As Free Man, Polonsky Plans Tourism Mecca

Sergei Polonsky, a Russian fugitive and former billionaire real estate magnate who was recently released from prison in Cambodia, has grand plans for a string of islands off the coast of Sihanoukville.

Less than a month after the Supreme Court refused to extradite him to Russia on charges of embezzlement, Mr. Polonsky says he wants to boost the tourism industry by creating a tourism mecca off Cambodia’s southern coast.

“I have eight islands off the coast of Sihanoukville where I’m planning to make my investments,” Mr. Polonsky said this week by email.

“I am already negotiating with tour operators and tourism developers in the country. Next year, we plan to bring about 50,000 tourists to Cambodia. I believe the people visiting have to see more than just the temples of Angkor and then go to spend the rest of their holidays on the beaches of Thailand and Vietnam,” he said.

Mr. Polonsky, who is still facing charges of assault in Preah Sihanouk provincial court for allegedly threatening six Cambodian boatmen with a knife, says his investment plan—dubbed Archipelago—will help bring millions of tourists to his islands off Sihanoukville’s coast.

“We are talking around three million people per year who are missing out on a lot of beauty because of underdeveloped infrastructure and the lack of service and safety,” he said. “My calculations show that within [the] next five years it is possible to triple the revenues from tourism here in Cambodia.”

But Mr. Polonsky’s plans include more than beautiful beaches and tourist retreats.

“Amongst everything else, I want to build a kindergarten and a school and I also hope that I will be finally able to make my dream of building a university come true,” he said.

Mr. Polonsky said his plans also include turning the islands into a refuge for a group of travelers rather like himself—people seeking an escape from legal troubles in other countries, particularly from Russia.

“Cambodia has no extradition agreements except for the four neighbor countries, and now that we have a precedent in a form of the judgment of the Supreme Court, this will attract people for whom the costs of legal services in England are getting too steep,” he said, referring to the Supreme Court’s decision not to heed Russia’s request to extradite him.

“In other words, we are looking at an opportunity here for creating separate areas for small and medium businesses in the form of legal tourism,” he added. “I also want to create a support center for the Russian-speaking tourists who want to buy property or become Cambodian citizens, including full legal support of a particular procedure.”

With Archipelago, Mr. Polonsky appears to be pursuing a promise he made during his initial extradition hearing in January, when he told the Court of Appeal that he would invest $1 billion in the country if he were allowed to stay.

The former Russian real estate mogul is wanted in Russia on charges of embezzling more than $180 million from more than 80 investors in two separate Moscow development projects.

Russian authorities in November and in April sent extradition requests to Cambodia, but the country’s top courts rejected both, citing the assault case he faces in Cambodia as well as there being no extradition treaty between the countries.

Even if Mr. Polonsky is able to overcome his legal woes, industry experts and local officials remained skeptical—albeit hopeful—about Mr. Polonsky’s vision for the currently undeveloped islands.

Ho Vandy, co-chair of the Government-Private Sector Working Group on Tourism, said Mr. Polonsky’s ambitious plans would likely require public sector support.

“It is easy to talk, but hard to do. I [will] look to see the results coming out,” he said. “It’s ambitious and the government or public sector should be involved.”

Sbaong Sarath, who was replaced as governor of Preah Sihanouk province earlier this month, said he had no doubt that Mr. Polonsky was serious about his plans, but they may take a while to materialize.

“I really think it is a good idea. I think he can convince a number of people to come,” Mr. Sarath said.

“As a rule, since he announced his plans, he will likely carry them out,” he added. “It is just that he might need more time.”

(Additional reporting by Phorn Bopha)

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