review of cambodia’s tourism industry dr. baromey neth

Review of Cambodia’s Tourism Industry: The Growth and Implications on

Its Sustainability

Dr. NETH Baromey Department of Tourism, Royal University of Phnom Penh

Contents

§  Cambodia’s Tourism Development from a Glance

§  Tourism Infrastructure and Logistics

§  Tourism Momentum in Generating Formal and Informal Economy

§  Implications of Tourism Growth

§  Opportunities and Challenges for Tourism Growth

§  Mechanisms to Sustain Tourism Development in Cambodia

Cambodia’s Tourism Development from a Glance

Tourism Highlights Year Num. of Inter.

Tourists Tourism

Receipts ($ mil.)

2010 2,508, 289 1,786

2011 2,881, 862 1,912

2012 3,584, 307 2,210

2013 4,210, 165 2,547

2014 4,502, 775 2,736

2015 (Until Oct) 3,755, 792 NA

Source: Statistics and Tourism Information Department, MOT, (2015)

Top Ten Market Arrivals in 2014 and 2015

Source: Statistics and Tourism Information Department, MOT, (2015)

Region No. of Inter. Tourists (Oct. 2015)

Asia and the Pacific 2,937,169

Europe 552,605

Americas 247,672

Africa 6,964

Middle East 11,382

3. Transportation

Tourism Logistics

1. Infrastructure and Connectivity

2. Production

4. Services

Infrastructure and Connectivity

Est. Accommodations 1396 Est. Travel agents 804 Est. Transportation 380

Source: http://www.tourismcambodia.org/

Access Modes

Access

from

Total No. of

Inter.

Checkpoints

List of Inter. Checkpoints

Vietnam 9 Bavet, Kaam Samnor, Phnom Den, Trapaing

Phlong, Trapaing Srè, Oyadav, Banteay Chakrei ,

Preak Chak, Samrong

Lao 1 Trapaing Kreal

Thailand 6 Poipet, Cham Yeam, O'smach, Choam, Prom,

Dong

By Land

Source: Ministry of Tourism, (2016)

Access Modes Total No. Name of the International Ports

1 Sihanouk International Port

2 Phnom Penh International Port

Alternative Choices

1 Reach Phnom Penh through the ships along the Mekong River (Vietnam and partly from Laos)

2 Trapaing Kreal international border checkpoint (Lao)

By Water

By Air

No International Airports 1 Phnom Penh international airport

2 Siem Reap international airport

3 Sihanouk international airport

Infrastructure and Connectivity

Tourism connectivity: §  ASEAN tourism connectivity

By-Region Tourism Zones

1. Mekong tourism corridor 4. Emerald triangle 5. Southern coastal tourism corridor 6. Green development triangle

v Heritage necklace circuit

v GMS coastal and river cruise lines

Transportation

§  Bus and car rental companies §  Local & international airline companies §  Local transports §  Water way transport, etc.

Low cost carriers airline

Services & Production

§  Accommodation (hotels, guesthouses, eco-lodges, boutiques, resorts, home-stays, B&B, etc.)

§  Restaurants and local food catering §  Travel agents and tour operators §  Handicrafts and souvenirs §  Transport §  Merchandise

Implications of Tourism Growth

Positive Economic Impacts

Economic Implication

§  Foreign exchange earning §  Plenty of job

opportunities §  Infrastructure investment §  Contribution to local

economy §  Others

Tourism Momentum in Generating Economy

Source: WTTC, (2015)

Positive Social Impacts §  Tourism can encourage the innovation

of entrepreneurs within the local communities.

§  Encourage people to value their living culture.

§  Motivate local employment in tourism industry.

§  Strengthening safety and security, §  Improved social welfare of the locals §  Others

Positive Environmental Impacts

§  Improved & integrated environmental governance agendas and mechanisms

§  Improved environmental management plans

§  Improved CSR practices among private entities

§  Community based ecotourism guidelines and monitoring toolkits

§  Sign post and the interpretation §  Rehabilitation and environmental

conservation fund §  Others

Negative Impacts

§  Economic leakage in the tourism sector in Cambodia, roughly estimated by the MoT and the Ministry of Commerce (2006), reached 40% in 2006, as cited in UNCTAD (2007) and Tourism&Leisure (2009). This amount of leakage was also predicted to continue through to 2010 (MoC 2006; UNCTAD 2007; Tourism&Leisure 2009).

