138,000 57,000 81,000 75 98,000 165,000 66,000 99,000 þ Total population: 10,990,000 13,439,000 6,526,000 6,914,000

Source: Ministry of Planning, National Institute of Statistics (2004b). 284 Vannarith Chheang

The textile industry, contributing three- The distribution of the growth is not equal, quarters of total Cambodian exports, plays and the poor seem to be left out of the benefits an important role in reducing poverty in of economic development. The level of socio- Cambodia owing to the fact that the entry economic inequality between the urban and salary for workers is about US$50 a month, rural areas is enlarging owing to the main well over the poverty line of US$30 per driving forces of economic growth being the month. Mainly female workers are employed garment and tourism industries, which are in the industry, and it does not require high based mainly in the urban areas (World levels of education or working experience Bank, 2007). (Yamagata, 2006a). The garment sector The Cambodian government has been absorbs 10% of the total labor force and facing a serious budget deficit (an excess of accounts for about 14% of GDP. This is expenditure over revenue), which foreign expanding, with exports rising by 20% in financial assistance plays a vital role in finan- 2006. Note that the top managers of the indus- cing (Figure 1). A large amount of foreign try are 76.8% ethnic Chinese from Mainland aid flows into Cambodia, but criticisms of its China, Taiwan, and neighboring effectiveness have gained momentum. Sophal Southeast Asian states, whereas only 7.9% of Ear (2007, p. 68) argues that “Despite more the top managers are Cambodian (Yamagata, than five billion dollars in aid, infant and 2006b, p. 9). child mortality and inequality have worsened” Tourism is the second largest contributor to and governance seems also to have worsened. the Cambodian economy after the garment Regarding the governance issue, the patron- industry. In 2005, income from tourism age system and corruption are the main accounted for US$832 million, or about 13% barriers to fair economic development and of the Cambodian GDP, and it provided business activities, adversely impacting the annually about 200,000 jobs for the Cambo- investment environment and poverty dian people. In 2006, tourism generated reduction (Sok, 2005). Cambodia is a society revenue of US$1.594 billion, about 16% of embedded in a very strong patronage system Cambodian GDP, and provided about regulating all social and political relationships 250,000 jobs (Ministry of Tourism, 2007). (Ledgerwood & Vijghen, 2002, p. 143). The tourism industry has become one of the Socially and politically, Cambodia is replete

Downloaded By: [Chheang, Vannarith] At: 00:48 10 September 2008 main catalysts for Cambodian economic with very strong patronage networks through development. The Cambodian leaders have which both patrons and clients strive to seek recognized the significance of tourism in their “crucial means of gaining access to resources policies: Hall & Ringer (2000, p. 179) noted and increasing one’s status”, thus causing that “International tourism to Cambodia has this relationship to be characterized by “dis- natural appeal for both the national govern- trusts and suspicions” (Hinton, 2004, pp. ment, seeking additional sources of revenue, 122–125). People who are placed in weaker and for the tourism industry looking for new positions are very likely to give their loyalty opportunities and destinations”. to those in relatively higher positions in In spite of the indicators showing economic exchange for protection (Chandler, 1992, growth and development, there are many p. 105). The patronage social structure plus constraints on reducing poverty and the poor institutional building have pushed sustaining economic growth in Cambodia. Cambodia into being one of the most corrupt Political Economy of Tourism in Cambodia 285

Figure 1 Financing of the Budget Deficit. Source: Nelmes (2007).

countries in the region. Notwithstanding the Sharpley (2002, p. 13) suggested that efforts of the donor countries, international “Tourism is seen not only as a catalyst of organizations and civil society, corruption is development but also of political and econ- still part of everyday life in Cambodia. It is omic change”. Moreover, tourism is linked the most serious problem hindering socio- with cultural nationalism. Nation is an “ima- economic development in the country gined community” (Anderson, 1983, as cited (Calava et al., 2004). Such a social and politi- in Graburn, 1997, p. 200). “Tourisms play a cal system limits the promotion of democracy vital part in both the ‘imaging’ – i.e. bringing and development in Cambodia. into awareness – and the ‘re-creation’ of national cultures in Asia and Oceania”

