LINES OF THOUGHT ACROSS SOUTHEAST ASIA

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Getting back on track

As a crucial link in the trans-Asian network and a viable alternative to road transport, Cambodia’s neglected railways are ready for renewal.

Johan Smits
August 1, 2009

As a crucial link in the trans-Asian network and a viable alternative to road transport, Cambodia’s neglected railways are ready for renewal.

By Johan Smits

Desperate to visit Europe but afraid of flying? In the future it may be possible to travel the journey by train from Phnom Penh. About 50 years ago Cambodia was a signatory to an intergovernmental agreement on the trans-Asian railway network. Its objective was a simple one: to build a 14,000km rail service from Singapore to Europe, linking about 28 countries and offering efficient rail transport services within the region as well as between Asia and Europe.

Phnom Penh's Royal railway station (Ryan Plummer)
Photo by Ryan Plummer.
Phnom Penh’s Royal railway station

 

Given the sorry state of the Cambodian railroad infrastructure, though, it seemed unlikely that the kingdom would hook up to the network.

Nevertheless, a day after the agreement came into force in June this year, the Cambodian government signed a deal with a joint venture company led by the Toll Group, an Australian logistics firm, to operate the country’s railway. A minority partner in the venture is the Royal Group controlled by Kith Meng, a high-profile Cambodian businessman. The deal gives the group a 30-year concession with exclusive rights to develop and operate the Cambodian railway system.

According to Wayne Hunt, president and chief executive officer of Toll Asia, a feasibility study has revealed strong freight opportunities and with Cambodia being a critical part of the Singapore link to Kunming in China, “the regional opportunities are very strong in the medium to long term”.

After the Singapore-Kunming link was proposed during an Asean summit in 1995, a feasibility study examining six alternative routes to connect the two destinations was completed four years later. Only one of the six routes included Cambodia, but eventually that was the one selected because of its high social and economic impact.

Slow train: local Cambodians find a use for the track with hand-driven trolleys (Martin Kroll)

Restoration of the Cambodian railway network was begun in March last year by TSO, a French company. The initial funding of $73m consisted of an Asian Development Bank (ADB) loan, a grant from the Organisation of Petroleum Exporting Countries, a Malaysian government grant in the form of second-hand rails and funding from the Cambodian government. However, despite possible increases in the budget, Gilles Goepfert, a director of TSO, sees the project as a major challenge. “Generally, the state of the lines is very poor,” he says.

Cambodia’s current railway network totals 603km and consists of two single-track lines originating in Phnom Penh. The northern line, which runs to Sisophon via Battambang, was built by the French between 1930 and 1940. The southern line runs to Sihanoukville and dates from the 1960s. However, years of neglect have left them in a shambles. “The passenger service to Battambang stopped about four or five months ago,” Goepfert says. The very limited services that are now still running are some freight trains, mainly carrying cement from Kampot and fuel from Sihanoukville.

According to Paul Power, who is advising ADB as a consultant for the Canadian company Canarail, the state-owned Royal Railways of Cambodia (RRC) has been operating the railway since 1992 and hasn’t been profitable for many years. Under the recent concession agreement, the RRC will continue to own the infrastructure, whereas Toll-Royal Rail will have sole responsibility to determine tariffs, rules and conditions. Toll-Royal Rail will also need to invest significantly in rolling stock but, according to Hunt, this will be based on the public’s reaction and acceptance of rail travel.

“Road transportation costs are quite high in Cambodia,” says Goepfert, “so the railway should attract new investment. There are industrial mining and plantation projects eager to use the railway, which should boost regional development.” According to Hunt, the main focus will be on generating freight revenue. He expects the southern line to Sihanoukville to be the most critical segment in the short to medium term, “but over time we hope that the northern line to Thailand will become equally important”.

“There’s a lot of business between Thailand and Vietnam,” says Goepfert, who believes a trans-Cambodian rail link would offer a reliable alternative to road transport. But before that becomes reality, two new railroad stretches will need to be built.

One is the 48km “missing link” from Sisophon to Poipet on the Thai border, which was removed either by the Khmer Rouge or the Vietnamese. Some say the steel was sold off as scrap by the liberating Cambodian military.

Whatever the cause of the missing link, rebuilding it is an important part of TSO’s rehabilitation project. There is also another 6km on the Thai side, but once Cambodia shows it is serious about connecting its railway to the Thai border, it is believed that will quickly follow suit. Thailand completed a rail connection with a passenger and freight terminal in Laos earlier this year.

The other stretch that needs to be built is more ambitious: a 225km line from Phnom Penh via Kompong Cham to Loc Ninh in Vietnam, which is the focus of a China Railway Group $2.5m feasibility study funded by its government. The link would require two bridges, one over the Tonle Sap and another over the Mekong. Power and Goepfert estimate the cost to be between $500m-$600m.

Ticket windows wait patiently for the future (Ryan Plummer)

However, the economic importance of a Trans-Asian network is believed to have increased a lot since its initiation in the 1960s. There is now a growing acceptance that rail transport of goods and people has an important role to play, is environmentally friendly and is a relatively safe mode of transport.

The entire project is meant to be completed within three or four years, but what kind of services might passengers expect? “The concession is primarily a freight one,” Power says. “However, Toll may develop its own specialised services,” he adds. Hunt does not want to make any promises. He explains that under the concession agreement, passenger services will only be provided after financial negotiations are completed with the government.

In a Cambodian context “three to four years” can be a very long time, so don’t let anyone sell you a ticket to Europe just yet.



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