With international tourism annihilated, it is now down to respective governments to resuscitate the sector. Cambodia must do the same but critics are sceptical of its intentions

A storm beckons on the horizon of Veal Rinh Bay in Kampot, as the salty wind sweeps through a close fold of family members squeezed into an open-air makeshift hut.

An old Khmer song blaring out of a stereo system accompanies the merriment as the family tucks into a feast of freshly cooked seafood prepared out of the kitchen of a nearby house -cum-restaurant resort.

“It is good to finally meet my relatives. We haven’t done this for a while,” said 23-year-old Phallin, who only offered her first name.

For the family, mostly natives of the province, picnicking by the beach or river are regular events but not since the pandemic altered socialising etiquettes.

As the restrictions, though not as austere compared to its neighbours, started to relax, tourist sites were slowly populated by Cambodians, left vacant by foreign visitors.

This meant places such as Prek Kdat Resort, a stone’s throw from the foothills of the majestic Bokor Mountain and nestled on the river mouth were finally able to heave back to life.

The proprietor who spoke in between table service said her modest homestay resort is finally seeing a trickling of customers at the restaurant which in normal times would have required people to wait 15 to 20 minutes for an empty hut to dine in.

The local patronage is a small mercy for the beleaguered hospitality sector in Cambodia, where official estimation states that $3 billion in revenue will be wiped out this year.

One of four economic pillars, the tourism industry represented 18.7 per cent of gross domestic product in 2019, second after construction (and real estate).

That year, some 6.6 million foreign tourists visited the country, the highest since 1993, and spent nearly $5 billion in tourism receipts.

But Cambodia sorely pales in comparison to Thailand which posted a four per cent increase to 39.8 million international tourist arrivals in 2019 from 38.2 million in 2018.

The Thai sector raked in an estimated 1.9 trillion baht ($61.1 billion) in tourism receipts – up 3.05 per cent a year ago.

The Kingdom also falls behind Vietnam which welcomed 18 million international visitors last year, up 16.2 per cent from 2018, and revenue of $30 billion.

So what could be the problem? Many say the sector’s performance stems from the government’s complacence and a dearth of creative skills or ideas to market new sites.

Most of its international marketing surrounds Angkor Wat, which does not particularly help as “there is only so much one can see”, a high-ranking Cambodia-registered airline official once remarked regarding the 12th-century temple.

“If you have seen Angkor Wat once, you are not likely to see it again. Why else would people come to Cambodia for the second or third time if there is nothing else to see apart from this temple? The government failed to do much for many years,” the official said.

Had it done what Thailand and Vietnam did decades ago in turning unlikely sites or hidden gems, often only known to locals, into world destinations, Cambodia’s industry might have been on par with them, if not better, critics argue.

Back in 2014, an Asian Development Bank (ADB) report quoted the National Supreme Council 2011 study where 90 per cent of international arrivals for tourism were made up of one-time visits that are not repeated.

This was echoed by World Bank in May 2020 where it found that structural slowdown in the tourism sector had occurred over the past few years as indicated by its low repeat visit rate of less than 20 per cent.

“Cambodia will need to diversify its tourism offerings if the government is to meet its target of eight million tourists in 2020,”ADB said then, in its Cambodia: Diversifying Beyond Garments and Tourism report.

Industry fraught with issues

For sites like Kampot which features a mountain range that slopes gently to the shores and a laidback ambience, the local and foreign tourist pull should be somewhat magnetic.

But as anxiety grew amid the pandemic, arrivals dropped but that is not to say that pre-Covid 19 figures were particularly phenomenal either.

Granted, international tourist numbers have steadily grown year-on-year, but dips and rises in policies and a lack of focus have posed a huge question mark over the sector’s sustainability.

For some time now, industry players have spoken of underlying currents that could pull the sector under unless sincere measures are immediately implemented.

For example, the oft-said lack of diversity to tourist attractions and tourism products, expensive tourist site fees, reduced direct flights from Europe and cruise liners calling at ports, and to a certain extent the political situation relating to human rights and democracy issues, true or not, have fraught the industry.

