Cambodia's Prime Minister Hun Sen delivers an address during an opening ceremony for the Khmer New Year at Bayon temple at the Angkor complex in Siem Reap province on April 13, 2018.Photo: AFP/Tang Chhin Sothy
Cambodia's Prime Minister Hun Sen delivers an address during an opening ceremony for the Khmer New Year at Bayon temple at the Angkor complex in Siem Reap province on April 13, 2018. Photo: AFP / Tang Chhin Sothy

For nearly two months, aggrieved Cambodian casino workers have protested almost daily in central Phnom Penh against mass layoffs implemented last year by the Hong Kong-listed NagaCorp, a business majority-owned by Malaysian billionaire Chen Lip Keong that runs Cambodia’s NagaWorld casino complex.

The protests represent a major test for Prime Minister Hun Sen’s government, which is split between appealing to Cambodian voters ahead of bellwether local elections later this year and protecting the interests of one of the nation’s top foreign investors and taxpayers.

They also come as Hun Sen bids to downplay his authoritarianism and put his best diplomatic foot forward while Cambodia serves this year as the rotational chair of the Association of Southeast Asian Nations (ASEAN).

Cambodian authorities, known in the past for their brutal strike-breaking tactics, have so far opted for “a war of attrition” against the protesters, signaling a potential softer approach while the global eye is on Cambodia.

At first, the government accused the strikers of threatening national security.  Then a court declared the strikes illegal, with a judge claiming the protesters were flouting arbitration procedures.

In early January, NagaWorld union president Chhim Sithar and dozens of strikers were detained by plainclothes officers on charges of criminal incitement. Soon thereafter, police were brought in to herd the protestors in a small contained area in downtown Phnom Penh.

There have been reports of intimidation and harassment, although nothing like the scenes witnessed in past years, such as when the police opened fire on striking garment workers in early 2014.  

Now, authorities are leveraging the pandemic to say the protestors are a threat to their fellow citizens. On February 4, the Ministry of Health stated that because a former employee of NagaWorld had tested positive for the Omicron variant, all strikers had to test for Covid-19 within three days. 

The same day, the local Phnom Penh administration said that if the protesters continue with their industrial action then they could be prosecuted under the Covid-19 law, which mandates jail terms for people who knowingly spread the disease.

Hong Kong-listed NagaCorp had big plans to expand through the pandemic. Image: Twitter

Analysts and observers say these claims are spurious. The person identified by the Ministry of Health as testing positive for Covid-19 says she hasn’t participated in any protest since January 15, the day she found out she was pregnant. 

Neither is it clear how the strikers are a particular menace of contagion. Restaurants, pubs and nightclubs are open again in Cambodia. Tourists have started to dribble back into the country. Quarantine restrictions are looser than ever. 

The protestors could reasonably argue they’re less likely to spread the disease at an outdoor protest than at a busy, indoors karaoke bar – and, in fact, transmission at a protest is easier for the authorities to track-and-trace.

The Covid-19 pandemic hit Cambodia’s casinos hard. Chinese tourists, their main clientele, to date have not returned.

For several months in 2020 and 2021, the casinos were told to shut their doors for health reasons. On top of that, NagaCorp has committed itself to a considerable US$3.5 billion investment to open a third casino complex in the capital.

It was due to these financial difficulties that around 1,300 employees were laid-off last year, the company says. But the protestors contend these dismissals disproportionately targeted unionized staff members. 

Union representatives are also appealing for reinstatement of the 365 workers who refused to take the compensation offered by the company. Others point out that NagaCorp’s finances aren’t so tight; it reported losses in 2020 but in previous years it saw huge profits.

According to a letter sent last month by the International Trade Union Confederation to Prime Minister Hun Sen, 1,100 of 1,329 laid-off workers were members of the Labor Rights Supported Union of Khmer Employees of NagaWorld. 

NagaCorp, which has an exclusive license to operate casinos in the capital until 2045, responded in a public letter that said the dismissals were made because of “internal rules of the company, based on business needs, past productivity, contribution and commitments and others, regardless of the unionized or non-unionized staff.”

As with past industrial action, the government quickly allied itself with capital over labor. Yet, analysts say its crackdown on the NagaWorld strikers has been atypically restrained. 

“The batons have not come out yet because [the authorities] understand this could be a hornet’s nest,” said Sophal Ear, an associate dean and professor at the Thunderbird School of Management in Arizona.

For starters, Sophal Ear said the authorities are cautious about angering workers in other industries who have also been hit hard by the pandemic. So far, there have been no solidarity strikes from other unions.

Workers hold Cambodian flags and signs as they rally to mark May Day in Phnom Penh, Cambodia, May 1, 2018. REUTERS/Samrang Pring
Workers hold Cambodian flags and signs as they rally to mark May Day in Phnom Penh, Cambodia, May 1, 2018. REUTERS/Samrang Pring

In November, the government estimated that 2.8 million Cambodians, or 18% of the population, now live below the poverty line, a statistical definition updated at the time to now mean less than around US$2.60 per day, which possibly massages the real number.     

The ruling Cambodian People’s Party (CPP), which has been in power since 1985, will go into June’s local elections mostly uncontested since it banned its only viable political opponent almost five years ago.

But Hun Sen’s party wants a clean sweep of almost all local seats without any major embarrassment, which could be sparked if there was a brutal crackdown on unemployed, mostly female workers.  

At the 2018 general election, following the forced-dissolution of the main opposition Cambodia National Rescue Party, more voters spoiled their ballots than voted for the second-placed party.

This June, a similar thumb in the face of the CPP may be delivered if voters boycott the ballot, spoil their votes or decide to give their support to the numerous small political parties. 

Authorities are also aware that Cambodia’s global image is under greater scrutiny than usual as ASEAN’s chair.

“Authorities could crack down much harder, as in years past, but haven’t done so in part because Hun Sen seemingly wants Cambodia to be on its best behavior,” said Charles Dunst, a fellow at the Center for Strategic and International Studies, a think tank. 

The Cambodian government received a quick warning from the international community on January 5 when a panel of UN experts — including Vitit Muntarbhorn, UN special rapporteur on the situation of human rights in Cambodia — released a statement five days after the first arrests of NagaWorld protestors.

“We also strongly condemn the manner in which the first arrests took place, after dark on a day where multiple other events diverted public attention,” the statement said.

“This could be seen as an underhanded way to clamp down on fundamental human rights and impinge on the free exercise of the rights to freedom of peaceful assembly and of association.”

Nagaworld employees in Phnom Penh. Image: Facebook

The local Cambodian Center for Human Rights echoed that call in a statement, saying: “The charge of incitement to commit a felony levied against the union leaders and activists sends the message to Naga World strikers that their labor rights can be flouted with impunity while they will face legal action merely for calling out their company’s labor violations and seeking redress.

“This could set a dangerous precedent, emboldening employers to ignore inconvenient labor standards, and potentially leading to a roll-back of hard-earned labor rights in Cambodia,” the statement said.

That criticism no doubt stings as Hun Sen tries to put on his best diplomatic face. Phnom Penh will play host to regional politicians throughout the year, and world leaders will jet into the Cambodian capital for the annual ASEAN Summit.

Hun Sen, as ASEAN’s chair, was formally invited by US President Joe Biden to his planned US-ASEAN summit in Washington, which is expected to take place before the summer.  

Lao Mong Hay, a veteran Cambodian political analyst, says the authorities are opting for “a war of attrition to wear strikers down to the point where their industrial action would collapse.”

He added: “The latest charge against them for breaking the anti-Covid law may just be to speed up that collapse.”

Follow David Hutt on Twitter at @davidhuttjourno