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NEWS UPDATES 28 June 2010

Phnom Penh port expands

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PHNOM Penh Autonomous Port is to quadruple its loading capacity in the next two years after securing US$68 million worth of Chinese financing for a second terminal 25 kilometres east of the capital, with construction slated to begin in September, the Phnom Penh Post reports.

Authorities said yesterday that the second terminal would give Phnom Penh a loading capacity of about 300,000 TEU (20-foot equivilant unit) containers per year, a dramatic increase from the current limit of 60,000 to 80,000 TEUs per year.

The first US$28 million stage of the two-stage build – slated to begin in September and take 22 months to complete – will create a total capacity of 120,000 TEUs per year once complete. That figure will increase to 300,000 TEUs once the second stage is finished.

Hei Bavy, director general of the port, said that after receiving a loan from China last year the new port would be built in Kandal province’s Kien Svay district.

Hei Bavy said that China-based Shanghai Construction had been contracted for the first stage of construction. The first stage will cover an area of 12 hectares, and the second stage will cover another eight hectares.

“We hope that this construction project will enable the Phnom Penh Autonomous Port to ship more and more goods in the future,” he said. The current port, first established in 1952 and renovated twice so far, has seen demand increase.

Hei Bavy said that if capacity was not boosted, goods shipments would inevitably face delays and obstruction.

“When the new port is completely constructed, we will use it as a place for loading containers so that big trucks will not cause traffic congestion in the capital,” Hei Bavy said.

Hin Theany, Division General Manager of Mitsui OSK Lines (MOL), said: “I think expanding the port is a good idea because it will help make freight shipment easier in the future when shipping activities increase beyond their current levels.”

The Cambodian government had been trying since early 2009 to secure the loan from the Chinese government to develop the port.

On October 15, Prime Minister Hun Sen signed deals worth $850 million with the Chinese government to spend on development projects in Cambodia. About $68 million was slated for the development of Phnom Penh’s port capacity.

Hei Bavy said that the second stage of construction might not be funded by the loan from China if the port proved to be capable of earning an income between $6 million and $10 million per year during the period of 2012 to 2015.

“We plan to use the money which the port earns by itself for the second-stage development project because the Chinese loan is too expensive,” he said.


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