Cambodia, Thailand agree to deal on traffic

Photo by: STEVE FINCH
Travellers on the Thai-Cambodian border prepare to cross over to Poipet early last month. The two countries have signed an agreement on transshipping, it was announced Thursday in Phnom Penh.

Friday, 18 September 2009 15:01 Nathan Green

Border-crossing agreement announced Thursday would see daily exchange of trucks in bid to minimise trade obstacles

CAMBODIA and Thailand signed a memorandum of understanding on the exchange of traffic rights Thursday in an effort to boost trade and tourism links between the two countries.

The agreement, which was signed by Cambodia’s Minister of Public Works and Transport Tram Iv Tek and Virachai Virameteekul, a minister attached to the Thai prime minister’s office, will allow a daily quota of trucks to cross the border without having to unload cargo and reload to a second truck on the other side.

Forty trucks from each side would initially be allowed to cross daily, but the quota is expected to be raised progressively.

It was signed on the sidelines of the Second Greater Mekong Subregion (GMS) Economic Corridors Forum in Phnom Penh, a meeting of ministers from the six countries through which the Mekong River flows.

Arjun Goswami, head of the Southeast Asia Regional Cooperation Group for the Asian Development Bank (ADB), which brokered the deal, said it was an important step in boosting trade between the two ASEAN neighbours.

“It will save time; it will increase the speed at which trade can take place,” he said.

Trucks would still need to clear customs under the agreement, and Goswami acknowledged that customs processes at the Poipet border with Thailand still had room for improvement.

“Trade facilitation is an issue for the whole of the GMS; it’s not an issue that’s location-specific to Poipet or location-specific to Bavet,” he said, referring to Cambodia’s major border crossings with Thailand and Vietnam, respectively. “That requires additional work by customs authorities throughout the GMS and by other agencies that are at the borders, and we are focusing a lot of effort in that area. The countries themselves recognise that this is a key issue.”

The memorandum is part of efforts on the Cross-Border Transport Agreement (CBTA), which was signed by the member countries of the GMS – Cambodia, China, Laos, Myanmar, Thailand and Vietnam – in 1999 as a framework for streamlining intraregional trade.

In the World Economic Forum Global Competitiveness Index for 2008 and 2009, Cambodia was ranked last among countries in Southeast Asia in terms of its customs burden, showing it has much work to do to catch up with its regional neighbours.

Slow progress
Arjun Thapan, the ADB’s director general for Southeast Asia, told the Post in June that progress on the Cross-Border Transport Agreement was “very much” behind schedule in the GMS, singling out talks between Cambodia and Thailand as a major sticking point, particularly when compared to negotiations with Vietnam.

Cambodia and Vietnam signed an agreement on the exchange of traffic rights in May this year with an initial quota of 40 trucks per day allowed to cross without unloading. That has since been increased to 150, but Thapan said Wednesday that the border crossing at Bavet was an example of how countries could work together to boost trade.

The site had been chosen as one of five border-crossing pilot sites by GMS members to get the CBTA working, he said. Between 2003 and 2006, the value of goods moved through the crossing grew 41 percent each year, and the number of people crossing grew 53 percent. The time it took to travel to Bavet from Phnom Penh along National Highway 1 was also reduced 30 percent over the period.

“Urban development along … [National Road 1] happened because there is life there, there is economic activity,” Thapan said, adding that the economic corridors could double or quadruple intraregional trade.