Downloaded By: [Chheang, Vannarith] At: 00:48 10 September 2008 (Graburn, 1997, p. 194). In examining the State, Tourism and Cambodian Identity complex relationship between tourism, state and ethnicity, Picard & Wood (1997, p. 2) Tourism, a global industry and phenomenon, argued that “the relationship between is liable to be influenced by forces of politics, tourism and ethnicity is mediated by various economics and culture. Meethan (2001, institutions, but none more important in p. 64) noted that “[we] can no longer think most instances than the state”. of tourism in simplistic terms as being either Furthermore, tourism has been regarded as a blessing or a curse, nor in terms of providing an engine for growth and poverty reduction. an easy route to modernity, nor as an index to Both developed and developing countries underdevelopment ... The development of design their policy to generate benefits from tourism is seen as a way to diversify and tourism industry, as Hall (1994, p. 27) con- expand economic activity”. In addition, tends that “Many governments around the 286 Vannarith Chheang

world have shown themselves to be entrepre- “In the present world, conserving and devel- neurs in tourism development”. Tourism oping national cultures have become a prere- deserves encouragement and support from quisite for all the weak nations in the strong the government (Jeffries, 2001). “Although current of globalization, for which they have tourism is an activity sustained mainly by to face with challenges and to stand influences private initiative, governments have tradition- of foreign cultures that have more economic ally played a key role in its development ...” and technological power than them”. (World Tourism Organization, 1996). Tourism is seen as one of the tools for Tourism policy involves the “interests, dealing with the problem of identity. The pre- values and power of those who formulate sence of tourists can be viewed by local people them” (Hall, 1994, p. 172). “In an increas- as a sign of cultural identity (Wood, 1997, ingly complex world, tourism cannot be p. 2). Tourism constitutes an arena where understood in a vacuum. A proper under- issues of cultural identity are related to the standing of this important activity must process of nation-building (Peleggi, 1996). situate it within, and refer constantly to, the For instance, “the cultural heritage of the social, economic and political context in Yogyakarta area has shaped the (inter- which it is rooted” (Hall & Oehlers, 2000, national) image of , as government p. 91). Tourism is a new form of nationalism propaganda has used architectural structures in which traditional art performances and cos- like the temples and the sultan’s palace and tumes represent the national identity of the expressions of art like the Ramayana dance host country (Yamashita et al., 1997, pp. to promote Indonesian tourism world-wide” 22–23). (Dahles, 2001, p. 20). The state is interested in tourism not only All the above arguments demonstrate clearly for economic reasons, but also for promoting the role of the state in tourism development for national identity and nationalism. economic benefits and national image cre- ation. The Cambodian state is no exception. The cultural identity that tourism projects to the Cambodian identity had been lost along the international market simultaneously relates to the way because of external intervention, French process of nation-building. Elements of tourism colonialism and civil war (Gottesman, 2003, are at the same time the ingredients of nationalism: pp. 14–15). Although Cambodians had been

Downloaded By: [Chheang, Vannarith] At: 00:48 10 September 2008 the identification with a place, a sense of historical aware of at the time of the French dis- past, the revival of cultural heritage, and the national covery, they did not view the ruins as “evi- integration of social group. (Leong, 1997, p. 72). dence of a Cambodian Kingdom” (Edwards, 1999, p. 155). Before the French Protectorate, As national culture, under the process of glo- people living near the Angkor Monument balization, seems to fall into a dilemma of regarded the monuments as a religious site. being lost through transnational integration They did not think of Angkor as a symbol of into the “global village” or thriving to pre- national pride (Edwards, 1999, p. 156). serve local and ethnic identities (Friedman, 1990), it is necessary for the government to The perception among Khmer that their culture has think strategically how to deal with this. been lost, or being lost, is pervasive. The destruction Cambodia is very concerned about losing its from years of warfare, the horrendous losses during culture. Hun Sen (2002, section 4) has stated the years of Democratic Kampuchea (1975–1979), Political Economy of Tourism in Cambodia 287

