Cambodia’s Global CAM Project Development Plc on Friday signed a memorandum of understanding (MoU) with Korea’s Green Eco Energy Co. Ltd. to build a high-speed expressway from Phnom Penh to Sihanoukville, executives from the two firms said.
The deal is worth more than $536 million.
Construction of the 275-kilometer-long, 20-meter-wide expressway along National Road 3 could begin in the middle of next year and take three years to complete, said Chhin Son, general manager of Global CAM.
“Cambodia needs more infrastructure. This is the first expressway in Cambodia and it will spur development,” said Mr. Son.
“After finishing the technical studies and survey on social impacts, both companies will release a construction plan for approval by the government,” Mr. Son said.
The two companies were granted a license from government to invest in the expressway. It gives them a 35-year concession to collect tolls before turning it over to the government. “Cambodian citizens and the government will benefit from this expressway as it will increase the number of tourists [to Sihanoukville], improve transportation and save time for road users,” Mr. Son said.
Lim Won Dae, CEO of Chansol Engineering and Green Eco Energy, said the expressway will help turn Cambodia into a developed country like South Korea. It will be the company’s first investment in infrastructure in Cambodia, he said.
Nou Savath, secretary of state at the Ministry of Public Works and Transportation, welcomed the expressway and encouraged more domestic and foreign companies to invest in infrastructure.
He said the government supports the build-operate-transfer (BOT) model as a template for further investment in infrastructure.
Economist Srey Chanthy said that the expressway could save costs, reduce traffic congestion and ease the flow of goods between Phnom Penh and Sihanoukville. Heavy traffic congestion wastes time, increases pollution and has negative impacts on public health, he added. An expressway will also cut transport costs between Phnom Penh and Sihanoukville and encourage more use of Sihanoukville Port as well as draw more tourists to the coasta resort, he said.
The Ministry of Public Works and Transportation in August signed an MoU with China’s Henan Provincial Communication Planning, Survey, and the Design Institute Co. Ltd. for the construction of a 190-kilometer-long, 25-meter-wide expressway linking Phnom Penh and Sihanoukville on National Road 4. According to the MoU construction is slated to begin next year and finish in 2020 at a cost of about $1.6 billion.
A master plan by the ministry estimates that Cambodia will need 850 kilometers of expressways by 2020 and puts the cost of this at $9 billion.
Cambodia will need 2,230 kilometers of expressway by 2040 and this will cost about $26 billion, according to the master plan.