Industrial rail project gathers steam with government push

A worker approaches a freight train as it prepares for departure from a railway station in Phnom Penh in April. Cambodia’s transport minister has announced plans to extend the domestic rail network into the Phnom Penh Special Economic Zone. Hong Menea

Transport Minister Sun Chanthol has vowed to reinvigorate a long-dormant project to connect the Kingdom’s sole operating railway line to the capital’s biggest industrial park – a move that would boost rail traffic ahead of the completion of a rail link to northwestern Cambodia and Thailand.

Chanthol said during the opening of a workshop for the National Logistics Council on Monday that his ministry was pushing Royal Railway, which owns a 30-year concession to operate the Kingdom’s railway network, to build a spur into the Phnom Penh Special Economic Zone (Phnom Penh SEZ).

“There are a lot of factories there and workers that need to travel to the zone,” he said.

“This will benefit the railway and help the zone get goods to and from factories.”

A rail link was always on the cards. The 266-kilometre Southern Line that runs from Phnom Penh to Sihanoukville skirts the eastern edge of the 357-hectare industrial park – one reason for choosing its location nearly 20 kilometres west of the capital’s centre. However, currently all cargo transport is handled by container trucks.

John Guiry, CEO of Royal Railway, said the decision to build a spur line into Phnom Penh SEZ was a “no-brainer”.

“The railway already runs just outside of the fence of the zone,” he explained. “All that needs to be developed is 30 metres of track.”

He added that with Chanthol’s support, it was clear that the small extension was soon on the horizon.

“We could start constructing the spur as soon as January when the rainy season is over and the land has dried up,” he said.

“We are all geared up to do our own rail work.”

However, he said Royal Railway was still awaiting a concrete plan from Phnom Penh SEZ and that the two companies were finalising a deal.

The plan made commercial sense for the 81 tenants operating in the industrial park, Guiry said.

“We are already shipping 40 to 80 containers to our dry port a week to be put on the railway,” he explained.

“And that costs companies $60 per container to drive approximately 2 kilometres.”

He said that the overall cost savings for Phnom Penh SEZ tenants would increase investment and place it in a better logistics position ahead of the opening of the 386-kilometre Northern Line. A portion of the line running 42-kilometres from Poipet to the Thai border is expected to open by the end of the year.

Meanwhile, state-run news agency AKP reported yesterday that Chanthol proposed a separate rail line that would run 8 kilometres from the capital’s airport to Phnom Penh SEZ, with a planned cost of nearly $4 million.

The rail link could improve transport for Phnom Penh SEZ’s 16,000 workers, increasing the safety of their commute and providing additional revenue to cover its costs.

“Even if we opened a passenger line that got at least 1,000 workers using it each day, it would pay for itself,” Guiry said.

Hiroshi Uematsu, CEO of Phnom Penh SEZ, was less optimistic that a plan was close to being finalised that would facilitate better access of trade to the industrial park.

“We are still in negotiations with Royal Railway about this, so it is still too early to give a full comment on if this will happen,” he said.

Wed, 7 December 2016

Kali Kotoski l the Phnom Penh Post