With just a little fanfare, Phnom Penh has finally opened the doors to its stock exchange. As expected, no shares were traded. But the opening was telling for the country’s often difficult bid to secure economic development alongside long-term peace.
Three decades of conflict – including the 1975-79 rule by the Khmer Rouge, which abandoned money and all but obliterated the country’s economy, cultural life and a third of the population – left Cambodia in the wilderness, and consigned its people to an uncertain future.
That is changing fast. The Khmer Rouge tribunal has started in earnest and Phnom Penh is flourishing despite a notorious reputation for corruption.
Amid this, the Cambodian stock market’s humble start was typical. Vietnam had an all-too similar beginning more than a decade ago, and Laos hardly set international investors alight when it launched in January with two listings. Cambodia’s low key start was no different, and most analysts agree its stock market will need five to 10 years before cementing itself as a genuine cornerstone of the economy. Between now and then, about half-a-dozen companies will earn their place as the market’s benchmarks.
Three state companies – Phnom Penh Water Supply Authority (PPWSA), Telecom Cambodia and Sihanoukville Autonomous Port – are preparing listings. Several private companies, including Post Media, owners of The Phnom Penh Post, have also signaled their intention to list.
Of the these, PPWSA is the standout. Shortly after the historic 1993 UN-sponsored elections, Co-Prime Minister Hun Sen appointed Ek Sonn Chan, a Killing Fields survivor who believed he had been spared the worst of Pol Pot's holocaust to fulfill a mission, as head of the PPWSA.
He went to work on a collection of leaky old pipes that partially fed the city contaminated water for just 10 hours a day. Raising the quality of Phnom Penh water to standards normally associated with Singapore proved a long and sometimes difficult road, but battling ingrain perceptions and convincing people that it’s safe to drink out of a tap here was even trickier.
This was despite routine independent tests by PSB Corporation in Singapore that consistently delivered the PPWSA a clean bill of health. ‘People have trouble believing that it’s clean,’ a slightly indignant PPWSA Director Ek Sonn Chan once told me.
Then, in 2004, the Cambodia Beverage Company (CBC), the exclusive bottling partner of The Coca-Cola Company, came to the party and were happy enough with their own tests that it substantially expanded its operations.
The same year, the Asian Development Bank awarded Sonn Chan its Water Prize, and two years after that he won a highly prestigious Ramon Magsaysay Award for government service, and has been declared a hero by Hun Sen.
Cambodians know their country has problems. But every now and again, as with the opening of the stock market, this country’s peace dividend pays off.