Government reviews island projects after downturn delays

Written by Kay Kimsong
Friday, 26 June 2009

THE government's investment arm is reviewing at least six island development projects in the light of the economic downturn. Youn Heng, the deputy director at the evaluation and incentive department in the Cambodian Investment Board (CIB), said delays by investors in their approved projects ought to be brief.

"My request to some investors is that if you delay your projects, you must not delay too long," he said. "I agree that projects might be affected by the global economic downturn, but it shouldn't have a huge impact."

Youn Heng said five companies signed agreements last year with CDC, but none has done so this year. The investments are generally long-term - some are 99-year leases. The Council for the Development of Cambodia, to which the CIB belongs, said most of the multi-million dollar projects are "moving on the right track".

CDC figures show five island development projects were approved in 2008 backed by firms with US$123 million of reported fixed assets.

"We are now reviewing the master plans for those islands and carefully studying the environmental impact," he said. "We will not allow them to cut too many trees on the islands - on some islands we want them to maintain the forests."

He said that the Kingdom's largest island resort investment - a $300 million Russian project for Koh Pous Island - was continuing.

Australia's Brocon Group, which has taken out a 99-year lease of Koh Oun and Koh Bong islands in a $3 million development, told the Post that its resort will cover 12 hectares when it is completed. Rory Hunter, the chairman of Sang Saa Island Resorts, which is Brocon Group's local operating company, said the resort would open its doors to guests by the end of 2010.

Sboang Sarath, the governor of Preah Sihanouk province, said tourism projects such as the island developments were one of three pillars of economic growth for the province. The others are heavy industry and port services. Combined, he said, they ought to provide an engine to lift the rest of the country.