IN a move that may result in a 400% hike in ferry fees, the government is
considering leasing the Mekong River ferries in Neak Leung to a private company.
The proposed deal comes just six months after the completion of an $18 million
foreign-donor-funded renovation of the ferries, most of the money coming from
One of the Neak Leung ferries that the Ponloeu Angkor Import Export and Construction company wants to take over
Minister of the Interior and Deputy Prime Minister Sar Kheng has
already stated that he has no objections to a privatization of the ferry
operation, and officials at the Ministry of Finance and the Ministry of Public
Works and Transportation support the idea.
But other government
officials, donors and ferry workers fear that privatization will lead to higher
charges for users who can ill afford such an increase.
Critics say the
Neak Leung ferries are running well and that there is no need for further
improvements by a private investor.
But the company Ponloeu Angkor Import
Export and Construction, which wants to operate the service, seems to think
In mid August, the company sent a letter to the Ministry of
Interior, the Ministry of Finance and the Ministry of Public Works and
Transportation, requesting permission to take over the operation and
administration of the ferries during a 10-year period from 2000 to
In its letter, the company offers to pay an unspecified amount of
money to the government and to renovate the structures and ferry units in Neak
In a copy of the letter, obtained by the Post, Sar Kheng notes
that he has no objections to the suggestion.
Two weeks ago, the Mekong
River Commission inquired at the Ministry of Public Works and Transportation to
know its stance on the matter. The MRC received the answer that the ministry had
decided to oppose the privatization.
However this week the Undersecretary
of State responsible for the ferries, Koy Kem Phan, who supports the
privatisation move, said no final decision had been made. He said other
ministries were backing the proposal.
"Officials in the Ministry of
Finance agree with me by saying that this is a very good plan for investment,"
He also explained that the final decision rests with Sar
Kheng, since the ferries are a matter of national interest.
The talk of
privatizing the Neak Leung ferries has created anxiety among the more than 150
people who work on the ferries, the jetties and the affiliated shipyard. Also,
some government officials are worried that it will upset the Danish government
if Cambodia were to lease the ferry project to a private company so soon after
More tangible is the fear that Ponloeu Angkor will exploit
the ferries without keeping them and the harbor structures properly
"There is some very complex equipment involved in the ferry
operation, and we made every effort to ensure that the staff was well trained to
handle it; but if the equipment is not properly maintained, the whole thing will
collapse," warns an MRC official, who estimates that with proper handling, the
ferries can run for 10 to 15 years without major rehabilitation.
director of the ferry operation, Um Luonn, says the period of the lease is
therefore an important issue.
"They will not maintain the equipment
properly. Then, after 10 years when everything is run down, they will hand it
back to the government," he says.
Luonn's opposition to leasing the ferry
operation has put him in a perilous position.
"I have been told that if I
don't go along with the idea, I will be moved away from the ferry station," he
Another matter of concern is the price of the ferry tickets, which
looks set to increase if Ponloeu Angkor takes over.
The Neak Leung
ferries make a daily profit of six million riel after all expenses and salaries
are paid. But according to Phan, Ponleou Angkor has offered to pay the
government eight to nine million riel a day and to double the wages of the
This can hardly be profitable without reducing the work force
or increasing the ticket price - today at an affordable level of 100 riel a
crossing. Most private operators along the Mekong River charge 500 riel per
When contacted by the Post, Ponleou Angkor's president, Chan
Long, and deputy president, Mom Nyn, both refused to discuss their plans for the
Neak Leung ferry operation.
Denmark's Minister for Development, Jan
Troejborg, said his Government had not been told of the plans for the ferries
they helped finance. He said they were not opposed to privatisation in principle
but that the process must be "sustainable and transparent".
The move has,
however, caused concern at the MRC, where one official said : "Our most serious
concern is the social impact that it will have. The company will gain a monopoly
on the ferry crossing and will be free to raise the prices, which will affect
many poor people."
Meanwhile the 150 ferry staff, and regular
passengers, are worried what privatisation will mean for them.
captains, security guards, mechanics, ticket sellers and dock workers sent a
thumb-printed letter to the Ministry of Public Works and Transportation,
protesting the proposed lease. Now, they threaten to go on strike if the
privatization is carried out.
"We are afraid that if the private company
takes over the ferries, they will fire many of the old staff or maybe replace
them with their own family members," says Im Reach, one of the security guards
on the fully renovated Peace 2 ferry.
"The company says that they will
double our salaries, but I don't believe that."
The captain of the newly
renovated ferry Ta Prohm, Chin Sary, has considerable pride in his ship but
little enthusiasm for seeing it privatized.
"We know from other
enterprises that private companies don't respect workers' rights. I fear that
the company will pressure us to work too hard and reduce our working conditions.
That is why I don't like the idea," says Sary.
A passing security guard
throws in another few arguments:
"Why do they think there is a need to
invest in the Neak Leung ferry station? It is not very old and it works well.
I'm sure that the private company will raise the ticket price and that will hurt
the poor people who cross the river all the time," he said.
It is a
concern shared by regular users. Fruit seller Sok Ny travels on the ferry every
day; she is concerned that her family will suffer if ticket prices go
"It is my business to go to the market and sell vegetables and
bananas, so I have to cross the river every day. But if the price goes up I will
make less money for my family," she says.