Data Collection Survey on the Trunk Road Network Planning for Strengthening of Connectivity through the Southern Economic Corridor

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1 2.6 Industrial Development Condition and Perspectives Industrial Development in Cambodia (1) Special Economic Zone (SEZ) in Cambodia The development of Special Economic Zone (SEZ) in Cambodia encourages private sector investment and ensures the provision of world class infrastructure and services. The Council for the Development of Cambodia (CDC) has approved 22 SEZs across the country with total investment capital in excess of USD740 million. Table and Figure show list and location of SEZ in Cambodia, respectively. Among these SEZs, 10 of them are operational and others are at various stages of development. Characteristics of major SEZs are described in Table The SEZs are designed to ease challenges to setting up business with government officials stationed on site to provide administration services, such as clearances and permits. The main law covering the definition, procedures and administration for SEZs in Cambodia is the 2005 Sub-decree on the Establishment and Management of the Special Economic Zone. The stated aim of this sub-decree is to establish and manage the Special Economic Zones and improve the investment climate conducive to the enhancement of productivity, competitiveness, national economic growth, export promotion, employment generation in order to reduce poverty. Under this law, SEZs are defined as: the special area for the development of the economic sectors which brings together all industrial and other related activities and may include General Industrial Zones and/or Export Processing Zones. Each Special Economic Zone shall have a Production Area which may have a Free Trade Area, Service Area, Residential Area and Tourist Area. Under the sub-decree, an SEZ must meet a number of basic requirements: It must cover an area of more than 50 hectares, with precise location and geographic boundaries; It must have a surrounding fence; It must have management office buildings, zone administration offices, road networks, clean water, electricity, telecommunications networks, fire protection and security system; It must have a water sewage network, waste water treatment system, location for storage and management of solid wastes, environmental protection measures and other related infrastructures as deemed necessary; and It must comply with technical requirements, regulations and basic rules on construction, environment and other obligations defined in instructions issued by relevant ministries pursuant to the existing laws, national and international standards. According to the Cambodian Government s SEZ website, businesses within SEZs benefit from a number of fiscal incentives, including income tax, customs, and VAT benefits. Cambodian SEZs are designed to offer a One-Stop Service for imports and exports, and have specially trained government officials stationed on-site to provide administrative services. Applications to establish businesses within SEZs are dealt with on-site, as is company registration and investment licenses, work permits and labour books for workers. Investment approvals, customs inspections and import-export procedures are also conducted on site. Other benefits listed on the SEZ website include tax holidays up to 9 years, 0% VAT, full import duty exemption for raw materials, machinery, and equipment, no export tax, permanent visas for families of investors and free repatriation of profits. Final Report 2-85

2 ] for Sstrengthening of Connectivity through the Southern Economic Corridor Table List of SEZ in Cambodia SQ Name of SEZ Location Land Area Major Companies Note 1 Neang Kok Koh Kong SEZ Neang Kok Village, Pakkhlong Commune, Mundul Seyma District, Koh Kong Province Ha Vehicle Assembly of Hyundai cars and Spare part 3companies located Capital: USD 69 million 2 Suoy Chheng SEZ Neang Kok Village, Pakkhlong Commune, Mundul 100 Ha No operation No construction Seyma District, Koh Kong Province 3 S.N.C SEZ Sangkat Bet Trang, Khan Prey Nob, Sihanoukville 150 Ha No operation No construction 4 Stung Hav SEZ Sangkat O Tres, Stung Hav District, Sihanoukville 192 Ha No operation No construction 5 N.L.C SEZ Phum Prey Phdao abd Phum Thlok, Khum Chrok Mtes, 105 Ha No operation No construction Srok Svay Teab, Svay Rieng Province 6 Manhattan SEZ Bavet Commune, Chantrea District, Svay Rieng Province 7 Poi Pet O Neang SEZ 8 Doung Chhiv Phnom Den SEZ 157 Bicycle Manufacturing Bolt-Nut Manufacturing Footwear Manufacturing Garment Manufacturing Hi-tech equipment recycling Hospital Neoprene wetsuits Manufacturing Packing Bag Factory Packing Bag Manufacturing Manufacturing packing products for export 23 companies located Capital: USD 183 million Poipet Commune and Nimit Commune, O Chhrov 467 Ha Jewerly Packing Manufacturing 1 company located District, Banteay Meanchey Province Capital: USD 0.8 million Kiri Vong District, Takeo Province 79 Ha No operation No construction 9 Phnom Penh SEZ Khan Dangkao, Phnom Penh and Ag Snuol District, Kandal Province 350 Pure Drinking Water Factory Dry Port Textile and Printing Factory Electric Pole Factory Shoe Manufacturing Garment) Motor Assembly, Accessories and Spare Parts) Steel Processing Factory: Material for Construction Sugar Packing Plastic Box Manufacturing Processing Cartons and Papers Production Power Plant Plastic Factory Manufacturing Seasoning and Processing Food 55 companies located Capital USD 267 million Final Report 2-86

3 ] for Sstrengthening of Connectivity through the Southern Economic Corridor SQ Name of SEZ Location Land Area Major Companies Note 10 Kampot SEZ Koh Touch Commune, Kampot District, Kampot 145 Ha No operation Under construction Province 11 Sihanoukvill SEZ 1 Stung Hav District, Sihanoukville City 178 Ha Coal fired power plant 1 company located Capital: USD 195 million 12 Tai Seng Bavet SEZ Bavet District, Svay Rieng Province 99 Ha Bicycle Manufacturing Footwear Manufacturing Garment Manufacturing 20 companies located Capital: USD 75.million 13 Oknha Mong SEZ Sre Ambel District, Koh Kong Province 100 Ha No operation No construction 14 Goldfame Pak Shun SEZ 15 Thary Kampong Cham SEZ 16 Sihanoukville SEZ 2 Sa Ang District, Kandal Province 80 Ha Carton, Printing Plastic Label and Knitting Factory 3 companies located Capital USD27 million Da Commune, Memot District, Kampong Cham Province Pou Thoung Village, Betrang Commune and Smach deang Vilage, Ream Commune, Prey Nop District, Sihanoukville 17 D&M Bavel SEZ Bavet Commune, Chantrea District, Svay Rieng Province Ha Vegetable Processing Factory 1 company located Capital: USD 26 million 1688Ha Garment Manufacturing Factory 27 companies located Motor Bicycle Assembly) Capital: USD 70 million Plastic Production Ha No operation No construction 18 Sihanoukville Port Tomnop Rolok Area, Sangkat Lek1 and Lek3, Khan 67.5 Ha Carbon Box Manufacturing 1company SEZ Meattapheap, Sihanoukville Capital:USD21 million 19 Kirisakor Koh Khum Prek Kasach, Srok Kirisakor, Koh Kong 1750 Ha No operation No construction Kong SEZ 20 Kampong Saom Village 4, Sangkat Ortres, Khan Stung Hav, 255 Ha No operation No construction SEZ Sihanoukville City 21 Pacific SEZ Salatean and Preytob Village, Chhrok Mates Ha No operation No construction Commune, Svay teap District, Svay Rieng Province 22 Phnom Penh Port New Phnom Penh Port, Kandal Distrct 300 Ha No operation Under planning SEZ Source: JICA survey team, based on CDC data Final Report 2-87

4 ] for Sstrengthening of Connectivity through the Southern Economic Corridor Final Report 2-88 Poipet O'Neang SEZ B 53A Neak Kok Koh Kong SEZ 8 8 Souy Chheng SEZ Pacific SEZ Oknha Mong SEZ N.L.C. SEZ Kirisakor Koh Kong SEZ Tai Seng SEZ Stung Hav SEZ Manhattan SEZ Thary Kampong Cham SEZ Sihanoukville SEZ 1 Kampong Saom SEZ S.N.C. SEZ Phnom Penh Port SEZ Goldfame Pak Shun SEZ Phnom Penh SEZ D&M SEZ Sihanoukville SEZ 2 Sihanoukville Port SEZ Kampot SEZ Doung Chhiv Phnum Den SEZ Source: JICA survey team Figure Location Map of SEZ

5 Table Characteristics of Major SEZs Name of SEZ Phnom Penh SEZ Manhattan SEZ Tai Seng Bavet SEZ Dragon King SEZ Developer Phnom Penh SEZ Co., Ltd: Ms. Lim Chiho (Cambodia-Chinese) 78% Zephyr Co., Ltd 22% Manhattan International Co., Ltd: Tai Seng Enterprise Group, Tai Seng Universal Joint International Group (Taiwan): Bavet SEZ Co., Ltd Majority shareholder Dragon King SEZ Co., Ltd. Date of establishment Site Developing Area Electricity Water Drainage Facility October 2006 November October km from the center of Phnom Penh City 8km from the Phnom Penh International Airport, It is located 154km from Phnom Penh City through national highway route 1of Cambodia. It is located 6km from Babet (border to Vietnam). It is located 86km from Ho Chi Minh Port through national highway route 22 of Vietnam. Total Area:360 ha 1st period:141ha (already developed) Total Area:180ha 2nd period:162ha (started construction 1st period:20ha(mainly commerce area) in January 2011) 2nd period:60ha(manufacturing area) 3rd period:57ha (housing area) 3rd period:65ha(manufacturing area) It is supplied by public transmission line, but an original power plant is prepared by establishment joint venture, It is supplied by public transmission line both Colben Energy PPSEZ Ltd with from Cambodia (Svay Rieng Province) and Singapore capital. The capacity of Vietnam. The main source is from Vietnam. generation of electric power is 13 NW and the fuel is crude oil. It is located 154km from Phnom Penh City through national highway route1 of Cambodia. (It is 151km at subphase) It is located 6km from Babet (border to Vietnam). It is located 86km from Ho Chi Minh Port through national highway route 22 of Vietnam. Total Area:125ha Main Phase:77ha Sub Phase:48ha It is supplied by public transmission line both from Cambodia (Svay Rieng Province) and Vietnam. The main source is from Vietnam. It is located 148km from Phnom Penh City through national highway route 1of Cambodia. It is located 12km from Babet (border to Vietnam). It is located 92km from Ho Chi Minh Port through national highway route 22 of Vietnam. Total Area:120ha It is supplied by public transmission line both from Cambodia (Svay Rieng Province) and Vietnam. The main source is from Vietnam. Filtration plant inside SEZ: The maximum capacity of supply is 5,300m3 underground water underground water underground water /day(1st period) Drainage facility inside SEZ: The maximum capacity of disposal is 4,500 Planning stage Planning stage Planning stage m3 /day (1st period) Telephone circuit 9 companies are constructing light fiber 1(Metfon) To be used in the SEZ 1(ezecom) To be used in the SEZ Related Facility Bank, Dry Port, Chinese restaurant, M inimart and clinic At the middle of 2012, accommodation for management staff will be constructed. Ground Rent USD 55/ m2 :Lease contract for 50 years USD 25/ m2 (excluding tax):lease contract for 50 years USD 22/ m2 (excluding tax):lease contract for 50 years USD 25/ m2 (excluding tax):lease contract for 50 years Rental Factory USD 2.50m3 /month (excluding tax) Ground:USD 0.1/ m2 factory:usd Ground:USD: 1/ m2 Building:USD 2/ m2 1.6/ m2 Office:USD 2.8/ m2 (Building (Building only) only) There is a plan of rental factory. Electric Charges USD 0.193/kwh USD /kwh USD /kwh USD /kwh Water Charges USD 0.30/ m3 USD 0.15/Ton free because of using underground water (with the condition that tenants sink a well) Drainage Charges USD 0.26/ m3 (calculation standard: 80% of used water fee) USD 0.25/Ton free free Telephone Charges Management Charges State of Lease Japanese Tenant Procedure of Tax Tax Charges Others To be confirmed at the telecommunication company outside Expense for maintenance infrastructure: USD 0.06/ m2 /month(+10%vat) Expense for collecting garbage:usd 80 ~300/month(+10%VAT) The number of companies:23(10 Japanese, 5 Taiwanese, 2 M alaysian etc.) Tiger Wing, Yamaha Motor, Ajinomoto, Clean Circle, Books Urarakana, Dishells, Proceeding, First Silk Trading, M inebea, O and M industrial arts, Combi, Sumitomo Wiring Systems, M arunix, Daiwa Onkyo, Kyowaseikan, Phone's Morofuji power, Rocks, japan medical Products, Daiwa Konpo, Marusan metal, Taika, Taiwa machine, Foot mark, GS eletech, Nikko Metal, Russian, Meikodo, Four Spirits It is possible to pass the customs inside the SEZ Based on the Law of Investment and other regulations The only EZ in Phnom Penh, There are Japanese permanent staff. To be confirmed at the telecommunication company outside To be confirmed at the telecommunication company outside USD 0.04/ m2 /month(+10%vat) USD 0.04/ m2 /month(+10%vat) USD 0.04/ m2 /month(+10%vat) The number of companies:21(1japanese, 10 Taiwanese, 5 Chinese, 2 Vietnamese etc.) Including the companies under construction and under application of investment license It is possible to pass the customs inside the SEZ Based on the Law of Investment and other regulations The SEZ is located along the border to Vietnam. Ho Chi Minh Port is used when importing materials/ parts and exporting finished goods. The number of companies:13(8 Japanese, 3 Taiwanese etc.) Including the companies under construction and under application of investment license Dohko, Yorks, Swanee, Towa, Nakayama commercial firm, ronchester, Japana, Kaken Sales, Tokyo Parts, label Sekchul, RKT It is possible to pass the customs inside the SEZ Based on the Law of Investment and other regulations The SEZ is located along the border to Vietnam. Ho Chi M inh Port is used when importing materials/ parts and exporting finished goods. None It is scheduled to open one-stop service office. Based on the Law of Investment and other regulations The SEZ is located along the border to Vietnam. Ho Chi Minh Port is used when importing materials/ parts and exporting finished goods. Draft Final Report 2-89

6 Name of SEZ Developer Date of establishment Sihanoukeville Port SEZ Sihanoukeville SEZ Koh Kong SEZ Poipet SEZ Sihanoukeville Autonomous Port Authority (PAS) Development Project used the loan by Japanese government (3.6 billion yen) Jiangsu Taihu Cambodia International Economic Cooperation Investment Co., Ltd Cambodia International Investment Development Group Co., Ltd L.Y.P Group Co.,Ltd September 2009 October Chhay Chhay Investment Site It is 230km from Phnom Penh. It is located next to the Sihanoukeville Port. It is 15 km from Sihanoukeville airport. It is 218km from Phnom Penh, 12 km from Sihanoukeville Port and 3 km from Sihanoukeville airport. It is 297km from Phnom Penh, 470km from Bangkok, 370km from Laem Chabang Port, 233km from Sihanoukeville. It is about 10km from the border to Thailand, Poipet. Developing Area Total Area:70ha Total Area:11.13k m2 Total Area:340ha 1st period:230ha(for industry), 70ha(for commerce), Dry Port (28ha) 2nd period:155ha Electricity It is panning to buy electric from EDC (Electricite Du Cambodge) The SEZ has a facility for receiving and supplying electricity inside the SEZ. It has supply by public transmission line. There is an original power plant of 2MW. It is supplied from Thailand with the help of L.Y.P Group(12MW). The amount of supply It is supplied from Thailand is scheduled to 20 MW in Water underground water in the SEZ:2,000 m3 /day It is to develop the filtering facility inside the SEZ 5,000 m3 /day Underground water Drainage Facility Drainage (concentrated) facility inside the SEZ: 2,000 m3 /day Planning stage Planning stage Planning stage Telephone circuit To be used telecommunication company outside Met Phone is interested in this SEZ Related Facility Ground Rent Logistic base (container freight station) is just next to SEZ. It will be constructed accommodation for foreigners (20 houses) and staff (2 building, for 500 staff). USD 65/ m2 :Lease contract for 50 years (less than 1ha) USD 47.5/ m2 :Lease contract for 25 years (less than 1ha) Investors pay the 10% of the collection of taxes at the source of income USD 28/ m2 (excluding tax):lease contract for 50 years USD 14/ m2 (excluding tax):lease contract for 20 years USD 7/ m2 (excluding tax):lease contract for 10 years Rental Factory There is a plan of rental factory. USD 1.60 m3 /month (excluding tax) There are resort hotels developed by L.Y.P Group nearby. <Lease constrict of ground> USD 40/ m2 (excluding tax):lease contract for 99 years USD $30/ m2 (excluding tax):lease contract for 70 years USD 20/ m2 (excluding tax):lease contract for 20 years USD 1.58/ m3 /month ( for 30 years), USD 1.75/ m3 /month (for 20 years), USD 2.00/ m3 /month (excluding tax):(for 10 years) <Lease contract of ground> USD 33/ m2 (excluding tax):lease contract for 50 years There is no plan. Electric Charges USD 0.33/kwh USD 0.25/kwh 6.5 Baht/kwh(No maximum limit) USD 0.12/kwh Water Charges USD 0.30/ m3 USD 0.15/ m3 (+10%VAT) 18 Baht/ m3 (+10%VAT) USD 0.35/ m3 (excluding tax) Drainage Charges USD 0.35/ m3 (80% of the expense of water supply) free free free Telephone Charges To be confirmed at the telecommunication company outside To be confirmed at the telecommunication company outside To be confirmed at the telecommunication company outside Management Charges USD 1.00/ m2 /year(+10%vat) USD 0.04/ m2 /month(+10%vat) USD 0.04/ m2 /month(+10%vat) Free of charge as of now When services are start, it start to consider to collect State of Lease After on December 2011, it is possible to construct factory (interior finish work at management office is implementing). The number of companies:22(7 are operating, 12 have got the license of investment, 3 are applying investment) The number of companies:3 The number of company:1 Japanese Tenant Oji haruta bakking Asure electric, Izumi Electron Yazaki Corporation, M ikasa None Procedure of Tax Tax Charges Others Source: CDC data It is possible to pass the customs inside It is scheduled to pass the customs inside the the SEZ It is possible to pass the customs inside the SEZ Based on the Law of Investment and other Based on the Law of Investment and other Based on the Law of Investment and other re regulations regulations Developed by the Loan from Japanese Government. As the SEZ is located neighboring to Sihanoukville Port. It is convenient to export and import. The SEZ is located 12km from Sihanoukville Port. The developer is a Chinese. The SEZ is located along the coast area and along the border to Thailand. It takes six to seven hours by land from Laem Chabang Port in Thailand. It is scheduled to open one-stop service office. Based on the Law of Investment and other regulations The SEZ is located along the border of Thailand and Cambodia and the south economic corridor. It takes 3three hours by vehicle from Bangkok. Draft Final Report 2-90

7 (2) Observation of SEZs (a) SEZs in Phnom Penh Area JICA survey team carried out to survey the SEZ in Phnom Penh Area. There are several industrial parks in Phnom Penh Area, but as for the SEZ, there is only one (1) SEZ and one more SEZ is now under planning. Phnom Penh SEZ Phnom Penh Port SEZ Source: JICA survey team & PPAP Figure Special Economic Zone in Phnom Penh Table Features of SEZs in Phnom Penh Area Items Phnom Penh SEZ Phnom Penh Port SEZ Establishment Year 2006 Year 2014 (Planned) Location 18 km from city center 30 km from city center Area (ha) 360 ha 125 ha Factories set up 55 factories are located, 28 Japanese factories - Source JICA survey team As of December 2012, 55 factories are located in Phnom Penh SEZ. Out of 55 factories, 28 factories are from Japan. Total investment capital of 55 factories is over US$ 267 million. This SEZ is the biggest out of 22 SEZs in Cambodia. Phnom Penh Autonomous Port (PPAP) is planning to develop SEZ near the new port in order to support New Container Terminal (NCT). This project is under preparatory survey by JICA, brief of which is as follows. - Infrastructure : Bonded Warehouse, Agricultural Processing Zone and Industrial zone - Location : PK 30 along NR1, opposite side of New Container Terminal - Size: Approximately 300ha (b) SEZs in Bavet area JICA survey team visited few factories of SEZs being operated in Bavet area, which is near the border of Vietnam. There are 4 SEZs in Bavet, namely Manhattan SEZ, Tai Seng SEZ, Dragon King SEZ and Manhattan 2 SEZ. Latter two SEZs are under construction at this stage and first two SEZs are being operated. From these SEZs, distance to border of Vietnam is less than 10 km and Ho Chi Minh in Vietnam is situated around 60 km from the border. Figure below shows entrance gate of the SEZ being operated. Draft Final Report 2-91