§  The sources and amounts of “leakage” or “non-retention” in Siem Reap Town (SRT) and Siem Reap Province (SRP) as a whole in 2010 comprise:

(1)  the continuing import of required products and services from outside SR, especially from foreign countries (SRT: 52%, SRP: 43%);

(2)  the remittance of wages and salaries by Cambodian in-migrants and foreign staff out of SR (SRT: 24%, SRP: 8%);

(3)  the remittance of gross operating surpluses out of SR (SRT: 54%, SRP: 45%); and

(4)  taxes and other fees or non-taxes remitted outside the designated area

Negative Impacts §  Increased dependency on single-coined economy while

tourism is not widely used for multi-sectoral growth §  Cultural alienation and commoditization §  Homogenization of local identities §  Seasonal tourism wages due to impacts of using casual

labors

Negative Impacts §  Direct impacts of extractive

industries on tourist attractions & product development and diversification

§  Impacts from the uses of energy §  Overcrowded and pollution

§  Impacts from tourists and other human-induced consequences, i.e. commercialization of natural environment & biodiversity resources in an unsustainable way

§  Impacts of waste on tourism §  Impacts on wildlife & their behaviors

Challenges for Tourism Growth

§  Lack of direct flights from far away tourism market sources

§  Limited local connectivity §  Limited national airlines and

dependency on external investment

§  Lack of facility, infrastructure, and hospitality services at the international bordering gateways

1. Connectivity and Travel Facilitation

2. Human Resource Development

§  Lack of tourism professionals: 500,000 tourism workforces are required to fill the loop by 2020 (MoT, 2012).

§  Cambodian workforces enormously are employed in low-skill and operational skill levels within the industry.

3. Marketing and Promotional Aspects

§  Lack of promotional activities for secondary destinations. §  Lack of marketing campaigns at tourist generating regions. §  Lack of information and interpretation materials in each

province / destination / site (brochures, core maps of attractions, etc.).

4. Connectivity and Circuit of Attractions

§  Lack of connectivity among core attractions and secondary destinations.

§  Many potential attractions are not widely known. §  Lack of satellite attractions to develop extensive tourist visit circuits.

5. Seasonal Fluctuations & Impacts of the Global Economy

Other Challenges

Legal Challenges

Policy Challenges

Ins1tu1onal Challenges

Structural Challenges

Market Challenges

Implementa1on Challenges

Poli1cal Challenges

Technological Challenges

Capability-‐supported

Sustainability of CBT / CBET

Economic Development

HR Development

Community Empowerment

Community Health

Conserva1on

Mechanisms to Sustain Tourism Development

Inclusiveness

Innova1on

Resilience Green Approaches

Equity

Risk & Crisis Solving

Approaches

(1) Strategic Direction and Strategies

Tourism Product Development

Marketing and Promotion

Connectivity and Facilitation of travel and tourists transportation

Safety system and tourism negative impact management

Legal system and management mechanisms

Human resource development

1. Product Development & Diversification based upon Innovation of Sustainability

Small scale ecotourism

Large scale ecotourism

Agro-ecotourism

Community -based

tourism / ecotourism

The Emerging Trend of Community-Based Tourism / Ecotourism (CBT/CBET)

Source: MoT (2016)

New Customers, Emerging Destinations

The rising number of Asian travellers: “The Asian middle classes will make up the largest share of international travel” R. Conrady & M. Buck (2012).

Emerging Destinations

Creative Events

2. Marketing and Promotion

A Vision to Build Siem

Reap Angkor Region as

a Cultural & Economic

Hub of ASEAN

3. Connectivity and facilitation of Travel

3. The Facilitation of E-Visa Tourist Visa

Entry Single entry only

Fees USD20 + USD5 (processing charge)

Validity 3 months (starting from the date of issue)

Length of Stay 30 days

4. Tourist Safety System and Impact Management

§  Angkor Tourism Master Plan-Visitor Code of Conduct

§  Sustainable Coastal Tourism Management Committee

§  Green Hotel Standard

§  Others

5. Legal System and Management Mechanisms

Marketing Strategies for Emerging Chinese Market

6. Human Resource Development

§  There are increasing numbers of degree and non-degree tourism, hospitality and hotel management training programs in Cambodia.

§  Degree programs are normally provided by higher education institutions, while non-degree programs are usually established and supported by INGOs and NGOs running social enterprises, responsible ministries (i.e. MoT, MLVT, MoEYS), and private establishments, all are struggling to reach ASEAN standard for tourism education.

