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Wat and the surrounding temples of Angkor. Although tourism has helped to develop the economy of Cambodia, it has also brought negative impacts onto the country in terms of tourism sustainabilty, culture as well as socio-economy. This report is to cover five project scopes which are: 1. PESTLE analysis of Siem Reap s tourism industry 2. Performance evaluation of Cambodia s hospitality product 3. Sustainable tourism of Cambodia 4. Impacts of globalisation on Cambodia s hospitality and tourism industry 5. Harmonisation between tourism and the culture, religion and socio-economy of the local commnuity A research trip to Cambodia was organised on the 11th to the 14th of February 2011 for the purpose of gathering information for this project. Information regarding the project was gathered through an interview with the Revenue Manager of Le Meridien Angkor, conversations with the tour guide as well as observation.
Executive Summary In relation to PESTLE analysis, the government is pro-business, prioritising land for the development of business and encourages the entry of international companies. However, the technology of Siem Reap is insufficient to support the needs of the international hotel chains with the Internet service being insufficient to allow connection to the hotel chain s server as well as the electrical grid of the country being unable to support the demands of the larger industries. In relation to the performance evaluation, the mid-scale and budget accommodations are performing to the satisfaction of the tourists. However, there are some limitations to the actual reflection of the performance of the hospitality products. Although preservation and restoration efforts are in place, the lenient enforcement of regulations has led to the damaging of the temples. Also, poor environmental management may lead to more damaging effects on tourism. Globalisation has changed the socio-economy of Cambodia with locals moving from agriculture to the business industries such as retail and hotels and restaurants. The tourism industry has also affected the culture, religion and socio-economy of the local community with celebration of new cultural events such as Christmas and New Year s which was previously not celebrated by the local community.
1. 2010).2 Economical In view of the financial crisis.5% in 2007 (Central Intelligence Agency. the government would approve the entry of the international company into Cambodia. 2011).0 1. As the hotels employ Thailand as a supplier for raw materials. 3 . occupancy for hotels in the area fell by 20% for the same period as the year before due to cancellations of bookings caused by the financial crisis (Orta. one condition to opening in Cambodia was that the foreign investors cannot fully own the land they operate on in the country.1 PESTLE Analysis of Siem Reap Political In the interview with the Revenue Manager of Le Meridien Angkor. This may suggest that there are more workers available for the hospitality industry to employ. Orta (2011) stated that when the hotel was first built at that time. The political situation with Thailand at the border has also affected the industry. The unemployment rate has increase from 2. leading to international companies using joint ventures with local operators to open up hotels. If the company had the finances as well as a feasible business plan. Other areas of Cambodia are safe for travel. Orta (2011) further mentioned that the financial crisis has made it more difficult for hotels to attract single customers and frequent individual travellers.5% in 2000 to 3. the government was open and encouraged the entry of international companies and chains into the country to develop hotels in order to boost the tourism sector of the economy. 1. For one. However. However. Orta (2011) stated that there had been a decrease in arrivals from Thailand to Le Meridien. the industry has not been heavily affected by the war with Thailand and only the area surrounding the temple at the border is affected by the fighting. the border war with Thailand may affect the supply of raw materials to the hotels as Thailand may decide to stop supplying to Cambodia.
the applicant must fulfil the requirement of having a high school graduation certification and must be able to converse in English as well as in the Khmer language. Health is also an issue in Cambodia with a lack of adequate sanitation as well as low accessibility to clean water (UNICEF. Another option is to obtain electricity supply from Thailand through underground cables. the Internet service quality is insufficient for the hotel to be able to connect to the hotel chain s server in Bangkok which caters to 8 other Starwood Hotels in the region. If foreigners such as Japanese or Koreans were to apply for a Cambodian tour guide 4 . 2010).5 Legal In order to obtain a license to become a tour guide operator.4 Technological Orta (2011) stated that the Internet service has improved within the region of Siem Reap over the years. This may lead to low skilled workforce who requires training before being competent to work in the hotels. Thus. 1. education levels in Siem Reap are generally low due to the quality of the national schools and the low level expenditure provided by the government for education. which is the case with Le Meridien Angkor. Le Meridien Angkor has had to run its own server in order to cope with their Internet bookings and other uses. 1. However. This has led to some hotels to rely on diesel powered stations to generate electricity as the country s own power grid is not sufficient to cope with the demands of large industries. Because of this. Jet.3 Socio-cultural According to the tour guide. The electric grid of Siem Reap is also insufficient to cope with the demands of the hospitality industry (Orta. Furthermore.1. diseases such as HIV/AIDS and malaria affect the local community of Cambodia and will affect the productivity of the workforce. 2011). the license is valid for two years only while the renewal period for the license is two years.