[were] followed by the presence of their traditional promote its political legitimacy and inter- enemies, the Vietnamese ... (Ledgerwood et al., national recognition. After the restoration of 1994, p. 1). peace in the early 1990s, Cambodia wished to show the world that it was a safe place to Angkor, which was rediscovered by Henri visit and do business. Ishizawa rightly Mouhot, a French traveler, in 1860, has observed that “Tourism is an important indus- become the symbol of Cambodian identity try that brings in much needed foreign cur- and nationalism (e.g. Gottesman, 2003, rency to Cambodia. Welcoming North p. 14; Sasagawa, 2005, p. 439). The Americans, Europeans and Japanese also APSARA authority (Authority for the Protec- gives the Cambodian government a good tion and Management of Angkor and the chance to demonstrate its political stability. Region of ), the single supreme In other words, the ruins are Cambodia’s authority in charge of Angkor’s preservation international showcase” (Yoshiaki, 2005). and tourism management, stated in its Tourism has therefore become the engine mission that “Angkor encompasses the civili- not only for economic growth, but also for zation of our ancestors ... Angkor is a unique the promotion of political legitimacy and cultural heritage, a living testimony of our national and cultural identity of Cambodia. past, and the foundation of our identity as a nation. Angkor continues to contribute to Cambodia’s evolution” (APSARA, 2004). Tourism Development After centuries of socio-cultural transform- ations and changes, and particularly after the Tourism Products and colonial period, the Khmer traditions have been reconstructed through what Hobsbawn Geographically, Cambodia is situated between & Ranger (1983) call the “inventions of tra- 10 and 15oN and between 102 and 108oE. dition”. After the fall of the This location indicates that Cambodia is a tro- and the shrinking of the Kingdom, Cambodia pical, warm and humid country that is favor- lost its identity. Under the French protecto- able for travelers all year round. Cambodia rate, Angkor and Khmer identity was seriously has great potential in developing a tourism researched and studied by the French experts. industry given the availability of many

Downloaded By: [Chheang, Vannarith] At: 00:48 10 September 2008 It is therefore logical to say that Cambodian tourism products. identity was reconstructed. Ledgerwood et al. (1994, p. 6) noted that “The term ‘Cam- Tourism products. Cambodia is home to bodian culture’ is an intellectual construct and both natural and heritage tourism products. the ‘Khmer traditions’ ...have long undergone There are seven national parks in Cambodia: transformations wrought by both endogenous Kirirom National Park (Mountainous area), and exogenous forces”. the National Park of Bokor Mountain (moun- Besides economic development and national tainous area), Kep National Park (coastal identity, tourism provides political legitimacy area), Riem National Park (coastal area), and stability of the destination. Cambodia Botum Sakor National Park (coastal area), had been isolated for decades and tourism the National Park of Kulen Mountain (moun- used to be one of the political tools of the tainous area) and Virak Chey National Park Heng Sam Rin regime in the 1980s, to (mountainous area). Besides these parks, 288 Vannarith Chheang

