Siem Reap’s US$1bn airport delayed

No ground was broken in May on the New Siem Reap International Airport (NSRIA), a US$1 billion Korean investment, and officials say no definite date has been set for work on the project as the developer looks for new partners.

NSRIA Co Ltd, an equal joint venture by Camco Airport Co Ltd and Lees A&A, would not begin construction on the mega-project, for which a ground-breaking ceremony had been scheduled in May, Tek Reth Samrach, chairman of the airport steering committee, said yesterday.

The two companies, which last year were embroiled in a fraud scandal in Korea, were struggling with the project that would be the largest airport in Cambodia if completed, according to Tek Reth Samrach.

NSRIA has declined to formally notify the Cambodian government of its plans for the project, which was hoped to have a capacity of as many as 15 million passengers a year.

“We sent them a letter in early April but they replied unofficially, saying the company is facing some internal problems,” he said. “They are seeking a new partner now.”

The government has largely been left in the dark regarding details on the nature of the company’s ailments.

Tek Reth Samrach said he didn’t know which of the two companies would be seeking a new partner, or if one of the companies would be pulling out of the project.

Construction was expected as early as April, the Post reported in March.

At the time, the airport steering committee expressed confidence in the Korean company’s ability to see a timely start to the project despite a key Korean player being jailed in his home country.

Attempts to reach Camco Airport Co Ltd and Lees A&A yesterday were unsuccessful.

The companies yesterday appeared not to have websites.

NSRIA has yet to announce any new plans for groundbreaking this year, stoking some worry on possible long-term delays, the likes of which other Korean projects such as Camko City and Gold Tower have seen in the past three years.

“For huge investments such as this one, if they get suspended for two or three months, that doesn’t matter. But delays should not last more than a year,” Tek Reth Samrach said.

“On the government side, we already offered them the land for the development. We hope they can seek a new partner and start soon.”

The airport design has been submitted to Cambodian officials, the Post reported in March.

The government granted NSRIA a 500 hectare land concession in 2010. The site is 60 kilometres from the city of Siem Reap.

In March, NSRIA chief executive Lee Tae-hwan was sentenced to seven years in prison for involvement with fraudulent loans at Busan Savings Bank.

The scandal, which shook Korean financers and investors in mid-2011, put the brakes on Camko City, a $2 billion satellite city project in Phnom Penh.

Much speculation also surrounds the future of Gold Tower, a Korean investment in the centre of the capital, which has been a more than 30-storey stack of concrete and rebar since 2010.

Investors Yon Woo have routinely declined to comment on their plans for the project and government officials in the Ministry of Land management, Urban Planning and Construction have said they are unaware of the company’s plans.

A bigger airport would be needed to cater to the seven million annual tourists the Cambodian government hopes to receive by 2020, Ang Kim Eang, president of the Cambodian Association of Travel Agents, said yesterday.

Phnom Penh International Airport has a maximum capacity of three million passengers per year, he said.

“If we look at the target of the Ministry of Tourism, of course we need an airport with a big capacity so that we can attract more tourists to come to the country. We could welcome long-haul flights from the United States, Europe, Australia and so on,” Ang Kim Eang said.

Bangkok’s Suvarnabhumi Airport can receive 40 million tourists a year and Vietnam is now expanding its capacity to 15 million passengers, he added.

Sourced: Phnom Penh Post