Dark clouds hang over the aviation sector as the pandemic holds down growth. Heng Chivoan
While tourism plans firm up in the Kingdom, the aviation sector has to negotiate unexpected headwinds as it kick-starts operation following an unfortunate hiatus. This two-part article highlights the challenges and hopes in a new normal setting
‘China is our main market.Cambodia was planning to start with them first,” a slightly disturbed Thourn Sinan, Cambodia chapter chairman for Pacific Asia Travel Association, said regarding a notice by the Chinese embassy in Cambodia on compulsory quarantine and Covid-19 tests before flying to China. “We are worried about this, especially when the government has been working hard to start vaccinated tourism.”
On June 26, the embassy issued an “urgent notice” requiring travellers to China from Cambodia to quarantine for 14 days, including the flight day, in airline-designated hotels.
They would have to undergo “dual detection” tests – nucleic acid and serum antibody – at the Royal Cambodian Army Hospital and the National Institute of Public Health at their own expense.
Both Chinese citizens and foreigners must then apply for an international health code from the embassy and submit necessary documents prior to departure. The notice takes effect on July 11.
The embassy, on its website, said the compulsory measures were implemented as the number of confirmed novel coronavirus cases “imported from Cambodia remained high” and “many travellers were infected on the way to China”.
It advised people to assess their need to travel, given that the global epidemic is serious and the risk of cross-infection is relatively high.
The Cambodian government in the past has allegedly dismissed the existence of exported cases involving Chinese nationals who tested positive upon return in Guangzhou city, which is one of the main entry points for flights from Cambodia.
A news report by Hong Kong-listed Tencent Holdings Ltd’s QQ web portal, quoting Guangzhou Municipal People’s Government, revealed a chart by Nandu Big Data Research Institute where imported asymptomatic Covid-19 cases from Cambodia was highest at 19.
The figure represented 32 per cent of the total imported cases between May 21 and June 20 this year in Guangzhou.
Cambodia was among 22 countries including Malaysia, Cameroon and Bangladesh identified by the research institute, which has been tracking imported cases since January 30 last year.
The information by the municipal was made public together with detailed measures on prevention and control of imported cases in a media conference on June 21, following a surge in cases in the Guangdong province where Guangzhou is its capital city.
According to QQ’s report, the event was attended by officials from Guangzhou Municipal Health Commission, Guangzhou Border Inspection, two Chinese airlines and the Guangzhou port.
Back in Cambodia, the Chinese embassy said following the tests, which are required two days before departure, “isolation certificates” would be issued to travellers by the respective airlines, and expenses such as food and lodging can be negotiated with the airline. It also listed the contact for some 10 Chinese and Cambodian airlines that served both markets.
Given that Chinese travellers make up the mass of airline passengers and tourist numbers in the Kingdom, the embassy’s decision reverberated through the travel sector.
“Ninety per cent of passenger airlines rely on Chinese traffic. It will crush all passenger airlines in Cambodia,” said a top executive in the aviation industry, who declined to be named due to his close association with the government.
Attempts to contact the Chinese Embassy proved futile as was the case with Ministry of Health spokesman Or Vandine, who failed to respond to questions.
Although vaccination is being rolled out at fever pitch in both China and Cambodia, positive Covid-19 cases continue to rise, particularly with the Delta strain detected in new infections.
The new variant threatens to pushmedical practitioners over the edge, with Health Minister Dr Mam Bunheng declaring the present community transmission as having reached “a red line”.
Going beyond it could result in widespread infection, increased fatalities and further disruption to daily living, while entailing a lockdown to contain the spread.
According to the Health Ministry, the variant has been detected in 22 persons as of June 29, all being import cases from Thailand.
Quarantine period for Delta and Delta Plus, a mutation of the variant, has been extended to 21 days from 14 days with land, sea and air borders tightened along with rapid testing on returning migrant workers.
As of July 1, Cambodia recorded 628 fatalities on the back of 51,384 cases as provinces registered daily spikes in recent weeks amid restrictive movements.
`Huge disincentive to travel’
In the last five years or so, some 80 per cent of air routes logged by the authorities plied between China and Cambodia, the State Secretariat of Civil Aviation (SSCA) indicated, adding that most of them were piloted by Chinese and Cambodia-based airlines.
Since Covid-19, China has yet to ease international travel restrictions but in 2019, Chinese arrivals stood at 2.4 million, with 97 per cent of them arriving by air, Ministry of Tourism data showed.
The citizens represented 36 per cent of total arrivals, up 17 per cent from 2018, making it the largest source market for Cambodia, a position it has held since 2017.