As more hotels build in the area. hotels in the area will have to find a new source of water in the event that the underground water supply finishes. There is a possibility that in the short run. 1. pollution has increased as a result. The increase in large organisations requiring the diesel station for electricity has led to an increase in air pollution in Siem Reap. Thus. hotels are unsure of the amount of water that is remaining in the underground sources. Orta (2011) stated that the underground water supply within the area was unknown and that hotels have been digging underground to obtain water. more water is being used. 5 .license.6 Environment Hotels in the Siem Reap area have to be aware of the problem regarding the water supply. they would have to first apply to work with a local tour guide operator and will be required to undergo the same process of obtaining the license as the locals. Due to the usage of diesel powered generator stations for electricity.
personal details such as nationality. which it is Siem Reap. safety and security. and these questionnaires were answered by different segments of tourists that consist of the groups of segments mentioned earlier. cleanliness or hygiene.0 Performance Evaluation of Hospitality Products This area is mainly focus and evaluate on the tourism industry s performance in Cambodia. and this evaluation has conducted in one of Cambodia s provinces. accommodation and food and beverages outlets. entertainment. the reasons for tourists to visit Cambodia. Nationality Grouping 16 14 14 12 10 10 8 6 4 2 0 European Asian Oceania 1 Number of participants 6 . The tourists questionnaire was divided into three different parts. The result and conclusion of this evaluation is mainly based on the answers and results that answered by the tourists in Siem Reap through the questionnaires that had created earlier before conducting this evaluation. These segments were used to evaluate the overall performance in the city of Siem Reap.2. Total number of questionnaires have collected during the survey in Siem Reap is 25. and the rating for overall performance such as transportation. age and type of accommodation.
Indonesia. Switzerland. This number has included various countries in Europe such as Britain. However. and New Zealand. there were only 11 Asian tourists answered the questionnaire in Siem Reap. Vietnam. however. But based on the observation in Siem Reap. Germany and more. Korea. small groups and couples. and they are from countries such as China. Korean and Japanese tourists have the largest group of tourist amount. there were 14 Europeans had answer the questionnaire. The tourists that answered these questionnaires were mostly backpackers.Age Groups 12 10 8 6 4 4 2 0 20-29 30-39 40-49 50-59 60-69 3 4 3 Number of participants 11 Accommodation Type of Participants 18 16 14 12 10 8 6 4 2 0 Budget Mid range Luxury 0 8 Number of participants 17 Based on the data that has collected earlier in Siem Reap. France. there was only one questionnaire 7 . Denmark.
This survey were mostly questioned and answered by budget tourists or travelers as most of them were backpackers or individuals. and they were mainly visiting Cambodia for leisure purpose. The least number of age groups are the groups of age between 40 to 49 years old and 60 to 69 years old. age group of between 20 to 29 years old was the largest age group during the data collection. Based on the findings and survey in Siem Reap. however. which come with the number of 17 tourists out of 25 tourists. most of them preferred mid range or three to four stars hotels as their accommodation during their visit in Siem Reap. The age groups that follow by the group of 20 to 29 years old is the age group of between 30 to 39 years old and 50 to 59 years. and this was the limitation for us to collect the answers and data from these large group of tourist. and it is because there was a language barrier during the survey answer collection with them which they only able to understand the very minimum of basic English. other tourists which are the 8 tourists had preferred budget or guest houses or one to two stars hotels as their preferred accommodation during their visit.answered by one Korean tourist through all groups of Korean and Japanese tourists. and each of these groups have four tourists that answered the questionnaires. Would You Visit Siem Reap Again? 16 14 12 10 8 6 4 2 0 Yes No Number of participants 8 . There are various and different types and groups of tourists in Siem Reap.