8 Tai Seng SEZ Source: JICA survey team Figure Special Economic Zone in Bavet Manhattan SEZ Table below indicates main features of two SEZs being operated. Table Features of SEZs in Bavet Items Tai Seng SEZ Manhattan SEZ Establishment Year 2006 Year 2006 Location 6 km from border 6 km from border Area (ha) 125 ha 180 ha Factories set up Source JICA survey team 8 Japanese factory out of 13 factories 1 Japanese factories out of 21 factories In accordance with the discussion in the meeting between SEZ management office and factories in SEZ (Tai Seng) and subsequent individual interviews (Tai Seng & Manhattan SEZ) to factories by the survey team in January 2013, there are number of issues to be resolved and improved in the SEZ Electricity supply is unstable and there are a few instantaneous interruptions of supply in a day as well as whole day supply stops sometimes. There are two main reasons for this unstable electricity supply, which are 1) electricity supply is from Vietnam through Electricité du Cambodge (EDC) and 2) there is no alternative means for supply stops, like stand-by generators. Workers often resign and shift to other factories. When more SEZs are opened at this area, work force may be shortage and worker shifting be more often. There is no transportation system for workers to commute to SEZs. Currently workers use trucks having seats and National Road 1 around SEZs is terribly congested in the morning and evening every day. Congestion is shown in the figure below. Draft Final Report 2-92

9 Source: JICA survey team Figure Road Congestion around SEZ in Bavet - - Water is taken from underground and there is no sewerage system after water use. When more factories are in operation, water supply and sewerage system will encounter with supply and environmental problems. Custom procedure is smooth but informal payment is being requested. This kind of practice has to be improved to cope with international standard of custom process. (c) Koh Kong SEZ The SEZ is located near the border in Cham Yeam area, the western seaboard of Cambodia. It is 330 km from Leam Chabang port of Thailand and 233 km from Sihanoukville port. The SEZ provides ease-of-access to seaside trading to Thailand and Vietnam. Furthermore, NR 48 and the new expansion of road and highway to Thailand make the SEZ provide convenient transportation. Thus, product company seeks to operate in cost-effective logistic and supply chain, where import and export goods can be in transit through Laem Chabang port, Thailand, and directly to the factories gate. There is only one SEZ in Koh Kong Province, currently. Tenants are only four (4) in 2012, three (3) tenants among four (4) are producing product and another one (1) probably start to produce in Koh Kong SEZ details are as follows. [Operating Factory] Camko Motor Company Ltd. (Assembly, Factory of Hyundai from Korea) KKN Apparel Co., Ltd (Garment Factory from Taiwan) Yazaki (Cambodia) Products Co., Ltd. (Electric Wire from Japan) Draft Final Report 2-93

10 Item Table Outline of Koh Kong SEZ 1 Location (province) Koh Kong 2 Kind of IP Special Economic Zone 3 Developer name Koh Kong SEZ 4 Details of developer Cambodian 100% 5 Year of development Area total area (ha) 336 occupied area (ha-%) 31 ha 9 % 7 Factory details Number 4 Country Products 8 Fee etc. product delivery in Vietnam and Thailand export (country) land rental (USD/m 2 ) Koh Kong Special Economic Zone Japan, Korea, Thailand Auto accessories, Sport Equipment, Garment Yes Australia, Thailand, USA USD 30 / 30yrs USD 40 / 40yrs infrastructure maintenance fee (USD/m 2 -year) USD / month electricity fee (USD/kwh) USD 0.22 (in baht 6.50 Baht) / Kwh fresh water (USD/m 3 ) USD 0.6 / m 3 waste water (USD/m 3 ) - other charges - 9 Incentives income tax Up to 9 years 0 % other items Import-Export Tax 0% 10 Other features - Unrestricted repatriation of profit - Tax exemption on import of raw material, equipment, construction material. Source JICA survey team Entrance of SEZ Source JICA survey team Figure Operating Factory Special Economic Zone in Koh Kong Draft Final Report 2-94

11 (d) SEZs in Sihanoukville Area Data Collection Survey on the Trunk Road Network Planning (i) Sihanoukville Port SEZ The Sihanoukville Port Special Economic Zone (SEZ) was established by referring to the concept originally proposed in the Master Plan Study for Phnom Penh Sihanoukville Growth Corridor Development (MP) in 2003, carried out by JICA in coordination with the Ministry of Commerce. It is essential for Cambodia to diversify its monotonous industrial structure, which depends heavily on the garment industry, for its sustainable economic development. For achieving this, diversifying the export commodities and accumulating new technologies by Foreign Direct Investment (FDI) are inevitable. Therefore, the MP proposed the establishment of a new promotional economic zone at the site adjoining the Sihanoukville Port, the only international deep seaport in Cambodia, and confirmed its feasibility. Based on the study results, Cambodia Government made an official request to the Government of Japan to develop the Sihanoukville Port SEZ through Japan Official Development Assistance (ODA). Development of the USD 40 million project began in 2009 and was established on 70 ha of land area adjacent to the container terminal within the Port Authority of Sihanoukville (PAS) s domain, which is the best advantage for transportation and operation. [Investment Incentives] - Up to 9 years tax holiday - Full import duty exemption such as raw materials, machinery, equipment, and construction materials - No export tax - The Royal Government authorizes to employ foreign expatriate up to 10% of total workforce - Permanent visa for families and investors - Long term lease up to 50 years Construction of SEZ was completed in March Currently, there is only one company under preparation for production in this SEZ. Layout of SEZ is shown below. Draft Final Report 2-95

12 Entrance of SEZ Factory under Construction Source: PAS & JICA survey team Figure Layout and Photos of Sihanoukville Port SEZ (ii) Sihanoukville SEZ 2 Sihanoukville Special Economic Zone (SEZ) was established in October The investors of this SEZ were Chinese investment company with Cambodian Investment Company. The SEZ is located at 12 km from Sihanoukville port and 3 km from Sihanoukville airport. As of end of 2012, tenants are 27 companies, of which 21 companies are from China, 2 are from Japan and remaining 4 are from French, USA, etc. 10 of these companies are garment related factories, and the others are shoes factory, bag factory, house apparatus, etc. Draft Final Report 2-96

13 Item Establishment October 25, 2006 Location Area (km 2 ) No. of Factories Main Product Source JICA survey team Data Collection Survey on the Trunk Road Network Planning Table Outline of Sihanoukville SEZ 2 Sihanoukville SEZ 13 km from Sihanoukville and 3 km from Sihanouk Airport 1,113 ha 2 - Japanese companies 22-Chines company 3 - Others (France, USA, Ireland) Total 27 companies Garment, Shoe, Leather, Sofa cover, Bag, Carpet TV aluminum frame, Vehicle assemble, Steel product, etc. Pharmacy, Industrial Development in Thailand (1) Industrial Estate in Thailand The survey team conducted to survey the industrial business in Thailand and how Thailand was tackling to invite foreign investors and achieved the economic growth. The point of view to investment to other country, company should consider how much it can get the incentive for foreign company. Government of Thailand has been discussing about the incentive services in order to invite foreign company to invest to Thailand and established Board of Investment (BOI) for this business concerns in 1970s. The objective of establishment of government support is to implement the investment incentive package and to stipulate the tax favor to foreign companies. Therefore, Thailand could achieve the growth of each regional and manufacturing industry sector rapidly. Source: website of industrial park in Thailand And Industrial Estate has likely recovered worldwide economic downturn by Lehman crisis according to the economic index in 2008 to 2010, number and amount of investments by zones, for 3years. Thus, economic in Thailand has been lifted up and sustainable growth among ASEAN countries, currently. Figure Location of Industrial Estate in Bangkok Area In Thailand, there are 3 zones to manage the industrial areas (refer to Table 2.6-7) and government considers to accord the different incentive to each zone. Among this 3 zones, the investments to Thailand are concentrated into large Industrial Estate at zone 2, according to the number and amount of investment categorized by Board of Investment Draft Final Report 2-97

14 (BOI). The investments to Zone 2 in 2010 are 38.5% of all zone, the number of investments are 605 companies. The investments by foreign capital are accounted 50.1% in the majority of zone 2. On the other hand Japanese company is 205 investments, and it is still higher percentage (59.9%) among investors. Zone 2 has been invested 63.4 billion baht by Japanese company in accordance with amount of investments, and it is accounted 63.2% of all investment from Japanese company (refer to Table 2.6-8, 2.6-9). The investments to Rajona Prefecture, eastern of Bangkok, is accounted 25.1% (152/605 investments) of zone 2, amount of investments are accounted 34.5% (84.1/244.1 billion baht). Industrial Estate in Rajona has been provided benefits of zone 3 while Rayon is categorized zone 2. Leam Chabang Industrial Estate in Chonburi Prefecture has provided the benefits as well. Therefore zone 2 in east side of Bangkok has provided the benefits as well as zone 3 until December 31st, The benefits attracted to investments. Table Industrial Estate Zones Zone 1 Zone 2 Zone 3 (1) Zone 3 (2) Source: BOI Statistic Bangkok Capital region: 6 Provinces Around Capital Region : 11 provinces and Phuket Required support area: 36 provinces Special required support area : 36 provinces Bangkok, Samut Prakarn, Samut Sakorn, Pathum Thani, Nonthabri, Nakhon Pathom Samut Songkhram, Ratchaburi, Kanchaburi, Suphanburi, Ang Thong, Atutthaya, Saraburi, Nakhon Nayok, Chachoengsao,, Chonburi, Rayong, Phuket Krabi, Kampheang Pet, Khonkean, Chanthaburi, Chainat, Chumphon, Chiang Rai, ChienMai, Trang, Trat, Tak, Nakhon Ratchasima, Nakhon Si Thammarat, Nakhon Sawan, Prachua Bkirikhan, Prachinburi, Phang Nga, Phatthalung, Phichit, Phisanulok, Petchaburi, Petchabun, Mukdahan, Mae Hong Son, Ranong, Lopbiri, Lampang, Lumphun, Loei, Songkhla, Sa Kaew, Singburi, Sukothai, Surat Thani, Uttaradit, Uthaithani, Kalasin, Chaiyaphum, Nakhon Phanom, Narathiwat, Nan, Bruriram, Pattani, Phayao, Phrae, Maha Sarakham, Yasothon, Yala, Roi Et, Sisaket, Sakon Nakhon,,Satun, Surin, Nog Khai, Nong Bua Lamphu, Amnat Charoen, Ubon Ratchathani, Udon Thani zone All investment Table Number of Investment by Zone Foreign Capital Japanese Company Japanese Company Foreign Capital Japanese Company Japanese Company Foreign Capital Japanese Company Zone Zone Zone Total 1, , , Source: BOI Statistic Table Amount of Investment by Zone Unit billion bart zone All investment Foreign Capital Japanese Company All investment Foreign Capital Japanese Company All investment Foreign Capital Japanese Company Zone Zone 2 3,655 2, , ,441 1, Zone , Total 4,978 3,511 1,062 2,814 1, ,912 2,792 1,003 Source: BOI Statistic Draft Final Report 2-98

15 (2) Industrial Estate Authority of Thailand (IEAT) and Preferential Benefits (a) Outline of Industrial Estate When a company starts to operate industrial business concerns in Thailand, they can select to set up in 3 potential industrial land involvements as below; (i) Industrial Estate, management by IEAT, (ii) Industrial Park, development and management by Private Company (iii) Out of Industrial Estate Firstly, a company is considering some expected benefits or incentives to invest to Thailand such as land purchase, land ownership, foreign capital ratio, facility imports and employment of foreigner as well as well-developed infrastructure. However, it will be slightly more expensive when business is set up in Industrial Estate or Park. Even so, most of foreign company selected those industrial areas in accordance with Japan Chamber of Commerce in Thailand. It is said that Industrial Estates or Parks have 60 places in Thailand, currently. 44 Industrial Estates located to be managed by IEAT among 60. Regarding the locations of 44 Industrial Estates managed by IEAT, 28 numbers of Industrial Estates are concentrated in Zone 2. Others are 10 at Zone 1 and 6 at Zone3. In particular in zone 2, the southeast of Bangkok (8 places Chonburi, Rayong 10 places) are concentrated in Industrial Estate that has integrated mainly in the automobile industries and lined up the heavy industry factories. According to survey report of Japan Bank for International Corporation (JBIC) in 2010, Thailand is the 4 th position of the prospectively destination country among 4 countries that are Thailand, China, India and Vietnam. However, the evaluation of infrastructure development in Thailand is overwhelmingly higher than the other three countries. Industrial estates in Thailand sufficiently installed basic infrastructure that is enough to proceed with the construction of the factory quickly. IEAT is also developing rental factory and warehouse business in the area. This provision is to reduce the initial cost and to start the production quickly. It is better for medium and small size companies. (b) Outline of IEAT IEAT is a government agency that is beside Ministry of Industry, which was established under the laws of the Industrial Estate Authority of Thailand. This Authority was established to 1) improve the competitiveness of the industrial estate developer, 2) provide counseling services to foreign investors and 3) grant the benefit to industrial tenants. In case of foreign-invested company which is greater than 50% of capital ratio will conduct the service industry, basically there were two ways, either approval of BOI or encouraged businesses to obtain a business license from Ministry of Commerce. And currently, there is another way to obtain this kind of license. When investors decide to locate the business in Industrial Estate, they can obtain the license complementary. In addition, IEAT can obtain another incentive from BOI. Operation in the Industrial Estate managed by IEAT will be classified into nine sectors as the followings other than category of incentive restrictive business even greater than 50% of capital ratio. Draft Final Report 2-99

16 Table Category of Incentive Business under IEAT Management Category of Incentive Restrictive Business Specific Incentive Business Source: JICA survey team 1. Agriculture or related product 2. Mining and Ceramics 3. Light Industry 4. Metal Product and Transport Apparatus 5. Electronic Parts 6. Chemical Product 7. Communal Facility or related services 1. Distribution for industrial goods or goods for the production of industrial products 2. Logistics and supply chain project (such as warehouse service and logistic center) 3. Exhibition and convention center business 4. Repair, maintenance and engineering business 5. Industrial research and development 6.Communication, computer, information, multimedia and entertainment media business 7. Health and sanitary business (such as hospital, health center, health promotion center, sports center and health recovery management center) 8. Educational service (such as educational institution, training center) 9. Others as required (c) General Industrial Zone and Free Zone by IEAT IEAT were classified into two zones there are general processing zone and free zone (the conventional export processing zone) when Industrial estate law has been revised at the year [General processing zone] Tenants can obtain the above services under IEAT management. They can be favored the Non-tax benefits such as land ownership, foreigner work permit, and bringing out of foreign currency. [Free zone] Tenants can obtain as well as general processing zone and also obtain the tax benefits that are exempted VAT, import duty and excise duty for machinery, equipment and raw materials. In addition, the duty-free import of machinery as well as for the construction of factories and buildings, equipment, and parts. In case of tenant product and sell to inside of Thailand, raw materials procured in Thailand are exempted customs duties. Also, if you have conduct a sale of products or provide a service between tenants in the free zone will be exempted VAT. Other than tax concerns, tenant can obtain specific benefits such as exempt some procedures of import permit and quality certification in case of product and raw materials brought into the free zone in order to sell, give service and product final goods. (d) Compare with Benefit of BOI When a company works on business development in Thailand, many manufacturing industries have approved the encouragement of industry by BOI, and have received the benefit. While if a company has been approved by the BOI, the company has to take some procedures, such as reporting to BOI so that some companies do not take an application to the BOI to avoid procedures. Located inside of Industrial Estate, IEAT can support such a complicated procedure and report. The following Table is comparison of the benefits between IEAT, incentive of BOI and other Industrial Park or Land for investors selection. Draft Final Report 2-100

17 Item Engaged Industries (Foreign Capital) Foreign Capital Ratio Data Collection Survey on the Trunk Road Network Planning Table Benefit by BOI Encouraged Business by BOI Less than 49% foreign capital industry regulations, without encouraged Business by BOI Comparison of Benefits Benefits for company in Industrial Estate managed by IEAT Encouraged Business by BOI Possible to be approved Some Service Less than 49% foreign capital industry regulations, without encouraged Business by BOI or approved service by IEAT Corporate income tax Available for exemption Unavailable Unavailable Import Tax on machinery Available for exemption Available for exemption Unavailable and equipment Import Tax Available for exemption Unavailable for General raw materials for export products for 1year or 5year depend on the area Industrial Zone, Available for exemption Land purchase and ownership (Foreign Capitals) Benefits for company in Industrial Park managed by private without BOI approval Impossible to engage in industries that are regulated by the Foreign Business Less than 49% foreign capital industry regulations, without encouraged Business by BOI Unavailable (possible to refund of customs duty on some procedure) for Free Zone Available Available No registration of land ownership Foreign labor Available Available regulation for the Foreign Business Act Preferential of visa Available Available Unavailable Source: JICA survey team Table List of Industrial Estate in Thailand (Example) Name of Pinthong Industrial Rojana I.P 304 I.P Rayong I.P Industrial Estate Park Area Ayutthaya Prachinburi Rayong Chonburi BOI Zone2 Zone3 Zone2 Zone2 Developer PINTHONG 304 Industrial Park Rayong Industrial SUMIKIN BUSSAN INDUSTRIAL PARK Co., Ltd Co., Ltd. CO., LTD. Project Area 6,000 RAI 10,000RAI 506 RAI Completed / June /Feb Main road Management Charge 4 lanes 4 lanes asphalt pavement 2 lanes 24m asphalt pavement 4 lanes concrete pavement 800 baht/rai/month 600 baht/rai/month 500 baht/rai/month 700 baht/rai/month Electricity 70 KVA/RAI 300 MW Power Plant 40 MW-Substation and 117 MW-SPP 50 KVA / RAI Power Plant Water 6~9 cu.m/rai/day 100 cu.m./rai/day 30 cu.m./rai/day 1,500 cu.m./day Drainage 16,000cu.m./day 70,000 cu.m./day 3,000 cu.m./day 1,200 cu.m./day Telephone circuit Facility Source: JCA survey team Readily Available More than 3,000 line 1,028 line Unlimited under construction for DFZ Hospital, Bank, Restaurant, Gasoline stand, Fresh market Restaurant, Canteen, Apartment Draft Final Report 2-101

18 2.6.3 Industrial Development in Vietnam Data Collection Survey on the Trunk Road Network Planning In Vietnam, Decree 29 was issued in March 2008 and specifies three kinds of industrial zones, namely Industrial Parks, Export Processing Zones and Economic Zones. Each one is given interpretation in the Decree as follows. Industrial Park means a zone that specializes in the production of industrial goods or provision of services for industrial production, has specified geographical boundaries, and is established under the conditions and according to the order and procedures specified in this Decree. Export Processing zone means an industrial zone that specializes in the production of export good, provision of services for export goods production and export activities, has specified geographical boundaries, and is established under the conditions and according to the order and procedures applicable to industrial parks specified in this Decree. (note) Industrial parks and export processing zones are collectively referred to as industrial zones, unless they are specifically referred to. Economic zone means a zone that has a separate economic space with particularly favorable investment and business environment for investors, has specified geographical boundaries, and is established under the conditions and according to the order and procedures specified in this Decree. There are investment incentives for industrial zones and economic zones, such as 50 % reduction of payable income tax etc. In south of Vietnam, lots of industrial zones are established, as shown in the figure below. Source: website of industrial zone in Vietnam Figure Location of Industrial Zones in South of Vietnam Because of huge population, economic dynamism and existence of good ports in particular in the region, numbers of industrial zones are set around Ho Chi Minh City. Name and area of those zones are shown in the table below. Draft Final Report 2-102