The ADB report too, in an allusion to the Travel and Tourism Competitiveness Report 2013, said Cambodia received low scores for health hygiene, tourism infrastructure, information and communication technology, and cultural resources compared to other Southeast Asian nations.

In recent times, the meteoric greenfield development of casinos and resorts in Sihanoukville heralded a new wave of tourists which slowly drove out Western visitors, many of whom arrived on cruises.

The frequency of cruise ships calling has dropped with figures ebbing and flowing. From January to May 2020, some 51,489 international tourists arrived via Sihanoukville port, and the Mekong from Chau Doc in Vietnam.

Comparatively, the figure last year was not exceptionally high — only 83,752 waterway passengers for the whole year. In 2018, 72,589 passengers arrived in Cambodia.

But over time, these factors have essentially shaped the tourism landscape to accommodate a different composition of travellers to Cambodia.

Similarly, things will change in future but first, the sector has to go through a trial by fire.

As it is, Covid-19 has brought the sector to its knees with the closure of 3,000 tourism-related businesses and 45,400 job losses.

In Siem Reap, home of Cambodia’s crown jewel – the Angkor Wat temple complex, some 83 per cent of lodgings have closed shop completely or temporarily suspended business.

“Our record shows that 18 hotels and 96 guesthouses have shut down while 172 hotels and 99 guesthouses have suspended operations,” provincial tourism department director Ngov Seng Kak said last month.

According to the revised estimates of Organisation for Economic Cooperation and Development (OECD), a decline of 60 per cent in international tourism this year is likely, although it could rise to 80 per cent if Covid-19 recovery is delayed until December.

While economic stimulus measures such as temporary tax relief for businesses and orders to banks to consider restructuring loans have been implemented to help the sector in Cambodia, what is strongly needed is for the government to rethink tourism for the future, as advised by the OECD.

To do that, Cambodia has to start rolling out its four-strategy tourism masterplan launched last September, although details of which are not public, much like other policy papers introduced by the government in the past. This masterplan is probably a successor to the Tourism Development Strategic Plan 2012-2020, which is add-on to the tray of policy papers, which Cambodia is known for. The strategies and masterplans often have sound measures but little execution.

“Well, the crisis has hit the whole world now [but] governments need to have clear statements and action plans for the present and long-term.

“I don’t think this is a challenge but there must [first] be a clear master plan [to execute],” said Pacific Asia Travel Association Cambodia chairman Thourn Sinan.

A prominent critique in the industry, Sinan has urged the government to consider seven measures, which might seem trivial but are highly pertinent to jumpstart the sector.

They include reducing landing and parking fees of aircraft, airport tax and tourist site ticket prices, and allowing cruise ships to dock while inviting more airlines to fly to Cambodia.

What about handling the political situation? He draws the line there.

“I can say that Cambodian politics is a normal thing now. Europeans know what is happening here. I don’t care much if the [political] parties want to fight with each other. It makes no difference.

“I must say that our recent elections have been peaceful compared to the previous ones which were tense, hence why I don’t think it has any effect on tourism,” he said.

But he contends that there are other things the government should be doing or should have done.

David Van, a private-public partnership consultant, said there was a lot of talk and hype over the last two decades about eco-tourism and coastal area development, only because Angkor Wat has been oversold for years.

“[It is] seriously [suffering] from a fatigue of mass tourism [resulting] in structural damage to the complex,” he said.

Yet, there is Preah Vihear’s ninth-century temple, which is also under the UNESCO World Heritage List including the pre-Angkorian Sambor Prei Kuk temple complex in Kampong Cham that have not received equal attention as Angkor Wat.

“Nothing concrete has been done by the Ministry of Tourism to actively promote and develop these sites which are lacking basic infrastructure to accommodate tourists,” Van said.

Additionally, plans to develop coastal areas have been mere “lip service”, apart from the annual Sea Festival held on a rotational basis in Koh Kong, Kep, Preah Sihanouk and Kampot.

“There is no in-depth enhancement of promotional activities. Private sector investors want to delve into eco-tourism projects but to expand investments, the ministry needs to work harder,” he remarked.