Even as the numbers tanked last year, Chinese nationals made up one-third of the total 1.02 million entries out of 10 top markets.
Plans are afoot to create a travel bubble or closed-loop chartered flights with China and other countries with tapering case numbers by the fourth quarter this year where Siem Reap would be the first site to open to tourists.
Given that the tourism sector suffered major blows with the loss of tourism dollars from Chinese visitors, Sinan’s concern is vindicated. However, he is cautious in his call to the Cambodian government to look into the matter due to the “special relationship” shared by both countries. “I hope the Cambodian government will take urgent action to carefully deal with China [regarding] this issue,”
Tourism Ministry undersecretary of state Sok Sangvar and spokesperson Top Sopheak could not be reached for comment.
For the short-term, Hannah Pearson, co-founder of Kuala Lumpur-based boutique tourism consultancy and sales representation firm Pear Anderson, does not anticipate the notice would “greatly harm” the tourism sector.
It is because the number of Chinese travellers entering Cambodia from January to April this year “has been just” 25,986, she said.
In the absence of a breakdown on these travellers’ purpose, Pearson assumed that they were entering on the pretext of business, seeing that Cambodia is not issuing tourist visas.
Although, she mused, this could become an issue if China decides to maintain this policy in the medium to long term, when Cambodia is looking at reopening for international tourism.
“Any quarantine is a huge disincentive to travel, and this additional requirement of a 14-day quarantine for travellers returning to China from Cambodia makes travel even less appealing,” she said.
Striking a balance
Admittedly, optimism for recovery in the Cambodian aviation sector might have dimmed with the Chinese notice, which Norinda Khek, communication and public relations director of Cambodia Airports, remarked as not being conducive to restarting activities.
“This is indeed another burden susceptible to deter air travels,” he told The Post via email.
Speaking in general, Norinda pointed out that aviation-related organisations call for risk-based and proportionate measures rather than “blanket restrictive” rules.
“We need to strike a balance between public health safety, restarting economies and restoring people’s livelihoods,” he stressed.
Cambodia Airports, majority-owned by Vinci Airports SAS – a wholly-owned subsidiary of French-listed Vinci SA – holds a 45-year concession for all three airports in the country since 1995.
Following the plunge in passenger traffic in 2020, the group continued to record a 96 per cent fall in arrivals in Cambodia in the first quarter ended March 31, 2021.
In terms of international visitors by air, the numbers grew year-on-year to 4.4 million in 2019, a figure similar to international departures that year, Tourism Ministry’s annual tourism statistics showed.
As for outbound Cambodians, some 774,369 travelled by air in 2019, up 20.2 per cent from 2018.
`Markets have shrunk’
Dependent mostly on tourism where 6.6 million people visited Cambodia a year before Covid-19, the aviation sector currently subsists on bare minimum as local airlines jostle for passengers with international airlines.
To date, five locally-registered airlines comprising flag carrier and majority state-owned Cambodia Angkor Air, Lanmei Airlines, Cambodia Airways, JC International Airlines and Sky Angkor Airlines continue to service their air operating certificates.
However, out of 22 aircrafts leased by the airlines, 13 are grounded, which is a huge loss incurred by the firms, said SSCA spokesperson Sinn Chansereyvutha who estimated it to be between 60 and 65 per cent.
“[Which is why] the strict measure [by the Chinese Embassy] will crush the air travel sector even more,” he stressed.
That being said, expanding cases in the region are likely to contribute to a push back in recovery of the aviation sector, which would have otherwise been aided by travellers from neighbouring states.
Unfortunately, there are no growth plans for this sector in Cambodia, Chansereyvutha noted. “The sector is merely a supporting industry, not a leading service.”
This, despite hosting one of the highest number of local airlines in the region. Not too long ago, Cambodia was a hotbed for cash-rich local and foreign tycoons who wanted to run their own airline, mostly to leverage on the boom of the Chinese market.
Nevertheless, he said, the Tourism Ministry’s roadmap ending 2025 has strategies to resurrect the tourism industry and attract tourists, which would inadvertently revive the aviation sector.
In the meantime, he advised airlines to rethink their fleet, business model and funding, although it would “not necessarily” lead to a change. For most of them, returning to business-as-usual is not going to be a viable option.
“To put it bluntly, there are too many aircrafts in the system relative to the realistic prospects for medium-term recovery. The new normal in many markets and the industry as a whole is going to be smaller.
“A market of 4.5 million passengers will not return overnight. Airlines will not be able to simply pick up where they left off.
“Not only have markets shrunk but the profile of their customers and needs will have changed and the way that they are required to serve their markets may become uneconomic,” he asserted.