19 Table Name and Area of Industrial Zones in South of Vietnam [Tay Ninh] 1 Linh Trung III (204ha) 2 Trang Bang (191 ha) [Bing Duong Province] 1 Song Than I (180ha) 2 Song Than II (319ha) 3 Dong n (132ha) 4 Binh Duang (17ha) 5 Tan Dong Hiep A (53ha) 6 Tan Dong Hiep B (164ha) 7 Viet Huong (46ha) 8 Binh An Garment and Textile IP (26ha) 9 Viet Huong II (250ha) 10 Viet-Singapore (500ha) 11 My Phuoc (377ha) Source: JICA survey team [Ho Chi Minh Province] 1 Tan Thuan (300ha) 2 Linh Trung I (62ha) 3 Linh Trung II (62ha) 4 Binh Chieu (27ha) 5 Tan Tao (444ha) 6 Cat Lai II (117ha) 7 Tan Binh (151ha) 8 Tan Thoi Hiep (29ha) 9 Le Minh Xuan (100ha) 10 North West Cu Chi (220ha) 11 Hiep Phuoc (332ha) 12 Vinh Loc (207ha) [Ba Ria Vung Tau Province] 1 My Xuan A (270ha) 2 Dong Xuyen (161ha) 3 Phu My I (954ha) 4 Cai Mep (670ha) 5 My Xuan A2 (313ha 6 My Xuan B1 (572ha) [Dong Nai Province] 1 AMATA (361ha) 2 Nhon Trach I (430ha) 3 Nhon Trach II (533ha) 4 Nhon Trach III (368ha) 5 Go Dau (184ha) 6 LOTECO (100ha) 7 Bien Hoa II (365ha) 8 Bien Hoa I (335ha) 9 Song May (227ha) 10 Ho Nai (230ha) 11 Nhon Trach Garment and Textile IP (184ha) 12 Dinh Quan (54ha) 13 Tam Phuoc (323ha) 14 Long Thanh (510ha) JICA survey team has visited Trang Bang Industrial Park in Tay Ninh Province, Tan Thuan Export Processing Zone and Hiep Phuoc Industrial Park in Ho Chi Minh Province and Phu My I Industrial Park in Ba Ria Vung Tau Province and interviewed to management office in those zones. Basic information for those industrial zones is shown in the table below and important points are compiled hereinafter. Tran Bang Park located in Tay Ninh Province is set up for easy recruitment of factory workers. Though border to Cambodia is very close, most products are delivered to Ho Chi Minh and not to Cambodia. Tan Thuan Export Processing Zone and Hiep Phuoc Industrial Park in Ho Chi Minh and Phu My I Industrial Park in Ba Ria Vung Tau Province have own ports or are located near ports, so that import and export of material and products are very convenient. Some zones are having custom office within the zone area, and then cargo packing could be done in the factory for checks in front of custom officers. Some factories in Phu My I Industrial Park export goods to Cambodia and main route is through Phu My I =>NR 51 => NR 1 => NR22 => Moc Bai (border). Main export goods are steel, gas and fertilizer, Export from Hiep Phuoc Industrial Park to Cambodia is fertilizer through NR 22 => Moc Bai (border) or Mekong River. Hiep Phuoc Industrial Park has own power plant, and hence power supply is always constant and stable. Draft Final Report 2-103

20 Table Summary of Industrial Zone in South of Vietnam Item Trang Bang Industrial Park Tan Thuan Export Processing Park Phu My I Industrial Zone Hiep Phuoc Industrial Zone 1 location (province) Tay Ninh Ho Chi Minh Tan Thanh District Nha Be District 2 kind of IP Industrial Park Export Processing Park Industrial Park Industrial Park 3 developer name INDECO Tan Thuan Corporation IZICO Hiep Phuoc Corporation 4 details of developer joint stock co. (state own 95%) Vietnam/Taiwan JV 5 year of development 1999 / (phase 1) / 2008 (phase 2) 6 land rental term till 2053 till 2041 till 2048 (phase 1) / 2058 (phase 2) 7 area total area (ha) (phase 1) 597 (phase 2) industrial land area (ha) occupied area (ha-%) % % 83% 96 % (phase 1) 10% (phase 2) 8 factory details number , 5 under preparation country Taiwan, Korea, Vietnam Japan (66), Taiwan (54), Vietnam (21), Korea (8), Others (24) products garment hi-tech, electronic, machinery, garment Heavy industry associated with the ports; Steel & power industries; Chemical & fertilizer industries; Construction material 78, 16 under preparation (phase 1) / 1 (phase 2) Japan (4), Other Foreign (10), Vietnam Mechanics; Furniture, Paper, Packet, Plastic, Construction material, Leather processing product delivery in Vietnam yes no yes 60% export (country) yes Japan, Taiwan etc (43 countries) yes 40% (Asia, Europe) 9 Fee etc. land rental (USD/m2) 45 / m2 260 / m2 70 / m / m2 infrastructure maintenance fee (USD/m2-year) 0.3 / m2-year 0.25% of FOB price 0.2/m2-year 0.64 / m2-year electricity fee (USD/kwh) government fixed price 0.06 / kwh Government price Government price fresh water (USD/m3) 0.35 / m / m3 Government price Government price waste water (USD/m3) 0.3 / m3 (80% of fresh water) / m3 other charges / m2- year in 10 years 10 Incentives income tax first 10years: 20% of income tax if hi-tech product 15years 10% other items no import tax on equipment etc in factory first 4 years: no tax next 9 years: half next 15 years: 25 % import / export tax 0% VAT 0% first 4 years: no tax next 9 years: half after 15 years: 25 % import tax 0% no VAT, Draft Final Report 2-104

21 Photos of industrial zones are shown below. Trang Bang Industrial Park Entrance Tan Than Export Processing Zone Entrance Phu My I Industrial Park Factory Hiep Phuoc Industrial Park Entrance Source: JICA survey team Figure Photos of Industrial Zones in South of Vietnam Draft Final Report 2-105

22 2.7 Cross Border Transport Agreement (CBTA) and Customs Clearance Facilities Current Situation of CBTA CBTA consists of seventeen annexes and three protocols in the Great Mekong Subregion (GMS). GMS includes six countries, Cambodia, China, Lao, Myanmar, Thailand and Vietnam and all member countries signed on the CBTA. History of CBTA is brief hereinafter, partly taking contents from the report Greater Mekong Subregion Cross-Border Transport Facilitation Agreement compiled in 2011 by Asian Development Bank. Entry into Force of the CBTA: The CBTA legally entered into force in December 2003, following its ratification by all six GMS countries. Establishment of NTFCs: Around this time, the countries put in place National Transport Facilitation Committees (NTFCs), in accordance with Article 28 of the CBTA on a regular basis. Completion of Three-Stage Negotiations: To facilitate the reaching of consensus, the annexes and protocols were negotiated in stages from February 2003 to November 2005, which provides the rationale for the staging and presents the negotiation minutes. Establishment of Joint Committee and Subcommittees: In accordance with Article 29 of the CBTA, a Joint Committee consisting of the heads of the NTFCs was established, with four subcommittees (Transport, Customs, Health, and Immigration), at the Inception Meeting of the Joint Committee in April Signing of All 20 Annexes and Protocols: Negotiation of the annexes and protocols were completed with their signing as follows: Annexes 2, 4, 7, 11, 12, 13a, and 15, along with Protocol 1 were signed in April 2004 on the occasion of the Inception Meeting of the Joint Committee; Annexes 1, 9, 13b, and 16 were signed in December 2004 on the occasion of the 13th GMS Ministerial Conference in Vientiane, Lao PDR; Annexes 3, 5, and 10 along with Protocol 2 were signed in July 2005 on the occasion of the Second GMS Summit in Kunming, PRC; and Annexes 6, 8, and 14 along with Protocol 3 were signed in March 2007 on the occasion of the Second Joint Committee Meeting in Beijing, PRC. Negotiation of IICBTA: In August 2004 the countries agreed to undertake initial implementation of the CBTA (IICBTA), on a pilot basis, at key border crossing points, with the aim of accelerating the implementation by allowing the early identification of key issues and the early realization of benefits from improved transport facilitation. An MOU was also negotiated for Bavet (Cambodia) Moc Bai (Viet Nam) in March 2006, but less progress has been achieved at this border crossing pair. At one border crossing, Poipet (Cambodia) Aranyaprathet (Thailand), constraints including bilateral political issues and a longstanding border demarcation question has substantially delayed progress. Ratification: Cambodia (2008), PRC (2008), Lao PDR (2007), and Viet Nam (2009) ratified/accepted all CBTA annexes and protocols. As of November 2010, Thailand had ratified 14 annexes and protocols. Myanmar has submitted Annexes 4, 6, 8, 12, 14, and 15 to its Cabinet, and a draft law related to annexes 13a and 13b to its Attorney General s office. Cambodia has signed (by the Royal Government of Cambodia) and ratified (by the Parliament, Senate and Royal Palace) all the annexes (17) and protocols (3), and deposited (by the Minister of Foreign Affairs) all ratified 20 annexes / protocols. CBTA status for all six countries is shown in the Table below. Draft Final Report 2-106

23 item Data Collection Survey on the Trunk Road Network Planning Description / Title Table CBTA Status Countries Cam PRC Lao Mya Thai VN Annex 1 Carriage of Dangerous Goods R R R S S R TQ Annex 2 Registration of Vehicles in International Goods R R R S R R TI Annex 3 Carriage of Perishable Goods R R R S R R TQ Annex 4 Facilitation of Frontier-Crossing Formalities R R R S S R C Annex 5 Cross-Border Movement of People R R R S R* R I Annex 6 Transit and Inland Clearance Customs Regime R R R S S S C Annex 7 Road Traffic Regulation and Signage R R R S R R T Annex 8 Temporary Importation of Motor Vehicles R R R S S R C Annex 9 Criteria for Licensing of Transport Operator for Cross-Border R R R S R R T Annex 10 Conditions of Transport R R R S S R T Annex 11 Road and Bridge Design and Construction Standards & Specifications R R R S R R T Annex 12 Border Crossing and Transit Facilities and Services R R R S R R T Annex 13a Multimodal Carrier Liability Regime R R R S R R T Annex 13b Criteria for Licensing of Multimodal Transport Operators for Cross-Border R R R S R R T Transport Operations Annex 14 Container Customs Regime R R R S S S C Annex 15 Commodity Classifications Systems R R R S R R C Annex 16 Criteria for Driving Licenses R R R S R R TI Protocol 1 Designation of Corridors, Routes and Points of Entry & Exit Border Crossing R R R S R R TI Protocol 2 Charges Concerning Transit Traffic R R R S R R T Protocol 3 Frequency and Capacity of Services and Issuance of Quotas and Permits R R R S R R TI Note: * Ratified part 1 4 Legend: R: Ratification has completed and finished T: Transport, C: Customs, I: Immigration, Q: Quarantine S: Signed but Ratification still pending Source JICA survey team based on data from ADB website As implementation of CBTA is difficult as a whole (six countries together), bilateral and tripartite agreements have been sought, like between Cambodia, Lao PDR and Vietnam, and Cambodia and Thailand. Bilateral or tripartite agreements are shown in the table below. Draft Final Report 2-107

24 Table Bilateral / Tripartite Agreement Agreement Contents Remarks With Vietnam Quota of vehicles for cross border transport: 40 nos. in year 2006 Quota of vehicles: increased to 150 nos. in year 2009 Quota of vehicles: increased to 300 nos. in year 2010 Quota of vehicles: increased to 500 nos. (trucks, scheduled & non-scheduled buses) in year 2012 Seven border crossing points: confirmed in year ) Oyadav (Ratanakiri) - Le Thanh (Gia Lai) 2) Dak Dam (Mundulkiri) Bu Prang (Dac Nong): pending due to border demarcation 3) Tranpeang Sre (Kratie) - Hoa Lu (Binh Phuoc) 4) Trapeang Phlong (Kampong Cham) Xa Mat (Tay Ninh) 5) Bavet (Svay Rieng) Moc Bai (Tay Ninh) 6) Phnom Den (Takeo) Tinh Bien (An Giang) 7) Prek Chak (Kam Pot) Ha Tien ( Kien Giang) With Lao PDR Quota of vehicles for cross border transport: 40 nos. (trucks) Scheduled buses for cross border transport: each 4 nos. Non-scheduled buses for cross border transport: 20 nos. under discussion One border crossing point 1) Trapeang Kriel (Stung Treng) Nong Nokkhien (Chanpasak) With Thailand Quota of vehicles for cross broder transport: 40 nos. (trucks & non-schedule buses) Scheduled buses for cross border transport: each 3 nos. One border crossing point 1) Poipet (Banteay Meanchey) Aranyaprathet (Thailand) Source MPWT information Separate MOU is needed for other cross border point The goal of CBTA is to establish transport facilitation, which means the removal of nonphysical hindrances that make movement of people, vehicles, and goods across national borders of the GMS countries more onerous, more time-consuming, and more expensive. In a larger context, the CBTA is expected to stimulate regional social and economic integration, and in that manner it aims at increasing prosperity and reducing poverty. Currently status of CBTA in Cambodia is considered just a few steps forward and will take some time to reach the goal. In fact it is observed that progress concerning custom matters is slow and toward the goal of CBTA, officials in related authorities shall continue to take necessary actions. It is the recent news that the MOU between Cambodia, Lao PDR and Vietnam has been signed in regard to cross border transport in January 2013 to confirm attachment I to III (cross border transport documents, boundary crossing points etc.). Draft Final Report 2-108

25 2.7.2 Customs Clearance Facilities Data Collection Survey on the Trunk Road Network Planning JICA survey team has conducted custom office survey and interview at Poipet and Aranyaprathet (Thailand), Bavet and Moc Bai (Vietnam), Koh Kong and Hat Lek (Thailand), Pailin and Chambory (Thailand), Trapeang and Xa Mat (Vietnam), Phnom Den and Tinh Bien (Vietnam) and Prek Chak and Ha Tien (Vietnam). Details are stated hereinafter and the survey team observed that customs clearance facilities and operations have been improved although slowly. It is expected that those will reach the level required for ASEAN Community in due course and due time. Custom offices of cross border in particular point is shown below. Poiet and Aranyaprathet Northwest Koh Kong and Hat Lek Southwest Pailin and Chambory Northwest point Southwest point Trapeang and Xa Mat Phnom Den and Tinh Bien Bavet and Moc Bai South Southeast Trapeang and Xa Mat Visited Custom Clearance South point Southeast point Source: JICA survey team Figure Location Map of Custom Office (1) Poipet (Cambodia) and Aranyaprathet (Thailand) Poipet-Aranyaprathet is one of two border crossings along the priority Southern Economic Corridor route linking Thailand, Cambodia, and Vietnam included in Protocol 1 of the CBTA, specifically Bangkok/Laem Chabang-Phnom Penh-Ho Chi Minh City/Vung Tau (the other is Bavet-Moc Bai, discussed below). This route, designated R1, was identified as the highest priority in the first GMS Subregional Transport Sector Study in 1994 and Survey on Improvement of Customs Procedures for Trade Facilitation in the Mekong Region in 2011 also pointed out the necessity of sensible and targeted use of existing equipment, mutual recognition of documents, single window processing for freight, and integration of risk management processes. JETRO Cambodia office reported that amount of trade in this point is getting bigger and bigger. This point fulfilled 40% of Cambodia s total import came from Thailand and 90% of total export to Thailand based on trade statistics in Thailand. Therefore, this point is a vital artery between two countries. The below is diagram at Poipet border and observation of current situation and issues the custom system at Poipet. Draft Final Report 2-109

26 Source: Survey on Improvement of Customs Procedures for Trade Facilitation in the Mekong Region in 2011, JICA Figure Diagram of Poipet Border Crossing Points The border crossing point access road is very narrow with no area for trucks to park, to load and to unload cargo. Furthermore, trucks park on the road causing congestion and a safety hazard. Thus, transshipment occurs in several private areas about 2 km away to load and unload. There is no primary inspection lane and shortage of non-intrusive inspection equipment. Only one truck x-ray scanner donated by China is operating. Automatic System of Custom Data (ASYCUDA) is operating since in September, However, there is only a small quantity of computer equipment and there is no local area network (LAN) connection. In principle, the border operating hours are 0700 to The congestion time is mainly at night time or weekend. There is office of custom and custom staff will be staying at SEZ in Poipet in future. However, only one company is operating there, currently. A May 2010 Memorandum of Understanding between the Royal Government of Cambodia and the Government of the Kingdom of Thailand on the Exchange of Traffic Rights for Cross Border Transport through the Aranyaprathet-Poipet Border Crossing Points provides for an initial exchange of traffic rights for 40 vehicles. The implementation was started from June, vehicles for truck and another 10 vehicle for bus were running with Traffic Rights Passport, currently. In a joint communiqué issued in August 2010 during a Thai-Cambodian joint commission meeting, the two governments announced an agreement to develop a new permanent border crossing point for freight traffic, most likely 12 km south of the current location. However, there is no concrete plan at present. Development of this new crossing point need to present opportunities for a feasibility study and to plan design and layout training, development of national and regional facilities, and maintenance standards. Border in Poipet is shown below. Entrance of Border Source: JICA survey team Figure Photos of Cross Border in Poipet Entrance of Border Draft Final Report 2-110

27 (2) Bavet (Cambodia) and Moc Bai (Vietnam) Bavet-Moc Bai is one of two border crossings along the priority Southern Economic Corridor route linking Thailand, Cambodia, and Vietnam included in Protocol 1 of the CBTA, specifically Bangkok/Laem Chabang-Phnom Penh-Ho Chi Minh City/Vung Tau (the other is Poipet-Aranyaprathet, discussed above). As noted, this route was identified as the highest priority in the first GMS Subregional Transport Sector Study in Cross-border traffic averages a total of about 100 trucks per day. Also, as noted in the subsection on Poipet-Aranyaprathet, there is very little intra-gms transit traffic due to the difficulties of transiting Cambodia. Simplified diagram of the border crossing point is presented in the figure below. Source: Survey on Improvement of Customs Procedures for Trade Facilitation in the Mekong Region in 2011, JICA Figure Diagram of Moc Bai Border Crossing Points Border facilities in Bavet and Moc Bai in 2012 is shown below. Bavet Source: JICA survey team Figure Photos of Bavet and Moc Bai Moc Bai There are the Manhattan and Tai Seng Special Economic Zones (SEZ) located on the outskirts of Bavet town, several new factories in and around Bavet, and several casinos in Bavet. Two more SEZs are being developed and within a few years factories in those SEZs will be operational. In SEZs in Bavet, there is office of custom or custom staff is attending while packing. In this sense, custom procedure in Bavet is very convenient to the factories for import and export. There are some comments that informal and additional fees are required to pay due to various reasons. In Bavet custom office, Automatic System of Custom Data (ASYCUDA) has been implemented since September Hence, the average time for document procedure is shortened and now around 10 to 20 minutes or within 2 hours in case the cargo is classified in Draft Final Report 2-111

28 Red color. Current custom procedure flow chart obtained in site survey in December 2012 is shown in the figure below. Source: Bavet Customs Office in Cambodia Figure Custom Procedure Flow Chart at Bavet In Moc Bai custom office, time for inspection and registration for export is said 5 to 10 minute for one set of declaration and time for inspection and registration for import is 5 to 20 minute for one set of declaration, which depends on type of declaration. number of line and type of good. In Vietnam, e-custom system has been announced to be fully implemented in 2013 in accordance with Decree No. 87/2012/ND-CP and Moc Bai custom office has conducted electronic custom procedure in May To declare, receive, handle custom declaration information and exchange other information comply with the provision of laws between related parties conducted through processing system of electronic customs data. With e-custom system, clearance speed becomes faster. On the Cambodian side, there are 29 customs officers, while there are 43 customs officers working on the Viet Nam side. In principle, the border operating hours are 6:00 AM to 22:00 PM on both sides every day (they were only 7:00 AM to 18:00 PM in 2005). There was strong opposition to 24-hour operation because customs officers are not machines. (3) Cham Yeam (Cambodia) and Hat Lek (Thailand) Cham Yeam-Hat Lek is the cross border point between Cambodia and Thailand at the south-western side of Cambodia. Traveling from Cambodia to Thailand via Cham Yeam-Hat Lek border is through NR48 which was rehabilitated with 2-lane DBST pavement by the Loan of Thailand in However, it might be difficult for freight traffic along NR 48 due to steep slopes from An Daung Toeuk bridge to Koh Kong city. Transportation of the products are preferred through maritime transport from S. Kittawan port near Hat Leak in Thailand to Oknha Mong port in Cambodia instead of through NR 48; then those products are transported through NR 4. Therefore, this cross border was observed basically small scale products exported from Thailand such as fruit etc. There is a Special Economic Zone so called Koh Kong SEZ developed by LYP Group which is about 2 to 3 km from the border, and it consists of 3 operating companies in recent years but sea port is not yet developed in Koh Kong area. Draft Final Report 2-112

29 Customs have no difficulties at the border check for regular import products for Thailand. Clearance time takes only a few hours, depending on volumes. If the products want to get tax exemption, procedure is more complicated. The survey team made some interviews to the border custom officers as below. Operation Time : 7:00AM to 8:00PM for everyday Custom clearance time: about 20 minute to a few hours Facility in custom: ASYCUDA system is currently used Situation of registered vehicle from Thailand and to Thailand: CBTA is not fully applied at Cambodia - Thailand border so that products must change the truck at the border or near the border. Recently, according to the Cham Yeam-Hat Lek cross border agreement, limited vehicles as tourism vehicles are permitted to enter Cambodia or Thailand within limited area approximately 10km from the border check point. By 5pm of a day, they need to return to their home country. Problem or issues from Custom viewpoint: There is not so much trading at this border. It might be due tocambodia side NR48 condition and width of road and bridge not being capable for commercial product transport. Custom officers require that profile of NR 48 shall be flatter, for example constructing tunnels into the mountain area. Border Point Source: JICA survey team Figure Photos of Cham Yeam Border Custom office (4) Other Custom Offices Others such as Pailin and Chambory (Thailand), Trapeang and Xa Mat (Vietnam), Phnom Den and Tinh Bien (Vietnam) and Prek Chak and Ha Tien (Vietnam) have smaller border facilities and photos are shown below. Pailin and Chambory Xa Mat Draft Final Report 2-113