Cambodia accommodates other ecotourism railroad and air routes. The main transpor- spots such as Tonle Sap Lake and its floating tation in Cambodia is by land. There are village, the River, and beautiful about 4,235 km of national roads and beaches. 3,675 km of provincial roads. Many travel There are about 1,080 ancient temples in 14 companies transport tourists by bus or car. provinces in Cambodia, especially the Angkor There is a railways connecting Phnom Penh temple complex in Siem Reap Province, the with Kompong Chhnang, Pursat, Battambang, Sambor Prey Kub temple complex in Kom- Sisophon and Poipet. The Phnom Penh– pongthom Province, and the Preah Vihea Sisophon–Poipet route is 386 km and the Temple in Preah Vihea Province. Moreover, Phnom Penh–Kep–Sihanouk Ville route is there are other historical buildings that could 264 km. However, very few tourists are travel- attract many tourists. These include the ing by this mean because of the lack of quality Royal Palace, built in 1866 during the reign and service. of King Norodom, located in Phnom Penh Waterways in Cambodia can be grouped overlooking the Mekong River, and the into three: the Mekong River system, the National Museum, built in 1917–1918, Tonle Sap system and waterways at the gulf. located to the north of the Royal Palace, There are also some waterway transport com- which contains a lot of ancient precious panies that transport tourists between Phnom objects relating to and Penh and Siem Reap through Tonle Sap, history. There are also festivals such as the with some tour boats taking the guests to Khmer New Year and Water Festivals, which visit Tonle Sap and other islands in Sihanouk also could attract many tourists. All these Ville. make Cambodia a unique place for cultural There are two international airports in heritage tourism development. Cambodia, Phnom Penh and Siem Reap, and Heritage tourism is growing very fast in two regional airports, Kong Keng in Sihanouk Cambodia. Most tourists come to visit Ville and Ratanakiri in Ratanakiri Province. Cambodia to learn and experience Cambodian There are 14 international air transportation history, art and culture. For instance, when companies and three local flight companies. asked by the Phnom Penh Post about Most tourists arrive by air. Domestic transpor- the reasons for Korean tourists coming to tation is operated mainly by tour and travel

Downloaded By: [Chheang, Vannarith] At: 00:48 10 September 2008 Cambodia, the Korean ambassador to companies with acceptable quality and Cambodia, Hyun Shin-suk, stated “Koreans reasonable prices. are very proud of their ancient culture. They expect to find this kind of culture in Hospitality facilities. Accommodation and China, but in Cambodia they have found facilities play an important role in tourism a particularly great Asian culture ...”(Phnom development. Tables 2–4 show the growth in Penh Post, 2006). It can be noted that South the numbers of hotels, guest houses, restau- Korean tourists accounted for 15% of all rants and other facilities over the last few tourist arrivals in Cambodia in 2006. years.

Tourism Infrastructure Financial services. There are currently 15 Transport. The Cambodian transpor- commercial banks and two remaining public tation network comprises land, waterway, banks run by the state, the Rural Development Political Economy of Tourism in Cambodia 289

Table 2 Hotels and Guesthouses Table 4 Travel Agencies and Tour Operators

Hotel Guesthouses Travel Agencies and Tour Operators

Year Number Room Number Room Year Head Offices Branch Offices Total

1998 216 8,247 147 1,510 2001 166 70 236 1999 221 9,115 186 1,897 2002 186 73 259 2000 240 9,673 292 3,233 2003 186 84 270 2001 247 10,804 370 3,899 2004 208 94 302 2002 267 11,426 509 6,109 2005 237 99 336 2003 292 13,201 549 6,497 2006 277 105 382 2004 299 14,271 615 7,684 2005 351 15,465 684 9,000 Source: Ministry of Tourism (2006). 2006 351 17,914 742 9,166 financial services are improving in Cambodia, Source: Ministry of Tourism (2006). making it more convenient for tourists.

