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Pledges to cut transport fees ignored, say logistics firms

Shipping containers are stacked at Phnom Penh Autonomous Port in 2010.
Shipping containers are stacked at Phnom Penh Autonomous Port in 2010. Pha Lina

Pledges to cut transport fees ignored, say logistics firms

Nearly two months since the government pressed ports and trucking companies to reduce cargo transport fees, local logistics firms say the initiative has been largely ignored.

On May 1, Prime Minister Hun Sen officially signed off on a 5 per cent reduction on container loading fees at Phnom Penh Autonomous Port, and a 10 per cent cut at Sihanoukville Autonomous Port. Additionally, the two largest trucking associations in Cambodia agreed to reduce the container transport fee by $10.

However, Nhiev Kol, general manager of container shipping company CMA-CGM (Cambodia) Co Ltd, said yesterday that because the implementation of the reduced container fees has been inefficient, his company has seen a negligible change in overall transport costs.

“We gained slightly from reduced overtime fees from the port, but the port’s basic price is still the same,” he said. “The trucking companies have not provided us with a reduced fees either and we have no right to force them to.”

Kol added that the firms have shirked the prime minister’s announcement out of fears that they will lose profits.

Ly Mey, a manager from Meng Hong Leap Logistics Co Ltd, claimed that the cost of truck transportation remains high. However, he could not say if the reductions had an effect on the ports as his company has never been charged a lift-on, lift-off (LOLO) fee.

“The new government policy did not help reduce the cost of transportation,” Mey said. “The cost for trucking is still the same.”

On Monday, Transport Minister Sun Chanthol met with representatives of local transport sector to discuss “the realities on the ground” and the impact of cost-cutting measures.

Sin Chanthy, president of Cambodia Freight Forwarders Association (CamFFA), said following the meeting that the government and the private sector were still working together to find solutions.

“We are creating a committee to work on the challenges of transportation,” he said. “We are researching ways in which we can reduce the cost, partly by identifying how other ASEAN countries operate.”

He claims that while the Kingdom’s ports have followed the directive, trucking associations have yet to adopt the $10 container fee reduction.

However, Sok Chheang, president of the Cambodia Trucking Association (CAMTA), defended the body by saying that trucking companies were already engaged in a race to the bottom. He said that trucking companies have reduced their container fees from $310 to $300, and some even lower than that. Any further reductions would make it impossible to remain profitable.

Instead, Chheang stood by the prime minister’s announcement that stated that the high cost of transportation was linked to findings that 48 per cent of fees are paid out as bribes. “I agree with the prime minister, the transportation industry is corrupt,” he stated.

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