The Royal Group of Cambodia’s plans to build a 300-room, four-star hotel near the famed temples of Angkor were torpedoed by Prime Minister Hun Sen, according to a broadcast Monday on TVK.
Hun Sen cited “irregularity” in the Siem Reap project’s approval process, dealing a blow to the prominent Cambodian firm’s diverse interests that include retail sales, mobile phones, and real estate.
Government officials said the agreement that allowed the project to begin primarily involved local Siem Reap officials and the company, and too little consultation with Phnom Penh.
Hun Sen issued a sub-decree Dec 30 that canceled a lease agreement on 50,000 square meters of state-owned land between the Royal Group and provincial authorities. The sub-decree also annulled approval by Siem Reap authorities on letting the firm develop a hotel on the property, according to the TVK broadcast.
Hun Sen further ordered that the land should be returned to the province and that management of it should be handled by the Apsara Authority, the government’s top supervisory body for the temple area, the announcement said.
The planned hotel site is adjacent to the football stadium on the outskirts of the town en route to Angkor Wat.
A government spokesman said Monday that the firm has not obtained approval for the lease of the state property from either the Council of Ministers or the Finance Ministry, which manages state property, noting approval from a local governor alone is not enough to carry out the project.
“You must go through the Council of Ministers and the Ministry of Finance in a case that you lease, sell or buy state property,” said the spokesman, who asked not to be named.
The official pointed out that the National Assembly passed a state property law early 1998 that requires such approvals from the government.
“[The approval by the local authority] was a ‘parachute’ contract that an investor drops in without going through the proper channels. That company made a mistake,” he said.
Nov Sam, former first vice governor of Siem Reap and current Battambang governor, admitted Monday that there was “irregularity in the procedure” for the hotel deal, but did not elaborate.
“Prime Minister Hun Sen’s decision was right….We should’ve protected the cultural heritage,” said Nov Sam, a CPP-appointee who was one of the most influential people in Siem Reap for more than 10 years until he was relocated last year.
The company, however, on Monday defended its record. It claimed it received an investment approval from the Council for the Development of Cambodia—a government agency that registers investment projects—in addition to the local authority’s green light.
“We’re professional and always abide by laws. We have done nothing wrong,” said a company official, who asked not to be identified. “If the local authority made a mistake, the government should punish officials involved. They should not punish the investor.”
The plot of land is home to a “conference hall” built in the 1960s and is considered to have national heritage value, the TVK broadcast said.
Siem Reap authorities made a lease agreement with the company for the hotel development in June 1998 and issued an approval letter in January 1999 to allow the development, according to the announcement and the copy of the lease agreement. The Royal Group established the Royal Heritage Hotel Company to carry out the project in February 1999.
Although the Royal Group had not received permission from the Council of Ministers, the CDC approved the $20 million hotel development project on Jan 25, according to a copy of the approval obtained from the Royal Group.
“The CDC approved the project after reviewing all the documents we submitted, including the land lease agreement,” the company official said. “I don’t understand why now the government wants to stop the project.”
The only official comment Royal Group Chairman Kith Meng would make was: “I will follow whatever Prime Minister Hun Sen decides.”
Suy Sann, second deputy governor of Siem Reap, confirmed Monday that the local authority has taken back the ownership and given the management to the Apsara Authority as of Dec 30.
“The building is very important for Siem Reap because the building is one of Cambodia’s heritage. It’s not good idea to knock down the building,” said Suy Sam.
“If we rebuild the building, it would cost millions dollars…. We should preserve the building,” he said. (Additional reporting by Ham Samnang)