Bank and the Foreign Trade Bank. At present, only foreign-owned banks offer modern Tourism Promotion Policies banking facilities (Lommen, 2006, p. 136). Some commercial banks such as Cambodia Security and safety for tourists. Security and Mekong Bank, Canadia Bank and ANZ safety for tourists are the main issues in Royal have introduced and installed automatic tourism development in Cambodia. In the teller machine (ATMs) in several parts of the early 1990s when the Khmer Rouge forces two main cities, Phnom Penh and Siem Reap. still operated, guerilla warfare threatened the Credit cards such as Visa Card and American tourism industry in Cambodia. Some foreign Express are accepted by some restaurants, tourists were kidnapped and killed in 1994. hotels and shopping centers. In general, In 1996, there were at least 70 cases involving the robbery of foreign tourists. Landmines are

Downloaded By: [Chheang, Vannarith] At: 00:48 10 September 2008 Table 3 Restaurants, Massages and Sporting present in most places in Cambodia, posing a Clubs major barrier to tourism development (Leung et al., 1996). Since 1999 when the total Massage Sporting Souvenir peace was established, security and safety Year Restaurants Salons Clubs Shops have improved remarkably. At the end of 2001, a tourism police force was created 2002 505 within the Ministry of the Interior to provide 2003 624 security and safety to tourists. There are 756 2004 713 56 17 40 tourist policemen spread across the country. 2005 719 56 17 40 These policemen are well trained and 2006 747 53 53 40 equipped with the necessary vehicles and other operational resources. The tourist Source: Ministry of Tourism (2006). police forces are located mainly in the most 290 Vannarith Chheang

important tourist locations: Phnom Penh, ecommunications linkages, travel facilitation, Siem Reap and Sihanouk Ville. tourism development planning, tourism invest- ment, human resources development, joint Infrastructure development. The Cambo- promotion and marketing, public and private dian government gives priority to infrastruc- participation and multilateral cooperation. ture development for the tourism industry. The four national tourism organizations are The “Open Sky” policy was introduced to also working with the relevant authorities of open the international airports in Siem Reap their respective countries to consider the and Sihanouk Ville. Many roads have been opening of more border checkpoints, authoriz- constructed to connect the main tourist spots ing visas on arrival and other facilities for tour- in Cambodia. Electricity and water supply ists and improving the convenience of traveling facilities have been established to meet the by overland routes. demands of tourists as well as local residents In the year 2000, the Tourism Authority of in many parts of the country. and the Ministry of Tourism of Cambodia launched their first cooperative Regional cooperation. The Cambodian gov- marketing campaign, “Two Kingdoms One ernment has shown a strong interest in Destination”, aimed at boosting tourism regional tourism cooperation and facilitation flows to and between the two countries. since 1996 when the annual conference of Based on this agreement, Thai and Cambodian the Pacific Asia Travel Association was held tour operators, airlines and public and private in Bangkok. Regional cooperation aims at tourism-related organizations will produce managing and marketing the region as a marketing resources and brochures, host single destination, providing a safety net for trade shows and workshops plus organize tourists and reducing barriers at the inter- familiarization trips for travel agents and national checkpoints in order to make it travel writers to the two Kingdoms. more convenient for tourists in traveling Subregional and regional cooperation and from one place to another in the region. integration is one of the pillars of Cambodian Recently, a lot of efforts have been made by foreign policy. The Cambodian government the Cambodian government to promote the has been actively involved in cooperation tourism industry in the region. An inter- within the framework of the Cambodia, Laos

Downloaded By: [Chheang, Vannarith] At: 00:48 10 September 2008 ministerial committee representing the and Triangle since the early 2000s, National Police Department and Ministry of a main aim of which is the “Three Tourism of Cambodia was established to Countries-One Destination” objective. Trans- assist tourists by reducing difficulties at the portation infrastructure is the foundation of border checkpoints at Poi Pet, Bavit-Moc Bai tourism and trade facilitation between the pro- and Trapaingkreal-Vinkham. New buildings vinces along the borders of the three countries. at the border were set up and immigration In addition, Cambodia is participating in procedures were simplified. In October 2000, cooperation in the Mekong Subregion and the tourism ministers of Cambodia, Laos in Southeast Asian regional integration, in PDR, Myanmar and Thailand signed the quad- which tourism is one of the objectives. rilateral tourism cooperation agreement under which the four countries will work closely Visa control. Cambodia was the first country together in the fields of transportation and tel- in to introduce e-visas (starting Political Economy of Tourism in Cambodia 291