accommodation.5 1 0. safety. However.5 4 3. Another reason to the declined offer to return to Cambodia was that the tourists wanted to visit other places around the world. and above all segments and areas. 9 . the other 10 tourists would not like to visit to Cambodia or Siem Reap again as it is because there is lack of entertainment facilities such as night clubs and attractions which are the younger generation s main preferences during their vacation to other places.According to the answers that have collected during the survey in Siem Reap. the performance rating for overall performance in Siem Reap which included the segments such as transportation. and the area which has the lowest score.5 2 1.24 4.2 Based on the ratings that have collected during the survey in Siem Reap. entertainment.72 4. and food and beverages outlets.5 3 2. These tourists are in the group of age 60 years old and above.5 0 4 3. cleanliness. and most of these tourists are in the group of age in between 20 to 59 years old. 4. the reason are due to local people s friendliness and also the Angkor Wat temples. which it also gave bad experience and impression to tourists is the cleanliness and hygiene of the area.04 4.04 3. the area that has highest score in term of the most happy experience that experienced by the tourists is accommodation. 15 of the tourists would like to go back to Cambodia to have second or more visits.
Mr. and this has led the people including tourists to dispose their rubbish along the road side. Based on the answers and ratings that given by the tourists in the questionnaires. during the two week peak periods that the industry experiences. the tourists feel safer walking around Siem Reap. not considering the other lower rated hotels and guest houses that are existent. Also. According to Orta (2011). hygiene and cleanliness in the city of Siem Reap is the area in need of improvement compared to all other areas that has mentioned earlier. and there is no proper area or site which able to let local residents and tourists to dispose their unwanted stuffs or rubbish. the local government has increase the amount of police in the city of Siem Reap as it is because of the increase in the number of tourists arrival in every year. 10 . This is due to the oversupply of accommodation facilities in the area. That is one of the reasons why some tourists in Siem Reap would prefer walking to the destination instead of taking tuk-tuk. However. the main concern for tourists is the safety issue with the tuk-tuk. the ride may be bumpy and unstable and may not be safe to use a tuktuk to reach the destination. it is because there is no enforcement of having recycle bins or normal dustbins on the streets in Siem Reap. as roads are less developed. occupancy for the hospitality industry is estimated to be around 50% every year. The tuk-tuk which resembles a trishaw attached to a motorcycle does not have the safety equipment such as seatbelts such as that of taxis and buses.Transportations for tourists to travel around in Siem Reap is mainly supported by the local tuk-tuk. Because of this enforcement that has been done by the local government. According to the tour guide. if all incoming flights into Siem Reap were full. the number of tourists that would arrive in Siem Reap would only be able to create 80% occupancy for all luxury hotels in the area. Jet. Orta (2011) stated that in his calculation previously. due to it is easy to travel around the city and price for tuk-tuk is very affordable for tourists at the lowest cost of 1 US Dollar or more for one to another destination.
The large crowds have made it difficult for the enforcement of regulations such as the prohibition of touching the walls and artwork of the temples which has led to the artwork of the walls to be discoloured due to the visitors actions of touching the design of the artwork on the walls. Due to the large numbers of visitors visiting the temple daily. Thus.0 Issues in Tourism Sustainability One issue pertaining to sustainable tourism is the lack of restrictions as to how many people can enter into Angkor Wat as well as the other temples in the nearby area such as Angkor Thom and the Bayon Temple.3. the large crowds entering into the temples daily have also caused damage to the archaeological sites of Angkor as tourists walk and climb the sandstone monuments 11 . Also. There is no limit as to the number of people who can enter into the area daily to visit the temples. This has led to other problems pertaining to the preservation of the temples as well as defacement of the temples walls. visitors are not fined or reprimanded by the local authorities when they do not follow the rules to visiting the temples. the enforcement of rules and regulations pertaining to how visitors should dress or behave while visiting the temples have been lenient. The picture above shows an example of the type of defacement tourists have done to the temple walls due to the lack of strict enforcement of regulation. It has become difficult for the local authorities to catch visitors disobeying the rules due to the large number of tourists that visit daily. because there are no restrictions to the number of people who visit the temples.
