Poipet: From gambling hub to an industrial boomtown
The town of Poipet, which hosts Cambodia’s main border crossing with Thailand, is located between Siem Reap and Battambang and has gained its popularity as a cross-border gambling destination.
Because most forms of gambling are banned in Thailand, for years the casinos just across the border in Poipet have been full of Thais trying their luck.
However, government plans are now in action to turn Poipet into an industrial zone. It is believed that due to this – and the town’s convenient proximity to Thailand – that investors will seek opportunities to invest in the town’s manufacturing sector.
Already infrastructure improvements are nearing completion, such as the railway link between Phnom Penh and Bangkok, via Poipet, and that has encouraged many to move to the town to pursue employment opportunities.
Once this railway link is completed, border trade between the two nations is expected to increase substantially.
Eric Wong, the administrator of the website SkyscraperCity Cambodia, said: “Poipet has seen remarkable development in recent times with the establishment of more factories and businesses.”
Mr. Wong’s family has invested in multiple businesses in Poipet due to the town’s strategic location next to Thailand and believes that border trade between Cambodia and Thailand is already growing.
The establishment of the Sanco Poipet Special Economic Zone (SEZ) in 2014 is one of the key reasons for this growth and acts as a vital economic trading gate between Cambodia and Thailand, and it’s poised for future development.
Soeng Sophary, a spokesperson for Cambodia’s Ministry of Commerce, said: “Thailand is one of the kingdom’s main trade partners with both governments enjoying very close and amicable relations.’’
Ms. Sophary believes that due to these strong government ties, the cross-border trade could increase to $15 billion by 2020. “The value of imports from Thailand has decreased marginally, due to the fact that more Thai investors are building factories in Cambodia,” she said.
“However, Cambodia’s exports to Thailand have actually increased.”
She also believes that the new railway will be a major catalyst for improving infrastructure and will aid both Cambodia and Thailand in reaching their trade goals.
In terms of Poipet’s real estate market, land prices are consistent and not seeing any signs of big increases.
However, Sorn Seap, the CEO of Key Real Estate, believes that prices will rise once the railway project is finished and more industrial activity takes place.
“Currently land prices for residential projects in areas without construction are between $200 and $300 per square meter, and in construction dense areas are priced between $300 and $500 per square meter,” he said.
“For commercial areas or downtown Poipet, prices range anywhere between $500 and $1,000 per square meter, while land prices along National Road 5 or close to the border can reach up to $1,000 and $2,000 per square meter.”
Although residential property development isn’t seeing any drastic growth at present, Mr. Sorn said he has seen a lot of progress, with a handful of Borey projects in the $50,000-$100,000 price bracket being developed.
He is convinced there is serious potential in the Poipet real estate industry in the future, due to increased employment opportunities from the existing SEZ and the government’s industrial plans.
Ultimately, more demand for labour in the city will lead to a need for residential housing.
Once the railway project is completed in 2018, it is predicated by real estate agents and experts alike that the increase of trade between Thailand and Cambodia will encourage a rapid influx of investors building factories in Poipet.
This will have flow-on effects of boosting the local economy and incomes across the board.
Ultimately, this casino dominated border town is rapidly changing and is anticipated to become one of the most attractive investment destinations in Cambodia in the years to come.