Cambodia’s ‘Imported Cities’
At the entrance to Grand Phnom Penh International City, bronze stallions gallop across the tops of twin arches, supported by imposing white columns in the classical style of ancient Rome. The road that leads into the luxury estates beyond is lined with coconut palms, a rare nod to Cambodia in this satellite city that feels a world away from its geographic location.
Situated on 640 acres of land to the north of Phnom Penh, the “self-sustaining urban township” is being built as a joint real estate venture by Indonesian and Cambodian property developers. It is one of a half-dozen massive development projects — entire cities and neighborhoods unto themselves — reshaping the character of Cambodia’s dusty, low-rise capital.
For the past two decades, the Cambodian government has been handing over large tracts of land to private companies, ostensibly with the aim of spurring economic development. But what was initially designed to be a selectively-employed tactic to attract foreign investment has evolved into a broad-based approach to urbanization that concedes large sections of the city to offshore property developers.
Economic Land Concessions (ELCs), as such land deals are usually called, were until recently mostly used in rural areas. The government would grant a foreign agricultural company a long-term land lease and in return that company would use the land to grow crops like bananas or sugarcane. The concept was framed as a win-win scenario, in which private companies get access to land and Cambodia gets an economic boost from a thriving agrobusiness within its own borders.
The model wasn’t without flaws, however. The Cambodian Center for Human Rights estimates that 700,000 Cambodians have been displaced from their homes to make way for ELCs, and that often these agreements have been used as little more than a cover for illegal logging. More and more, the concessions have come to be viewed as a territorial giveaway to rapacious foreign powers, which prompted Cambodia’s prime minister to declare a moratorium on granting new ELCs in 2012.
But the ELC model didn’t die. Over the past decade, as urbanization has become big business, ELCs have migrated from the countryside to the city. Though such land deals in cities are not characterized as ELCs on paper, in reality the practice is much the same: The government awards huge chunks of urban land to offshore investors and local developers alike. Much of this development is taking place in huge development projects owned entirely by private companies on city fringes.
To a degree, these satellite city projects are a response to rapid urbanization and economic growth, combined with a state failure to invest in planning and infrastructure — this is what has happened in Phnom Penh. According to University of Leeds geographers Tom Percival and Paul Waley, property developers sense an opportunity and step in to fill the void with their model of urban planning by private corporation.
“This caters to a growing demand for satellite city living from middle- and upper-income groups, who are wooed by images of a cosmopolitan lifestyle. Businesses too evince the desire to move out of makeshift space in the city center into the appropriately international setting of a satellite city,” the academics write in Articulating Intra-Asian Urbanism: The Production of Satellite Cities in Phnom Penh. “At the same time, governments have become increasingly entrepreneurial in order to attract investment from regional urban development companies.”
IMPORTED CITIES
Drive down the perfectly paved streets of Grand Phnom Penh, and a sound that has become rare elsewhere in the traffic-snarled city can be heard all around: birds chirping in unison. Residents say that the tranquil environment is what drew both them and the birds. Nhek Sim, a retiree who declined to give her age, bought into Grand Phnom Penh two years ago. She thinks of it as a weekend escape from her home in an affluent suburban area that’s mostly populated by middle-class Cambodians. “I used to have another house in the inner city, but because of the traffic and pollution, I rented it to someone else and went to live in Toul Kork. But now, [the livability there] is not very good either,” she says.
Her two-story townhouse overlooks an 18-hole golf course created by Jack Nicklaus’ design firm, and is a stone’s throw from a theme park, Fantastic Water World. Still in the pipeline for this area are a golf clubhouse, school and shopping mall. According to an on-site sales executive who spoke anonymously, as she is not authorized to make comment to media, prices for the 5,000 homes that are either built or being constructed range from $111,000 to $1 million. By comparison, the minimum monthly wage in Cambodia’s vast garment sector is just $170; many workers in other industries are paid considerably less.
This is not just a Cambodian phenomenon. The trend can be seen across Southeast Asia, where it has become increasingly common over the past decade for satellite cities to spring up in peri-urban areas.
Vietnam is home to several sprawling projects. In Ho Chi Minh City, the Taiwan-backed Phu My Hung, or Saigon South, was originally intended to house a million people. Northwest of Ho Chi Minh City, a Malaysian firm is building the largest project, North West Metropolitan Area, at an estimated cost of $3 billion. In the capital, Hanoi, long-established Indonesian developer Ciputra is constructing Ciputra Hanoi International City on 740 acres in partnership with a local firm.
In Malaysia, Bandar Malaysia is a new planned business district in Kuala Lumpur of which China has been seeking partial ownership. And off the country’s Singapore-facing coast, a string of cities are being built by Chinese companies, with buyers from mainland China as their target market.
Even tiny Laos has seen large-scale foreign property investment. On the outskirts of the capital, Vientiane, is the $1.6 billion That Luang marsh development, a controversial Chinese project that has led to the eviction of hundreds of families.
These satellite cities are generally financed by either a single developer or through a joint venture, and they result in entirely planned settlements that integrate residential, business, retail and leisure amenities into one community. Most of these self-contained urban systems are being built either partially or entirely by foreign firms, each via an ELC-style agreement with the host country or through other government-driven economic development schemes.
Regionally, this model has its roots in Indonesia. It dates back to the early 1970s on the outer edges of Jakarta — then a relative backwater and now a sprawling megacity of about 30 million people — in response to a growing middle-class demand for suitable housing. One of the first privately developed satellite cities, Pondok Indah, broke ground in 1975. Built atop 1,135 acres of former rubber plantations, it has since morphed into a wealthy suburb in the south of the Indonesian capital.