damaging the structure of the temples. According to Sharp (2008). the movement of workforce from rural areas to cities would affect the continuity of local supply of raw materials to organisations in the hospitality industry that rely on local suppliers. In an interview with the Revenue Manager of Le Meridien Angkor. most hotels do not undertake measures to encourage guests to care for the environment such as putting up signs to encourage guests to reuse their towels or distributing brochures to encourage tourists to partake in the hotel s eco-tourism measures. this leaves the older generation to work for the agriculture industry. As the younger generation move into the cities and away from the agriculture industry areas. The extracting of water from underground sources has led to instability within the ground supporting Siem Reap and 12 . the development of hotels in the area has led to decrease in underground water supply beneath the urban areas as organisations dig underground for water supply. 2008). in the long run. The influx of tourists to visit the temples has caused extreme pressure on the temples sandstone monuments. However. recycling is not emphasised as there is no separation of trash bins into the various recycling materials such as paper and plastics.located in Angkor (Sharp. The movement of workforce from rural areas to the city may also affect the sustainability of tourism. As the young adults move from the rural areas into the city to find work. Thus. they no longer work in the agriculture industry. The development of hospitality and tourism in Siem Reap may also affect the sustainability of tourism in the area. Few hotels are involved in environmental management. This would affect the hospitality industry as the agriculture industry represents a supporting industry for the organisations in the hospitality industry in terms of supplying raw materials for food items. Le Meridien Angkor annually sets targets for reducing their water and electricity usage and intake. For example. As it appears. Thus. the hospitality industry may no longer to be able to rely on the local agriculture industry for raw materials as the agriculture industry may not have the necessary workforce required to help support the supply demands of the hospitality industry. Orta (2011) stated that the hotels as well as restaurants rely on local suppliers for food materials.
While the tourists walk through the temples. The increase in tourism has also led to the pollution of the temples. if the government does not control the water intake of the hotels and organisations in the area. 2008) and Takahashi (as interviewed in Sharp. 13 . the stability of the ground in the long run will be affected and may lead to the destruction of the temples as the ground crumbles underneath the weight of the temples. The large influx of tourists arriving in groups to Angkor Wat and its surrounding temples have caused the walls of the temples to be discoloured due to the pollution which is caused by engines of the tour buses of the tourists. the engines of the tour buses are left running in order for the air conditioning within the bus to work to keep the bus cool. This has caused the walls of the temples to turn black due to the pollution caused by the running engines of the tour buses. According to Jinnai (as interviewed in Sharp. 2008).in particular the temples of Angkor.
has cooperated to restore the structure of the temples. 14 . Construction has already started on Angkor Wat. the Cambodian government together with non-government organisations such as UNESCO and the World Monument Fund as well as the funding from other countries such as Japan and Germany. The pictures from the previous page as well as above show some of the preservation efforts of Angkor Wat and the surrounding temples by non government organisations such as World Monument Fund and UNESCO.In relation to the preservation and restoration of the temples.
0% to 60. retail trade. Thus.3% in 2004. In the same period of time. there has been an increase in employment in the wholesale. the increase in international hotels entering into the country due to globalisation has led to the movement of workforce from rural areas focusing on agriculture into the major cities focusing on business and tourism. restaurants and hotels industry of Cambodia. these foreign labour have been 15 . According to Orta (2011). In 2002. the younger generation (from rural areas). Thus. Fewer chances are given to the locals to be promoted.4% but the rate increased to 14. The employment of the agricultural sector of Cambodia has been on a decline since year 2002 from 70. globalisation has led to the increase in foreign labour into the Cambodian economy.5%.4. 2009 The table above shows the percentage of employment by industries of countries involved with ASEAN. In the hospitality and tourism industry.0 Impacts of Globalisation on Hospitality Industry Source: Publication ASEAN. This can further be justified from an interview with Orta (2011). travel to Siem Reap and Phnom Penh for job opportunities in the hospitality sector. Foreign labour is emphasised at management level by the international hotel chains for managerial positions. the employment rate of the industry was 10. Orta (2011) also says that locals are at most promoted to the highest level of front office or human resource in the international chain hotels.
