Gamblers chain-smoking and speaking Mandarin are feeding $100 bills into hungry roulette machines at the Holiday Palace Casino Resort. Next to them, dragons and pandas dance to music blaring from giant TV screens.

The once-peaceful seaside paradise of Sihanoukville has become one of Asia’s major gambling hubs, thanks to Chinese money flowing into Cambodia.

“People call it Macau Number Two,” said Kong Monika, leader of the Khmer Will Party, which opposes the Cambodian prime minister’s pursuit of money from Beijing. “We now go to China without a passport,” he jokes.

About 80 casinos have popped up in the city, which has a local population of around 157,000, helping to double the number of Chinese tourists in two years, to 120,000 in 2017.

Skyscrapers crowd the skyline next to the pristine beaches that used to be Sihanoukville’s biggest draw. The city is located on Cambodia’s only deep-water port – part of a vital trade route for President Xi Jinping’s Belt and Road development initiative.

Hun Sen, Cambodia’s prime minister, and Mr Xi have said Beijing’s £1.3  billion investment in Cambodia last year is a “win-win”.

Chinese people shop inside the China Duty Free mall at NagaWorld hotel and entertainment complex August 4, 2018 in SihanoukvilleCredit:
 Paula Bronstein/Getty Images AsiaPac 

Observers have warned of China’s “ulterior motives” in spending on one of south-east Asia’s poorest countries.

One of Beijing’s principal concerns in the region is securing privileged access to maritime trading routes, according to the Centre for Advanced Defence Studies, a US-based think tank. Cambodia borders the Thai gulf, next to the South China Sea, where Beijing has amassed a military presence in disputed territory, worrying the US. The think tank said Beijing could also be looking to Mr Hun, who has been accused of human rights abuses and brutally quashing dissent during last month’s election, to back it on territorial disputes.

Whatever Beijing’s motives, with Mr Hun’s power unabated, the “Chinafication” of Cambodia seems irreversible.

On land, relations between Cambodians and Chinese in Sihanoukville have become less than friendly. You Veasna, a restaurateur, was forced out of business in the city centre last year. The 38-year-old rented two properties at £390 a month, but his landlord ordered him to make way for Chinese tenants offering more.

Cambodian families live in shanty homes next to the massive construction site called Blue Bay beach resort which includes a 38 floor building that will house a 5 star hotel and luxury apartmentsCredit:
 Paula Bronstein/Getty Images AsiaPac

“My mother-in-law had a shop next to us, so now we’re separated,” Mr You, who moved his business five miles out of the city, told The Sunday Telegraph. “Cambodian citizens can’t rent. I searched everywhere in town.”

His story is typical of many locals forced from property or businesses in the city, priced out by Chinese money.

The influx of Chinese has reportedly brought a rise in crime. Last month in Sihanoukville, four Chinese tourists were shot in a suspected “kneecapping” attack. Five Chinese tourists later kidnapped another five tourists, holding them to ransom to cover gambling losses. “We never had kidnappings before,” one local said.

Land for sale, signs are becoming more commonCredit:
 Paula Bronstein/Getty Images AsiaPac

The casinos exclusively cater to Chinese patrons, as gambling is illegal for locals, effectively creating social bubbles, with the two rarely meeting.

Cambodians work at the casinos, but some seeking jobs in venues catering to Chinese customers lose out. “One casino boss asked interviewees if they smoked,” a bartender said. “If they didn’t, they didn’t get the job.”

While most Cambodians have lost out, landlords have hit the jackpot.

“Landlords cancel fellow Cambodians’ contracts then rent to Chinese,” said Cheap Sotheary, Sihanoukville coordinator of the Cambodian Human Rights and Development Association.

“Place names change from Khmer to Chinese, staff become jobless. The rich get richer,” she said. “There are losers and winners in gambling, but what should the losers do?”

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