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Casino town raises the stakes with factories

Jan 06. 2015
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By The Straits Times
Asia News

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Border town Poipet poised for growth as tax incentives attract foreign investors
Under the glow of a blinking replica windmill in the dark, a dozen sheep shuffle around a browning patch of grass. A wiry man in a cowboy suit keeps watch as excited children flock around to the strains of Thai country music.
This is Poipet, a Cambodian district bordering eastern Thailand, where pastiches are as common as slot machines. The scruffy town, better known for its bustling Thai-oriented casinos, is poised for growth as bilateral relations, fraught over border disputes, show signs of easing and tax incentives ease the way for trade and investment.
Cross-border trade is already firmly established in the area, with a sprawling market in the Thai border town of Aranyaprathet anchored by hundreds of Cambodian vendors living in Poipet.
Then, six months ago, rumours of a crackdown by Thailand’s post-coup government sent more than 200,000 migrant Cambodian workers fleeing across the border back home.
Prime Minister Hun Sen – known to be close to exiled former Thai premier Thaksin Shinawatra, brother of ousted premier Yingluck – called it a “violation”.
Today, the workers have returned, allowing both neighbours to turn their attention to special economic zones being developed on both sides of the border.
Poipet has had a head start. A new Japanese hard disk component factory with about 1,000 workers is already operating at an industrial park five kilometres from the border.
Three companies – including multinationals like Toyota Tsusho – are due to move in soon, says Chhour Vichet, chief executive of Sanco Cambo Investment Group, which is behind the special economic zone project.
If it takes off, it promises to add variety to Poipet’s job scene.
Not that its casinos are not thriving. During a visit on a weekend last month, construction workers swarmed over half-built annexes as a never-ending stream of Thai punters rolled up on golf carts ferrying them directly from the border checkpoint.
According to the latest statistics from Thailand’s Immigration Bureau, about 24,000 Thai nationals crossed over into Poipet using short-term border passes last February. Many of them spent more than a few hours in Poipet’s nine casinos, which Cambodian nationals are banned from entering.
 
Big earnings
“I come here for a change of atmosphere,” says 79-year-old Taweetip Limsuklam as she showed the nine passport stamps she acquired here last year. Prior to this, she had gambled on ships moored off Thai waters as well as Singapore waters.
According to the Phnom Penh Post newspaper, the country earned US$22 million (Bt727 million) in casino and gaming-related taxes in 2013, a sum which analysts say understates the size of the industry, with more than 50 casinos scattered all over the country.
Hun Sen, who is regularly criticised for turning the country into a gaming hub for its neighbours, said in 2012 that building casinos was his secret plan to protect the border.
“The biggest goal for giving permission to build casinos is to protect the border,” he was quoted as saying. “One can remove border markers, but one can’t remove five-storey hotels.”
The off-beat rationale does not detract from the fact that casinos have created thousands of jobs in a country with the lowest per capita gross domestic product in Southeast Asia, which was $944.4 in 2012. In Poipet, the effect is obvious, with its casino strip wedged between the two border checkpoints teeming with young Cambodians drawn by the relatively comfortable jobs.
“It’s easy,” says Meas Sophea, 28, who, after 12 years of schooling, earns Bt6,500 a month as a dealer. “I work for only eight hours a day…I’m happy.”
In the hardscrabble town, where trucks laden with cars, machinery and consumer goods from Thailand constantly rumble through, and where locals need to cough up their own cash to fix roads in their neighbourhoods, the casino strip also provides a welcome change of scenery.
“This place is beautiful,” declares seven-year-old Seak Leap Chanrath, whose parents take her here for picnics on its neat lawns once a month. Such greenery is rare in other parts of town.
At dusk falls, the strip glitters with fairy lights more befitting a city mall than frontier town.
“Casino growth has a limit,” says Chap Sotharith, a senior research fellow at the Cambodian Institute for Cooperation and Peace. “We cannot have a thousand casinos, or it would be like Las Vegas. But manufacturing and industry can still grow because we have a large labour force.”
In Poipet’s special economic zone, Sanco is touting a stable electricity supply from Thailand, labour recruitment services and the duty-free import of equipment and construction materials.
Across the border, while full details have yet to be firmed up, business leaders speak of long-term plans to connect Cambodia to Thailand’s Suvarnabhumi Airport and to provide better connectivity between southwestern Cambodia’s Sihanoukville port and Thailand’s main Laem Chabang container port.
The plans give hope to townsfolk like Bun Heang, 48, who thinks that casino jobs are dishonourable and is averse to his children working there, even though they are jobless and his family business is failing.
“If more factories come, I’ll ask my daughter to go and apply,” he says.

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