The government plans to look into building a proposed Sihanoukville Logistics Center (SLC), with support from the World Bank, to transform Cambodia into an “active distribution channel” for the region as well as to capture and maintain a sound competitive edge against its peers, according to Minister of Public Works and Transport Sun Chanthol on December 22.
This comes as studies on the similar Phnom Penh Logistics Center (PPLC) near completion, albeit behind schedule. The hotly-anticipated PPLC is planned on 98ha in Samrong Krom commune of the capital’s Dangkor district, an area just west of Phnom Penh International Airport.
The minister told reporters that the SLC would bring down logistics costs, making the Kingdom more competitive in the Greater Mekong Subregion.
“We’ve been studying with Singapore’s YCH to set up the PPLC … [and] now we’ve signed an agreement with the World Bank to study the SLC, which could streamline and better integrate logistics, distribution and transport.
“[With Cambodia] in the middle of the Greater Mekong Subregion [surrounded by] Vietnam, Thailand, Laos and Myanmar … we’ll benefit a lot from transhipments, especially from Thailand and Vietnam.
“Since they ship tonnes of goods through us, we’ll need to set up our transportation and logistics system well, to establish ourselves as a Mekong region’ producer and distributor of choice,” Chanthol said.
Speaking to The Post on December 22, Cambodia Logistics Association president Sin Chanthy commented that the SLC could find much favour with foreign investors eyeing a slice of the local export business.
“We support and applaud the government’s commitment to improving the logistics and transportations systems of Cambodia, which will help to reduce costs in this sector, enabling it to compete with regional markets. This will also support the manufacturing sector and boost exports,” he said.
Hong Vanak, director of International Economics at the Royal Academy of Cambodia, suggested that the SLC could be a key economic booster and foster additional transport and logistics development.
“Logistics and transportation are the main economic vehicles for regional competition – lower prices will add to the allure of the export-oriented manufacturing sector for investors, which will make Cambodia’s production chains stronger,” he told The Post.
On March 4, 2021, the public works ministry signed on Singapore’s YCH Group Pte Ltd (YCH) to develop the PPLC. Then on May 3, 2022, YCH inked a memorandum of understanding (MoU) with local conglomerate Worldbridge Group to collaborate on the development and operation of the logistics centre.
The PPLC forms part of the ASEAN Business Advisory Council’s (ASEAN-BAC) Smart Growth Connect (SGConnect) initiative, and is the second project under the ASEAN Smart Logistics Network (ASLN) that supports the ASEAN Connectivity Master Plan 2025.