Cambodia tourism starts its slow recovery

Oct 08, 2009
By Luc Citrinot
eTN Staff Writer

Cambodia tourism has been confronted with the economic crisis to the slump of a dramatic decline from Northeast Asia, especially Japan and South Korea. Political skirmish with Thailand also contributed to a sharp drop from neighboring tourists.

After six years of uninterrupted growth –and mostly in double-digit figures-, Cambodia tourism has seen a decline in total arrivals for the first half of 2009. Albeit modest at -1.1 percent, it sent a worrying signal as tourism is one of the biggest revenues earning for the government and a major source of employment with over 300,000 Khmers working in the hotel and tourism business.

According to a survey, South Korean travelers, among Cambodia’s top incoming markets, drop by a third during the first semester 2009. Markets such as Australia, China, Thailand or Japan declined also in double-digit numbers. Growth was however recorded in Vietnam –now Cambodia’s largest incoming market-, France, the UK and the USA.

The city of Siem Reap, where Angkor Wat fabled temples are located, has been more affected by the drop. According to data from the airports authority, the number of passengers at Siem Reap declined from January to May by 25.5 percent, from 778,000 to 580,000.

During the same period, Phnom Penh saw passengers’ traffic declining by a more modest 12.9 percent from 767,000 to 667,000 passengers. Numbers have since substantially improved at Phnom Penh International Airport. Passengers’ traffic was only down by 10.2 percent at the end of August.

The disaffection for Angkor Wat is also reflected into the revenues from Apsara Authorities, which manages the temples. For the first half of the year, revenues from ticket sales were down by almost 20 percent. It would be the second consecutive year of decline for the authority as revenues from ticket sales already dropped from US$ 32 to 30 million between 2007 and 2008. Bun Narith, director general of the Apsara Authority, blamed the economic crisis, political uncertainties in neighboring Thailand and bad weather for the overall drop.

Meanwhile, tourism in Cambodia seems to have reached the bottom line. In July, the kingdom recorded an increase of 10 percent in total arrivals. Numerous price reductions and discounts in hotels and tourist attractions, the opening of new border crossings, more flights to Cambodia thanks to the new national carrier Cambodia Angkor Air (CAA) should contribute to put back tourism on the right track. The government has already promised to start again a TV campaign on channels in China, Japan and Korea and predict that tourism will grow again from September. With a bit of luck, it could even erase completely its decline and show a modest growth in total arrivals by year-end.

Souvenir sellers suffering

A souvenir vendor in the Russian Market in Phnom Penh. Fewer tourist arrivals mean tough times for market vendors. (Photo by: SOVANN PHILONG)

Thursday, 26 February 2009
Written by Soeun Say The Phnom Penh Post

Falling tourist arrivals are taking a toll on tchotchke vendors, with some fearing bankruptcy if business doesn't improve.

SOUVENIR store operators in Siem Reap and Phnom Penh may face bankruptcy if tourism does not recover quickly, with revenues down by as much as 70 percent in recent months, say vendors.

Mam Ros Chamroeun, the owner of Asian Silk Souvenir Shop in Phnom Penh, said monthly revenues have plunged from US$1,500-$2,000 in mid-2008 to only $400 a month currently.

"Our businesses have been kept alive by tourists," he said. "If tourist arrivals continue to drop, our businesses will go bankrupt."

According to Ministry of Tourism figures, 2.125 million foreign tourists visited Cambodia in 2008, up 5.5 percent from 2007.

But arrivals dropped 6.5 percent in the second half of the year after growing 12.6 percent in the first six months, meaning the government missed its target of 2.3 million visitors in 2008.

In January, Tourism Minister Thong Khon told the Post that the global financial crisis and ongoing political turmoil in Thailand - a major tourist gateway to Cambodia - were behind the downturn.

He said that the souvenir trade earned 20 percent to 25 percent of tourism sector revenue, estimated at $1.4 billion in 2008, or about $700 per arrival.

The official expected total revenues to climb to $1.5 billion in 2009, with a full recovery by 2011.

Thouch Kunthea, owner of Khmer Princess Souvenir Shop, also in Phnom Penh, said revenues had fallen between 50 percent and 60 percent in recent months.

"Now I am already considering leaving my business, and I think that the downturn will continue to get worse," she said. Lim Nam, the owner of Angkor Night Market in Siem Reap, said that the downturn had forced him to lower rents to attract operators. Sales in the market had dropped by 50 percent, he said.

"It is not like 2007," he said. "Sales have slumped since 2008, and we have been forced to decrease rentals from $150 to $100 per stand, but still nobody wants to rent because they cannot earn."

He said he was worried he faced bankruptcy if the market does not recover.

Men Sinoeun, executive director of the Artisans Association of Cambodia, a training and trade facilitation organisation, said sales were healthy in the first six months of last year but dropped between 40 percent and 50 percent over the second half.

"Souvenir markets are going to drop even further no matter what we do because potential buyers lost income when the world financial crisis happened," he said.

Cambodia to form tourism task force to tackle crisis fallout

PHNOM PENH, Dec. 3 (Xinhua) -- Cambodia's tourism sector is set to form a task force next week to address the Thai political crisis that has caused foreign arrivals in the Kingdom to plummet, national media reported Wednesday.

The task force will consist of 10 institutions, including airlines, travel agencies, hotels, restaurants and government departments, and will develop a national strategy to attract foreign tourists, Ho Vandy, president of the Cambodian Association of Travel Agents, was quoted by the Phnom Penh Post as saying.

He said the Ministry of Tourism approved the task force on Tuesday and it would convene next week.

Both of Bangkok's major airports have been occupied by anti-government protesters since last week, leaving hundreds of thousands of travelers stranded.

The crisis has hit Cambodia's tourism industry hard, as about a third of the Kingdom's visitors arrive via Thailand.

Ho Vandy said the task force hopes to shift Cambodia's tourist arrivals away from Thailand.

"Although most tourists in Cambodia come through Thailand, our tourism sector has survived because we have other gateways such as Malaysia, Singapore, China, South Korea and Vietnam," he added.