Cambodia’s Infrastructure Guru

• 31 December 2015
• Uncategorized
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Having been emerged for almost his entire career in the business of infrastructure, Oknha Hann Khieng is credited as the force behind many of Cambodia’s most recognisable infrastructure projects.

As Director of Muhibbah Engineering (Cambodia) Co. Ltd, a conglomerate established in 1995 and with over 10 infrastructure-related business streams, he has overseen the construction of dozens of Cambodia’s most significant infrastructure projects including national highways, airport developments, and bridges. Thanks to his decades of experience in the sector, Oknha Hann Khieng was also elected as Vice-Chairman of the Cambodia Constructors Association (CCA).

Success hasn’t come easy though. Born in Sihanoukville in 1949, Oknha Khieng began working on building sites in the 1960s before he was 20, working as a translator with Chinese engineers building Borey Keila and airports at the time.

These early experiences stayed with him and inspired him after he returned from Australia and New Zealand where his family had spent almost 20 years after escaping from the nation’s civil war.

After returning to Cambodia in July 1993, he started his empire with a small stone crushing business supplying construction projects. In 1994, his golden opportunity arrived. During a visit by former Malaysian Prime Minister Mohd Mahathir to Cambodia along with many Malaysian business owners, he signed a Joint Venture deal with Malaysian-based Muhibbah Engineering to set up Muhibbah Engineering (Cambodia) in 1995, then won the concession to build and operate the airports in Cambodia among over 20 foreign firms who competed in the bidding for the project at that time.

“During my early period of business in the 1990s, it was a difficult time to find machines, equipment, materials and human resources to run the works, and I needed to outsource almost everything from overseas suppliers,” Okhna Hann re-calls.

While he has achieved most of his aims in the construction sector including the soon to be built expressway and sea port, he still dreams of building a road inside a mountain.

Okhna Hann doesn’t believe that investors with construction experience can necessarily lead a successful construction business or that people with no construction experience will fail. He alerts current and potential business owners to keep ‘timing’ in mind i.e. build the right projects at the right time. “Any business is good to invest in, but there are people crying while some other laugh, there are people that have good luck and others face bad luck, we can’t avoid this,” he warns. “So successful people must ensure they are superior in the market for the competition against their rivals, we can’t avoid this.”

Though many real estate developers are successful thanks to banks providing mortgages to allow buyers on the property ladder, he warns future crises can occur. “Many buyers ask their employers to increase their salary ranking so that they can request a bigger home loan from the bank, while some developers set their unit price over the reasonable level which forces buyers to request a higher bank loan. This can cause a financial crisis when buyers can’t afford to pay the loans when an economic crisis occurs. The American financial crisis which occurred several years ago led to bankruptcy for some giant banks because of this problem.”

“Today, those buyers have work that can generate income to pay the banks, but how about when they don’t have jobs during an economic crisis,” he said. “This will be a real estate crisis.”

However, he also feel optimistic that AEC is an opportunity for real estate business in Cambodia as prices remain cheaper than in more advanced economies like Singapore and Thailand.

Cambodia will need more high quality roads and expressways, and express railway lines to connect with the region which represents a much greater opportunity for his business. As co-chair of the China-ASEAN Building Materials Committee, and a member of the China-ASEAN Construction Cooperation Committee, he has already seen a lot of infrastructure planning to be built across Cambodia, including deep sea ports.

Cambodia’s industrial supply chain for spare parts and accessories continues to provide challenges and the need to outsource to neighbouring countries prevents large scale industrial investment in the kingdom.

To enhance the building sector in AEC, Okhna Hann would like the government to ensure clear standards that meet ASEAN requirements, and establish mechanisms for all companies to meet quality standards to compete with ASEAN companies.

Transparency and an effective legal framework in construction bidding are also needed so that small and large companies can compete equally in the market.

It is good that the Cambodia Constructors Association is helping on sector now, he says though stresses that there should be cheaper and more options for construction materials so that the constructors can build cheaper, developer can sell cheaper and buyers can own cheaper. “Today, the property prices rates are too high, and few buyers can afford them.