4.5  PHYSICAL INFRASTRUCTURE

4.5.1    TRANSPORTATION

284.    The Government’s goal for the transport sector is to establish an efficient (low cost and competitive) transport network that can support economic growth, poverty alleviation, regional cooperation and globalization.

The Government’s medium term objectives for the transport sector are: to rehabilitate, maintain, and expand transport infrastructure to facilitate integration of market and maximize trade, especially within the region, giving priority to rural development, domestic and international trade routes, and tourism facilities. Specifically, RGC’s medium term priorities are to: (i)

rehabilitate and reconstruct the main national roads to improve access to a land transport system throughout the nation, (ii) improve the efficiency in the use of existing infrastructure,  institutions, and operational performances, and (iii) build road links to neighboring countries, thereby opening to international trade and tourism, (iv) increase revenues from the transport sector to cover an increasing share of maintenance and development, (v) strengthen institutional capacity in sector planning and management, and (vi) promote increased private sector participation in the financing of transport infrastructure development.

285.    ROAD TRANSPORT: In the road sector, RGC’s first priority is the rehabilitation of the road network and strengthening of its operations and maintenance capabilities. A significant bottleneck in the rehabilitation of the road network is the large number of river crossings, also on the main national roads. Many existing bridges have load capacities below 20 tones and collapses are not infrequent. The Road Master Plan has three main objectives: (i) to rehabilitate and reconstruct the main national roads, thereby improving land transport throughout the nation, (ii) to build road links to neighboring countries, thereby opening up some of the more remote areas of the country to international trade and tourism, and (iii) to develop a sustainable road maintenance program, thereby assuring that investment in road rehabilitation and reconstruction generate sustainable benefits.

286.    In 2001-2002, external assistance for the rehabilitation of 1,400km of road network was secured. In addition, RGC’s planned target is to carry out emergency repairs and short-life rehabilitation of an additional 4,800km of the road network. First priority will be given to the main/secondary national roads that connects Phnom Penh to the provincial capitals. Second priority will be given to 2,000 km of the national road system that directly link adjacent provinces and connects small communities with towns and cities. The planned activities will strengthen the linkage between the three broad economic zones into which the country is divided for transport planning process. These are: (i) tourism zone, formed by the triagle of Siem Reap-Preh Vihear and Kompong Thom, (ii) industrial zone, defined by the entire northern coastal zone of the country, and (iii) agro-Industrial and eco-tourism zone, covering the eastern region of the Mekong river, including Ratanakiri and Mundulkiri.

287.    The Government recognizes that the country’s geographic location offers strategic opportunities for establishing Cambodia as a regional transportation hub for the Greater Mekong sub-region. The Government places high priority on further expanding trade, particularly within ASEAN, and on improving cross border linkage. The budget will be used to the maximum extent possible to finance the local cost of domestic roads and railway programs either alone or in parallel with international agencies. In addition, the Government will assess the scope of financing regional infrastructure programs through the participation of the private sector, as has been the case with the international  airport, national road NR4, Koh Kong bridge. The reconstruction of RN6 will be continued to link Siem Reap and Angkor Wat temples to Phnom Penh and Poipet/Cambodia-Thai border by road which will open and facilitate increased tourist traffic on this route. Regional routes will be improved and the upgrading of RN1 and RN5 will constitute the first phase of the Ho Chi Minh-Phnom Penh-Bangkok Road through Cambodia. RN7 will be rehabilitated to link southern Laos with Phnom Penh and Sihanoukville via RN4 together with construction of a bridge over the Mekong River at Kompong Cham with the support from the Government of Japan. RN48 will be rehabilitated to link Sihanoukville, the trade-industrial zone of the country to Bangkok port and the other main international ports in the region to facilitate the traffic of goods and could also become importance route for regional trade. In the frame work of economic cooperation between Cambodia and Thailand some more of secondary roads and provincial roads will be rehabilitated and  linked with Cambodia-Thai border as NR56, 57, 58, 59, 68, 69, 64,  ..etc. The rehabilitation of national roads NR78, 76a,78a, 78b, 76, 72, PR303a, 303b  in Ratanakiri and Mundulkiri Province  will open the new opportunity for facilitating transportation goods and people crossed the border and international trade and tourism in the framework bilateral, triangle socio-economic cooperation area and Greater Mekong Sub-region.

