Officially sanctioned reductions in port container fees will have little impact on the Kingdom’s trade competitiveness as deeply engrained problems in trucking and railways, as well as high custom fees, remain in place, stakeholders in the transport sector said yesterday.
“The cost reduction of transportation fees is better than nothing, but documentation, customs and administrative costs are big expenses that need to be reformed,” said Siev Eang Tang, an import supervisor for CTSI Logistics Inc.
On Sunday, Prime Minister Hun Sen announced that state-owned Sihanoukville Autonomous Port and Kampuchea Shipping Agency and Brokers would cut container costs by 10 per cent, while Phnom Penh Autonomous Port would reduce container fees by 5 per cent.
Tang said the cuts would have little effect on overall freight transport costs, as the majority of the company’s customers struggle with high tariffs and documentation fees.
Ly Meng, manager of Meng Hong Leap Logistics, agreed that the small reductions in port container fees would have little impact on the sector’s overall competitiveness.
“Reducing the loading costs provides a little help, but the overall costs are still high and the trucking sector has yet to be reformed,” he said.
While the two largest private associations for the Kingdom’s trucking industry – CamFFA and CAMTA – have already agreed to reduce container fees by $10, Meng said those cuts have yet to become official.
Song Saran, CEO of Amru Rice, said that the cuts imposed by the prime minister were a positive step in a challenging sector that would eventually increase overall trade competiveness. But he argued that railway costs and trucking fees should also be closely examined.
“[The port] fees are only a small part of the production line,” Saran said.
“The government should continue to call on the logistics sector to discuss cutting costs together.”
Logistics companies have also complained of being charged onerous informal fees by state officials, which increase the cost of freight shipments and reduce export competitiveness.