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Cambodia’s ranking as a logistics hub remains ‘stable’

Jose Rodriguez T. Senase / Khmer Times Share:
A delivery lorry transports multiple shipping containers from Cambodia’s main deep-sea port in Sihanoukville. Khmer Times

Cambodia’s ranking has slightly improved in this year’s global index of emerging logistics markets, rising one notch compared with the same survey last year from 42 to 41 among 50 countries included in the study.

The survey is conducted by Agility, one of the leading logistics companies in the world. Agility first conducted the survey in 2008 and has published its findings every year since.

The study only involves countries that are considered to be emerging logistics markets. The World Bank’s International Finance Corporation has defined emerging markets as a country making an effort to improve its economy, with the aim of reaching the same level of sophistication as nations defined as “developed”.

This year, Cambodia achieved a score of 4.36 points (out of a perfect 10), placing it on the same ranking as Uganda and just behind Iran.

The Kingdom performed the best in international logistics opportunities (4.46), while its lowest score was in business fundamentals (4.19).

Among the 50 countries in the survey, Cambodia was ranked 49th in domestic logistics opportunities, 33rd in international logistics opportunities and 36th in business fundamentals.

China remains the top-ranked country on the global index of the emerging logistics market. Asia’s largest economy scored 9.75 points in the international logistics opportunities, validating its reputation as one of the world’s leading logistics hubs and a premier destination investment in logistics.

Among countries in Southeast Asia, it is Indonesia (4th globally) that is on top, followed by Malaysia (5th), Thailand (9th), Vietnam (11th), Philippines (22nd), Cambodia and Myanmar (47th). Singapore, the region’s richest and most developed country was not included in the study. Neither was Laos because, being landlocked, it has no port.

Vietnam, which was in the top 10 in 2019, fell one notch and was overtaken by Thailand. Still, Vietnam did well, ranking 4th globally in international opportunities, which is a testament to the country’s growing reputation as a premier investment destination, not only in Southeast Asia but in the world.

Cambodia’s ranking is expected to improve further in the future, with development of the logistics sector prioritised by the government and more global players eyeing to tap the vast potential in the Kingdom’s logistics market. In the last five years, according to figures provided by Cambodia Freight Forwarders Association, close to 500 registered logistics companies have started operating in different parts of Cambodia. These include local firms and branches of prominent international players such as Maersk, Nippon Express, OOCL and Ben Line Agencies.

The countries are ranked based on three factors; domestic logistics opportunities, international logistics opportunities and business fundamentals.

Falling under domestic logistics opportunities are the following factors: Domestic logistics markets-size and growth; economy-size and growth; population- size and growth; income equality; urbanisation; and development of business clusters.

International logistics opportunities are measured through the following factors: International logistics markets-size and growth; logistics-intensive trade-size and growth; infrastructure quality and connectedness; and border procedures-time and cost.

Business fundamentals are the following: Regulatory environment; credit and debt dynamics; contract enforcement and anti-corruption frameworks; inflation and price stability; the cost of crime and violence; and market accessibility and domestic stability.

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