288.    Other immediate plans include the preparation of technical studies to assess requirements and priorities for inter-connecting roads and establishing road-bridge maintenance organizations to ensure that investments are sustained. The government will place emphasis on job generation during project implementation, as these types of projects can provide significant employment during construction using labor-intensive techniques.

289.    The establishment and implementation of an adequate road maintenance fund is essential in order for Cambodia to benefit fully from the assets already built and to ensure the long-term sustainability of the road network. In this regard, the Government will aim to ensure that the maintenance of the road network, including bridges and ferries, is financed by vehicle registration charges, tolls, international transit fees and fuel levies or other related taxes and duties. The setting-up and introduction of standard unit costs for use in project preparation and sectoral databases describing the nature of sectoral assets, age, condition and maintenance history will provide a basic for formulating a strategy for meeting recurrent costs.

290.    Investment priorities for port and inland waterways transport include rehabilitation of dredgers to allow for the regular dredging of all major waterways, rehabilitation and expansion of Sihanoukville deep water sea port for which a master plan was completed and the project implementation is currently under preparation with the financing support  from the Government of Japan. Further upgrading of the Phnom Penh inland river port as well as improvements to smaller domestic river and lake ports and upgrading of the existing ferries are also priorities. The establishment of self-financing entities to own, manage and maintain the international ports of Phnom Penh, Sihanoukville and Koh Kong and to assist provinces to establish locally generated funding mechanisms to develop and maintain island port facilities, is being pursued with the private sector. Other plans include: establishing a national ports policies; establishing maintenance organizations for waterways and ports; and a comprehensive data base for executing necessary future-oriented studies.

291.    The establishment of self-financing entities to own, manage and maintain the international ports of Phnom Penh and Sihanoukville through locally generated funding mechanisms is an objective of the Government. Other plans include: establishing a national ports policies, establishing maintenance organizations for waterways and ports, and a comprehensive data base for executing necessary future-oriented studies. The RGC’s plan is to develop and maintain the port facilities and to improve the Sihanoukville Port through the construction of a new cargo wharf (400m length), expansion of container wharf (160m), building a Container yard 60 000 m² and container cranes supply, and improving the roads, power supply and  lighting system in the port area.

292.    The railway network has long been a vital, but much damaged and grossly under-utilized asset. An immediate priority of the RGC is to prepare performance standards and a regulatory framework that is aimed at facilitating the expansion of private investment throughout the transport sector. At present, the regulatory framework for private sector participation in specific areas such as rail is not clear. The Southern railway line between Phnom Penh and Sihanoukville port requires rehabilitation to reduce excessive operating costs to enable it to effectively compete with road transport. The viability of rehabilitating the northern line, including the missing link to the Thai border, will be investigated. Additional rolling stock and track maintenance operations will be needed to provide an adequate level of service to the growing traffic. Emphasis will also need to be given to the rehabilitation of additional rolling stock, and upgrading of signaling equipment, development of efficiency standards, and cost recovery management.

293.    The availability of Civil Aviation services is a pre-requisite for the development of the tourism sector that has a significant multiplier effect on the economy. The Civil Aviation Development Framework (CADF) 1996-2005 guides Government activities. The CADF focuses on immediate establishment of the regulatory framework to meet international standards for safety, operations and security; air navigation services, communications,  surveillance, and meteorology, development of national airport; and strengthening institutional capacities in planning and management. It also emphasizes efficiency in regulating and licensing, ensuring that competition is promoted and monopoly situations are avoided, safeguarding consumers, and enforcing adherence by transport operators to national safety, technical and environmental standards. The current CADF needs to be updated and will require support of external partners. There is also a  need to improve and upgrade noth-east domestic airports at Stung Treng, Rattanakiri, and Modulkiri. To meet the international safety standards the Communications-Navigation-Surveillance/Air Traffic Management Systems (ATM) are urgently needed. The Pochentong Airport is being further improved under the ongoing BOT agreement. There is also a need to upgrade the Sihanoukville and the Siem Reap international airports improved to  international standards to cater to the growing traffic to the area (Angkor temples).

