Concerns linger as Russian island development begins

An artist impression of Koh Puos development.

By Neth Pheaktra
The Mekong Times

A Russian company held a ground-breaking ceremony Saturday for a US$300 million island resort project off Cambodia’s southwest coast, despite one of its partners now being in jail for sex crimes. Political opposition has alleged that the government was involved in “serious corruption” during the bidding process of the island purchase.
Prime Minister Hun Sen presided over the ceremony marking the start of work on a 900 meter bridge that will link Koh Puos (Snake Island) with a coastal beach in Sihanoukville. Koh Puos Investment Group (KPIG) has a contract to develop and manage resorts on the island for 99 years.
At the ceremony, Prime Minister Hun Sen said he considered Sihanoukville a “multi-pole economy including tourism, ports and Special Economic Zones.” The premier called the area the “dragon’s head” of Cambodia’s economic growth, inviting other investors to develop Cambodian islands.
Sun Chanthol, minister of public works and transport, said the Koh Puos Bridge – built 32 meters above the ocean to allow cargo ships to pass underneath – will “play a key role in the transport system linking Sihanoukville and other areas to Koh Puos, serving the tourism sector and increasing jobs.”
The bridge will cost about US$31.3 million and be completed at the end of 2010, he added, saying it will help develop Koh Puos “into a world-class resort.”
Chepa Alexey, president of KPIG, said 20,000-25,000 jobs would be created by the project.
However, dark rumors surround KPIG, run by a group of Russian businessmen, according to its website.
One of the group’s partners, Alexander Trofimov, was sentenced in March by a Cambodian court to 13 years in prison on charges of sexually abusing a 14-year-old girl.
Trofimov was arrested last October over allegations that he had abused as many as 19 girls since 2005, but was charged only in the case of the 14-year-old. He has protested his innocence.
Opposition Sam Rainsy Party parliamentarian Son Chhay alleged that island developments have been granted to firms with no experience or resources for development through non-transparent bidding. He requested the government should require development plans before granting permission to any firm to invest.
However, Deputy Prime Minister Sok An rebutted Son Chhay’s allegations in a lengthy letter. “A case of lease is different from that of sale,” he wrote. “Usually, leasing does not involve bidding. It is necessary to carefully select investors, because some islands are located near borders.”
Prime Minister Hun Sen stressed at the groundbreaking ceremony that Cambodia does not sell islands, echoing Sok An’s clarification of the difference between sale and lease. “Cambodia does not sell islands but allows investment concession like in other countries … such as for islands in Thailand and Malaysia,” he said.
Son Chhay was unconvinced, alleging that the leasing process was also dubious. “The clarification is clearly indicative of serious corruption in leasing the islands to foreigners,” he said. “We are still concerned about investment in islands if there is no clear information about the [development] plans and no environmental impact assessment.”