The Cambodian government is shutting down dozens of casinos in a nationwide crackdown on online gambling.
The southern coastal city of Sihanoukville, the center of a casino boom in recent years, is reported to be hit especially hard. Prior to the raids, the city was home to more than 70 casinos, many of them run by Chinese nationals and catering to Chinese nationals wishing to gamble remotely, which is illegal in China.
The government in Phnom Penh banned online gambling back in August but has only gone after the operations in recent days, reportedly in response to pressure from Beijing, which is a major foreign investor and wields sizable influence in the country.
Cambodia has grown into East Asia’s second-largest online gambling hub after the Philippines, and like the latter has seen an explosion in gambling-related crime, including large-scale money laundering and extortion, which is what the government says has prompted the crackdown.
“I see that if Cambodia’s economy continues to depend on online gambling, Cambodia’s national security will be threatened,” Prime Minister Hun Sen said last month. “We’ll be under the (influence) of organized crime groups who will come to Cambodia to carry out their activities.”
The country currently has some 141 casinos, around 89 of which are believed to have internet capabilities. In Sihanoukville alone it’s expected that half the market will disappear.
Enforcement won’t come without a price, however. Ros Phearun, an official with the Finance Ministry, told Reuters that online gambling had contributed about 25 percent of the estimated US$80 million per year in total taxes from casinos.
The boom also has brought huge increases in the construction sector to places like Sihanoukville, but local residents complain their once sleepy coastal village has been inundated with Chinese tourists and casino operators and promoters.
Kim Heang, president of a non-profit organization that represents real estate agents, said the ban will hurt the property sector, but will be beneficial in the long run by attracting tourists to Cambodia for reasons other than gambling.
The Chinese government also is reported to be offering grant money to support Sihanoukville in weaning its tourism sector away from casinos.
As for the casinos’ employees, the number losing their jobs nationwide could surpass 8,000, although it’s expected the country’s many clothing manufacturers will take up the slack.
“Before, they worked in factories, and when there was better salary in casinos they came to work in casinos,” said Yov Khemara, director of Sihanoukville’s labor department. “When the casinos close, they return to the garment sector.”