294.    Government interventions will be strictly limited to ensuring that markets work by regulating market entry and the licensing of transport systems. This will ensure that competition is promoted and monopoly situations are avoided. The aim is to safeguard consumers as well as to seek better adherence by transport operators by enforcing the national safety, technical and environmental standards. Suppliers of transport services will not be constrained in tailoring their services to customers provided that they adhere to legislative and regulatory rules designed to protect consumers, workers health and safety and the environment.

295.    To ensure that these policy action are successfully implemented and enforced it is imperative that the MPWT has the capacity to implement medium term policies. Furthermore, steps will have to be taken to strengthen and develop sector institutions, so as to increase the range of feasible policy options. The Government with external assistance will promote efforts to improve public sector capacity to identify, prepare, implement, manage, and co-ordinate policy and investment priorities. The MPWT will also carry out with external assistance an inter-modal transport study for the transport sector as a whole to formulate a comprehensive long-term transport policy.

296.    Public investments, loans, private sector's investment under BOT formula will be utilized to implement this plan for the rehabilitation and development of the national road infrastructure.

4.5.2    WATER RESOURCES MANAGEMENT AND SANITATION

297.    The water resources sector plays a key role in the implementation of the government policies aimed at poverty reduction through the provision of irrigation for rice production and the supply of drinking water to the population in towns and in rural areas. Every year, about 475 billion cubic meter of water flows through Cambodia into the sea.  Because there are limited facilities to store these waters, during the dry season, there are only limited options to supplement irrigation for agricultural production and drinking water supply.  Floods, droughts, the misuse of surface and underground water resources affect the incomes and the health of the population and cause delays in achieving the poverty reduction goals. A draft of the Water Law has been approved by the Council of Ministers and is now proceeding to the Parliament for endorsement.

298.    The RGC’s goals for the management of the water resources, sanitation, and metrology are :

  1. To increase the irrigated area from 16,62 percent to 20 percent, through water storage during the wet season for double crop production, to increase job opportunities and the income of the population in rural areas.

  2. To take a leading role with regard to drainage, water conservation, water resources development for the benefit of the population, by developing drainage systems and protection dikes.

  3. To study surface water and groundwater to ensure that quantity and quality of water are managed in an integrated manner and to maintain a balance between the demand and water availability.

  4. To improve weather forecasts, hydrological forecasts and ensure the timely warning of natural disasters such as typhoons, floods and drought to the population in the whole country.

299.    The Ministry of Water Resources and Meteorology has prepared an action plan to achieve these goals. The elements of the action plan include:

  • Meteorology work: increase data collection, set up the geographical information system and disseminate information on the importance of meteorology work;  construct synoptic stations and connect the radar system for 24 stations;  improve/construct29 agro-meteorological stations; and improve/construct 274 pluviometers.

  • Hydrology work: improve hydrological data collection, set up a geographical information system and disseminate information on the important hydrological work;  construct/improve 60 hydrological stations; and install 30 stations to analyze water quality and wastewater discharges.

  • River Works: study the problems of stability of river bank, streams and canals in the Kingdom of Cambodia; and improve/construct river bank protection works in the region and in important towns.

  • Management of potential surface water: design and construct major dams along the river for multiple purposes, such as the Stung Prek Thnot, Stung Komchay, Stung Pursat, Strung Battambang, Stung Ateay, Stung Meteuk, Stung Piphot, Stung Sen, Stung Sekong, Stung Sesan, and the Kirirom hydropower dam; map and plan the development of important slope areas within catchment areas; prepare plans for the distribution of water resources, according to needs in various areas; create a mechanism for public participation in the preparation of plans and water resources development.

  • Irrigation system works: improve the inventory of the existing irrigation systems; rehabilitation and design of drainage systems and flood protection systems; rehabilitation of the existing irrigation systems and pumping stations to ensure sufficient irrigation; and create farmer water user communities for all irrigation systems that have been completed.

  • Water supply and wastewater: prepare groundwater maps; increase the capacity to supply water to the provinces; and plan drainage and wastewater systems for provinces and tows.

  • Human resources development: increase and transfer new technologies to the technical departments to improve the knowledge of the staff, and disseminate information thereon; and train staff according to the specialization of each technical section.

