Herd of mobile milk cafés grows

The Cambodian owner of one of the Kingdom’s fastest-growing beverage chains said he is ready to take his mobile milk carts beyond the capital, and perhaps even into neighbouring countries as well.

Cheth Serey Sopheak, who launched his first Monsne Café mobile cart in April, said he has been inundated with requests to franchise the distinct blue-and-pink beverage carts, which specialise in drinks concocted with Hokkaido milk from Japan.

“There is no other milk like this in the world,” the 29-year old entrepreneur said yesterday. “It tastes sweet. It tastes lovable.”

Serey Sopheak said his first Monsne Café cart parked outside Chenla University in Phnom Penh sold over 3,000 cups of Hokkaido milk drinks during its first five days, far outpacing his expectations. The success prompted him to consider franchising.

According to Serey Sopheak, within two weeks of opening the Monsne Café brand to franchises on April 28, a total of 15 franchises were sold. Since mid-May the number of new franchise licences issued has slowed, but not the demand.

“I have to train everyone myself, so it takes time to launch each franchise,” Serey Sopheak explained. “I have over 500 people asking to buy franchises right now, but I go by trust. I need to trust that the people operating Monsne Café carts really love the drink.”

The original Monsne Café – offering coffee, tea and flavoured drinks made with Hokkaido milk – is still in the same place, but now seven franchised beverage carts operate in Phnom Penh. Another eight will open soon in the capital, while one cart is set to hit the streets in Siem Reap and another in Battambang.

Report shows need for Cambodia to diversify exports

Global credit rating agency Moody’s Investors Services said yesterday that while it has retained Cambodia’s B2/stable sovereign rating alongside Vietnam’s B1/positive rating, the Kingdom’s low diversification of exports has put it at higher risk from external shocks than its eastern neighbour.

In a report that compared economic development in Cambodia and Vietnam, Moody’s noted that while both countries share similar overall fiscal strengths, Vietnam’s larger and more diverse economy is underpinned by higher incomes and stronger institutions which provide better shock absorption.

Moody’s added that Vietnam’s continued robust growth and broad economic and financial stability should cap its government’s relatively elevated debt.

As for Cambodia, while it has smaller fiscal deficits and a lower government debt, which provide it large access to concessional loans, the economy is still constrained due to its dependence on garment exports.

“Garment and textiles production and a few other low value-added manufacturing dominate Cambodia’s exports, which are largely destined for the US and the European Union, exposing the economy to sector- and market-specific shocks,” the report said.

The report added that despite Cambodia undertaking government reforms and increasing its tax collection efforts, Cambodian institutions face greater challenges than Vietnamese institutions in weeding out corruption and enforcing the rule of law, which in turn affects the ability of the Kingdom to deliver a high credit rating.

Additionally, Moody’s placed Cambodia at a higher level of political risk than Vietnam based on the fact that foreign direct investment (FDI) could be hindered if tensions between Cambodia’s ruling party and opposition stand in the way of its reforms.

“Should political tensions lower the impetus for reform to address institutional weaknesses, that would be credit negative,” Moody’s said.

Nevertheless, Miguel Chanco, lead Asean analyst for the Economist Intelligence Unit, said Cambodia could diversify its export basket to make it more resilient to shocks if it properly invested in educational reforms and increased government spending.

Cellcard service beats out rivals: OpenSignal analysis

A recent analysis of Cambodia’s top three cellular service providers conducted by OpenSignal, a wireless coverage mapping company, suggests that CamGSM’s Cellcard is the highest-performing cellular provider in Cambodia, receiving more recognition for its services than either Viettel’s Metfone or Smart Axiata.

OpenSignal, which crowdsources data from phones that have installed its applications, collected data from 8,414 smartphone users in Cambodia between April 1 and June 30 and analysed over 80 million data points to determine comparisons between Cambodia’s cellular companies based on 3G and 4G download speed, latency, and availability.

According to the report, Cellcard stands out as being the best in both 4G and overall download speeds. In other categories the distinction was not so easily awarded: both Cellcard and Metfone tied for best 3G download speeds, while both Cellcard and Smart tied for greatest 4G availability. All three companies had similar levels of 4G and 3G latency, meaning each company experienced similarly small delays in transference of data from networks to individual phones.

“The competition is materially tightening and is pointing toward a two-horse race between Smart and Cellcard,” said Anthony Galliano, CEO of Cambodian Investment Management. “We are seeing Smart and Cellcard establish themselves as top tier in the field.”

Cambodian service providers only introduced LTE coverage in 2014, but LTE availability has spread across the country quickly and OpenSignal’s LTE Report on the first quarter of 2017 noted that overall, Cambodian cellular service users have been able to access an LTE network 63.3 percent of the time.

While 4G is more available in the country than ever before, connection speed in Cambodia remains markedly lower than most other countries. With a typical speed of 5.7 megabits per second (mbps) across all networks, Cambodia’s connection speed ranked among the slowest of the 87 countries OpenSignal analysed in its report.

“As Cambodian operators add more capacity to their networks, 4G speeds will increase to match LTE’s growing reach,” said OpenSignal analyst Kevin Fitchard in the report.

According to Galliano, competition between Cambodian mobile providers is directly linked to the progress networks have made in recent years.

JC Airlines adds fourth jet to a growing fleet

JC International Airlines received its fourth Airbus A320 yesterday, with one more Airbus set to arrive this year before the company more than doubles its aircraft lineup in 2018, the brand manager for the airline said yesterday.

“Because of the huge growth of international arrivals and the domestic tourism industry, we will keep on bringing in new planes to meet the market demand,” said Cheav Kirirom.

JC Airlines, which is part-owned by Yunnan Jingcheng Group, inaugurated service in March of this year and currently offers international flights to Malaysia, China, Vietnam, Thailand and Taiwan. The operator plans on running scheduled service to Singapore next month.

Yunnan lays out plan for airport in Siem Reap

Yunnan Investment Holdings Ltd (YIHL), the Chinese state-run company that plans to build Siem Reap’s new international airport, will begin construction next year and over the course of three phases, Sinn Chanserey Vutha, spokesman of the State Secretariat of Civil Aviation, confirmed yesterday.

The company will invest $500 million into the first and second phase, and $300 million for the third phase. The airport should take two to three years to complete, Vutha said, adding the company was currently clearing the 750 hectares of land that sits 50 kilometres away from Siem Reap.

Yunnan lays out plan for airport in Siem Reap

Yunnan Investment Holdings Ltd (YIHL), the Chinese state-run company that plans to build Siem Reap’s new international airport, will begin construction next year and over the course of three phases, Sinn Chanserey Vutha, spokesman of the State Secretariat of Civil Aviation, confirmed yesterday.

The company will invest $500 million into the first and second phase, and $300 million for the third phase. The airport should take two to three years to complete, Vutha said, adding the company was currently clearing the 750 hectares of land that sits 50 kilometres away from Siem Reap.

Capital’s port shows profit growth for H1

The capital’s listed port operator, Phnom Penh Autonomous Port (PPAP), reported net profits of $1.6 million for the first half of 2017, a 2.5 percent increase compared to the same period last year.

PPAP said in a filing to the Cambodia Securities Exchange yesterday that total revenue increased to $8.2 million during the first half, compared to $7.5 million a year earlier.