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Port’s expansion responds to trade growth

Port’s expansion responds to trade growth

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Eang Veng Sun, deputy director general of the Phnom Penh Autonomous Port, speaks with the Post this week. Photograph: Daniel De Carteret/Phnom Penh Post

Deputy Director General of Maritime Services/Traffic, Eang Veng Sun has spent his life on the water. Before working at the Phnom Penh Autonomous Port (PPAP), Veng Sun was a shipping captain who had visited many of the world’s greatest trading ports.

Veng Sun sat down with the Post’s Daniel de Carteret to discuss the progress of Phnom Penh’s newest port and the rapid growth of Cambodia’s exports.

How is the new port coming along?

With an average of about 15 per cent growth each year, the current location was no longer able to cope with the continuing increase of cargo output. We were facing a problem with a lack of space, and that is why we have developed a new port.

The first stage of the new PPAP terminal began operating on January 22 this year.

The Phnom Penh Autonomous Port is to be listed on Cambodia’s stock exchange at some point. How is that progressing?

The government wants to have the Phnom Penh Water Supply Authority, Telecom Cambodia and the Sihanoukville port to be listed first. Then other state enterprise like Phnom Penh Autonomous Port will be in the second wave.

When we are listed then we will arrange things accordingly, but in the meantime we are also preparing for the IPO. We have initiated an independent auditing company to check our financials and we have also rearranged our organisational structure so we can easily split between the authority and the operational functions.

It is only a matter of waiting for instructions from the government.

The Post recently published an article about the utilisation of Cambodian waterways to deliver cargo to the PPAP. Do you think there is greater potential here?

Indeed, yes, we should look more in to using the waterways system in Cambodia to benefit from cheaper transport.

PPAP is aware of the importance of the waterways, which is why we invest in improving the accessibility from Phnom Penh to Kampong Cham province, a province that is famous for agricultural products.

We have set up a small terminal there that we hope will be in operation later this year.

The PPAP’s shipping fees are higher than for other ports in the region. Why is that the case?

There are several factors that contribute to higher costs. If you look at the port charge, for the ship operator, compared to other ports in the region, it is more or less the same. But if you look in to the cargo service rate like freight charge or the lift on and lift off charge, we are a bit higher compared than other ports in the region, but there are reasons for this.

We need to import all our cargo handling equipment as well as fuel, whereas neighbouring countries have these resources available themselves.

Another reason that drives the costs higher is the operations at this port. Due to the limited space we are not always able to utilise this effectively in a way that we can easily identify and reach the container that we need, making the operation costs higher.

What are the challenges for the PPAP in light of such rapid growth?

There are several challenges: firstly is the cost, which we are aware of. We are working to resolve this by regularly improving our efficiency.

The second challenge is accessibility. Along the entire river from the mouth through Vietnam and Cambodia there are bottlenecks that require dredging work and regular maintenance.

The third challenge is that we have to continue to improve on the human capacity by building up skills and knowledge, and this of course takes time. With support from the Mekong River Commission, we have also installed an automatic identification system, which allows us to track a vessel’s movement along the river at any point in time.

Environmental impacts of global trade are of growing concern. How does the PPAP manage this?

Environmental protection is also a priority for us. The harbour office department manage this generally, while internally we also have the safety, health and environment unit who in are in charge of the environmental policy of the port, as well as safety and security.

Given that PPAP’s cargo goes via Vietnam for further export, how important is the relationship with Vietnam?

If we are working in the right direction together, then we are likely to reach our common goal. In Vietnam there tends to be an oversupply in the port facility, of course they need to attract transit and for us, having a smooth connection will reduce costs, so co-operation is very important.


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