private island development in cambodia
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Private Island Development in Cambodia
By Sam Chanthy
Saang Saa Island Development of Bronco in Sihanouk Ville
or some regions, the investable islands are in a pristine, natural state. However, it is often not really expensive for those undeveloped islands, but very sensitively costly when it comes up with the development projects for them. The real estate in terms of
island usually poses distinctive challenges which depend on different geographical location and quality of the resources on the islands. Additionally, it also depends on the local government of the invested islands regarding their enabling environment including politic, policies, human resources, utilities and infrastructures; and Cambodia is exampled. These have contributed to the success and failure of the investment. This paper will brief some essential commitments for private island development in Cambodia such as approval processes, and first possible start‐up plan.
The earliest stage happens before the development of the investment project, and this is when investors need to make sure themselves to what level or how much of investment can be settled down. Some islands are really sensitive or fragile to their ecosystems or important tribes which careful operation is uniquely needed and thus, very expensive. Then, the first step before other works start is to gain the investment approval from the host government. Initially, the investors would study the existing policies regarding to island development and critically analyze the enabling environment. Also remember that it is an investment, and therefore the cost‐effective analysis is really crucial to balance the benefits and investing capital from up 50 years ahead. The process to obtain the approval differs from country to country where some is complicated and others are not. For Cambodia, investment financed for more than 20,000USD needs to apply for their investment application to Council for Development of Cambodia (CDC) where relevant ministries are assigned to assist. “One‐Stop” unit is the main channel for communication among CDC. For the last five years and now, the proposed investments are required to go through the Council of Ministers (CM) before working with CDC in details. Moreover, a new channel for investment opportunities is to gain the “green light” from the prime minister. Big corporations usually seek for a chance to greet and introduce their proposal to the prime minister for the sake of the obtaining the principle support from the top decision‐maker.
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Later, the project proponents develop their proposal on their own with the assistance from the government. Sometimes, they hire a local consulting firm to help in terms of legal procedures and compliance, and ensuring other risk management. When the proposal and application are ready, it is submitted to CDC for the review and comment from the relevant ministries coordinated by CDC. If the initial proposal is applicable and accepted, project owners are required to submit the full version. For island development, environmental impact assessment (EIA) is needed, according to the 1999 sub‐decree no. 72, as there will be EIA‐required development plan. The required documents are then reviewed, analyzed and decided whether it cannot or can go ahead with minimum social and environmental risks in Cambodia. Department of Environmental Impact Assessment, Ministry of Environment, is the single government unit which mostly involves in the development processes, in comparison to other departments. For EIA approval, it takes nearly 60 working days.
The real world of island development starts when the permits, and master plans, are approved. A general clean up will be done especially for the islands which have not uninhabited, cared, or just currently been subjected to floods or storms. Clearing brush to leave a clean canvas for your development can be labor‐intensive, but will generally not be an expensive project. After the land has been cleared of fallen branches and other detritus, a clearer picture should be available of potential building sites, and any areas that may need to be filled in to even out the terrain and stabilize ground for construction. At this point in development, some basic landscaping such as creating sand beaches and planting trees can be started.
The following is the Basics of Private Island Development1 throughout the globe which can be taken into account for Cambodian circumstances.
• The next step for many filling land essentially requires that materials such as dirt or silt be transported to any areas of the island that are uneven or waterlogged, leaving a stable, smooth terrain for construction. While also applicable to many temperate islands in marshy areas, it is quite common for low‐lying tropical reef islands in regions like Belize to require a complete or partial fill prior to any sort of development. The fill can be moved from higher elevation parts of the island, purchased from a local construction materials supplier, or in some cases, dredged from the surrounding lake or ocean floor. The type of dirt most effective in use for fill is often subsoil, the layer of earth found below lighter, more organic topsoil. The heavy, clay‐like consistency of subsoil ensures that it will stay in place and not be weakened by construction or erosion, and the lack of decaying organic components such as mulch and dead leaves means that the fill will be free of destabilizing air pockets. As a finishing touch, it is often recommended that completely filled islands be planted with deep‐rooted trees, to prevent erosion and give the soil added stability.
• After an island has been cleaned and filled, it’s time to bring in the necessities of life such as sewage, potable water, and electricity. The difficulty involved in developing utilities on an island is largely dependent on how far the island is from an urban center, and what kind of infrastructure is available on the mainland.
1 Source: http://articles.privateislandsonline.com/island-industry/the-basics-of-private-island-development-part-one-of-two/
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• Once wild and untamed, the island is now ready to build on, and outfitted with virtually all of the necessities for survival
• The process of transforming a pristine, untouched island into a hospitable place for vacation homes, resorts or even permanent residences can be an intimidating task, but as the first installment of The Basics of Private Island Development has shown, there are a variety of resources available to help ease the process. Your local agent is an invaluable source of contacts and information, and from obtaining permits and utilities to clearing, filling, and landscaping an island, all aspects are simplified by learning as much as possible about the challenges of island development, researching portable, “green” technologies, and cultivating helpful relationships with your new neighbors. Some investors may wish to stop at the partial stage of development, which adds a significant premium to islands for resale, but much work remains for those seeking additional profits or who intend to use the island personally. This article will cover constructing residences, docks, and the growing trend of private island airstrips and helipads, and the environmental and financial considerations associated with these developments.