30 Phnom Den and Tinh Bien Prek Chak Source: JICA survey team Figure Photos of Other Border Facilities Draft Final Report 2-114

31 2.8 Current Logistic Conditions in Cambodia General This Section is to discuss the current logistic situation in Cambodia. In order to grasp the logistic sector, there are several viewpoints as follows: (1) Logistic related enterprises (a) Land transport (b) Inland water transport (c) Maritime transport (2) Major consigner and consignee (3) Administrative system of logistics As mentioned in Chapter 1, this Survey is to formulate the road network plan in the southern economic corridors. So, in this section, comparative analysis of logistic modes and routes between Cambodia and neighboring counties namely Thailand - Cambodia, Vietnam - Cambodia and Thailand - Vietnam is carried out Presumptions (1) Alternative Modes and Routes In order to carry out comparative analysis, the following alternative modes and routes are taken into considerations: (a) Cambodia (Phnom Penh) - Thailand (Bangkok) Alt. 1 :By land transport (truck ) Alt. 2a) :By maritime transport and truck (Bangkok - Sihanoukville port - Phnom Penh) Alt. 2b) :By maritime transport and rail (Bangkok - Sihanoukville port - Phnom Penh) Alt. 3 :By maritime transport and inland water transport (Bangkok - Cai Mep port - Phnom Penh port) (b) Cambodia (Phnom Penh ) - Vietnam (Ho Chi Minh) Alt. 1 Alt. 2 (c) Thailand - Vietnam Alt. 1 Alt. 2 :By land transport (truck) :By inland water transport :By land transport (truck) :By maritime transport and inland water transport Figure shows the alternative modes and routes. Draft Final Report 2-115

32 Alt. 1 Alt.2b Alt. 2 Alt.2a Alt. 2 Alt. 1 Alt. 3 Alt. 2 Alt. 3 Source: JICA survey team Figure Alternative Modes and Routes (2) Evaluation Factors There are many indicators to evaluate the comparative analysis. It is very important for modern enterprises to evaluate views of consigners and consignees points. They are as follows: (a) Transport Time (hr. or day) (b) Transport cost (c) Lot Size (d) Location of consigners and consignees (e) Safety and risks (f) Environmental issues (3) Logistics Cost, and Transport Time There are several ways to collect the logistics cost and transport time. In this study, cost and time is estimated- by the following procedure: (a) Data collection from various studies and reports made by JICA as Strengthening Project for Sihanoukville Port in Cambodia July 2012, and Comprehensive Logistic System Information Collection and Confirmation Study December (b) Based on those reports and studies, supplements to the data mentioned above are made by interview and hearing survey conducted in this survey Comparative Analysis between Cambodia (Phnom Penh) - Thailand (Bangkok) Table shows the comparative analysis of alternative logistic modes and routes between Bangkok and Phnom Penh. From this table, the following findings can be made: Before conducting the survey, the survey team thought that most of commodities between Bangkok and Phnom Penh are using the land transport (truck). However, freight forwarders told that most of commodities are using maritime and inland water transport. This is several reasons: (1) Road condition in Cambodia is not good enough to transport modern commodities. Draft Final Report 2-116

33 (2) Forwarders cannot get transport information of goods due to local transport operators not having such system. (3) Truck transport has many risks such as traffic accidents, goods damages, etc. Presently, it seems that the maritime and inland water transport (alternative 3) is higher share than the land transport (truck). If the international road (National Road 5) and cross border system are improved, truck transport is expected to increase drastically. Draft Final Report 2-117

34 ] Table Comparative Analysis of Alternative Logistic Routes between Phnom Penh and Bangkok Logistic Routes Transport Mode Land Transport (Truck) Transport Routes Evaluation Bangkok - Phnom Penh Alt. 1 Alt. 2 a Alt. 2 b Alt. 3 Bangkok - Aranyaprathet - Poipet - Phnom Penh Transport Time (hr.) 25 hr. between Bangkok and PP Possible to set up flexibly Possible to transport various cargoes flexibly Logistic Cost (USD) USD 1,400-1,850 Logistic cost is higher than the others Lot Size Possible to select various lots depending on vehicle type Possible to transport as mixed cargo Location of Consigners and Consignees No limitation of location of consigners or consignees Door to door services Safety & Risk Traffic accident risk, truck and motor-bike, driving rule, etc Cargo damages due to pot-hall Environmental Compared with water transport, Issues energy consumption is high Overall Evaluation Need to improve land transport system, higher standard of road, Cross border system improvement, Source: JICA survey team based on hearing from various organizations Maritime Transport & Land Transport (Truck) Bangkok - Leam Chabang Port- Sihanoukville Port - Phnom Penh 3 days Maritime transport is not flexible and depending on shipping schedule Transport time is depending on transshipment time USD 1,300-1,500 Logistic cost is lower than Alt. 1 but more expensive than alt.3 Maritime Transport & Land Transport (Rail) Maritime Transport and Inlandwater Transport Bangkok - Leam Chabang Port - Sihanoukville Port - Phnom Penh Bangkok - Leam Chabang Port- Cai Mep Port - Phnom Penh More than alt.2a) 3 days Marine and island water transport is not flexible and depending upon shipping schedule Transport time is largely depending on transshipment time Less than alt. 2a) USD 1,200-1,300 Logistic cost is lesser than the other alt. Preferable lot size is container of 20 Preferable lot size is container of 20 or 40 feet Preferable lot size is container of 20 or 40 or 40 feet Difficult to transport a small lot cargo feet Difficult to transport a small lot Difficult to transport a small lot cargo cargo Preferable to locate near port Preferable to locate near port and terminal Preferable to locate near port and terminal Traffic accident risk is smaller than alt.1 Cargo damage is less than alt. a) Traffic accident risk is smaller than alt.1 Cargo damage is less than alt. 1 Traffic accident risk is smaller than alt.1 Cargo damage is less than alt. 1 Moderate energy consumption Moderate energy consumption Energy consumption is lesser than the other plan Need to more transport time due to one transshipment, Need to more transport time due to one or more transshipments Presently, railway operation is still trial basis Due to cheapest transport cost, usage of this transport mode and route is higher share at present. Final Report 2-118

35 2.8.4 Comparative Analysis between Cambodia (Phnom Penh) Vietnam (Ho Chi Minh) Table shows the comparative analysis of alternative logistic modes and routes between Phnom Penh and Ho Chi Minh. From this table, the following findings can be made: (1) Road condition in Cambodia is not good enough to transport modern commodities. (2) Forwarders cannot get transport information of goods due to local transport operators not having such system. (3) Truck transport has many risks such traffic accidents, goods damages, etc. Presently, it seems that the inter water transport (alternative 2) is equal to the land transport (truck). If the international road (National Road 1) and cross border system are improved together with the completion of bridge over Mekong, the truck transport is expected to increase in future. Table Comparative Analysis of Alternative Logistic Routes between Phnom Penh and Ho Chi Minh Logistic Routes Ho Chi Minh - Phnom Penh Alt. 1 Alt. 2 Transport Mode Land Transport (Truck) Maritime Transport & Inland Water Transport Transport Routes Ho Chi Minh - Moc Bai - Bavet - Phnom Ho Chi Minh - Cai Mep Port - Phnom Penh Penh Port Evaluation Distance 240 km 350 km Transport Time (hr.) 13 hr. between Ho Chi Minh and Phnom 36 hr. between Ho Chi Minh and Penh Possible to set up flexibly Possible to transport various cargoes flexibly Phnom Penh Island water transport is not flexible and depending upon shipping schedule Logistic Cost (USD) USD 750-1,050 between Ho Chi Minh and Phnom Penh Logistic cost is higher than the others Lot Size Location of Consigners and Consignees Safety & Risk Environmental Issues Overall Evaluation Possible to select various lots depending on vehicle type Possible to transport as mixed cargo No limitation of location of consigners or consignees Door to door services Traffic accident risk, truck and motor-bike, driving rule, etc. Cargo damages due to pot-hole Compared with water transport, energy consumption is high Need to improve land transport system, higher standard of road, Cross border system improvement, Source: JICA Survey Team based on hearing from various organizationss USD between Ho Chi Minh and Phnom Penh Logistic cost is slightly lower than the alt. 1. Preferable lot size is container of 20 or 40 feet Difficult to transport a small lot cargo Preferable to locate near port and terminal Need to transship from ship to truck in case of companies far from ports Traffic accident risk is smaller than alt.1 Cargo damage is less than alt. 1. Energy consumption is lesser than the other plan Prepare cheaper transport cost and transport a lot of cargoes at onece Final Report 2-119

36 2.8.5 Comparative Analysis between Thailand (Bangkok) - Vietnam (Ho Chi Minh) Table shows the comparative analysis of alternative logistic modes and routes between Bangkok and Ho Chi Minh. From this table, the following findings can be made: (1) Road condition in Cambodia is not good enough to transport modern commodities so that most of cargoes are transported by marine transport (2) Transport cost by land transport is more expensive than that by maritime transport so that most of cargoes are transported by marine transport (3) Forwarders cannot get transport information of goods due to local transport operators not having such system. (4) Truck transport has many risks such traffic accidents, goods damages, etc. Presently, the maritime transport (alternative 2) is shared mostly, compared with the land transport (alternative 1). If the international roads in Cambodia (National Road 1 and 5) and cross border system are improved together with the completion of bridge over Mekong, the truck transport is expected to increase in future. Table Comparative Analysis of Alternative Logistic Routes between Bangkok and Ho Chi Minh Logistic Routes Bangkok - Ho Chi Minh Alt. 1 Alt. 2 Transport Mode Land Transport (Truck) Maritime Transport & Inland Water Transport Transport Routes Bangkok - Aranyaprathet - Poipet - Bangkok - Leam Chabang Port - Cai Mep Phnom Penh - Bavet - Moc Bai - Ho Chi Port - Ho Chi Minh Minh - Evaluation Distance 900 km 1,350 km Transport Time (hr.) 38 hr. between Bangkok and Ho Chi Minh. 65 hr. between Bangkok and Ho Chi Minh Logistic Cost (USD) USD 2,150-2,900 USD 1,000-1,200 Lot Size Location of Consigners and Consignees Possible to select various lots depending on vehicle type Possible to transport as mixed cargo No limitation of location of consigners or consignees Door to door services Safety & Risk Traffic accident risk, truck and motor-bike, driving rule, etc. Cargo damages due to pot-hole Environmental Issues Compared with water transport, energy consumption is high Overall Evaluation At present, very Expensive transport costs Road condition is not good, Source: JICA Survey Team based on hearing from various organizations Preferable lot size is container of 20 or 40 feet Difficult to transport a small lot cargo Preferable to locate near port and terminal Need to transship from ship to truck in case of companies far from ports Traffic accident risk is smaller than alt.1 Cargo damage is less than alt. 1. Energy consumption is lesser than the other plan Cheaper transport cost and transport a lot of goods Most of cargoes are carried out by ships Final Report 2-120

37 CHAPTER 3 EXISTING TRAFFIC CONDITION AND TRAFFIC DEMAND FORECAST 3.1 Traffic Survey Objective In order to understand the present traffic conditions along the Southern Economic Corridor in Cambodia, the traffic count survey was conducted in the entire work area. The survey provides fundamental and sufficient information of existing transport and road network conditions in order to enable the forecasting of the future transport demand Survey Outline The classified vehicular counting was conducted on both traffic directions for 16 hours from 5:00 to 21:00 and for 24 hours 5:00 to 5:00 (next day) at ten (10) locations on weekdays (Tuesday through Friday) excluding Saturday, Sunday, and public holidays. The type of each vehicle was separately counted and recorded for every 15 minutes interval. (1) Survey Location The survey locations were selected at the provincial boundary and national border and they are shown in Table and Figure 3.1-1, respectively. Survey Location No. Road No. Table Location and Date of Traffic Count Survey Survey Location Survey Hours Year 2013 and Survey Date 1 1 Provincial Boundary of Prey Veng and Svay Rieng January (Wed.) 2 1 Vietnam Border (Bavet) January (Wed.) 3 2 Vietnam Border January (Fri.) 4 21 Vietnam Border January (Fri.) 5 33 Vietnam Border January (Fri.) 6 4 Near Sihanouk Port January (Tue.) 7 48 Thai Border (Koh Kong) January (Tue.) 8 5 Thai Border (Poipet) January (Tue.) 9 57 Thai Border (Pailin) January (Thu.) Vietnam Border January (Wed.) Note: 16 hours : 5:00~21:00 24 hours : 5:00~5:00 (Next day) Source JICA survey team Final Report 3-1

38 :24 hours at 4 locations :16 hours at 6 locations Source JICA survey team Figure Location of Traffic Count Survey (2) Vehicle Classifications Vehicle are classified as follows. Table Vehicle Classification for Traffic Count Survey I II III Group Motor Cycle (MC) Light Vehicle (LV) Heavy Vehicle (HV) Source JICA survey team Classification 1 Motorbike and Motodop 2 Tuk - tuk 3 Motorumo 4 Sedan, Wagon, Van 5 Taxi 6 Mini Bus 7 Light Truck / Pick Up 8 Truck (2 axles) 9 Medium and Large Bus 10 Truck (More than 3 Axles) 11 Semi & Full Trailer (with Container or Load) 12 Semi & Full Trailer (without Container or non-load) 13 Tank lorry Final Report 3-2

39 3.2 Existing Traffic Condition Existing Traffic Volume (1) Survey Result 16 hours traffic volume by vehicle categories is shown in Table (1) and Table (2). Location No. Road No. Survey Hours Motobike and Motodop Table Traffic Survey Result for 16 hours (1) Motor Cycle (MC) Tuk - Tuk Motorumo Total Sedan, Wagon and Van Taxi Light Vehicle (LV) Mini Bus Light Truck and Pick Up Truck (2axles) Unit: Vehicle , , , , , , , , , , , , ,488 1, , , , , ,687 1,904 1, , , , , , , Source JICA survey team Location No. Road No. Survey Hours Table Traffic Survey Result for 16 hours (2) Medium and Large Bus Truck (More than 3axles) Heavy Vehicle (HV) Semi& Full Trailer (with container or Load) Semi& Full Trailer (Without Container or non-load) Tank lorry Total Total Unit: Vehicle Grand Total , , , , , ,134 9, , , , ,061 Source JICA survey team Hourly traffic volume in each location is shown in the figure below. Final Report 3-3

40 Unit Vehicle Location No. 1 MC LV HV 05:00 to 06:00 06:00 to 07:00 07:00 to 08:00 08:00 to 09:00 09:00 to 10:00 10:00 to 11:00 11:00 to 12:00 12:00 to 13:00 13:00 to 14:00 14:00 to 15:00 15:00 to 16:00 16:00 to 17:00 17:00 to 18:00 18:00 to 19:00 19:00 to 20:00 20:00 to 21:00 21:00 to 22:00 22:00 to 23:00 23:00 to 24:00 24:00 to 01:00 01:00 to 02:00 02:00 to 03:00 03:00 to 04:00 04:00 to 05:00 Unit Vehicle Location No. 6 MC LV HV 05:00 to 06:00 06:00 to 07:00 07:00 to 08:00 08:00 to 09:00 09:00 to 10:00 10:00 to 11:00 11:00 to 12:00 12:00 to 13:00 13:00 to 14:00 14:00 to 15:00 15:00 to 16:00 16:00 to 17:00 17:00 to 18:00 18:00 to 19:00 19:00 to 20:00 20:00 to 21:00 21:00 to 22:00 22:00 to 23:00 23:00 to 24:00 24:00 to 01:00 01:00 to 02:00 02:00 to 03:00 03:00 to 04:00 04:00 to 05:00 Unit Vehicle Location No. 2 MC LV HV 05:00 to 06:00 06:00 to 07:00 07:00 to 08:00 08:00 to 09:00 09:00 to 10:00 10:00 to 11:00 11:00 to 12:00 12:00 to 13:00 13:00 to 14:00 14:00 to 15:00 15:00 to 16:00 16:00 to 17:00 17:00 to 18:00 18:00 to 19:00 19:00 to 20:00 20:00 to 21:00 21:00 to 22:00 22:00 to 23:00 23:00 to 24:00 24:00 to 01:00 01:00 to 02:00 02:00 to 03:00 03:00 to 04:00 04:00 to 05:00 Unit Vehicle :00 to 06:00 06:00 to 07:00 07:00 to 08:00 08:00 to 09:00 Location No. 7 MC LV HV 09:00 to 10:00 10:00 to 11:00 11:00 to 12:00 12:00 to 13:00 13:00 to 14:00 14:00 to 15:00 15:00 to 16:00 16:00 to 17:00 17:00 to 18:00 18:00 to 19:00 19:00 to 20:00 20:00 to 21:00 Unit Vehicle 1200 Location No. 3 MC LV HV Unit Vehicle 1200 Location No. 8 MC LV HV :00 to 06:00 06:00 to 07:00 07:00 to 08:00 08:00 to 09:00 09:00 to 10:00 10:00 to 11:00 11:00 to 12:00 12:00 to 13:00 13:00 to 14:00 14:00 to 15:00 15:00 to 16:00 16:00 to 17:00 17:00 to 18:00 18:00 to 19:00 19:00 to 20:00 20:00 to 21: :00 to 06:00 06:00 to 07:00 07:00 to 08:00 08:00 to 09:00 09:00 to 10:00 10:00 to 11:00 11:00 to 12:00 12:00 to 13:00 13:00 to 14:00 14:00 to 15:00 15:00 to 16:00 16:00 to 17:00 17:00 to 18:00 18:00 to 19:00 19:00 to 20:00 20:00 to 21:00 21:00 to 22:00 22:00 to 23:00 23:00 to 24:00 24:00 to 01:00 01:00 to 02:00 02:00 to 03:00 03:00 to 04:00 04:00 to 05:00 Unit Vehicle :00 to 06:00 06:00 to 07:00 07:00 to 08:00 08:00 to 09:00 Location No. 4 MC LV HV 09:00 to 10:00 10:00 to 11:00 11:00 to 12:00 12:00 to 13:00 13:00 to 14:00 14:00 to 15:00 15:00 to 16:00 16:00 to 17:00 17:00 to 18:00 18:00 to 19:00 19:00 to 20:00 20:00 to 21:00 Unit Vehicle :00 to 06:00 06:00 to 07:00 07:00 to 08:00 08:00 to 09:00 Location No. 9 MC LV HV 09:00 to 10:00 10:00 to 11:00 11:00 to 12:00 12:00 to 13:00 13:00 to 14:00 14:00 to 15:00 15:00 to 16:00 16:00 to 17:00 17:00 to 18:00 18:00 to 19:00 19:00 to 20:00 20:00 to 21:00 Unit Vehicle Location No. 5 MC LV HV 05:00 to 06:00 06:00 to 07:00 07:00 to 08:00 08:00 to 09:00 09:00 to 10:00 10:00 to 11:00 11:00 to 12:00 12:00 to 13:00 13:00 to 14:00 14:00 to 15:00 15:00 to 16:00 16:00 to 17:00 17:00 to 18:00 18:00 to 19:00 19:00 to 20:00 20:00 to 21:00 Unit Vehicle Location No. 10 MC LV HV 05:00 to 06:00 06:00 to 07:00 07:00 to 08:00 08:00 to 09:00 09:00 to 10:00 10:00 to 11:00 11:00 to 12:00 12:00 to 13:00 13:00 to 14:00 14:00 to 15:00 15:00 to 16:00 16:00 to 17:00 17:00 to 18:00 18:00 to 19:00 19:00 to 20:00 20:00 to 21:00 Source: JCA survey team Figure Hourly Traffic Volume in Each Location (2) Expansion to 24 hours (daily) Traffic Volume The 24 hour traffic count was carried out at four (4) stations (No. 1, No. 2, No. 6 and No. 8) in order to confirm the trend of the traffic volume in rural area and at national borders. The 24 hours traffic volumes were calculated using the expansion factor for national border, which are applied to traffic volume at No. 3, 4, 5, 7, 9, and 10. Table shows Traffic Volume Expansion factor. Final Report 3-4