Due to Cambodia s membership in ASEAN. giving favour to foreigners over locals for those positions. skilled labour may be enticed to travel overseas in search of work. Emerging Market Consulting (2005) stated that tourism in Cambodia has been growing by 30% each year which has encouraged the development of hotels. resorts and guest houses. This may discourage certain international groups who prefer full ownership of a business from entering into the Cambodia market. Jet. Globalisation may have caused local employees to be overlooked for managerial positions even though the employees have the calibre for the position. The ruling. it is now easier to travel to other countries in search of a better paying job. is that the local operator must own at least 51% of the land that the international company is planning to operate on. 16 . Globalisation may also lead to a shortage in skilled labour. leaving the country with unskilled labour which require more training. Globalisation has also led to the increase in job opportunities for the country. The opening of these hospitality organisations has led to more job opportunities for the local community of Cambodia. This may lead to the country having a shortage of skilled labour. the ruling that the international company must cooperate with a local operator may discourage some international companies who wish to fully own land in the country.employed for managerial and senior management positions. Although the Cambodian government encourages the entry of international businesses to set up in Cambodia. Due to the low wages of Cambodia. according to the tour guide.
and United States. Some issue in term of religion is the non halal product in Siem Reap. Jet 17 . Thus. the celebration of Christmas has been incorporated into the local culture as the Cambodians have also started to celebrate Christmas as a holiday. The influence of Christians into Cambodia may be caused by the employment of foreign managers in the international hotel chains who are Christians. China. they may lose the market from Middle East. As a result.2 Culture In Siem Reap. Siem Reap is not recommended for Muslim tourist. 5. Prior to the development of tourism in Siem Reap. Basically.1 Religion In terms of religion harmonisation. the local community may only observe the tourist without any communication. Christmas was not usually celebrated by the locals in Cambodia. as tourists visit Cambodia to celebrate Christmas as well during their visit. As a result. South Korea. we may see that there is only little interaction between the tourist and local community. the most nation that tourist come from is non Muslim country such as Japan. We hardly find Halal food for the tourist.0 Harmonisation of Tourism and Local Community 5. Thus. Orta (2011) says that the Christmas and New Year s holiday period is one of the peak times in the industry besides Chinese New Year. According to Jet the tour guide. The hotels and food and beverage establishment use Christmas as a time to attract more tourists. Orta (2011) stated that there is a small Christian community in Siem Reap which is apparent as there are few small churches in Siem Reap. Majority of the locals are following the Buddhist religion.5. According to the interview with Le Meridien Angkor Revenue Manager. Language has become the major barrier here. the tourists just interact with the tour guide and the tour guide will interact with the local community. There has been an influence on the dressing fashion of the locals from the tourists that visit Cambodia.