• Excessive development carries hidden hazards for the island’s ecological stability, as well. An isolated and relatively self‐contained ecosystem, every aspect of the island’s wilderness has evolved to fulfill a unique function in maintaining a general health and balance. A prime example, the intricate tangles of mangrove forests that encircle many properties have often been removed entirely to make way for sandy beaches, and were long considered the bane of constructing in southern areas. However, total eradication of these forests may actually endanger the future of some islands. The root systems of mangroves not only act as a habitat for a variety of wildlife such as water birds and fish, but function as a barrier against the tumult of the surrounding waters, preventing waves and storm surges from eroding the island’s coastline. In anticipation of the increased sea levels and hurricane activity predicted in climate‐change scenarios, countries ranging from Italy to Indonesia are now replanting these much‐maligned forests to take advantage of the natural protection they offer. Similarly to mangroves, native trees and other deep‐rooted plants are increasingly being preserved during development by owners who are wisely conscious of the dangers posed by erosion.
• The growing culture of environmental awareness among private island owners doesn’t mean that new construction is restricted to primitive thatched‐roof huts, however. Proving that “eco‐friendly” and “high‐tech” aren’t mutually exclusive concepts, the new wave of easy‐to‐transport modular residences are bringing a touch of luxury to “green” living.
• Construction of a dock on an island differs from that of mainland property in that it
isn’t a luxury or afterthought, but a necessity that the safety of the island’s users will depend on. When establishing a location, several critical factors should be taken in to account: wind, water depth, available natural harbors, and the stability of the connecting part of the island. A dock should be placed on the side of the island with the most shelter from the wind, and if the water depth allows it, in a natural harbor or cove. Water depth is particularly important for dockage‐ for example, a 20‐ft boat will require at least five feet of clearance to safely dock without risk of getting stuck or damaging the hull. For a smaller craft, such as a small speedboat, three feet may be sufficient. If the water depth deepens significantly within 100 feet of the island, a longer type of dock may be employed to allow for larger sizes of boats. While some
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outside assistance may be required for traditional construction, a wide variety of new modular styles like the Mod‐U‐Dock may be assembled in a short period of time with minimal labor.
Final remarks
Cambodia has covered comprehensive regulations in executing the island development. Private island development requires structural approval to some extent, however; there is a short‐cut to smooth the process, resting on the political relationship or support with the political alliance, especially the ruling party.
There are lots of ground technical works to be done after the development project has been approved. The main challenging works are commonly seen as clean‐up on the ground on the islands, transportation of the materials for constructions, or other utilities needed for the development on the islands, and construction of docks. Along with these tasks, the project owners need to take into account of the traditional, cultural and local wisdom in regarding of the social and environmental aspects. In context of Cambodia, social, cultural and environmental best practices are usually ignored and not fully exercised due to the lack of rule of law. Development has driven the government’s plan to boost the economic growth, while not stabilizing the check‐and‐balance across the country. So‐far experiences have indicated that development would benefit some groups of people, while usually the majority has been the victims. Additionally, the major concerns toward island development in Cambodia are 1) weak rule of law, 2) weak institutional arrangement (mainly institutional capacity, and policies and other relevant regulations), 3) external influence from private donors or sectors, and finally 4) ineffective sound development exercises. These are obstacles require more attentions from government, NGOs, donors, and especially the local communities.
Updated list of island investments in Cambodia, 2009
Note: N/A: Not Available
Source: The Cambodia Daily, Phnom Penh Post, and Reaksmey Kampuchea in 2008
No Name of Island Investment Projects $ Invested Investing Firms Duration Sizes and Locations Timeframe
1 Koh Russey Resort Investment Project 48 millions Koh Russey Resort Co Ltd (A Singaporean City Star Private Equity Asia Company)
99 years 78 out of 137 hectares (Bamboo Island)
Already approved on Thursday, February 28, 2008
2 Koh Rong Natural Resort Investment Project
N/A Royale Groups 99 years 7826 hectares (Sihanouk Ville)
3 Koh Puos Resort Investment Project 300 millions Koh Puos Investment Group (Russian Firm)
99 years Snake Island (Sihanouk Ville) Already approved in September 2006
4 Koh Pous Bridge Construction Project N/A Sinohydro Corp 2 years 950‐meter length and 32.5‐m height (Sihanouk Ville)
Already approved in June 2008
5 Koh Sesh Resort Investment Project 500 millions Vimean Seila Co. Ltd 99 years 700 hectares (Kampot Province)
Starting from 2008‐12
6 Koh Kong Commercial and Tourism Development Project
300 millions Tianjin Investment Development Group (Chinese Firm)
99 years 30000 hectares (Botum Sakor and Kiri Sakor Districts)
Proposed starting in January 2009
7 Ream Beach Resort Development Project N/A Ream Resort and Development Co. Ltd
99 years 140 hectares (Sihanouk Ville) Started in November 2008 (expected to finish by 2010)
8 Koh Sramoach Investment Project N/A Ream Resort and Development Co. Ltd
N/A 43 hectares (400 m from the beach in Khan Prey Nop, Sihanouk Ville)
N/A
9 Koh Oun and Koh Bong Investment Project (Saang Saa Project)
35 millions Australia Brocon N/A Sihanouk Ville Expected to finish by 2010
For more information, please contact: Cambodian Environmentalist Alumni (CEA) Tel: 012 757 614 E‐mail: [email protected] Cambodian Volunteers for Society (CVS) Tel: 012 708 093 E‐mail: [email protected] Conservation and Development on Cambodia (CDCAM) Tel: 012 932 804 E‐mail: [email protected]