41 Table Traffic Volume Expansion factor Motorbike & Motodop Tuk-Tuk Motorumo Sedan, Wagon and Van Taxi Mini Bus Medium & Large Bus Light Truck and Pick Up Truck (2axles) Truck (More than 3axles) Semi&Full Trailer (with container or Load) Semi&Full Trailer (Without Container or non-load) Tank lorry Source JICA survey team Location No. Road No. In national border for traffic 24 hours a rate of daily traffic to daytime traffic (24 hours / 16 hours) was calculated. Average value was converted in calculation of 24 hours except for the maximum ratio of an every survey location. The results of 24 hours traffic volume are shown in Table (1) and Table (2). Survey Hours Motobike and Motodop Table Traffic Survey Result for 24 hours (1) Motor Cycle (MC) Tuk - Tuk Motor umo Total Sedan, Wagon and Van Taxi Light Vehicle (LV) Mini Bus Light Truck and Pick Up Truck (2axles) Unit: Vehicle , , , , , , , , , , , , , , ,717 1, , , , , ,813 2,043 1, , , , , , , Source: JCA survey team Table Traffic Survey Result for 24 hours (2) Unit: Vehicle Heavy Vehicle (HV) Location No. Road No. Survey Hours Medium and Large Bus Truck (More than 3axles) Semi& Full Trailer (with container or Load) Semi& Full Trailer (Without Container or non-load) Tank lorry Total Total Grand Total , , , , , ,329 9, , , , ,246 : Actual observed Traffic Volume Source JICA survey team Final Report 3-5

42 (3) Passenger Car Unit In the traffic assignment, traffic volume is expressed in the form Passenger Car Unit (PCU). The PCU equivalents used in this survey are shown below. Table PCU Factor Categories MC LV HV PCU Equivalents Source JICA survey team Usually, PCU of sedan and pick-up truck is set at 1.0. In this survey, PCU of Light Vehicle (LV) is set at 1.25 considering that this category includes light truck, pick-up truck and 2 axle truck which speed are slower than passenger cars because of cargo and as a consequence, contribution to traffic congestion is larger than ordinary passenger car. Table Daily Traffic Volume by PCU Unit: PCU Location No. Road No. MC LV HV Total ,179 1,416 4, ,719 2,447 1,176 5, , ,050 3, ,371 1, , , ,716 3,675 3,987 9, , , ,144 5,207 2,289 8, ,214 2, , ,743 3,469 Source JICA survey team (4) Traffic Volume from Other Studies The survey team refers to the data of traffic survey carried out in recent years and incorporates as supplemental data for demand forecast. The supplement data from past survey and data of this survey are shown in Table Project Name The Preparatory Survey for National Road No. 5 Rehabilitation Project The Preparatory Survey for National Road No. 5 (South Section) Rehabilitation Project The Project for Study on The Improvement of Existing Bridges The Project for Comprehensive Urban Transport Plan in Phnom Penh Capital City (Inventory and Road Maintenance Office of RID in MPWT) Implementation Year and Organization 2011 JICA 2012 JICA 2012 JICA 2012 JICA 2011 MPWT Road Section NR 5 North and Central Section NR 5 South Section 2-digits National Road Phnom Penh Boundary NR 1 Final Report 3-6

43 Location No. Table Traffic Volume in Cambodia Road No. MC LV HV Total Year Remarks 1 1 4,482 5,745 1,689 11, PP boundary 2 1 2,573 4,220 1,239 8, PK ,179 1,416 4, Provincial Boundary 4 1 2,305 2, , PK , Bavet 6 2 2,733 4, , PP boundary 7 2 1, ,050 3, Vietnam Border 8 3 2,638 6,433 2,703 11, PP boundary 9 4 4,751 9,888 4,299 18, PP boundary , Sihanoukville ,718 4,735 3,855 10, Provincial Boundary ,691 3,705 3,288 8, Kampong Chhnang ,654 2,829 6, Kampong Chhnang ,173 2,730 5, Provincial Boundary ,075 3,567 6, Provincial Boundary ,169 2,853 2,328 6, Provincial Boundary ,070 4,591 2,436 8, Jct NR 5 and NR ,144 5,207 2,289 8, Poipet ,903 3, , Ta Khmau ,985 1, , Kaoh Thum ,371 1, , Vietnam Border , , Boundary , , Kampot , Vietnam Border , , Kampot , , Koh Kong , Koh Kong , , Koh Kong , , Thai Border Pousat ,576 2,689 1,575 5, Battambang ,214 2, , Thai Border ,743 3, Vietnam Border Source JICA survey team Unit PCU Final Report 3-7

44 Source JICA survey team Figure Location of Traffic Volume Result (5) Utilization of Traffic Survey Result by MPWT MPWT has been carrying out the traffic survey in year 2010 to 2012 on 1-digit national road and year 2010 and 2012 on 2-digit national road. It is possible to use those results as basic data for the future road network plan and rehabilitation work, which shows the trend in traffic volume annually by regular survey. From now on for transport sector of JICA study or survey, JICA survey team recommends future study/survey team to collect traffic survey result from MPWT, as those are effective Comparison between Existing and Past Traffic Volume To understand the change of traffic condition on the road network, in some sections the traffic volume of the survey carried out in this survey was compared with that of the Study on Road Network Development in the Kingdom of Cambodia implemented by JICA in There are fifteen (15) survey locations where traffic volume comparison can be made. The comparison is shown in Table The maximum increase rate is observed at location no. 32 of NR 57 where the ratio indicates 4.5 times when traffic volume of the 2006 result is compared with that of the present result. Most of ratio of 2-Digit roads is larger than 1-Digits roads, because 2-Digit roads have been improved since The large traffic volume growth of all vehicle types is affected by the road improvement and the increasing number of vehicle owners due to the upturn in economic activity in Cambodia. Final Report 3-8

45 Table Daily Traffic Volume by Vehicle Classification in Year 2006 and Unit: Vehicle Seq. No Location No. Road No MC LV HV Total Ratio Ratio Ratio Ratio , ,225 3, ,051 12, ,182 2, ,079 1, ,580 4, ,297 3, ,639 4, , ,241 2, ,357 6, ,073 3, ,376 4, ,007 8, , ,207 3, , ,891 4, , ,056 2, ,562 3, ,938 4, , , ,353 7, ,076 4, , ,334 5, ,005 3, ,484 4, Source JICA survey team Existing Traffic Condition (1) Registered Vehicle and Motorcycles Figure shows the number of road accidents and vehicle registered from 2000 to By 2000, the total number of registered vehicles was around 331,900 and an increase reached 1,652,000 by 2010 (5% up). Once the number of vehicle registered increase, traffic accidents are also the concern for Cambodian traffic view point. The total number of casualties was recorded around 4,800 in year 2000 and it increased 5.4 times in 2006 which is around 26,000. Even though it slightly decrease from 2006, the share of casualties is also high comparing to the data before ,000 18,000 Fatalities Slight injuries 1,800,000 1,600,000 Number of Casualties(person) 16,000 14,000 12,000 10,000 8,000 6,000 4,000 Serious Injuries Number of vehicle registered 1,400,000 1,200,000 1,000, , , ,000 Number of Vehicle registered 2, , Source: National Institute Statistics, Figure Number of Road Accident Case along with Number of Vehicle Registered Final Report 3-9

46 Figure shows the number of fatalities by traffic accidents at major national roads in year 2007, 2008 and The three years data indicates that the national road as NR 5 is one of the concern for traffic safety with around 200 fatalities recorded in each year, while NR 1 and NR 4 fatalities rate were recorded around 100 in year Number of Fatalities NR1 NR2 NR3 NR4 NR5 NR6A NR6 NR7 Source: Statistics form Handicap International, 2009 Figure Number of Fatalities at Major National Roads in Cambodia 3.3 Traffic Demand Forecasting Forecast of the future traffic demand is calculated based on present traffic volume and depends on road improvement planning and economic analysis. Methodology and data used in the traffic demand forecast are hereafter described and the result of the forecast is shown, too. In the estimation of future traffic demand, target years are set at 2020 (medium-term plan) and 2030 (long-term plan) Socio-economic data The OD table prepared by the Preparatory Survey for National Road 5 (South Section) Rehabilitation Project in 2012 was modified and traffic demand forecasting is computed. The OD used because it was the latest and corresponded to a national road network. In computing transport demand forecasting, the following future economic indicators were used. (1) Future Population General Population Census of Cambodia 2008 published in January 2011 by the National Institute of Statistics, Ministry of Planning is the latest population projection of Cambodia. The population projection up to 2030 is shown in Table Table Future Population in Cambodia Unit :Person Year Population 14,962,591 16,505,444 18,390,683 Source: General Population Census of Cambodia 2008, Population Projections of Cambodia, National Institute of Statistics, Ministry of Planning Final Report 3-10

47 (2) Future GDP Growth Rate The future GDP growth rate by each organization The long-term GDP growth rate predicted is calculated by United States Department of Agriculture and International Futures of University of Denver and the short-term is by International Monetary Fund and the Ministry of Economic and Finance (MEF) of the Cambodian. Table shows the GDP growth rate predicted by each organization. Table GDP Growth Rate Year USDA International Futures IMF MEF S ource: Economic Research Service, United States Department of Agriculture (USDA) International Futures, University of Denver (International Futures) World Economic Outlook, International Monetary Fund (IMF) Cambodia Macroeconomic Framework , Ministry of Economic and Finance (MEF) (3) Future GDP Growth Rate Scenario of GDP growth rate The GDP growth rate was set for the future, based on the GDP growth rate predicted by each organization which are shown below. Year : 6.3% Year : 5.6% Fright Traffic Demand The southern Railway Line (SL) is operating between Phnom Penh and Shihanoukville, where National Road 4 (NR 4) runs along. The rehabilitation work of SL with the assistance of ADB was complete in December 2012, and SL operates experimentally now. In the briefing sheet by ADB taken effect on ADB in November, 2012, it is assumed that a railway takes 40% of carriage of goods between Phnom Penh and Shihanoukville after the service of the SL. When the network of railway is developed in Japan, railway share for transportation of 1,000 km or more is assumed 6% and for transportation of 100 km ~ 300 km in 1%. It is therefore considered that ADB indication 40% seems relatively too high. In this forecasting, it was assumed that 20% of heavy vehicle is converted into a railway Vehicle Traffic Demand (1) Verification of Result of Traffic Forecast In order to verify correctness of the traffic volumes, assignment traffic volumes through simulation was computed with counted traffic volume at traffic counting stations. Table shows the result of comparison. The figures confirmed correctness of the assignment results and actual survey observed volumes. Final Report 3-11

48 Table Comparison Observed and Assignment Traffic Volume Location No. Road No. Observed Volume (PCU) Assignment Result (PCU) 1 1 4,381 4, ,342 5, ,083 3, ,101 8, ,201 8, ,378 3, ,414 1, ,640 2, ,006 4, ,469 3,470 Source: JCA survey team Source: JCA survey team Figure Verification between Assignment Result and Actual Traffic Count (2) Future Network Scenario The road network was set as future road network including on-going projects, road rehabilitation, Neak Leung Bridge, and road widening in the Southern Economic Corridor (SEC), Phnom Penh ring road and other relative proposed road. In order to consider the evaluation of the road project, the survey team made a scenario of the future road network, which is shown below. Final Report 3-12

49 Table Scenario of the Road Network Road Section NR 1 Future Project PK 30 -Neak Leung 4 lanes 1st. Neak Leung Br. 2nd. Neak Leung Br. Ring Road 2 Ring Road 3 Ring Road (NR 1 to NR 2) 4 lanes (NR 2 to NR 5) 4 lanes Whole Section NR 4 4 Lanes Whole Section 4 Lanes NR 5 With Kampong Chhnang Bypass, Battambang Bypass and Sri Soporn Bypass Whole Section NR 6 4 Lanes Source JICA survey team Final Report 3-13

50 3.3.4 Assignment to Road Network Traffic volume by road section in the future was estimated by traffic assignment program of JICA STRADA. JICA STRADA adopts the minimum paths method in which the vehicles are assumed to take the path with the minimum cost (sum of travel time cost) among the road links of the network connecting the pair of OD zones. The traffic assignment results for the project case for 2020 and 2030 are shown in Table Table Future Traffic Volume Unit: PCU Road Section Location Wat Phnom - Monivong Bridge 25,601 59, Monibong Bridge - PK 9 29,868 44, PK 9 - PK 30 25,958 39,552 NR PK 30- Neak Loeung 14,762 43, st Neak Loeung Bridge 9,074 24, nd Neak Loeung Bridge 6,725 22, Neak Loeung- Bavet 8,014 18,507 Phnom Penh RR 3-1 NR 1 KP 30 - NR 2 19,275 34,786 Ring Road 3 RR 3-2 NR 2 - NR 5 PK 12 16,020 26, Wat Phnom -Takhmau Roundabout 26,358 48,893 NR TakhmauRoudabout- Takeo 12,667 15, Takeo - PhnomDen 2,876 3, Wat Phnom -Chaom Chao 39,727 57,416 NR Chaom Chao - Kampot 12,979 16, Kampot- Veal Rinh 3,299 5, PK 12 PK 18 27,939 55, PK 18 Kampon Speu (PK 48) 26,748 50,878 NR Kampong Speu- PK 78 19,273 41, PK 78 - PK ,199 31, PK Sihanoukville 12,248 23, Wat Phnom - PrekKdam 36,925 51, PrekKdam - ThleaM am 18,121 36,864 NR ThleaM am - Battambong 14,368 30, Battambang - Sri Sophorn 11,772 21, Sri Sophorn - Poipet 13,951 21,703 NR PreakTameak NR 11 5,953 12, NR 11 - Vietnam Border 4,839 10,562 NR 21-1 Takhmau Roundabout - ChreyThum 13,140 15,343 NR 21-2 PK 4 - ChreyThum 7,227 10,946 NR 31 ThnalBekKous - Kampong Trach 3,882 5,291 NR 33 Kampot - Lork (Vietnam Border) 3,411 5,178 2-digit Road NR 48-1 SreAmbel - Koh Kong Bridge 3,089 7,840 NR 48-2 Koh Kong Bridge - Cham Yeam 1,996 3,171 NR 55 Pursat - Thma Da 634 1,057 NR 57 Battambang - Thai Border 6,449 10,439 NR 72 Krek (NR 7) - Smach 5,237 8,277 Source JICA survey team Final Report 3-14

51 Figure (1) to Figure (2) shows the result of the traffic assignment for year 2020 and Poipet LEGEND VCR (Vehicle/Capacity Ratio) NR 5 VCR<1.00 VCR<1.20 VCR< <VCR Koh Kong NR 4 NR 1 Bavet Sihanouk Villle NR 3 NR 2 Source: JCA survey team Figure (1) Future Assignment in 2020 LEGEND VCR (Vehicle/Capacity Ratio) VCR<1.00 VCR<1.20 VCR< <VCR Source: JCA survey team Figure (2) Future Assignment in 2030 Final Report 3-15

52 3.3.5 Function and Characteristics of Trunk Roads Data Collection Survey on the Trunk Road Network Planning (1) National Road 1 NR 1 covers about 167 km in Cambodia from Phnom Penh to Bavet (Cambodia-Vietnam border). The route is designated as ASEAN HIGHWAY No. 1 (AH1) linking NR 22 of Southern Vietnam road. In general, the road sections consist of 2 lane carriageway. The pavement types have been upgraded to AC under Japanese Grand Aid from Phnom Penh side to Neak Loeung. From Neak Loeung to Bavet, road section was rehabilitated in 2004 under ADB Loan with DBST pavement type.the Neak Leung Bridge is under construction. Based on the traffic survey conducted by JICA team in 2012 & 2013 and MPWT in 2011, the traffic volume were observed around 12,000 PCU/day near Phnom Penh, around 4,400 PCU/day at Prey Veng- Svay Rieng boundary and around 5,300 PCU/day at Bavet. However, once the construction of first Neak Loeung Bridge being completed and the custom checking point time being improved, the volume of traffic along NR 1 is expected to increase as well. As the railways line is absent between Phnom Penh and Bavet, NR 1 serves as the most important economic corridor for freight traffic between Cambodia and Vietnam besides the inland water transport. Geographically, traveling along NR 1 will pass 3 provinces: Kandal, Prey Veng and Svay Rieng. This area produces crops such as paddy, maize and vegetables as well as fisheries and livestock or poultry products that are mainly transported to Phnom Penh. The new Phnom Penh port and SEZ is going to settle along NR 1 at 30 km from Phnom Penh city center in addition to major SEZs nearby the border such as Tai Seng or Mahattan SEZ, so the NR 1 would function for larger freight transport.. Therefore, once NR 1 is improved, it will stimulate the development potential and high vehicle traffic is generated along this road as well as ensuring traffic safety along the road. (2) National Road 2 NR 2 is one the southern road of 120 km long in total connecting Phnom Penh (PK 5) to Phnom Den. The road links with the South Vietnamese Road NR 91 via Tien Bien. The DBST road section developed by ADB in 2001 is found from Takhmau to Takeo while AC road developed by Japan in 2007 is from Takeo to Phnom Den. The results from traffic survey by JICA indicate that around 8,000 PCU/day near Phnom Penh boundary, and around 3,100 PCU/day at Phnom Den Border were observed in 2012 and 2013 respectively. Traveling from Phnom Penh to Phnom Den will pass Kandal, Takeo provinces. The road serves mainly for freight traffic from Vietnam to Cambodia. The domestic production in Takeo or Kandal are also transported either to Phnom Penh or to Vietnam through NR 2. The road is also connected to the Goldfame Pak Shun SEZ and Phnom Den SEZ. Such an international trunk roads shall be developed in the near future to improve the economic corridor between the two nations in addition to the improvement of NR 1. (3) National Road 3 NR 3 is one of southern DBST road of 201 km long in total connecting from Phnom Penh to Veal Rinh (KP 180 of NR 4). A traffic volume on NR 3 under the traffic survey by JICA team 2012 was observed at the volume around 12,000 PCU per day near Phnom Penh boundary. Traveling on NR 3 will pass Kandal, Takeo and Kampot provinces. NR 3 is connected to NR 33 at Kampot and NR 31 at Nheng Nhang in which NR 33 links with Vietnam border The sea side tourism traffic and freight traffic from Vietnam via NR 33 is travelled through NR 3 from/to Phnom Penh. On the other hand, the Kampot SEZ was developed in Kampot along NR 3 and the domestic production is widespread in seaside area.so, NR 3 is one of the important routes of southern economic corridor along with the railway line from Kampot to Phnom Penh. Final Report 3-16

53 (4) National Road 4 NR 4 is a south-western AC road of 214 km long considered as part of AH11, which connects the capital city of Phnom Penh to major Sea port at Sihanoukville city with a dual carriageway around 48 km and single carriageway of the remaining section. The existing road facilitated with three numbers of toll stations travels through following Cambodian provinces, Kandal, Kampong Speu, and Sihanoukville. Recently, NR 4 is under maintained by private company (AZI). Regarding to the traffic survey in 2013 by JICA, the results explained that around 18,938 PCU/day near Phnom Penh boundary, and around 9,400 PCU/day at Sihanoukville. The proportion of trucks on NR 4 is the highest in Cambodia with a total no. of 4,300 PCU/day near Phnom Penh boundary. NR 4 connects a number of important infrastructural facilities such as deep sea port in Sihanoukville, airport in Phnom Penh and Sihanouville as well as major industrial zones as Sihanoukville SEZ, PP SEZ and so on. Cargo shipments arriving in Sihanoukville are transported to Phnom Penh and other city by trucks. In addition, traveling from Cham Yeam to Phnom Penh through NR 48 has to travel along NR 4 as well. Meanwhile, inbound and outbound tourists are also travelling to Sihanoukville seaside via NR 4. Such mix traffic of light vehicle and heavy vehicle in single carriageway indicate that NR 4 has high potential for economic development route for Cambodia. (5) National Road 5 NR 5 connecting Phnom Penh to Poipet (Cambodia-Thailand border) is a 407 km AC and DBST road in certain sections developed by foreign loan/aid such as ADB, China and Japan as mentioned in Chapter 2. It is designated as AH1 linking to NH 33 of Thai roads. Traveling along NR 5 will pass Kandal, Kampong Speu, Kampong Chhnang, Pursat, Battambong and Bantheay MeanChey provinces. The road is the most important international trunk road of Cambodia and Thailand. JICA did the traffic survey from 2011 to 2013 at certain locations, the volumes are around 10,300 PCU/day, 8,700 PCU/day 6,500 PCU/day, 5,200 PCU/day, 6,100 PCU/day, 6,350 PCU/day, 8,100 PCU/day, and PCU/day at Udong, Kampong Chhnang, Kampong Chhnang,Pursat,Moung Russey,Battambang,Thmar Koul, Sri Sophorn and Poipet respectively. This shows total traffic generation on NR 5 outside Phnom penh are one of the remarkable volume compared to NR 1 or NR 4. NR 5 serves as the most important freight transport road for Cambodia and Thailand. Then, the majority domestic productions from western provinces need to transport through NR 5. Such an influenced area has high development potential for Cambodia. The number of fatalities by traffic accidents also generated highest at NR 5 compared to that at other international trunk roads. Therefore, development of NR 5 would not only to promote ASEAN connectivity, international and domestic economic development but also traffic safety improvement for Cambodia. (6) National Road 21 NR 21 is the southern DBST road of 66 km long connecting from Takhmau roundabout to Chrey Thum (Cambodia-Vietnam Border). The NR 21 connects to the Vietnam border at Chrey Thum where the river is the boundary. The traffic survey results from JICA in 2012 and 2013 indicated that 7,900 PCU/day, 4,200 PCU/day and 3,100 PCU/day at Takhmau, Khao Thum and Chrey Thum respectively. Less heavy vehicles was recorded at the border with a share of 13%. However the area has high development potential in terms of domestic production/ consumption. This area produces crops such as paddy, corn and vegetables as well as fisheries products that are mainly transported to Phnom Penh through NR 21. Once the bridge connected from Vietnam to Cambodia at the border area would be developed, the higher traffic volume of freight traffic from/to Vietnam would be increased because NR 21 is one of the short distance roads from Phnom Penh to Vietnam border. Final Report 3-17

