CDC rejects Al Jazeera claims of casinos in SEZ’s
The Council for Development of Cambodia (CDC) has rejected outright, an international news report alleging that “many” casinos operate within Cambodian Special Economic Zones (SEZs).
Qatar-based Al Jazeera released an article titled “Cambodia’s nightlife scene tests Covid success” raising concerns about human trafficking, underaged sex workers in karaoke parlours and casinos in SEZs.
“Cambodia is home to about 15 mega-casinos based along the Thai and Vietnamese borders, as well as in Phnom Penh and Chinese investment hubs in Sihanoukville and Koh Kong,” read the news report.
“Many operate within ‘Special Economic Zones’: defined as areas on Cambodian soil where the laws and regulations that govern the rest of the country do not apply,” it continued.
A representative from the CDC told Khmer Times that they had requested that Al Jazeera correct a portion of the article related to SEZs.
“In fact, there is not a single casino in any SEZ in Cambodia and all Cambodian laws are applicable and enforced without any exception within any SEZ on Cambodian territory,” the representative stressed.
A source familiar with the matter said: “I can say unequivocally that there are no casinos in Cambodian SEZs. Frankly, some of the most popular SEZs in the country are Japanese and it is unlikely they would allow such a thing to happen. I find the allegation to be preposterous at the least and libelous at the most. Moreover, the dormitories build in SEZs almost entirely house Cambodian staff who are not allowed to gamble in the country by law. The government would not allow for SEZs to host casinos.
“Perhaps, they [Al Jazeera] are confusing casinos in proximity to SEZs along border towns like Poipet – the existence of these are undeniable. It may be the case in neighbouring countries but not here. The Cambodian government welcomes the financial benefit from gambling to build a Singapore-Macau hybrid in Sihanoukville but they are not comfortable in jeopardising the investment environment in the country to reach that or risk public safety.”
Neighbouring countries, such as Laos, which hosts the Golden Triangle Special Economic Zone owned by King Romans Group and the Laotian government, do have SEZs hosting casinos, such as the Blue Shield Casino.
Independent Khmer Times investigations show that there is no such equivalent in Cambodian SEZs and that the zones do not host any gambling facilities.
There have, however, been criticisms over Bridge and Road Initiative projects being used to fund the construction of casinos.
In 2020, the National Assembly passed a law restricting the presence of gambling in the country.
The ban on online gambling in August last year resulted in a mass exodus of Chinese nationals from the coastal province of Preah Sihanouk province.
Nonprofit thinktank C4ADS used Palantir technology to highlight Chinese investments in Preah Sihanouk province.
Palantir is a data analytics firm used heavily by intelligence communities to support US interests, including the Central Intelligence Agency, Federal Bureau of Investigation and Britain’s Military Intelligence, Section 6, commonly referred to as MI6.
C4DS found no evidence of casinos in Sihanoukville Special Economic Zone. It also found that the number of house leases in the province fell by 187.87 percent after the Aug 18 ban on online gambling while land leases fell by 97.5 percent.
The CDC is comprised of senior minister from relevant government departments and is chaired by Prime Minister Hun Sen. It is responsible for the oversight of investment activities and is responsible for the creation and operation of SEZs.
However, there is no law on the books that provide special privileges to SEZs beyond infrastructure necessary to facilitate trade. Instead, it is governed through “Sub-decree No. 147 on the Organization and Functioning of the CDC”.
The firms do not receive special privileges not enjoyed by those outside of the zones, instead a copy of the sub-decree reviewed by Khmer Times revealed that it outlines required facilities and infrastructure to qualify for SEZs.
For example, SEZs are required to have at least 50 hectares in size with an enclosed fence; a production area, which may include a tourist area; required infrastructure including roads, office buildings and water systems, among others.
In 2020, the CDC approved 236 investment projects worth $8.2 billion, according to official figures. None of these projects were in the casino industry.
There are 24 SEZs in Cambodia. They have created approximately 261,000 jobs in the country.
The CDC said that SEZs are critical to driving FDIs to the country and it has not identified a single casino operating within the SEZ territories.
The government is currently working on a new law to regulate SEZs, meant to increase foreign direct investment (FDI).
The Prime Minister previously said that the new legislation will help improve FDIs to the country.
The law is not expected to be enacted until after the Law on Investment in the Kingdom of Cambodia which is currently before the senate.
It is anticipated that it will encourage investments in specific value-added industries, especially the technology sector.