Thus. However. some restaurants are offering free local dance performances such as the traditional Apsara dance in order to attract tourists to come and dine at the restaurant while watching the dance. The average income for people in Cambodia is 1-2 USD per day. For the older generation. 18 . they do not like this condition. The reason is the income of the business. It should expose the local food more. this has led to the traditional dances to be used as an advertising tool instead of being used to remember special events. The introduction of the modern hotels and restaurants have led to the damaging of the traditional town image of Siem Reap as the modern hotels and restaurants do not have any traditional Khmer design in them. For example. due to the high arrival of tourist there and in particular the increase in tourists from South Korea. In order to accommodate the Chinese. the local women are starting to wearing short sleeve shirts and short pants while the younger generation have started to follow the Korean fashion of dressing. Meanwhile. Chinese New Year has become another peak time for hospitality industry in Siem Reap. In terms of cultural events.explained that one could hardly find local girls wearing short pants and sleeveless shirts. The issue here is the number of Chinese and Western food outlet may overcome the number of Cambodian food outlet. The Cambodian culinary is affected by Chinese culinary here. the local girls have started to imitate the way the tourist dressed. we may see a big gap between the income of hospitality industry and other industry. 5. For a long run. it may not be sustainable since tourist may find better western and Chinese food in other country. Chinese food can be found almost everywhere.3 Socio Economic Hospitality industry may attract the local community more. Son and Suong (1995) also stated that the development of new modern buildings such as hotels and restaurants have caused the deterioration of the traditional Khmer culture of towns such as Siem Reap. Thus. There is a clash in Asian and Western culture on the way of dressing. In term of event. a tourist may spend 3-4 USD per meal.
This is due the education level of Cambodia may be lower than other country. According to interview with Mr. Even though the job from hospitality industry offers a great salary. there is already an oversupply of hotel in Siem Reap.The issue here is the shifting of people from other industry into hospitality industry. Andreas Orta. Thus. it may result in oversupply. Another issue is usage of foreign worker. the employer sometimes prefer to foreign staff in order to save training cost and time. Le Meridien Angkor Revenue Manager. 19 .
may be easily satisfied. it can be summarised that the mid-scale and budget accommodation facilities are performing to the tourists standards of satisfaction. There has also been issues in relation to the harmonisation of tourism and the culture. In relation to sustainable tourism. the development of tourism in the country has increased the level of pollution due to the increase usage of tour buses for tour groups. Tourism has also led to the change in the design of Siem Reap town as new modern buildings such as restaurants and hotels are increasing and changing the look of Siem Reap from traditional Khmer town to a modernised town. One assumption is that the budget travellers may not be as demanding as travellers who have a larger expenditure power. thus. cleanliness is an issue as most of the participants stated that cleanliness of Siem Reap could be improved. Also. For one. tourist from Korea have led to a change in dressing fashion for the local community. 20 . However.Conclusion In relation to the performance evaluation of Cambodia s hospitality products. some issues have risen such as the water supply issue caused by the increase in hotels in the area which can cause several outcomes such as the destruction of the temples of Angkor if the underground water supply is not managed properly. religion and socio-economy of Cambodia.
Sharp.co. Available from: http://unesdoc. [Interview] Le Meridien Angkor with class of Bachelor International Hospitality Management 2008.pdf [Accessed: February 7.unicef. UNICEF . (1995). Available from: http://www. (2008).1. Issues with the hospitality industry in Siem Reap.unesco. Orta.html [Accessed: March 2. R.gov/library/publications/the-world-factbook/geos/cb. Heritage site in peril: Angkor Wat is falling down.org/images/0012/001226/122618eo. Case Study on the Effects of Tourism on Culture and the Environment. ASEAN Statistical Yearbook 2008.H.org/infobycountry/cambodia_39558.org/publications/cambodia_commodity_chain_analysis_stud y_volume1_eng.org/Publication-ASEAN-SYB-2008.Cambodia . Emerging Market Consulting (2005). 2011]. Cambodian Commodity Chain Analysis Study.Lack of adequate sanitation triggers child health concerns in Cambodia. S.cia. L. 21 . Available from: http://archive.asean. 2011].independent. 2011]. A.The World Factbook.cosecam.html [Accessed: March 2. Available from: http://www. Available from: Government of United States of America.Reference Central Intelligence Agency (2010). 2011].pdf [Accessed: February 28.7. 11th February 2011. Comparative Industry Assessment. UNICEF (2007). Central Intelligence Agency Web site: https://www.uk/news/world/asia/heritage-site-in-peril-angkorwat-is-falling-down-795747. 2011]. Son. CIA .pdf [Accessed: March 2. Available from: http://www. Publication ASEAN (2009).html [Accessed: March 2. & Suong. 2011].
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