in 2006) with the purpose of making travel With regard to tourism development, the more convenient for tourists to Cambodia. Cambodian government encourages the The tourists can apply for Cambodian visa private sector to invest in hotels, restaurants, through the internet. Entry visas can also be resort centers and other services. Thong provided at the international airports and Khon, the current Minister of the Ministry of border checkpoints. Tourism, stated that in order to strengthen the tourism industry in Cambodia, a good relationship between the public and private Tourism training and education. Owing to sectors must be provided. He added: “We the importance of the tourism industry in want Cambodia to become one of the socio-economic development and cultural pro- tourism destinations for the region and for motion, the Cambodian government, private the whole world” (Vong & Charles, 2007). sector and non-governmental organizations (NGOs) have focused their attention on tourism education and training. Many univer- Tourist Arrivals in Cambodia sities have tourism programs, from vocational training to Masters’ degrees. The Cambodian Insurgencies, civil war and the killing fields Ministry of Tourism also provides support to during the 1970s and 1980s prevented the universities and has created an inter- Cambodia from welcoming tourists. Only a ministry network for discussions and training. very few brave visitors came to Cambodia at Moreover, the Ministry of Tourism trains this time. After the Paris Peace Agreement in tour guides and grants licenses for the resolving the conflict in Cambodia in 1991, successful candidates. Without the certificate, tourists started to visit Cambodia. In 1991, one cannot become an official tour guide. there were about 25,000 and in 1992 there were about 50,000 people, but many of them Public–private sector relationship. The were UN personnel. Peace-keeping forces Cambodian government has pushed strongly and other UN staff accounted for 22,000 of the transition to a market economy and the these. Statistics on tourist arrivals have been development of a private sector framework officially recorded from 1993. since 1993. A series of important laws regulat- The top 10 countries of origin of tourist

Downloaded By: [Chheang, Vannarith] At: 00:48 10 September 2008 ing the private sector were enacted. Among the arrivals in Cambodia in 2006 were: South most important were a Law on Investment Korea (16.79%), Japan (9.31%), the USA (1994), a Law on Organization and Function- (7.28%), Taiwan (5.01%), China (4.74%), ing of Council for Development in Cambodia Vietnam (4.56%), (4.53%), and Cambodia Investment Board (1995) and Thailand (4.53%), the UK (4.34%) and a Law on Taxation (1997). New institutions France (4.23%) (Ministry of Tourism, 2006). were created to enforce these laws. For The reasons for the drop in the number of example, the Cambodia Investment Board tourists in 1997 were political instability in under the Council for Development in the aftermath of the armed conflict and the Cambodia has authority to grant tax Asian financial crisis. In 2003, the number of incentives contained in the Law on Investment tourists also dropped owing to the SARS for investment projects carried out by the epidemic that spread in the region. However, private sector. the tourism industry in Cambodia has 292 Vannarith Chheang