‘Booking sheet is empty’

Since its re-discovery in 1860 and especially after 1993, Angkor Wat has gained popularity as one of the most visited sites in Southeast Asia.It attracts about two million visitors per annum and churns up revenue of around $100 million from ticket sales and souvenirs.

Today, it lies solemn with a smattering of local tourists who take delight in the solitude. Definitely a boon for locals but not so for Cambodia’s mainstay which recorded 45.6 per cent year-on-year contraction in tourist arrivals in the first quarter this year, World Bank stated.

About 15 minutes from the complex, 45-year-old Bunyong Roeurn’s homestay stays idle after bookings were cancelled in March for the whole year.

Signs of a slowdown were there when his revenue dropped 30 per cent between January and March but he did not expect a total obliteration from March onwards.

“I have never experienced this before. For five years since I opened my business, we enjoyed good times with customers from Europe and the US.

“Now my booking sheet is empty. My family is surviving on our savings now. It is bad but at least my situation is better than others because I can manage for another two years.

“It should take us through till the travel sector recovers but after that, I don’t know what to do,” said Bunyong.

Ministry data showed that overall international arrivals dropped 60 per cent to 1.2 million in the first five months of 2020 from 2.9 million in the corresponding period last year.

Although previous years’ figures seem encouraging, the tourism sector’s growth has been incumbent on the Chinese market following the “China ready” initiative introduced in 2016. Chinese arrivals peaked at 35.7 per cent out of total arrivals in 2019.

Therefore, any policy changes could have jarring effects on the influx.

For instance, data from the second half of 2019 revealed a slide, particularly after the announcement on the online gambling ban in August which triggered the closure of Chinese-owned casinos in the run-up to the January 1, 2020 deadline.

This led to a moderate year-on-year growth of 6.6 per cent from 2018, the National Bank of Cambodia’s Financial Stability Review 2019 stated. Conversely, visitor arrivals expanded 10.7 per cent in 2018.

Giving rise to domestic tourism

The saying “even the best-laid plans by men and mice can fail” might have some bearings on Cambodia’s current predicament, particularly with the roll-out of the master plan.

It contains a short-term action plan (2019-2020) with goals to diversify tourism products, extend tourists’ length of stay, boost competitiveness, improve connectivity and create a new identity for Siem Reap as well as Preah Vihear.

At what stage of works it is at right now is difficult to say as attempts to source details from the ministry have been futile.

“Without Covid-19, tourism in Cambodia would have carried on well, although there was not much increase. I received enquiries by cruise liners which want to call on Sihanoukville prior to the pandemic but all that talk has died now,” Sinan said.

In the midst, Cambodia has imposed Covid-19 measures on travellers upon arrival including a $3,000 deposit for checks and a minimum $50,000 insurance coverage.

For Clais Chenda, president of Cambodia Hotel Association, the restriction on travel is a bane.

“We understand why the government imposed these measures but it is ruining the sector. We are very pessimistic about the future,” she said.

But the imposition of the policy is unavoidable, particularly as Cambodia has been at the brunt of mostly imported cases. To date, 198 cases have been recorded with 142 recovered.

Mekong Strategic Partners co-founder and managing director Stephen Higgins said even if those measures were not in place, tourists would not come in meaningful numbers.

“That isn’t going to change until an effective vaccine or a simple effective treatment is in place. Tourism is going to be very, very challenged for at least the next 12 months,” he said.

But there is some hope yet. As the OECD wrote, domestic tourism will offer the main chance to drive recovery.

Higgins echoed it, adding that the government and the industry could work together to encourage greater domestic tourism as international tourism will be negligible.

However, Cambodia could also consider a travel bubble if Thailand and Vietnam continue to keep the coronavirus under control.

“The last thing Cambodia needs is community transmission happening, resulting in lockdowns which could further damage the economy. Keeping strong quarantine measures is essential,” he said.

Difficult as it may seem, Covid-19 has nonetheless given the authorities an opportunity to reboot the sector. Whilst that happens, domestic tourism will take root, possibly uncovering new sites, and with it, new hope.

And like the sun rays that break through the storm clouds on Veal Rinh Bay, good fortune could shine upon the sector in future, provided Cambodia does not delay in rising to the occasion.