Donaco International Limited has reported significant operational disruptions at its Star Vegas casino in Poipet, Cambodia, following heightened tensions between Thailand and Cambodia. The Thai government’s border restrictions, which came into effect after a brief military clash between the two nations on May 28, 2025, have severely impacted the casino’s business.
Ongoing border tensions affect Star Vegas performance:
These measures, which were imposed on June 8, include reduced hours at key border crossings and a ban on Thai nationals crossing the border for non-essential travel, specifically targeting tourism and gambling activities in neighboring Cambodia. As a result, Donaco has observed a sharp decline in its daily activity, with a 62% drop in average headcount and a 42% fall in hotel occupancy at Star Vegas. As stated in the Australian Securities Exchange (ASX) official release (pdf), the company now expects these disruptions to significantly affect its profitability for June 2025.
“While both governments have expressed a commitment to resolving the border tensions, bilateral talks held on June 14, 2025, did not ultimately result in a resolution,” Donaco stated. “While the current situation is relatively calm, underlying disputes persist, and the Thai government continues to impose measures impacting movements across the border.”
The border issues between Thailand and Cambodia have long been a source of contention, but the recent military clash has escalated the situation. Cambodia has appealed to the International Court of Justice, calling for a peaceful resolution based on international law, according to a Facebook post from the Cambodian Prime Minister.
For Donaco, the timing of these tensions is particularly challenging. The company, which also operates the Aristo International Hotel near the China-Vietnam border, had seen a steady flow of customers prior to the new restrictions. In the March 2025 quarter, Star Vegas reported an average of 928 players, but now, with the Thai government’s actions limiting cross-border activity, Donaco faces a significant downturn in revenue and activity levels.
The reduced movement of Thai nationals—many of whom regularly cross the border to gamble in Poipet’s casinos—has cast a shadow over the local economy. The gambling and tourism industries in Poipet, which are heavily reliant on Thai visitors, are experiencing a major setback due to the restriction of Thai nationals from crossing the border.
The growing challenge for Star Vegas amid geopolitical tensions:
Star Vegas, one of the prominent casinos in Poipet, has been a significant player in the region’s gambling market, largely due to its proximity to Thailand’s border. The casino has relied heavily on Thai nationals as a key customer base, with estimates suggesting that 80% of Poipet’s gambling visitors are from Thailand. However, with border restrictions in place, Donaco faces the dual challenge of dealing with both reduced foot traffic and growing uncertainty about the resolution of the border dispute.
While Donaco’s management has stated that it will continue to monitor the situation and provide updates as necessary, the company remains cautious in its outlook for the remainder of 2025. Despite the current challenges, both the Thai and Cambodian governments have expressed their commitment to resolving the situation, though there is no indication of a near-term resolution.
“Management will continue to monitor the situation closely and update shareholders as appropriate,” Donaco added.
These developments highlight the broader issues facing the Southeast Asian casino industry, particularly in areas where border regions are critical to operations. The crackdown on cross-border gambling and tourism has exposed the extent to which casinos along the Thai-Cambodian border depend on the free movement of people and money between the two countries.
Additionally, the casino network across the Thailand-Cambodia frontier, which includes not just Star Vegas but numerous other operations like those in Poipet, has drawn attention to a sprawling underground economy and a network of political elites that control much of the gambling landscape. This has raised questions about the sustainability of cross-border casino operations and the political and economic dynamics that shape their success.
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