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Korean Firm Violated its Contract: Minister

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Sun Chanthol (center), the Minister of Public Works and Transport, talks with representatives (in yellow jackets) of the Korean Hanshin Engineering and Construction Company on National Road 21. Supplied

Sun Chanthol, the Minister of Public Works and Transport, said last week that Hanshin Engineering and Construction Company, a Korean firm that won the contract to improve National Road 21, violated the contract with the government by hiring a subcontractor to do the job.
“The subcontractor must be approved by the MPWT [Ministry of Public Works and Transport] based on the contract,” he said. “As of today, that subcontractor has not been approved and secondly, a subcontractor cannot do more than 50 percent. One hundred percent by one subcontractor is wrong, violating the contract.
“And that, we have to report to the EDCF [Korea Economic Development Cooperation Fund] and report to the Korean ambassador so they know it is in violation,” added Mr. Chanthol in a video clip posted to his ministry’s Facebook page.
He said that if no action was taken against this violation, EDCF could stop giving loans to the Kingdom, and it would be a big loss to the Cambodian people.
Mr. Chanthol also said his ministry was aware of the low quality of road construction all over the country, which was due to many factors including corruption, low contract costs and floods during the rainy season.
To tackle road quality issues, the ministry has hired a private company to regularly inspect road construction sites and report back to the ministry, which will in turn, send a technical team to inspect if the roads are being poorly constructed.
As for National Road 21, Mr. Chanthol said his ministry had performed many road quality tests. The results indicate the road has not been constructed to standards mentioned in the contract, but since the road is not yet finished the company should have more time to make improvements.
“We did a lot of tests to see whether the road is qualified as mentioned in the contract or not. After the tests, we found out that the road is of poor quality,” said the minister.
“However, the road is still under construction and we told the construction company to improve the quality of the road. We can never accept any road in bad quality.”
If the construction company was unable to build roads to the required quality as mentioned in the contract, Mr. Chanthol said his ministry could terminate the contract and/or ban the company from building roads in the country.
Hanshin Engineering and Construction Company did not respond to requests for comment.
The construction of National Road 21, with a total length of 63.6 kilometers, was launched by Prime Minister Hun Sen in March. Funds for road construction total $61.6 million – $52.54 million as a loan from the South Korean government and $9.06 million from the Cambodian government.
According to the Asian Development Bank (ADB), the primary road network in Cambodia includes 2,263 kilometers of paved roads that connect the Kingdom to its neighboring countries. The secondary national roads are 3,360 kilometers of mostly unpaved roads and provincial unpaved roads total 6,441 kilometers.
The Ministry of Public Works and Transport, in cooperation with 10 development partners, is managing an investment program worth a total of $2.7 billion over five years (2014-2017) for the construction of roads and bridges in the Kingdom.
High priority was given to 15 projects worth a total of $803 million, of which $500 million will be for the construction of a new railway link to Vietnam.
As for 40,000 kilometers of rural roads, the Ministry of Rural Development manages them. These rural roads are covered with earth or laterite and comprise 77 percent of the total road network.
From the ADB’s point of view, the local materials for paving roads are often of poor quality, which requires roads to be repaired every three years.
On the other hand, the lack of border exit facilities slows down trade and passenger traffic. However, cross border facilities exist at Trapang Kreal and Bavet, and the construction of two other border facilities are in progress at Lork and Prey Var at the border with Vietnam.
“There is stakeholder interest in building a railway from Thailand to Vietnam. To achieve this, a new railway line is required from Phnom Penh to the northeast border. It is anticipated that private finance will be required because of the high cost involved ($500 million-$600 million),” the ADB said.

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