The government has entered into negotiations with a Chinese airline to help resurrect Cambodia’s failed national carrier, government sources confirmed Wednesday.
Hainan Air, based in Hainan, China, has agreed to a $10 million investment deal to salvage defunct Royal Air Cambodge and create Air Cambodia, a civil aviation official said Wednesday.
Cambodia will have to come up with $4.1 million, or 41 percent, of the start-up capital, the civil aviation official said.
Reuters has reported that CTG, a Cambodian company, will pay another $1 million to help start the company, but that could not be confirmed Wednesday.
After a series of public embarrassments, including a fuel spill on a plane meant to carry King Norodom Sihanouk to Beijing, Royal Air Cambodge went on indefinite hiatus last year. Critics of the government called it an embarrassment to the country to not have a national carrier.
Reuters reported that among the unresolved details was the slimming down of Royal Air Cambodge’s staff from its current 400 employees. The news came as Prime Minister Hun Sen was praising the government’s so-called “open skies” policy as a boon to the economy.
“Some analysts criticized, saying that tourism in Cambodia will die,” Hun Sun said Wednesday during a nationally televised speech in Siem Reap. “In fact, there has been an increase.”
Tourism in the country rose 29.71 percent in 2001 compared to 2000, Hun Sen said. Most of those tourists have flown to Siem Reap province, but the whole country has gained from the new policy, the prime minister said. “The open sky policy has brought great benefit to the Cambodian people,” Hun Sen said.
The open skies policy allowed direct flights into different Cambodian airports, as opposed to requiring all foreign flights to land first in Phnom Penh.
Critics said the policy would simply concentrate money in tourist areas and leave the rest of the country mired in poverty, but all such critics have either been quieted or “have apologized for it to Hun Sen,” the prime minister said.
The government expects an airport expansion in Siem Reap to bring at least 1 million tourists to that province, home to the famed temples of Angkor Wat, and create even more jobs for Cambodians.
According to Hun Sen, building on the success of the open skies policy, the government should also begin easing border controls for travelers who wish to arrive by land or water.
China is not just a factor in the tourism picture because of the proposed national airline deal.
With China’s entry into the World Trade Organization, Cambodia stands only to profit, Hun Sen said. A wealthy China has the potential to send more than two million tourists to Cambodia per year, according to the prime minister. “I wish China to become rich,” Hun Sen said.