Table 5 Tourist Arrivals in Cambodia million per year, the tourism industry helps to reduce poverty in Cambodia. The former Visitor Arrivals Average Minister of Tourism, Veng Sereyvuth, said: Length “Tourism is the answer for the future of this Year Number Change (%) of Stay country. It is the most active and most power- ful force in the economy ...tourism generates 1993 118,183 00 N/A a lot of benefits to the guy down the street, 1994 176,617 49.44 N/A down in the village ... Be it the vegetable 1995 219,680 24.38 8.00 grower, or handicraft [seller], the moto taxi 1996 260,489 18.58 7.50 [drivers] in the village, the spread is enor- 1997 218,843 215.99 6.40 mous” (Green, 2003). Former Minister of 1998 289,524 32.30 5.20 Tourism Lay Prohas stated that “Tourism is 1999 367,743 27.02 5.50 the only sector of the economy which can 2000 466,365 26.82 5.50 have a positive, almost immediate impact on 2001 604,919 29.71 5.50 poverty reduction through growth, unlike 2002 786,524 30.02 5.80 agriculture which needs a longer timeframe 2003 701,014 210.87 5.50 ... Our biggest potential field in Cambodia is 2004 1,055,202 50.53 6.30 tourism ... Tourism creates jobs and brings 2005 1,421,615 34.72 6.30 steady income for the nation and leads to 2006 1,700,041 19.59 6.50 development”. Ly Korn, President of the Cambodian Tourism and Service Workers Source: Ministry of Tourism (2006). Federation, said “the industry is now a major employer ... Now about 660,000 people get recovered quickly after these two disasters jobs in the tourism industry, compared to (Table 5). about 330,000 in factories” (Sam & Shannon, 2007). The Cambodian Prime Minister Hun Sen stressed the importance of Economic Impact of Tourism in tourism in his message on the occasion of Cambodia World Tourism Day, 27 September 2007:

Downloaded By: [Chheang, Vannarith] At: 00:48 10 September 2008 Tourism has played an important role in recon- [The] Cambodia tourism industry has been playing structing the Cambodian economy, improving a vital role in socioeconomic development. Within local community development and eradicating this cultural tourism is a dynamic influx source of poverty in Cambodia. Tourism provides many tourists who have had high appreciation and economic benefits, such as foreign currency admiration of cultural heritage linking to other his- earnings, direct and indirect benefits to the torical heritage; and pristine white-sand beaches, national economy and employment for the beautiful landscapes of rivers, lakes, mountainous Cambodian workforce, and it plays a role as range and national parks ... Within the Rectangu- an accelerator of other sectors of the lar Strategy, the Royal Government of Cambodia economy, such as services, manufacturing has determined tourism as [an] economic-priority industries and agriculture. sector in improving the people’s living standard, With the number of international tourists especially pro-poor, community-based tourism coming to visit Cambodia standing at over 1 (CBT). (Hun, 2007c). Political Economy of Tourism in Cambodia 293

At the same time, however, tourism in Cambodian government has issued some Cambodia faces many challenges. Moeung development policies aimed at improving the Sonn, President of the National Association capacity of the small and medium enterprises of Tourism Enterprises, argues that the prices to provide goods and services, encouraging of consumer products, transport and food in high-quality agricultural production for the Cambodia are higher than those of its neigh- tourist market (Ministry of Tourism, 2007). bors and that “more of the income from A development project called “Green Belt” tourism in Cambodia goes to private foreign supported by JICA and the Cambodian gov- companies than to the national budget or ernment was initiated to provide support for local economy” (Cheang, 2004). the farmers living around the Angkor The Phnom Penh Post observed that tour- complex to grow good quality vegetables and ists “usually come and visit two or three other agricultural products to supply the countries on the same trip and usually only tourism industry in the region. stay two or three days [in one place]. They stay in Korean-owned hotels and eat at Korean restaurants, so it’s not desirable from Social Impact of Tourism in Cambodia the point of view of Cambodian people” (Phnom Penh Post, 2006). Although the state- Besides the economic impact, tourism also has ment is a little bit exaggerated, it raises other impacts on Cambodian society. Tourism concern among some Cambodians. plays an important role in improving the Most of the products, even vegetables, are image of the Cambodian culture and people imported from neighboring countries to and it somehow makes Cambodians feel supply the hotels and restaurants in Cambo- proud of their nation. However, tourism dia, particularly those in Siem Reap. Boua brings about some social costs as well. Chanthou, the director of a local NGO, Tourism has adversely impacted Cambo- Padek, said the lack of homegrown supplies dian society through the spread of HIV and was a result of policy neglect and stressed the AIDS. Cambodia experienced a rapid growth need for government subsidies to encourage of the epidemic from the 1990s with the agricultural diversification. arrival of United Nations forces and inter- national tourists. Regarding this particular

