The Thai Samart Corporation has established a new Cambodian-based company to develop and operate air traffic control systems at three Cambodian airports, according to news reports.
Cambodia Air Traffic Services Ltd will implement the 15-year agreement, which Samart signed with Cambodia in January, a Dow Jones new service report stated.
The new company, with registered capital of $2.5 million, will get a 7 year, $15 million loan from Thailand’s Export-Import Bank for the project, the report stated.
Tea Sotha, undersecretary of state for the State Secretariat of Civil Aviation, said the company was formed last week. Securing money to finance the project is more important than establishing a local company, he said.
“It is not a big deal,” he said. “We care more about whether Thai Samart is going to put money into the project, as they promised in the contract.”
The local company will design, develop and operate the overflight control system and airport navigation services for 15 years. The company is required to buy equipment, including radar and other communication systems from Airsys ATM, a subsidiary of the French giant Thompson, for $10.4 million. Equipment will be installed in Pochentong, Siem Reap and Stung Treng airports.
Samart will keep 70 percent of revenues from overflight charges and 50 percent of revenues from navigation services. The rest goes to the government.
Last year, Cambodia generated $6.5 million from air traffic services. Samart will make $8 million per year and perhaps as much as $20 million in the future, Samart managing director Teerachai Phongpanangan told a Thai newspaper.
He also said that Samart has spent $17.5 million on equipment, instead of $10.4 million quoted in the contract. Neither he nor Samart CEO Charoenrath Vilailuck were available for comment.
Soy Sokha, economic adviser to the Council of Ministers, said the government will be able to generate more money out of the deal, even though more than half of the revenue goes to Samart.
Overflight and navigation services’ fees will be determined by the company and the State Secretariat of Civil Aviation, he said.
A senior civil aviation official said it will take about 10 months to obtain equipment from France and another six months for installation.
It remained unclear when the new system will be ready to serve airlines.