54 (7) National Road 31 and 33 NR 31 is the southern road of 54 km long in total connecting Wat Khao to Kampong Trach. The traffic volumes on NR 31 under the traffic survey by JICA team in 2012 were observed around 2,500 PCU/day, and 2,000 PCU/day at the boundary of Takeo-Kampot and at Kampong Trach, respectively. Meanwhile, NR 33 is the southern road of 52 km long in total. It has two sections. Section 1 starts from Kampot to Kampong Trach with 37 km long and section 2 starts from Kampong Trach to Prak Chak (Cambodia-Vietnam border) with 15 km long.the traffic volumes on NR 33 conducted by JICA in 2012 and 2013 indicated that 2,600 PCU/day and 1,200 PCU/day at Kampot and Prak Chak (Cambodia-Vietnam border). The number of heavy vehicle traffic was relative low at Prak Chak border with 4% share. It serves as the international economic corridor of Cambodia-Vietnam connecting to NR 80 of Southern Vietnam road. The freight transport traveling from border to Phnom Penh will run through NR 33 or NR 31 to NR 3. (8) National Road 48 NR 48 is the south-western DBST road of 161 km long in total connecting from Sre Ambel (Junction of NR 4) to Cham Yeam (Cambodia-Thailand border). It was designated as AH123 linking to PR318 of Thai road. The traffic volumes on NR 48 under the traffic survey carried out by JICA Study Team 2012 & 2013 were observed at 4 different places along the road. The traffic volume is around 2,400 PCU/day, 2,200 PCU/day, 1,500 PCU/day and 2,200 PCU/day at Cham Yeam, Koh Kong Town, Andoung Tuek and Sre Ambel, respectively. Heavy vehicle traffic was recorded around 280 PCU/day at the border with a share of 11.6%. Koh Kong SEZ and Suoy Chheng SEZ locates at the Koh Kong area along NR 48 and freight traffic from Thailand to Cambodia goes through Cambodia via Cham Yeam border, so NR 48 is also one of the essential international trunk roads for future economic development as well as ASEAN connectivity. (9) National Road 55 and 57 NR 55 is the western laterite road of 185 km long in total connecting from Pursat (PK 191 at NR 5) to Thmar Da (Cambodia-Thailand border). NR 57 is the DBST road with 103 km long connecting from Battambang to Pailin up to Cambodia-Thailand border. The traffic volumes on NR 55 observed in 2012 by JICA study was around 660 PCU/day at Phnom Kravanh, Pursat Province while the traffic volumes on NR 57 were observed at 2 different places along the road in 2012 and 2013 indicated that 5,800 PCU/day, 4,000 PCU/day at Battambang and Cambodia-Thailand border. These two roads also serve for alternative routes for freight traffic from/to Thailand. (10) National Road 72 NR 72 is the eastern road of 13 km long in total connecting from Ponhear Krek to Trapaing Plong (Cambodia-Vietnam border). The road links to NR 22B of Southern Vietnam road. The traffic volume on NR 72 under the traffic survey by JICA survey team in 2013 was observed that 3,500 PCU/day at Cambodia-Vietnam border. The share of heavy vehicle was recorded the largest amount with around 50%. Due to Kampong Cham province is one of agriculture-industrial area for Cambodia. The NR 72 serve one of economic corridor for Cambodia-Vietnam. Final Report 3-18

55 Table Function and Characteristics of Trunk Road Road Section Road Length Traffic Volume in 2030 Vehicle Composition MC LV HV Land Use High Volume Traffic Volume Traffic Characteristics Medium Volume Low Volume Livelihood Industrial Agricultural Tourism Watt Phnom Monivong Bridge ,501 30% 50% 20% Commercial Livelihood road Monivong Bridge - PK ,696 35% 51% 14% Commercial PK 9 - PK ,552 40% 44% 16% Residential PK 30- Neak Leuong ,890 36% 50% 14% Residential 1st Neak Leung Bridge ,494 37% 48% 15% - 2nd Neak Leung Bridge ,744 34% 54% 12% - Neak Leung- Bavet ,507 27% 55% 18% Agricultural/Industri Agricultural / industrial road al/commercial NR 1 PK 30 - NR 2 ( Bypass of NR ,786 33% 51% 16% Commercial/Residen Livelihood / industrial road 1/5) tial NR 2 - NR 5 PK PK 12 (Bypass of 26,306 16% 63% 20% Commercial/Residen Livelihood / industrial road NR 1/5) tial Road Characteristics Remarks Expect to be logistic route after completion of Neak Loueng Bridge Wat Phnom -Takhmau Roundabout ,893 31% 52% 18% Commercial/Residen tial Livelihood road Takhmau Roundabout- Takeo ,070 24% 59% 17% Agricultural Agriculture road Takeo-Phnom Den ,940 41% 30% 29% Agricultural Agriculture road Wat Phnom -Chaom Chao ,416 26% 47% 26% Commercial/Residen Industrial road tial Chaom Chao- Kampot ,858 18% 58% 24% Agricultural Agriculture road Kampot- Veal Rinh ,321 21% 52% 27% Tourism Industrial / tourism road PK PK ,851 24% 51% 25% Commercial/Residen Industrial road tial / Industrial PK 18 - Kampong Speu (PK48) ,878 21% 51% 28% Industrial Industrial road Kampong Speu- PK ,134 13% 51% 36% Industrial Industrial road PK 78 - PK ,693 8% 53% 39% Agricultural Agriculture road PK Sihanoukville ,514 11% 53% 36% Industrial Industrial / tourism road Wat Phnom - Prek Kdam ,744 27% 49% 24% Commercial/Residen Livelihood / industrial road tial Prek Kdam ThleaM am ,864 20% 49% 31% Agricultural Agriculture road ThleaM am - Battambang ,344 17% 46% 37% Agricultural Agriculture road Battambang- Sri Sophorn ,490 21% 51% 28% Agricultural Agriculture road Sri Sophorn- Poipet ,703 18% 48% 34% Commercial Industrial /Agriculture road Preak Tameak- NR ,146 27% 45% 27% Agricultural Agriculture road NR11-Vietnam Border ,562 26% 50% 24% Agricultural Agriculture road Source: JCA survey team Continue to be logistic route Expect to be logistic route Final Report 3-19

56 CHAPTER 4 DIRECTION OF ROAD DEVELOPMENT IN SOUTHERN ECONOMIC CORRIDOR 4.1 National Development Plan In order to ensure the efficiency and sustainability of socio-economic and poverty reduction, the Royal Government of Cambodia (RGC) has worked out intensively to formulate and implement key national policy frameworks, which focus on the governance action plan and improving people s quality of the life. The Government has prepared two (2) national development policies consisting of: Mid-term Review 2011 on National Strategic Development Plan, Update Rectangular Strategy, Phase 2 (RS-II) The Rectangular Strategy, Phase2 prepared in September 2008 is as follows: The Rectangular Strategy Phase2 stated that Overriding goal of the Royal Government of Cambodia (RGC) is to firmly and steadily build Cambodian society which enjoys peace, political stability, security and social order, and sustainable and equitable development, with strict adherence to the principal of liberal multi-party democracy, respect for human rights and dignity; and a society in which social fabric will be strengthened to ensure that the Cambodian people are well-educated, culturally advanced, engaged in dignified livelihood and living in harmony both within family and society. The RS II declares that RGC is strongly committed to achieve its prioritized goals ensuring: (1) Sustainability, peace, political stability, security and social order to promote rule of law and protect human rights and dignity and multi-party democracy (2) Sustainable long-term economic growth at a rate of 7% per annum on a border basis and more competitive capacity in the context of one-digit inflation (3) Poverty reduction at a rate of over 1% per annum, and (4) Increased outreach, effectiveness, quality and credibility of public services 4.2 Progress and Major Achievement of Road Development Project As mention in Section 2.3, the road development during has been made greatly. Tables and show the progress of the pavement condition of 1-Digit and 2-Digit roads in 2008 and 2012, respectively. According to this table, the following findings can be made: There are not many changes in 2008 and 2012 in case of 1-Digit roads. As for 1-Digit road, 4-lane road in the asphalt concrete (AC) pavement in 2012 is slightly increased compared with that in Length of DBST roads is still much larger than that of AC. As for 2-Digit road, there are drastic changes in 2008 and Length of DBST is now 2,400 km compared with 560 km in Share of laterite / earth roads in 2008 to the total being about 80% reduces to 24 %. This is due to the road being mainly invested to 2-Digit roads. Considering the past trend of road developments, it is pointed out that investments for 1-Digit road are not enough to develop the international and domestic trunk roads. Final Report 4-1

57 2008 Data Collection Survey on the Trunk Road Network Planning Table Progress of 1-Digit Road Development in 2008 and 2012 AC 4-lane 2-lane S-Total DBST Laterite Total Km , ,100 % % 33.2% 65.8% 1.0% 100.0% Km , , % % 35.0% 65.0% 0.0% 100.0% Source: JICA survey team based on MPWT data 2008 Table Progress of 2-Digit Road Development in 2008 and 2012 AC 4-lane 2-lane S-Total DBST Laterite / Earth Total Km ,495 3,055 % % 0.0% 18.3% 81.7% 100.0% Km , , % % 4.5% 71.4% 24.1% 100.0% Source: JICA survey team based on MPWT data Source: MPWT and JICA survey team Figure Progress of 1-Digit and 2-Digit Road Development in 2008 and 2012 Tables4.2-3 and show the progress of road improvement for 1-Digit roads by donors and that for 2-Digit roads, respectively. And Figure shows the road network improvement by donors. Final Report 4-2

58 Road Section Table Progress of Road Improvement for 1-Digit Road by Donors Location Existing Road Condition Length (km) NR1 Phnom Penh Vietnam Border 167 Current road condition Road Width(m) Road Pavement Remark 1-1 Wat Phnom Monivong Bridge 5 (2 lanes +bike ) x AC Within Phnom Penh 1-2 Monivong Bridge PK9 4 1 lane x2 - AC Waiting for Approval (by Japan) 1-3 PK9 Neak Loeung 51 (1 lane +bike) x AC Completed (by Japan, 2011) 1-4 Neak Loeung Bridge On-going (by Japan) 1-5 Neak Loeung Bavet lane x DBST Repairing (by ADB, 2012) NR2 Monivong Bridge Phnom Den Wat Phnom Takhmau Roundabout 6 (2 lanes +bike)x AC Within Phnom Penh 2-2 TakhmauRoudabout Takeo 64 1 lane x DBST Developed by ADB, 2001; F/S to upgrade into AC by Korea 2-3 Takeo Phnom Den 50 1 lane x AC Completed (by Japan, 2007) NR3 Phnom Penh Veal Rinh Wat Phnom Chaom Chao 12 ( 2lanes+bike)x AC Within Phnom Penh 3-2 Chaom Chao Kampot lane x DBST Completed (by Korea, 2011) 3-3 Kampot Trapang Ropaou 33 1 lane x DBST Completed (by Korea, 2007) 3-4 Trapang Ropaou Veal Rinh 19 1 lane x DBST Completed (by WB, 2006) NR4 Phnom Penh Sihanoukville Chaom Chao Kampon Speu (KP45) 33 (2 lane x2); (2 lane x1, 1lane x1) AC/DBST 4-2 Kampong Speu Sihanoukville lane x AC Completed (by USA, 1996) Maintained by AZI Completed (by USA, 1996) Maintained by AZI NR5 Phnom Penh Poipet Wat Phnom Prek Kdam 30 1 lane x AC/DBST Being widened by China with AC, from PrekKdam ThleaM am lane x DBST F/S by JICA by ThleaM am Battambong lane x DBST F/S by JICA by Battambang Sri Sophorn 68 1 lane x DBST F/S by JICA in Sri Sophorn Poipet 47 1 lane x AC Completed (by ADB, 2008) NR6 Phnom Penh Sri Sophorn Wat Phnom Skun (PK75) 75 1 lane x AC On-going (upgraded to 4 lanes, China, from 2012) Bakong temple to Siem 6-2 Skun Siem Reap lane x DBST Reap (15km) by Japan 2001, Committed (upgraded to AC 2lanes, China, 2012) 6-3 Siem Reap Sri Sophorn lane x AC Completed (by ADB, 2008) NR7 Skun Trapaing Kreil Skun NR lane x AC 55 km by Japan in 1999/ NR11 Kratie lane x DBST Kratie Stoeung Treng lane x TBST Completed (by China, 2007) 7-4 Stoeung Treng Trapaing Kreil 56 1 lane x TBST Completed (by China, 2007) NR8 PreakTameak Krek Preak Tameak NR lane x2 10 AC Completed (by China, 2012) 8-2 NR11 Vietnam Border 44 1 lane x2 10 AC Completed (by China, 2012) 8-3 Vietnam Border Krek 20 1 lane x2 12 AC Completed (by China, 2012) NR9 TbaengMeanchey Stung Treng TbengMeanchey Therabarivat lane x DBST On-going (by China) 9-2 Mekong Bridge (Stung Treng) 2 1 lane x DBST On-going (by China) Total Length (Km) 2,241 Source: MPWT 2012, JICA survey team Final Report 4-3

59 Road Section Data Collection Survey on the Trunk Road Network Planning Table Progress of Road Improvement for 2-Digit Roads by Donors Location Existing Condition Length (km) Current road condition Road Width(m) Road Pavement NR11 NeakLeoung ThnalToteoung 90 1 lane x2 9.0 DBST Completed (by ADB, 2004 ) NR13 SvayRieng AndongTrabek 60 1 lane x DBST (39.2km) Completed (by ADB) /Laterite (20.3km) NR20 KrangSvay Kampong Tuol 10 1 lane x DBST - NR21-1 Takhmau Roundabout PK4 4 1 lanex AC On-going (by China) NR21-2 PK4 ChreyThum 62 1 lane x DBST Developed by ADB, Requested to upgrade into AC (Korea) NR22 Ochambak AngTa Saom 10 1 lane x DBST - NR23 Prek Ho Phoum Ta Prum 12 1 lane x AC Requested (Korea) NR31 ThnalBekKous Kampong Trach 54 1 lane x DBST Being rehabilitated by Korea NR32 KepThmei Phnom Bokor 33 1 lane x AC Completed NR33-1 Kampot Kampong Trach 37 1 lane x DBST On-going (by Korea) NR33-2 Kampot Lork(Vietnam Border) 15 1 lane x DBST On-going (by ADB) NR41 ThnalToteung (NR4) Chum Kiri(NR3) 96 1 lane x DBST On-going (by China) NR42 Bek Chan Bat Doeng 24 1 lane x Laterite - NR43 TrengTrayeung (NR4) TvearThmey 79 1 lane x DBST (4.0km) /Laterite Under Negotiation (China) (74.9km) NR44 Chbar Morn RolakKorng Cheung 85 1 lane x DBST (11.0km) F/S (by China) /Laterite (73.8km) NR45 Kang Keng Ream (Military Camp) 9 1 lane x DBST - NR46 TrengTrayueng Kirirom Mountain top 27 1 lane x DBST Completed NR48-1 SreAmbel Koh Kong Bridge lane x DBST Completed (by Thailand, 2007) NR48-2 Koh Kong Bridge Cham Yeam 8 1 lane x Concrete Completed (by Thailand) NR51 VeangChass ThnalToteuong Market 38 1 lane x DBST Completed (by WB, 2006) NR52 Ponley ChhnokTru 8 1 lane x DBST (2.0km) /Laterite - (6.0km) NR53 KampogChhnang Prey Chruv 62 1 lane x DBST (37.0km) - /Laterite (25.0km) NR53A Phsar Kdul 29 1 lane x Laterite - NR53B Krokor Komrieng 22 1 lane x Laterite - NR54 Krakor Kampong Luong 5 1 lane x DBST (2.0km) /Laterite - (2.9km) DBST (2.0km) /Laterite NR55 Pursat Thma Da lane x (123.2km) /Gravel (60km) Requested (China) NR56 Banteay Mean Chey OddarMeanchey lane x DBST (3.0km) /Laterite - (110.6km) NR57 Battambang Thai Border lane x DBST Completed (by China, 2012) NR57B Thmorkoul Sampaoloun 90 1 lane x DBST On-going (by China) NR57B- 1 Bovel Phnom Prek 70 1 lane x DBST On-going (by China) NR57B- 2 Phnum Sam Sep Kamrieng 16 1 lane x DBST On-going (by China) NR58 Banteaychey ThmarDaun lane x Laterite Requested (China) NR59 KounDamrey Pailin lane x DBST On-going (by China) NR60 SamborChey Prey Toteng 20 1 lane x DBST - NR61 PrekKdam ThnalKeng 16 1 lane x AC On-going (by China) NR62 ThnalBek on NR6 - Tbeng Mean Chey- DBST (235.97km) lane x Completed (by China, 2012) PreahVihear Temple /Concrete (6.69km) NR63 Siem Reap Chong Khneas (Phnom Krom) 14 1 lane x DBST - NR64 Dam Dek ThnolChek lane x DBST - NR67 RorLours Chhoarm lane x DBST Completed (by Thailand, 2009) NR68 Kralanh(NR6) O Smach (Border with Thiland) lane x DBST Completed (by Cambodia, 2011) NR70 Prey Tor Teung PeamChikong 14 1 lane x DBST Maintained (by RAMP) NR71 Troeung(NR7) KompongThmar 58 1 lane x DBST Maintained (by RAMP) NR72 Krek(NR7) Smach 13 1 lane x DBST Maintained (by RAMP) NR73 Pratheat(NR7) Kratietown 92 1 lane x DBST Maintained (by RAMP) NR74 Snuol(NR7) KhumThnou 21 1 lane x DBST Maintained (by RAMP) NR76 Snuol(NR7) Senmonorom O Chheng lane x DBST Completed (by China, 2011) NR78-1 Ou Pong Moan Bang Lung lane x DBST Completed (by China, 2013) NR78-2 Bang Lung O YaDav 70 1 lane x AC Completed (by Vietnam, 2008) NR88 KrarBao MoeunChey 6 1 lane x AC Notconfirmed Total Length (Km) 3,360 Source: MPWT 2012, JICA survey team Remark Final Report 4-4

60 Source: JCA survey team ROAD NETWORK MAP 2012 UNDER FINANCIAL AIDS FROM DEVELOPING PARTNER Figure Road Network Improvement in 2012 by Donors Legend Legend Completed Project by Cambodia F/S Project by Cambodia Completed Project by China Committed Project (4-Lane Road) by China On-going Project (4-Lane Road) by China On-going Project by China Proposed Project by China F/S Project by Japan On-going Project by Japan Completed Project by Japan Completed Project by Vietnam Completed Project by World Bank (WB) On-going Project by World Bank (WB) Completed Project by Korea Committed Project by Korea F/S Project by Korea Completed Project by Thailand Completed Project by ADB Committed Project by ADB Port- Bridge (China - Japan - Vietnam) Final Report 4-5

