A large-scale and long-overdue renovation of the country’s archaic railway system, which was built between 1929 and 1942, is scheduled to begin next month, government officials said this week.
“Finally our country is able to fix our railroad after such a long period of war,” said Sokhom Pheakavanmony, director of the Transport Ministry’s railway department.
French firm TSO and Thailand-based Nawarat have signed an agreement to rebuild all existing lines in Cambodia after winning rights to the project in a joint-venture bid, Sokhom Pheakavanmony said.
There are more than 600 km of rail track connecting Phnom Penh with both Banteay Meanchey province’s Svay Sisophan in the northeast and Sihanoukville in the south, but the rails are desperately in need of a total makeover.
Construction is set to be completed in 2010 and will extend the rail link to Poipet, which will then connect to Thailand.
The project will cost approximately $55 million, said Paul Power, a consultant with the Asian Development Bank, which is financing some of the rail rehabilitation.
An additional $18 million will be spent by the government on the project for clearing mines, moving displaced residents and other preparations for the project, Power said.
Power said that bidding had not yet begun for the proposed 250-km line running from Phnom Penh through Kompong Cham and Kratie provinces to Loc Ninh in Vietnam. But he said that construction on the proposed line, part of Asean’s 5,513-km Singapore-Kunming project, could be finished by 2012 or 2014.
Because of existing lines from Singapore to Thailand and from Vietnam to Kunming, China, Cambodia’s rails are a necessary component to connecting the Asean region, he said.
“It can’t be done without Cambodia. It’s the essential middle,” he said.
Sokhom Pheakavanmony said the new rail lines would attract tourists seeking ease of travel and scenic views.
But Huy Rith, engine unit manager of the railway, said not only the tracks, but also the existing trains need to be replaced.
Currently trains travel at speeds of between 15 and 30 km per hour, with only one group of passengers using the train to travel to Battambang once a week, he said. The trip can take eight hours.
The new tracks would allow travel at 50 km per hour and eventually speed up to more than 90 km per hour with future improvements, Sokhom Pheakavanmony said.
Australia-based Toll Holdings company is negotiating a 30-year concession agreement to provide and operate new engines and railcars from Phnom Penh to Svay Sisophan and Sihanoukville, Power said. That agreement could be signed in February, and Toll could begin running on the existing lines by August.
Toll intends to invest $80 million in the project, Power said, adding that the company is taking some risk with the investment, as they will be expected to pay off their investment debt in addition to paying 2 to 6 percent of revenue to the government.
But Toll projects $12 million in revenue in its first year, $54 million in its 5th year and $80 million in its 10th year, Power said. Though some 60 to 70 percent of that money will go towards operating expenses, he said.
Power added that the potential for profit from the railways has increased with Sihanoukville’s airport expansion, Kampot’s new seaports and cement factory, and Poipet’s continuing growth.
The current railway system, however, can’t handle too much commerce, Power said.
“There’s a derailment almost every day. The infrastructure is in really dangerous shape,” he added.
Economist Sok Sina agreed that the railway project would boost the economy, creating jobs and offering better services for transport and travel. But he raised concerns about job losses in other sectors.
“The cheap transportation by train will compete with bus and taxi,” he said.
Kampot Governor Thach Khorn welcomed the railroad’s renovation, saying that private investors are planning to build new seaports in Kampot for heavy goods that could be transported by train.
And Tourism Ministry Director-General Kousoum Saroeuth said a railroad might one day connect Asean countries like rail systems through France, Italy and Spain.
“Asean could be the same as the European Union,” he said.
(Additional reporting by Neou Vannarin)