  • Preparation of legislation and standards for water resources management: prepare the draft water resources management law for submission to the Council of Ministers and approval; prepare the draft water resources policy; prepare water resources strategies; prepare a draft sub-decree on the licensing of water uses, the licensing of wastewater discharges, the licensing of groundwater drillers and licensing of activities within the framework of flood prevention; and prepare draft technical standards for wastewater discharge and standards for drinking water.

4.5.3    ENERGY

ELECTRICITY POWER DEVELOPMENT

300.    Cambodia’s Power Sector Strategy (2001-2005) sets out the priorities and a major investment program to lower tariffs and bring reliable electricity supplies to considerably more Cambodians. The planned investment program includes: (i) the development of a generation and transmission grid to link large electricity generation units between Phnom Penh and the provincial capitals; (ii) provincial towns electrification plan to rehabilitate supplies; and (iii) the development and implementation of a rural electrification plan.  Rehabilitation and expansion of Phnom Penh’s electricity supply system is being continued. Generation capacity is also being expanded with an interconnection from Vietnam and over the next five years from a new gas turbine combined cycle power plant in Sihanoukville. These improvements will allow a reliable and security of electricity supply to the outer regions of Phnom Penh.

301.    National Generation and Transmission Grid: The Program to establish a National Generation and Transmission Grid commenced in 2000. The first stage of this program is the construction of transmission line between Vietnam and Phnom Penh through Takeo Province. The second stage is the construction of a transmission line from Kampot province to Takeo province and the third stage is the transmission line from Sihanoukville to Kampot province. It will allow generating units to be established in Sihanoukville to provide supplies to provincial cities between Sihanoukville and Phnom Penh and also increase the capacity available to Phnom Penh. By establishing generation in Sihanoukville which is expected to be a gas power plant, it will lessen the need to transport fuel on the Mekong reducing the danger of oil spills and environmental damage. The portion of  transmission line from Phnom Penh to border of Vietnam through Takeo will be established first to import electricity from Vietnam in year 2003. The 220 kv Interconnection from Vietnam will supply power to communities in the South and increase capacity available to Phnom Penh. A Five-Year Rural Electrification Program including renewable energy will also be scheduled. The total cost of this first portion of power transmission and rural electrification project is estimated at US$89M. Another 115 kv interconnection transmission line is also planned to connect from Thailand to Banteay Meanchey, Battambang and Siem Reap provinces to support the provincial and rural electricity program. The plans also include developing hydropower project in Kamchay and there after Stung Battambang, Stung Atay and Russy Chrum.

302.    Electricity Law: The Electricity Law has been promulgated and an independent regulatory agency for the electricity sector, the Electricity Authority of Cambodia (EAC) has been established. The EAC is responsible for tariffs setting, licensing of all electricity suppliers and monitoring the national electricity standards, and regulations. Private power suppliers and  independent power producers are encouraged to participate in the implementation of the energy Development plan. The technical and operational performance of EDC is being strengthened through concerted capacity building to enable it to develop the needed technical skills and to perform the power sector planning, management, accounting and budgeting functions. The electricity law provides transparency, and a regulatory

framework that will ensure a balance between giving investors a reasonable return on capital and ensuring tariffs are as low as possible.

303.    Hydropower Development: Decisions about the pace and scope of hydropower development will be taken within a framework that carefully examines the costs and benefits of this development. The first step is to conduct feasibility studies of the potential sites. Further support from donors is being sought to formulate technically sound and economically optimal multipurpose projects, and to strengthen program/project planning capacity for these activities. In addition to the rehabilitation of the Kirirom 12 megawatts project, that is now in progress, a feasibility study of the Kamchay hydropower project in southern Cambodia with an installed capacity of around 120 megawatts is currently being conducted. A number of small-scale hydropower projects are also being considered as priorities for local supply, such as Stung Battambang (60 megawatts) Prek Thnot, Stung Chinit and Sambo project. The total potential of the Mekong tributaries is estimated, with minimum risks to the environment, at 2,200 megawatts, with a further 1,000 megawatts from rivers outside the Mekong Basin.