(2) One Belt One Road Initiative

(3) ASEAN Tourism Connectivity

(4) ASEAN Initiative: ASEAN Clean Tourist City Standard

§  Leading coordinator

§  With indicator, criteria,

implementation

mechanisms were

endorsed at ATF, 2014.

(5) ASEAN Initiative: ASEAN Community-Based Tourism Standard

§  The set of standard of community based tourism was developed with facilitation from Cambodia’s MoT.

§  The meeting on ASEAN community based tourism standard was held in 2014 in Siem Reap Province

Samples of Certificates

(6) Guidelines, M&E Toolkits and Scorecards for CBT/CBET

§  Were developed by Department of Tourism of

Mondulkiri and WWF-Cambodia with the

technical support from the Department of

Tourism of RUPP.

§  Aim at providing community roadmap of how to

basically develop CBT/CBET in an

entrepreneurial and sustainable way at local level.

§  Will be replicated at other CBT/CBET sites

across Cambodia

CBET Guideline Components

Phase 1

Feasibility Study

Phase 2 Formalization Procedure of

CBET Site

Phase 3 Formulation Sustainable

CBET Business

Phase 4 Sustainability Management

and Monitoring

Phase 1: Feasibility Study

1. General Poll

2. Resource Inventory

3. Stakeholders & Institutional

Analysis

4. Community Assessment

5. Market Assessment

Feasibility Methods

and Process

Phase 2: Formulation Procedure of CBET Site C

BET E

stab

lishm

ent

Step 1. Registration and Feasibility Study

Step 2. Zoning and Spatial Land Use Planning

Step 3. Establishment of CBET MC

Step 4. Formulation of By-Laws

Step 5. Formulation of Management Plan

Step 6. Stakeholders Endorsement and Implementation

Phase 3: Formulation of CBET Business Plan

Step 1: Envision CBET

Business Typology

Step 2: Develop vision and mission statement

Step 3: CBET Enterprise Description

Step 4: Value chain and

Green supply management

Step 5: Consumer care

and quality management

plan

Step 6: Sale and marketing

strategy

Step 7: Risk & crisis

management

Phase 4: Sustainability Management and Monitoring Plan

Step 1: Environmental & Biodiversity Conservation

Step 2: Visitor Management

Step 3: Community/Indigenous Empowerment

Step 4: Community/Indigenous Capacity Development

Step 5: Contribution to Community Welfare & Social Inclusion

Step 6: Respect of community/indigenous culture

Step 7: CBET Business Sustainability

(7) Principles for Agro-Ecotourism Development in Northeastern Cambodia

•  Crop diversification with rotational crop planting system, improve animal and human welfare

Organically-grown and managed farm

•  Water quality and soil fertility management, integrated land used planning, ecosystem approaches in agricultural production

CC response in agricultural practice and environmental

governance

•  Product development & diversification and quality improvement

Visitor and tourist experiences

•  Create strong linkage and network with other businesses Multi-sectorial integration

•  Create partnerships, networks, and consultation with government advisor, CSOs, CBOs, private sectors, etc.

Stakeholder collaboration

•  Build trust, ownership, capacity and capital investment, proper governance structure, business legal frameworks

Community empowerment and ownership building

•  Product development, marketing network, distinctive product branding, sustainable business models, extensive initial consultation

Market mechanisms

Agro-Ecotourism Development under 3 Scenarios Scenario 1: Community-Owned & Managed

Community Empowerment,

Ownership building

Stakeholder Collaboration

Organically-managed

farm

Climate Change

Responses & Environ.

Governance

Market Mechanisms

Visitor / Tourist

Experience & Satisfaction

Multi-Sectoral Integration

Scenario 2: Joint Venture


Ownership building

Market Mechanisms



Organically-managed

farm

Climate Change


Governance

Visitor / Tourist


Scenario 3: Private-Owned & Managed Farm

Market Mechanisms


Ownership building

Visitor / Tourist



Organically-managed

farm

Climate Change


Governance


(8) Private Sector Partnership Building and Public-Private and

Community-Private Sector Partnership

§  The Cambodia hotel association

§  The Cambodia restaurant association

§  Cambodia chefs federation §  Cambodia chefs association §  Cambodia E-Visa §  Business 2 Business The strong alliance of private

services provided in tourism

THANKS

review of cambodia’s tourism industry dr. baromey neth

Economy & Finance