61 4.3 Changing Socio-Economic Environments Surrounding Road Network Development (1) General The Road Network Plan in Cambodia had been formulated under the Study on the Road Network Development Plan in 2006 by JICA. In 2006 study, the following strategies had been considered in order to formulate the Road Network Plan: 1) Multi growth pole development 2) National integration 3) Development of international corridor 4) Enhancement of rural economic development 5) Regional development In 2009, the Road Network Development Plan had been reviewed and formulated under the Follow Up Study on Road Network Development Study in 2009 by JICA. At the time, the following additional strategies were taken into consideration: 1) Multi growth pole development 2) National Integration 3) Development of international corridors for Cambodian Regional Integration 4) Enhancement of rural socio-economic development mainly agriculture development for poverty reduction 5) Strengthening of economic growth corridor development 6) Promotion of tourism development Based on the results of reviewed plan, the road network development has been implemented by Ministry of Public Works and Transport (MPWT). After review to the factors considered in the previous study, the followings are determinant factors for the road network development from now on: 1) ASEAN community and connectivity 2) Provision of ASEAN Highway 3) Promotion of direct investment to Cambodia 4) Promotion of manufacturing development These factors are discussed as below; (2) ASEAN Community and Connectivity (a) ASEAN Economic Community (AEC) 1 The Association of South Asian Nations (ASEAN) has been the representative of regional economic cooperation and integration among developing countries, within the structural change of the world economy. A Common Effective Preferential Tariff (CEPT) is a scheme to promote the free flow of goods within ASEAN. The next step is the establishment of the ASEAN Economic Community (AEC) with main objectives being to create a single market and production base, highly competitive economic region, region of equitable economic 1 ASEAN Economic Community (AEC) 2015 and its Implication on APEC, by Kuboon Charumanee Final Report 4-6

62 development, region fully integrated into global economy. The Goal of the AEC is to seek regional economic integration by The areas of cooperation include: Human resource development and capacity building Recognition of professional qualifications Consultation on economic and financial policies Trade financing Infrastructure and communication connectivity Industrial integration to promote regional sourcing Enhancing private sector involvement for the building of AEC, etc In short, the AEC will transform ASEAN into region with free movement of goods, services, investments, skilled labor, and freer flow of capital. (b) ASEAN Economic Community and Connectivity Figure shows the concept of ASEAN community and connectivity. Source: Building Blocks for ASEAN Connectivity, Role of Subregional Arrangements, ACCC Meeting in 2012 Figure Concept of ASEAN Community and Connectivity (3) Completion of ASEAN Highway Network The ASEAN transport ministers signed Ministerial Understanding in 1999 in Hanoi Vietnam and its understanding is as follows: Table Ministerial Understanding Signed in 1999 Phase Year Technical Target Stage Network configuration and designation of national routes to be completed Stage Road Sign installed Missing link be constructed All designated cross-border points to be operational. Stage ASEAN routes be Class I/Primary Class II for non-arterial routes Source: Realizing ASEAN Connectivity: Cambodia s Perspectives, H.E. Tauch Chankosal Final Report 4-7

63 According to this understanding, ASEAN highway shall be at class I level or primary level and non-arterial roads be class II level. This target is somewhat the promises for ASEAN members. It is therefore to achieve this target by around (4) Increasing Direct Investment in Cambodia Figure shows number of investment projects and project cost. As for the project costs, before 2004, the total investment was less than USD 450 million. However, the total investment after 2005 was over 1 billion and that in 2008 recorded over USD 10 billion. After 2008, the total investment was constantly USD 2 billion. Source: Statistical Yearbook of Cambodia in 2011, NIS Figure Trend of Direct Investment 4.4 Major Issues for Road Network Development (1) Trunk road network and its condition in Cambodia is poor As mentioned in Section 4.2, most of trunk roads (1-Digit roads) in Cambodia are 2-lanes and DBST. Compared with road condition in Vietnam, the trunk road level in Cambodia is poor in terms of composition of the asphalt concrete pavement. Table Road Network Condition in Cambodia, Neighboring Countries, Japan and UK Item Cambodia Vietnam Thailand Japan UK Area (km 2 ) Population (1000) Registered Vehicle (1000) 1,653 1,146 8,923 75, Road Network (1000) , National Road (1000) Expressway (km) , Road Network Density (1000 km/km 2 ) National Road Density(1000 km/km 2 ) Expressway Density (km/1 million veh.) Sources: Key Indicators for Asia and the Pacific in August 2012, ADB Final Report 4-8

64 Vietnam 2009 Table Comparison of Pavement Condition in Vietnam and Cambodia National Road Provincial Road AC/ Concrete DBST Gravel / Earth Total Km 11,118 4, ,758 % 66.3% 29.8% 3.8% 100.0% Km 5,018 14,904 5,527 25,449 % 19.7% 58.6% 21.7% 100.0% Km 785 1, ,244 1-Digit NR Cambodia % 35.0% 65.0% 0.0% 100.0% 2012 Km 151 2, ,361 2-Digit NR % 4.5% 71.4% 24.1% 100.0% Source: Cambodia- MPWT, Vietnam- Transport Sector Study in 2010 JICA (2) International road network in Cambodia is not developed compared with that in neighboring countries Figure shows the current situation of ASEAN Highway (AH) 1 and AH 123. As far as AH 1 and 123 is concerned, the current road condition in Vietnam and Thai sides is the multi-lane and asphalt concrete road while that in Cambodia is 1 lane road / both directions. In order to transport machinery goods, and modern product goods, it is necessary to prepare appropriate infrastructure. Source: JCA survey team Figure Comparison of International Roads (3) Road appurtenance on international roads is poor compared with that in neighboring countries Road appurtenances such as street lighting, road sign, road marking, etc. on international roads in Cambodia are poor, compared with that in neighboring counties. (4) Increase of transport risks and traffic accident in Cambodia Final Report 4-9

65 Table shows traffic accident condition in Cambodia and neighboring countries. According to this table, it is found out traffic accidents in Cambodia are increasing, especially persons killed. This is largely due to road condition on trunk road being poor and lack of road safety facilities, mixed traffic on trunk roads, etc. Table Traffic Accidents in Cambodia and Neighboring Countries Injured Accident (per 100,000 persons) Person Killed (per100,000 persons) / /2000 Cambodia Vietnam Thailand Japan Australia n/a n/a Source: ADB 4.5 Road Development Objectives and Strategies Road Development Strategies As stated in previous section on the road development strategies established in 2006 and 2009 JICA studies, the strategies are amended and modified by the recent socio-economic environment and are presented below: (1) ASEAN community and connectivity (2) Strengthen of infrastructure linkage for increasing direct investment to Cambodia (3) Development of international and economic corridors, especially southern economic corridor (4) Enhancement of multi growth pole development (the same as 2006 and 2009) (5) National Integration (the same as 2006 and 2009) (6) Enhancement of rural socio-economic development and poverty reduction (the same as 2006 and 2009) (7) Promotion of tourism development (the same as 2009) Regarding to the above-mentioned strategies (4) to (7), MPWT has been implementing the road network development, following the Road Network Development Master Plan formulated in Those strategies are expected to be implemented by MPWT. In this survey, the new additional strategies (1) to (3) will be discussed as follows: Strategy 1 : ASEAN Community and Connectivity Strategy 2 : Strengthen of Infrastructure Linkage for Increasing Direct Investment Strategy 3 : Development of International and Domestic Economic Corridor Final Report 4-10

66 Strategy 1: ASEAN Community and Connectivity Objectives: To promote connectivity of Cambodia to ASEAN community in order to enhance rules and good governance, for ASEAN, and integration and competitiveness for ASEAN and enhance the well-being and livelihood of ASEAN peoples. Target: Construction of expressway network linking with the neighboring counties Widen to 4-lane AC Road with appropriate road appurtenance on 1-digit international roads Construction of Phnom Penh Outer Ring Road connecting with New Phnom Penh Port, SEZs, Railway Terminal, etc. Improvement of 2-digit international roads from DBST to AC road Improvement of 2-digit minor international roads connecting to entry and exit points (cross boarder points) from laterite / earth roads to DBST roads. NH314 (AH1) Lane Number : 4-Lane Road Pavement Type : Asphalt Concrete NH304 (AH1) Lane Number : 4-Lane Road Pavement Type : Asphalt Concrete NH33 (AH1) Lane Number : 4-Lane Road Pavement Type : Asphalt Concrete NR7 (AH11) NR5 (AH1) Lane Number : 4-Lane Road (Proposed) Pavement Type : Asphalt Concrete Lane Number : 2-Lane Road Pavement Type : DBST NH7 (AH123) Lane Number : 8-Lane Road Pavement Type : Asphalt Concrete NR5 (AH1) Lane Number : 4-Lane Road (Proposed) Pavement Type : DBST NH36 (AH123) Lane Number : 4-Lane Road Pavement Type : Asphalt Concrete RR3 NR8 (AH11) Lane Number : 2-Lane Road Pavement Type : Asphalt Concrete NR72 (AH11) Lane Number : 2-Lane Road Pavement Type : Asphalt Concrete (Proposed) NH3 (AH123) Lane Number : 4-Lane Road Pavement Type : Asphalt Concrete Lane Number : 4-Lane Road Pavement Type : Asphalt Concrete PR318 (AH123) NR22B (AH1) Lane Number : 4-Lane Road Pavement Type : Asphalt Concrete Lane Number : 4-Lane Road Pavement Type : Asphalt Concrete NR22 (AH1) NR48 (AH123) Lane Number : 4-Lane Road Pavement Type : Asphalt Concrete Lane Number : 2-Lane Road Pavement Type : Asphalt Concrete (Proposed) NR4 (AH11) Lane Number : 4-Lane Road (Proposed) Pavement Type : Asphalt Concrete NR51 Lane Number : 4-Lane Road Pavement Type : Asphalt Concrete NR3 Lane Number : 2-Lane Road Pavement Type : DBST NR1 (AH1) Lane Number : 4-Lane Road (Proposed) Pavement Type : Asphalt Concrete Legend NR80 Multiple Lane Road 2-Lane Road Lane Number :2 to 4-Lane Road Pavement Type : Not Available NR91 Lane Number :2 to 4-Lane Road Pavement Type : Not Available Source: JCA survey team Figure ASEAN Connectivity Final Report 4-11

67 Strategy 2: Strengthen of Infrastructure Linkage for Increasing Direct Investment Objectives: To provide appropriate and cheaper infrastructures linkage to ASEAN and world trade in order to achieve competiveness of invested companies in Cambodia Target: Widen to 4-lane AC roads on 1-digit national roads connecting with SEZs and industrial parks Road network linkage with maritime and inland water ports, ICTs, railway terminals, and airports Improvement of 2-digit national roads and access roads connecting with SEZs and industrial parks Improvement of frontage roads at around SEZs and industrial parks Source: JCA survey team Figure Strengthen of Infrastructure for Increasing Direct Investment to Cambodia The following figures show location of industrial parks in Cambodia, Thailand and Vietnam with concentric circles, which indicate that industrial parks in Cambodia may be more attractive than those in Thailand or Vietnam with the same distance, if roads in Cambodia are improved. Final Report 4-12

68 Location of Industrial Parks in Cambodia, Thailand and Vietnam with Concentric Circles Location of Industrial Parks in Cambodia and Thailand with Concentric Circles Source: JCA survey team Figure Location of Industrial Parks in Cambodia, Thailand and Vietnam Final Report 4-13

69 Strategy 3: Strengthen of International and Domestic Economic Corridor Objectives: To provide easy access to the international and domestic markets by providing appropriate transport system Target: Widen to 4-lane AC roads on 1-digit national roads in order to increase accessibility to the agricultural and manufacturing production sites Improvement of multi-modal transport system, particularly road and maritime and inland water, road and rail. Source: JCA survey team Figure Strengthen of International and Domestic Economic Corridor Road Development Policies The road network plays a role as a Primary Mover of International Connectivity and Economic Growth and as arteries linking all parts of Cambodia to be a cohesive economic body and to integrate the Cambodian economy into the region and the world. Based on the above mentioned discussions, the following road development policies are proposed: To develop the international highway system as well as expressway network to achieve the ASEAN Community and Connectivity, especially the neighbouring countries as Vietnam and Thailand. To develop four (4)-lane and AC road network in the South Economic Corridor in order to strengthen economic development in this corridor. To develop four (4)-lane AC road network outer ring road of Phnom Penh as National Road 1 bypass. To develop two (2)-lane AC road in the Southern Coastal Economic Corridor Final Report 4-14

70 To development four (4)-lane AC road network between Phnom Penh and Sihanoukville road (NR 4) in order to facilitate international trade. To develop frontage roads and traffic management scheme along Special Economic Zones (SEZs) in order to alleviate traffic congestion during morning and evening peak periods 4.6 Revised Road Master Plan To achieve the target mentioned on the above, proposed roads to be improved are selected according to the each strategy. Location of the each proposed roads are shown in Table & and illustrated in Figures4.6-1& Table Proposed Road Development Plan in South Economic Corridor (1-Digit Road) Current Road Conditions Proposed Road Road Location Length Current Cross Section Road Width Road Pavemnent Proposed Cross Section Road Pavemnent EIRR (%) Project Cost Score NR1 Phnom Penh- Vietnam Border Wat Phnom Monivong Bridge 5 (2 lanes +bike ) x AC (2 lanes +bike ) x2 AC Monibong Bridge - KP lane x 2 AC (2 lanes +bike ) x2 AC KP 9 - KP (1 lane +bike) x2 AC (1 lane +bike) x2 AC KP 30- Neak Leuong 30 (1 lane +bike) x AC 2 lane x2 AC Ist Neak Leung Bridge (1 lane +bike) x2 AC nd Neak Leung Bridge lane x 2 - AC 2 lane x 2 AC Neak Leung- Bavet lane x DBST 2 lane x 2 AC PP RR 3 60 RR3-1 NR 1 KP 30 - NR 2 ( Bypass of NR 1/5) lane x2 AC RR 3-2 NR 2 - NR 5 PK PK 12 (Bypass of NR 1/5) lane x 2 AC NR2 Monivong Bridge - Phnom Den Wat Phnom -Takhmau Roundabout 6 (2 lanes +bike)x AC (2 lanes +bike)x 2 AC TakhmauRoudabout- Takeo 64 1 lane x DBST 1 lane x2 AC Takeo- PhnomDen 50 1 lane x AC 1 lane x2 AC NR3 Phnom Penh- Veal Rinh Wat Phnom -Chaom Chao 12 ( 2lanes+bike)x AC ( 2lanes+bike)x2 AC Chaom Chao- Kampot lane x DBST 1 lane x2 AC Kampot- Veal Rinh 52 1 lane x DBST 1 lane x2 AC NR4 Phnom Penh- Sihanoukville KP KP lane x AC 2 lane x2 AC KP 18 - KamponSpeu (KP48) 30 2 lane x2 or 2lane+1lane AC 2 lane x2 AC Kampong Speu- KP lane x AC 2 lane x2 AC KP 78 - KP lane x AC 2 lane x2 AC KP Sihanoukville 82 1 lane x AC 2 lane x2 AC NR5 Phnom Penh- Poi Pet Wat Phnom - PrekKdam 30 2 lane x DBST 2 lane x2 AC PrekKdam ThleaM am lane x DBST 2 lane x2 AC ThleaM am - Battambong lane x DBST 2 lane x2 AC Battambang- Sri Sophorn 68 2 lane x DBST 2 lane x2 AC Sri Sophorn- Poipet 47 (1 lane +bike) x DBST 2 lane x2 AC NR8 PreakTameak- Krek PreakTameak- NR lane x2 10 AC 1 lane x2 AC NR11-Vietnam Border 44 1 lane x2 10 AC 1 lane x2 AC Vietnam Border- Krek 20 1 lane x2 12 AC 1 lane x2 AC 0.00 Source: JCA survey team Final Report 4-15

71 Table Proposed Road Development Plan in South Economic Corridor (2-Digit Road) Current Road Conditions Proposed Road Road Location Length Current Cross Section Road Width Proposed Cross Section Road Pavement Project Cost Project Status NR21-1 Takhmau Roundabout ChreyThum 4 1 lanex lanex2 AC - NR21-2 PK4 ChreyThum 62 1 lane x lane x2 DBST 31 Requested NR31 ThnalBekKous Kampong Trach 54 1 lane x lane x2 AC 27 - NR33 Kampot Lork(Vietnam Border) 52 1 lane x lane x2 AC 26 ASEAN Highway NR48-1 SreAmbel Koh Kong Bridge lane x lane x2 AC 76 ASEAN Highway NR48-2 Koh Kong Bridge Cham Yeam 9 1 lane x lane x2 Concrete 0 ASEAN Highway NR55 Pursat Thma Da lane x lane x2 DBST 37 Requested NR57 Battambang Thai Border lane x lane x2 DBST 0 Completed NR72 Krek(NR7) Smach 13 1 lane x lane x2 AC - Source: JCA survey team Final Report 4-16

72 Source: JCA survey team Figure Revised Road Network Master Plan in Cambodia Final Report 4-17

73 NH314 (AH1) Lane Number : 4-Lane Road Pavement Type : Asphalt Concrete NH304 (AH1) Lane Number : 4-Lane Road Pavement Type : Asphalt Concrete NH33 (AH1) Lane Number : 4-Lane Road Pavement Type : Asphalt Concrete NR7 (AH11) NR5 (AH1) Lane Number : 4-Lane Road (Proposed) Pavement Type : Asphalt Concrete Lane Number : 2-Lane Road Pavement Type : DBST NH7 (AH123) Lane Number : 8-Lane Road Pavement Type : Asphalt Concrete NR5 (AH1) Lane Number : 4-Lane Road (Proposed) Pavement Type : DBST NH36 (AH123) Lane Number : 4-Lane Road Pavement Type : Asphalt Concrete RR3 NR8 (AH11) Lane Number : 2-Lane Road Pavement Type : Asphalt Concrete NR72 (AH11) Lane Number : 2-Lane Road Pavement Type : Asphalt Concrete (Proposed) NH3 (AH123) Lane Number : 4-Lane Road Pavement Type : Asphalt Concrete Lane Number : 4-Lane Road Pavement Type : Asphalt Concrete PR318 (AH123) NR22B (AH1) Lane Number : 4-Lane Road Pavement Type : Asphalt Concrete Lane Number : 4-Lane Road Pavement Type : Asphalt Concrete NR22 (AH1) NR48 (AH123) Lane Number : 4-Lane Road Pavement Type : Asphalt Concrete Lane Number : 2-Lane Road Pavement Type : Asphalt Concrete (Proposed) NR4 (AH11) Lane Number : 4-Lane Road (Proposed) Pavement Type : Asphalt Concrete NR51 Lane Number : 4-Lane Road Pavement Type : Asphalt Concrete NR3 Lane Number : 2-Lane Road Pavement Type : DBST NR1 (AH1) Lane Number : 4-Lane Road (Proposed) Pavement Type : Asphalt Concrete Legend NR80 Multiple Lane Road 2-Lane Road Lane Number : 2 to 4-Lane Road Pavement Type : Not Available NR91 Lane Number :2 to 4-Lane Road Pavement Type : Not Available Source: JCA survey team Figure Proposed International Highway System in Cambodia with Neighboring Countries 4.7 Evaluation of the Projects Evaluation Methodology The road network plan was formulated and presented in the previous section. Based on the proposed projects, the evaluation of the project in terms of prioritization of the proposed projects is described as follows: In the project evaluation, the road projects are classified into two (2) types: (1) 1-Digit road (2) 2-Digit road Evaluation criteria and factors are as follows: (a) Urgency and necessity aspect (b) This indicates how urgent the project or how necessary the project will be implemented from the aspect of ASEAN connectivity, promotion of direct investment to Cambodia, and international and domestic economic corridor development. (c) Traffic, social and economic aspect (d) This indicates the degree of the project influenced in terms of engineering (traffic volume), social aspect (benefits to peoples) and economic effect. Final Report 4-18

