Cambodians consumed by capitalism

HomeNewsroomCambodians consumed by capitalism

Cambodians consumed by capitalism

Cambodians consumed by capitalism

The Straits Times, TUESDAY, SEPT 30 2014

BRAND FACTOR

We see there's a lot more buying power than before. People can afford to pay so now's the time, we're ready for big brands so come here… Materialism is in peoples' hearts, what you wear, what you drive, represents what you are.” 

- Businessman Chy Sila


Construction activity and luxury cars are just a few signs of Phnom Penh's fast-changing faces.

PHOTOS: REUTERS

Urban boom and robust economic growth propel rise of consumer society

PHNOM PENH - Mr Chy Sila has come a long way since he invested his US$500 life savings in a small shop in Cambodia's capital to sell bootleg music and pirated movies.

Fast-forward 16 years and Cambodians are now watching the films he distributes on scratchy DVDs but in US$5 million (S$6.4 million) multiplex theatre, a joint venture with Thailand's Major Cineplex and the centrepiece of a new mall owned by Japanese retail giant Aeon.

The 39 year-old-former tour guide, university drop out and son of a mechanic is one of the biggest success stories in a country that was for years South-east Asia's war-torn, aid-dependant basket case. Though poverty is still rife in a countryside, an urban boom and robust growth fuelled by garment manufacturing for brands such as Nike and GAP has given rise to a growing consumer class that earns triple the average income. "We see there's a lot more buying power than before," said Mr Sila as he sipped cappuccino at one of the bakeries run by his CBM Corporation, Cambodia's biggest food and beverage firm.

"People can afford to pay so now's the time, we're ready for big brands to come here… Materialism is in people's hearts, what you wear, what you drive, represents what you are."

With a fast-growing population and falling dependency ratio, Cambodia's demographics are most favourable to rapid economic growth.

Young Cambodians buy smartphones, flat screen TVs and Japanese motorcycles. They tap banks for loans and credit cards and are fuelling the kind the kind of capitalist culture the Khmer Rouge killed two million people to prevent.

Mr Sila was born the same year the Khmer rouge swept to power and says he lost "countless" relatives to Pol Pot's genocidal regime.

Today's capitalist Cambodia, with an economy that averaged 8.1 per cent growth from 2000-2012 and expanded 7.4 per cent last year, according to the World Bank, is a far cry from what the Khmer rouge envisioned when its abolished money and property ownership, executed entrepreneurs and blew up the Central Bank.

Forty years after the population of Phnom Penh was emptied into labour camps, the city is swelling with malls, office towers, hotels and fast-food chains popping up rapidly. Modern SUVs cruise its once potholed streets.

The World Banks says the country of 15 million people is a top global performer in tackling poverty, having cut the ratio of poor from 53 per cent of its population in 2004 to 20 per cent in 2011.

Foreign direct investment has grown, from US$2.65 billion in 2007 to as high as US$10.8 billion in subsequent years, says the investment board. There is now a small stock market and the number of banks has nearly doubled in a decade. In the first half of the year, bank deposits grew 13 per cent and loans to the private sector were up 28 per cent, the central bank said recently.

But there are still many who do not have such privileges, and Mr Sila says he is saddened by the yawning gap between the rich and the poor.

Phnom Penh's newfound opulence can leave a sour taste in the mouths of those who struggle to get basic services in Cambodia, where hospitals are overwhelmed and average daily income is US$2.60- half that of Vietnam and a fifth of Thailand.

"Economic growth is only for the city," said rice farmer Heang Samnang, waiting with her sick daughter at Phnom Penh's foreign-funded Kantha Bopha Hospital, which provides free treatment to millions of poor. "In rural areas, there's no development, we just work on farms."