Valuation Study

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Sustainable Development of a Cultural Heritage

Attributes

Medium: Health and/or Human Capital

Country: Cambodia

Analytical Framework(s): Other

Study Date: 2005

Publication Date: 2006

Major Result(s)

Resource/Environmental Good KHR, million currency units per year
(2005)
KHR, million currency units per year
(2014)1
USD, million currency units per year
(2014)2
potential for entrance fee revenue (low estimate) 11.00 17.60 0.00
potential for entrance fee revenue (high estimate) 44.00 70.41 0.02

About the Inflation Adjustment: Prices in Cambodia (KHR) changed by 60.03% from 2005 to 2014 (aggregated from annual CPI data), so the study values were multiplied by 1.60 to express them in 2014 prices. The study values could be expressed in any desired year (for example, to 2020) by following the same inflation calculation and being sensitive to directional (forward/backward) aggregations using your own CPI/inflation data.

Study Note: Historically, the sustainable use of water resources has been a major concern in Angkor, from the Angkorian engineers who had to meet the water demands of a large metropolis, to present-day policymakers who have to satisfy the needs created by the development of tourism. While Angkorians devised an intricate hydraulic system to exploit runoff and overland flow, the extraction of groundwater is now favoured. The recent implementation of a centralised water supply system in the city of Siem Reap is an improvement over past practices in which individual hotels operated their own wells to meet customers' demands. However, this system alone will not be able to cope with the numbers of visitors that have been predicted. If water extraction rates were to exceed aquifer recharge rates, land subsidence would occur. This would result in structural damage to the temples.

Study Details

Reference: Thanakvaro De Lopez et. al. 2006. Towards Sustainable Development in Angkor, Cambodia. EEPSEA Research Report, No. 2006-RR5.

Summary: Founded in the 9th century, the city of Angkor lies at the heart of Khmer cultural heritage and figures prominently in the history and on the standard of the Kingdom of Cambodia. At its zenith, the metropolis stretched over a 1,000 km 2 and was inhabited by up to two million people. However last century Angkor remained in a relative slumber until the late 1990s as Cambodia's tumultuous modern history had kept casual visitors at bay. However, in less than a decade, the number of foreign visitors to the temples of Angkor, now a World Heritage site, has jumped from a few thousand a year to almost one million. The neighbouring city of Siem Reap, gateway to Angkor, has also experienced rapid growth in recent years. Local infrastructure and services have struggled to keep up with the demands of international mass tourism. While it represents a significant source of foreign currency for Cambodia, mass tourism has increased pressure on Angkor's cultural and natural features. The question that needs to be urgently answered is how the development of Angkor can be made more sustainable from financial, environmental and social perspectives. This study estimated the potential for entrance revenues from the Angkor Park. This was done by assessing tourist numbers and entrance fees. The estimate ranged from a low of US $11 million to a high of US $44 million per year. This represents a substantial source of funding to meet the needs of present generations and to ensure that the temples are protected against degradation for future generations. Without Angkor, there would be little use for neighbouring resorts, hotels and other tourism facilities. Economic logic dictates that, while returns on the temples must be maximised, further restoration and rehabilitation work needs to be undertaken.

Site Characteristics: Angkor was once a capital city, and retains a large resident population. Settlements clustered around the temples (which are located in the strictly protected zones of the park) are the homes of an estimated 70,000 people. Surveys of more than 2,500 households and 400 souvenir sellers paint a picture of hardship and poverty. Levels of illiteracy remain high, even among children. Agriculture, which still accounts for about a third of household income, has low productivity. Paddy fields yield less than a ton per hectare per year. On average, tourism accounts for only 10% of household income. This shows that local people have not been able to benefit from the increased popularity of Angkor.

Comments: Tourism provides favourable prospects. It also constitutes a threat to the sustainable development of Angkor. Revenues from entrance fees represent a unique opportunity to restore Angkor to a thriving city and to conserve its cultural heritage. Local people's desire to work with the authorities in the preservation of their heritage must be built upon through community-based conservation, as well as through the implementation of development projects in agriculture, education and water supply.

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