74 Prom otion of Direct Investment Traffic Aspect ASEAN Connectivity Prioritiza tion of the Project Social Aspect Ministrial Commitment Economic Efficiency Urgency and Necessity Aspect Traffic, Social and Economic Aspect Source: JCA survey team Figure Prioritization Criteria and Factors Table Scoring of Factors in the Overall Evaluation Criteria / Factor Indicator Score A. Urgent and Necessity 1. ASEAN Connectivity 1. Primary connection 2. Class I connection 3. Class II connection 4. Class III connection 5. No connection 2. Indirect investment 1. More than 5 SEZ 2. SEZ = 4 3. SEZ = 3 4. SEZ = SEZ =0 3.International and Domestic Economic Corridor B. Engineering, 1.Big amount of Agriculture and Industrial Output 2.Meium amount of Agriculture and Industrial Output 3. Small amount of Agriculture and Industrial Output 1. Traffic Aspect 1. ADT > 40,000PCU/km 2. 40,000 > ADT > 20,000 PCU/km 3. 20,000 > ADT > 10,000 PCU/km 4. 10,000 > ADT > 5,000 PCU/km 5. 5,000 > ADT 2. Social Aspect (Population in influence area) 1. Population > 300,000 people ,000 > Population > 100,000 people ,000 > Population > 50,000 people 4. 50,000 > Population > 10,000 people 5. 10,000 > Population 3. Economic Efficiency 1. EIRR > 20 % > EIRR > 128 % > EIRR Source: JCA survey team Final Report 4-19

75 4.7.2 Economic Evaluation (1) Presumption of Economic Analysis Prior to carrying out the economic analysis, the following presumptions are made; (a) The costs and benefits are calculated as differences between with and without the Project. The with case denotes a situation of how the road conditions could be improved as given the revised Master Plan Network or Projects. While, the without case does not stands for nothing happened on the current situation, but represents situation of how the transport conditions would be in the entire Study Area, given only the on-going and committed projects completed as scheduled. (b) Evaluation period is assumed to be 20 years from 2017 to 2036 (c) A discount rate is assumed to be 12 % taking into account the opportunity rate of capital investment in Cambodia. (d) The following benefits are estimated; - Saving in vehicle operation costs (VOC) - Saving in travel time costs (TTC) (e) Annualized factor of daily benefits is assumed to be 340 days per year taking into consideration the weekly variation of the traffic volume on the roads. (2) Economic Analysis of the Road Network Master Plan Based on the above estimated economic costs and benefits, the cost benefit analysis is made. The calculation results are summarized in Table 4.7-2, which indicates the proposed Road Network Master Plan is economically feasible. Table Summary of Cost Benefit Analysis Indicators EIRR (Economic Rate of Return) (%) 22.6 B/C Ratio 2.06 Net Present Value (US $ million) 2,471.8 Source: JICA survey team Notes; 1) Discount rate is assumed to be 12 %, 2) Evaluation period is assumed to be 20 years (3) Economic Analysis of the Projects Based on the benefits and cost estimates of each projects, economic analysis is carried out for each project. Tables and show the cost benefit analysis for the 1-Digit national roads and 2-Digit national roads, respectively. Final Report 4-20

76 Table Economic Analysis of 1-Digit National Roads Proposed Road Road Location Length Proposed Road Cross Section Pavemnent Project Cost EIRR (%) Score NR1 Phnom Penh- Vietnam Border Wat Phnom Monivong Bridge 5 (2 lanes +bike ) x2 AC Monibong Bridge - KP 9 4 (2 lanes +bike ) x2 AC KP 9 - KP (1 lane +bike) x2 AC KP 30- Neak Leuong 30 2 lane x2 AC Ist Neak Leung Bridge 5.5 (1 lane +bike) x2 AC nd Neak Leung Bridge lane x 2 AC Neak Leung- Bavet lane x 2 AC PP RR 3 60 RR3-1 NR 1 KP 30 - NR 2 ( Bypass of NR 1/5) 30 2 lane x2 AC RR 3-2 NR 2 - NR 5 PK PK 12 (Bypass of NR 1/5) 30 2 lane x 2 AC NR2 Monivong Bridge - Phnom Den Wat Phnom -Takhmau Roundabout 6 (2 lanes +bike)x 2 AC TakhmauRoudabout- Takeo 64 1 lane x2 AC Takeo- PhnomDen 50 1 lane x2 AC NR3 Phnom Penh- Veal Rinh Wat Phnom -Chaom Chao 12 ( 2lanes+bike)x2 AC Chaom Chao- Kampot lane x2 AC Kampot- Veal Rinh 52 1 lane x2 AC NR4 Phnom Penh- Sihanoukville KP KP lane x2 AC KP 18 - KamponSpeu (KP48) 30 2 lane x2 AC Kampong Speu- KP lane x2 AC KP 78 - KP lane x2 AC KP Sihanoukville 82 2 lane x2 AC NR5 Phnom Penh- Poi Pet Wat Phnom - PrekKdam 30 2 lane x2 AC PrekKdam ThleaM am lane x2 AC ThleaM am - Battambong lane x2 AC Battambang- Sri Sophorn 68 2 lane x2 AC Sri Sophorn- Poipet 47 2 lane x2 AC NR8 PreakTameak- Krek PreakTameak- NR lane x2 AC NR11-Vietnam Border 44 1 lane x2 AC Vietnam Border- Krek 20 1 lane x2 AC 0.00 Source: JCA survey team Final Report 4-21

77 Table Economic Analysis of 2-Digit National Road Proposed Road Road Location Length Proposed Cross Section Road Pavement Project Cost EIRR (%) Score NR21-1 Takhmau Roundabout ChreyThum 4 1 lanex2 AC NR21-2 PK4 ChreyThum 62 1 lane x2 DBST NR31 ThnalBekKous Kampong Trach 54 1 lane x2 AC NR33 Kampot Lork(Vietnam Border) 52 1 lane x2 AC NR48-1 SreAmbel Koh Kong Bridge lane x2 AC NR48-2 Koh Kong Bridge Cham Yeam 9 1 lane x2 Concrete 0 NR55 Pursat Thma Da lane x2 DBST NR57 Battambang Thai Border lane x2 DBST 0 NR72 Krek(NR7) Smach 13 1 lane x2 AC Source: JCA survey team (4) Overall Evaluation The overall evaluation of the proposed project roads is made using the scoring methodology developed mentioned above. The results of the overall evaluation for 1-Digit and 2-Digit are shown in Table & 4.7.6, respectively. From these sheets, scores for sections in NR 1, 4 and 5 are high and therefore those in these NRs could be priority projects. Table Overall Evaluation of 1-Digit Road Road Location Length NR1 Phnom Penh- Vietnam Border 167 Proposed Cross Section Proposed Road Road Project Cost Pavemnent Urgency & Necessity Points Technicai, Economic and Social Points A-1 A-2 A-3 B-1 B-2 B-3 Promotion to Economic Traffic S-Total Social Economic Direct Corridor Volume / Aspect Efficiency Investment Development Trip Length Contribution to ASEAN connectivity S-Total S-Total 1-1 Wat Phnom Monivong Bridge 5 (2 lanes +bike ) x2 AC Monibong Bridge - KP 9 4 (2 lanes +bike ) x2 AC KP 9 - KP (1 lane +bike) x2 AC KP 30- Neak Leuong 30 2 lane x2 AC Ist Neak Leung Bridge 5.5 (1 lane +bike) x2 AC nd Neak Leung Bridge lane x 2 AC Neak Leung- Bavet lane x 2 AC PP RR 3 60 RR3-1 NR 1 KP 30 - NR 2 ( Bypass of NR 1/5) 30 2 lane x2 AC RR 3-2 NR 2 - NR 5 PK PK 12 (Bypass of NR 1/5) 30 2 lane x 2 AC NR2 Monivong Bridge - Phnom Den Wat Phnom -Takhmau Roundabout 6 (2 lanes +bike)x 2 AC TakhmauRoudabout- Takeo 64 1 lane x2 AC Takeo- PhnomDen 50 1 lane x2 AC NR3 Phnom Penh- Veal Rinh Wat Phnom -Chaom Chao 12 ( 2lanes+bike)x2 AC Chaom Chao- Kampot lane x2 AC Kampot- Veal Rinh 52 1 lane x2 AC NR4 Phnom Penh- Sihanoukville KP KP lane x2 AC KP 18 - KamponSpeu (KP48) 30 2 lane x2 AC Kampong Speu- KP lane x2 AC KP 78 - KP lane x2 AC KP Sihanoukville 82 2 lane x2 AC NR5 Phnom Penh- Poi Pet Wat Phnom - PrekKdam 30 2 lane x2 AC PrekKdam ThleaM am lane x2 AC ThleaM am - Battambong lane x2 AC Battambang- Sri Sophorn 68 2 lane x2 AC Sri Sophorn- Poipet 47 2 lane x2 AC NR8 PreakTameak- Krek PreakTameak- NR lane x2 AC NR11-Vietnam Border 44 1 lane x2 AC Vietnam Border- Krek 20 1 lane x2 AC 0.00 Source: JCA survey team Final Report 4-22

78 Road Location Length Data Collection Survey on the Trunk Road Network Planning Table Overall Evaluation of 2-Digit Road Proposed Cross Section Proposed Road Road Pavement Project Cost A-1 A-2 A-3 B-1 B-2 B-3 Contribution to ASEAN connectivity Urgency & Necessity Points Promotion to Direct Investment Economic Corridor Development Traffic Volume / Trip Length Technicai, Economic and Social Points NR21-1 Takhmau Roundabout ChreyThum 4 1 lanex2 AC NR21-2 PK4 ChreyThum 62 1 lane x2 DBST NR31 ThnalBekKous Kampong Trach 54 1 lane x2 AC NR33 Kampot Lork(Vietnam Border) 52 1 lane x2 AC NR48-1 SreAmbel Koh Kong Bridge lane x2 AC NR48-2 Koh Kong Bridge Cham Yeam 9 1 lane x2 Concrete 0 NR55 Pursat Thma Da lane x2 DBST NR57 Battambang Thai Border lane x2 DBST 0 NR72 Krek(NR7) Smach 13 1 lane x2 AC Source: JCA survey team S-t ot al Social Aspect Economic Efficiency S-t ot al Total 4.8 Implementation Program Prioritization Based on overall evaluation of the proposed projects mentioned in the previous section, priority projects may be selected from those in NR 1, 4 or 5. It is to note that sections from Prek Kdam to Sri Sophorn in NR 5 have been or are being studied for loan projects under JICA and sections in NR 4 are taken care by the company under the concession contract with MPWT or being studied for PPP scheme under the Ministry of Land, Infrastructure, Transport and Tourism of Japan. Hence, by excluding sections in NR 4 and 5 as already planned for development, priority projects are hereby selected and outline as follows. National Road 1: Neak Loeung to Bavet to widen to 2 lanes x 2 directions with asphalt concrete (AC) pavement National Road 1: Another Neak Loeung Bridge to be constructed as second bridge with AC pavement to accommodate at least 2 lanes x 2 directions capacity together with the first bridge National Road 1: PK 30 (New Phnom Penh Port) to Neak Loeung to widen and/or construct new road as NR 1 bypass to 2 lanes x 2 directions with AC pavement, including provision of accesses to new Port and new SEZ near new Port Phnom Penh Ring Road No. 3: NR 1 (PK 30) to NR 2 to construct 2 lanes x 2 directions road with AC pavement newly, including provision of interchange for smooth movement between NR 1 and ring road No. 3 National Road 5: Sri Sophorn to Poipet to widen to 2 lanes x 2 directions with AC pavement Once the above projects are complete, the Southern Economic Corridor / Asian Highway 1 will be 2 lanes x 2 directions within Cambodia from Poipet (border to Thailand) to Bavet (border to Vietnam). Table Priority Road Development Projects no Road Location Length Current conditions Development (a) NR 1 Neak Loeung to Bavet 107 km 1 lane x 2 directions 2 lanes x 2 directions (b) NR 1 2nd Neak Loeung Bridge New PP Port to Neak Loeung 5.5 km 1st bridge to complete in 2015 (1 lane + bike) x 2 directions (3 lanes or 2lanes +bike) x 2 directions or more (c) NR 1 30 km 2 lanes x 2 directions RR 3 New PP Port to NR 2 30 km - 2 lanes x 2 directions (d) NR 5 Sri Sophorn to Poipet 47 km (1 lane + bike) x 2 directions 2 lanes x 2 directions Source JICA survey team Final Report 4-23

79 4.8.2 Implementation Program Data Collection Survey on the Trunk Road Network Planning Implementation program has been examined taking into consideration the results of overall evaluation. The implementation program is divided into three (3) stages as: Short term plan: Medium term plan: Long term plan: Table shows the road section to be improved by a short, medium and long term plan by 1-Digit and 2-Digit road. Table Implementation Program for 1-Digit Road Road Section Location Length Proposed Road Proposed Cross Road Pavemnent Section Short Term ( ) Medium Term ( ) Long Term ( ) NR1 Phnom Penh- Vietnam Border Wat Phnom Monivong Bridge 5.0 (2 lanes +bike ) x2 AC Completed 1-2 Monibong Bridge - KP (2 lanes +bike ) x2 AC Pipeline Project 1-3 KP KP (1 lane +bike) x2 AC Completed 1-4 KP 30- Neal Leuong lane x2 AC 1-5 Ist Neak Leung Bridge 5.5 (1 lane +bike) x2 AC On-going 1-6 2nd Neak Leung Bridge 5.5 (1 lane +bike) x2 1-7 Neak Leung- Bavet (2 lanes +bike ) x2 1-8 KP 30 - NR 2 ( Bypass of NR No 1) lane x2 NR2 Monivong Bridge - Phnom Den Wat Phnom -Takhmau Roundabout 6 (2 lanes +bike)x 2 AC Completed 2-2 TakhmauRoudabout- Takeo 64 1 lane x2 AC F/S by Korea 2-3 Takeo- PhnomDen lane x2 AC Completed NR3 Phnom Penh- Veal Rinh Wat Phnom -Chaom Chao 12 ( 2lanes+bike)x2 AC Within Phnom Penh 3-2 Chaom Chao- Kampot lane x2 AC 3-3 Kampot- Veal Rinh lane x2 AC Need to repair NR4 Phnom Penh- Sihanoukville KP KP lane x2 AC Completed 4-2 KP KamponSpeu (KP48) lane x2 AC FS by MLIT of Japan 4-3 Kampong Speu- KP lane x2 AC FS by MLIT of Japan 4-4 KP 78 - NR lane x2 AC FS by MLIT of Japan 4-5 NR 48 - Sihanoukville lane x2 AC FS by MLIT of Japan NR5 Phnom Penh- Poi Pet Wat Phnom - PrekKdam 31 2 lane x2 AC Being widened by China with AC, from PrekKdam ThleaM am lane x2 AC F/S by JICA by ThleaM am - Battambong lane x2 AC F/S by JICA by Battambang- Sereysophorn 69 2 lane x2 AC F/S by JICA in Sereysophorn- Poi Pet lane x2 AC NR8 PreakTameak- Krek PreakTameak- NR lane x2 AC Completed 8-2 NR11-Vietnam Border lane x2 AC Completed 8-3 Vietnam Border- Krek 20 1 lane x2 AC Completed Source; JICA survey team Table Implementation Program for 2-Digit Road Road Location Length Proposed Road Short Term Medium Term Long Term Current road Road condition Pavement ( ) ( ) ( ) Remark NR21-1 Takhmau Roundabout ChreyThum lanex2 AC Completed NR21-2 PK4 ChreyThum lane x2 DBST Requested NR31 ThnalBekKous Kampong Trach lane x2 DBST - NR33 Kampot Lork(Vietnam Border) lane x2 AC ASEAN Highway NR48-1 SreAmbel Koh Kong Bridge lane x2 AC ASEAN Highway NR48-2 Koh Kong Bridge Cham Yeam lane x2 Concrete ASEAN Highway NR55 Pursat Thma Da lane x2 DBST Requested NR57 Battambang Thai Border lane x2 DBST Completed NR72 Krek(NR7) Smach lane x2 AC Completed Total Length (Km) 3, Source; JICA survey team Remark Final Report 4-24

80 4.9 Effects of the Road Improvement on National Roads 1 and General Figure shows the schematic figure of the road network development. This figure shows that if there is no improvement of road development on NR 1 and 5 as it is, transport costs and times will not be reduced at all and road accident risks are to increase. Under such conditions, the following situations may be come out: (a) Stagnant foreign investment (b) A little opportunity of job creation (c) Lower economic growth, etc. When these priority projects are implemented, it is expected to achieve the following direct and indirect effects. Direct effects - Reduction of transport time - Reduction of transport cost - Reduction of accident risks - Reduction of commodity damaged risks Indirect effects - Increase in foreign investments - Increasing opportunities of job creation - Expansion of local product markets - Achieving higher economic growth Undeveloped Cross Boarder System Poor 1 Digit National Roods Undeveloped Cambodian Land Transport System Keeping Expensive Land Transport Cost Stagnant foreign investment A little Opportunity of job creation Low economic growth Road Improvement Actions 1. Improvement of NR No Improvement of NR No.5 3. Improvement of CB Transport System, Source: JCA survey team Effects of Transport Improvement Reduction of transport cost Reduction of transport time cost Reduction of accident risks Indirect Effects of Transport Improvement Increase in foreign investment Increasing opportunity of job creation Local product expansion High economic growth Figure Schematic Drawing of Road Network Development Effects Each effect is discussed below. Final Report 4-25

81 Transport Time (Hr) Reduction of Transport Time (1) Factories in Bangkok - SEZ in Phnom Penh Data Collection Survey on the Trunk Road Network Planning The present transport time between factories in Bangkok and SEZ in Phnom Penh is estimated at about 25 hours based on the hearing from information of several forwarders, of which that between Bangkok and Aranyaphrathet needs to be about 5hours after loading cargoes from factory, and that at custom clearance needs about 6 hours including changing truck fleet, and that between Poipet and Phnom Penh passing through NR 5 needs about 14 hours with average speed of 30 km/hr. Total transport time between factories in Bangkok and SEZ in Phnom Penh needs about 25 hours presently. When the following improvements are implemented, the transport time is able to reduce as follows: widening to 4-lane AC road project is implemented, average transport speed on NR 5 is expected to be 50 km/h Custom clearance at Poipet will be shorter from hours at present to hours in future when the CBTA is implemented effectively. After the above-mentioned improvements are implemented, the transport time between factories in Bangkok - SEZ in Phnom Pen is expected to be reduced from about 25 hours to 16 hours. This means that 20 or 40 feet container dispatches from factories in Bangkok in the early morning and arrives at SEZ in Phnom Penh in the late evening. Figure shows comparison of transport time before and after these improvements made. Bangkok Aranyaprathet Poipet Phnom Penh Custom Clearance Battambang Bangkok - Aranyaprathet Custom Clearance Poipet - Phnom Penh Present After Improvement Source: JCA survey team Figure Transport Time between Bangkok and Phnom Penh As for the transport costs, there are several issues as follows: Unbalanced transport cargos Inefficient logistic system Existence of administrative cost in Cambodia Need to long time custom clearance Poor transport system quality Final Report 4-26

82 Transport Time (Hr) Data Collection Survey on the Trunk Road Network Planning Presently transport cost of 20 feet container is as expensive as about USD 1,350 based on hearing information. The transport cost is comparatively expenses. This is largely due to a little export cargoes from Cambodia to Bangkok. So it is necessary to increase export to Thailand to reduce unbalanced transport cargoes. If so, the transport cost may be reduced to half of the cost. Land transport, which has many merits such as door to door services, flexibility of transport cargoes, shorter transport time compared with maritime transport, has comparatively advantages. It is expected to increase drastically transported cargoes by truck between Bangkok and Phnom Penh. (2) SEZ in Phnom Penh - Factories in Ho Chi Minh The present transport time between SEZ in Phnom Penh and factories in Ho Chi Minh is estimated at about 13 hours based on the hearing from information of several forwarders, of which that between SEZ in Phnom Penh and Bavet passing through NR1 and Neak Loeung Ferry is about 6.7 hours, and that at custom clearance needs about 3 hours, and that between Moc Bai and Ho Chi Minh needs about 2.8 hours taking into consideration traffic congestion in Ho Chi Minh. At present, total transport time between Phnom Penh and Ho Chi Minh needs about 13 hours. When the following improvements are made, the transport time is reduced as follows: Construction of Neak Loeung Bridge to be completed by 2015 will be able to reduce transport time. widening to 4-lane AC road project is implemented, average transport speed of truck on NR 1 is expected to be 50 km/h Custom clearance at Bavet will be improved and as the results custom clearance time is expected to be shorter from hours at present to hours in future based on information of other cross-border cases. After the above-mentioned improvements are implemented, the transport time between SEZ in Phnom Penh - factories in Ho Chi Minh is expected to be reduced from about 13 hours to 8 hours. This means that 20 or 40 feet container sends from Phnom Penh in the morning and arrives at Phnom Penh in the evening. Phnom Penh Bavet Moc Bai Ho Chi Minh Custom Clearance Phnom Penh - Bavet Custom Clearance Moc Bai - Ho Chi Minh Present After Improvement Source: JCA survey team Figure Transport Time between Phnom Penh and Ho chi Minh Final Report 4-27