304.    Sector Financing: The RGC’s approach to financing the power sector is to encourage private sector financing and to seek concessional loans from multilateral and bilateral donors to generate funds for the expansion of the power sector at the lowest cost. While at present, revenues only partially cover total costs, the approach to financing the expansion of the power sector is based on the principle of full cost recovery. The RGC’s target for the power sector is have a level of revenues that will meet the total costs operating and maintenance of the facilities as well as the costs of replacement of capital equipment. To this end, further revision of the tariff schedule for different consumers is envisaged to encourage efficiency and power conservation in parallel with intensified efforts to attract additional private sector participation in the development of the power sector.

4.5.4    POSTS, TELECOMMUNICATIONS, AND NATIONAL INFORMATION

305.    The RGC’s goals and objectives are to establish an efficient commercial low cost telecommunications network of adequate capacity and coverage in line with the Master Plan together with an efficient public postal service and a public broadcast network. For the medium term the objectives are to: (i) provide telecommunications network that can adequately cover Phnom Penh, Sihanoukville and Siem Reap and to expand services to the urban cores of provincial towns; (ii) establish national standards for the design, construction and operation of all telecommunications services; (iii) strengthen postal organizational structure and institutional capacity to improve service delivery; and (iv) expand the television and radio network. Sector development hinges on improvement of the telecommunications regulatory and legal framework and more efficient use of resources in the postal and information services.  Strengthened regulatory framework will encourage additional private investment and alternate financing and technical shortages.  Restructuring of the postal and information services primarily through reallocation of resources to their most efficient use is a prerequisite for additional major capital investment.  National Information Services are committed to the maintenance and expansion of an independent press and to expanding the coverage and efficiency of radio and television networks.

306.    Telecommunications:  Over the next five years, the RGC is committed to establish the Cambodia Telecom (CT), rehabilitate and extend customer telephone networks of Phnom Penh, and construction of a microwave or FIO link between: (i) Kampong Cham - Phnom Penh – Takeo -  Kampot – Sihanoukville; (ii) Kampong Cham - Kampong Thom - Siem Reap – Sisophon; Kampong Cham – Kratie - Stung Treng; and (iii) Mondukiri, Pailin, Preah Vihear, Udom Mean Chey.  It will involve installation of central switching (15,000 lines) in Phnom Penh and network extension to Poipet, Banteay Meanchey, Battambang, Pursat, Kampong Chhnang, Neak Loeung, Svay Rieng, Bavet.  The goals are to provide adequate network capacity and coverage to at least one line per 100 people to fully cover Phnom Penh, Sihanoukville and Siem Reap and to expand services to the urban cores of the other provincial towns. Other activities include: preparation and enactment of a Telecommunications Act to provide the legal framework for the industry; maintaining the existing MPTC database and incorporating all relevant information related to the existing networks to allow for monitoring of demand; execution of studies needed for the development of a long-range comprehensive plan for networks extension in provincial towns; Development of this plan to incorporate priorities for development of the provincial system;  execution of studies by CT to identify and elaborate on project sites in coordination with town planning authorities; development by CT of administrative units for procurement of equipment, supplies and materials, and establishment of proper accounting and monitoring systems for rehabilitation and new local area networks; establish national standards and practices for the design, construction and operation of all telecommunication systems, and for customer services. Measures will be implemented by CT to develop on-going training, for transferring technical expertise, administrative and operational skills to CT personnel and to operators of provincial systems. There will be full coordination by MPTC with the donor community in the development of plans, studies projects and financing in order to avoid unnecessary duplication of efforts, and to secure the resources necessary to rehabilitate and extend networks.

307.    Postal Service: Over the next five years RGC will: (i) strengthen organizational structures and institutional capacity in order to ensure efficient delivery of services; (ii) develop the administrative capacity for procurement of equipment, supplies and materials; (iii) establish proper accounting and monitoring systems; (iv) establish a database of all physical assets and manpower as a basis for planning of maintenance, training and redeployment; (v) carry out studies to assess the requirements for improving and extending postal services into the communes; (vi) promote competition in bulk mail transport to and from the provinces. The Government will ensure that funds are made available and properly managed to maintain constructed facilities. Commercial charges will be applied to telecommunications operators utilizing post office services.                                               

308.    National Information Services: The RGC is committed to maintaining and expanding the independent press and to expanding the coverage and efficiency of the radio and television networks.  It will upgrade essential equipment and build technical capacity through continuation of in-house and overseas training, and extend the television network to provinces where reception is not currently available.

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