Downloaded By: [Chheang, Vannarith] At: 00:48 10 September 2008 We have tried to help farmers produce lemongrass issue, the former Minister of Women’s and lettuce and other produce for hotels ... But Affairs, Mu Sochua, admitted that Cambodia it’s difficult to get the farmers to commit because was on the child sex tourism map. The they worry the buyers will not come. Then, if former Minister of Tourism Veng Sereyvuth they’re offered construction work in Siem Reap, also admitted that the country had a problem they go and we have no products for the buyers. with sex tourism, which carries an enormous (Hayman, 2007). cost by deterring “normal” tourists from visit- ing. He said “I’m outraged at this stuff and It is estimated that about “30% of revenue also at the internet that gives out information from tourism ... leaked out of [the] country specifically about child sex ... My proposal through imported foreign goods to serve the is that the authorities must take appropriate tourism sector in Cambodia” (Hun, 2007b, measures in all these places. They must be pun- section 9). To deal with this problem, the ished for their crimes and the punishment must 294 Vannarith Chheang

be severe to send a proper signal to these every day. The Cultural Village presents min- people that they will pay the price if they do iatures of historical buildings and structures, it” (Green, 2003). The sex tourism issue has and local traditions of ethnic groups in Cam- also received international publicity from bodia. There are 11 unique villages, which high-profile cases such as that of the British represent the different cultural heritages and pop singer, Gary Glitter (Eades, 2007). characteristics of 19 ethnic groups. To counter the negative impacts from tourism, the Cambodian Ministry of Tourism has established a Committee for the Safety of Conclusion the Child in Tourism. This committee operates on two levels, the national level and the munici- This paper has discussed various issues includ- pal and provincial level. In order to curb child ing political economic development in Cam- sex tourism, the Cambodian government bodia, the role of the state and tourism wants to increase public awareness through development, tourism products, the govern- education and other administrative programs. ment’s policies in promoting tourism, and In addition, cooperation with NGOs is also the perceived impacts of tourism on socio- emphasized. However, constraints still exist economic development in Cambodia. in the implementation process, particularly Cambodian political and economic develop- the corruption that is rampant in Cambodia. ment has experienced more challenges than opportunities in the last decades. Since the 1990s, Cambodia has tried to transform Tourism and Cultural Development itself into a democratic and market-oriented country. However, the issues of corruption Like other countries in Southeast Asia, and governance are still at the forefront of tourism has a great influence on cultural devel- socio-economic development. With an opment in Cambodia. Khmer Art performance increasing labor force looking for jobs and a has been reconstructed after the prolonged governmental budget deficit, tourism is seen civil war, to present to tourists. Many per- as a solution to both of these problems. Cam- formances, especially Apasara dancing, are bodia has both great natural and cultural available at some big restaurants, hotels and tourist attractions and tourism has been

Downloaded By: [Chheang, Vannarith] At: 00:48 10 September 2008 theaters. Moreover, Cambodian traditional growing remarkably in Cambodia since the scarves, especially made from silk, art crafts early 1990s. The tourism industry helps Cam- made from wood and stone, and other souve- bodian people to have jobs and incomes. nir products that represent Cambodian art and Direct and indirect impacts of tourism on culture are mass-produced to meet the demand socio-economic development in Cambodia from tourists. are coming to the fore. The Cambodian Tourism gives an opportunity for the government views tourism as an efficient private sector to sell cultural products to foreign exchange earner, employment provi- tourists. For instance, the Cambodian Cultural der, income generator and promoter of Village, home to Cambodian cultures, was national identity or prestige. With this in built in 2003 not far from Siem Reap town mind, the government initiated several policies with the purpose of attracting tourists. Thou- to develop tourism. These comprise security sands of visitors come to visit the village and safety for tourists, infrastructure and Political Economy of Tourism in Cambodia 295

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