Cambodia's China dependence deepens as first expressway opens – Free Malaysia Today

PHNOM PENH: After three years of Chinese-led construction work, Cambodia’s very first toll expressway has opened for business, the project symbolising the deepening economic ties between the Southeast Asian nation and Beijing.
Costing roughly US$2 billion to construct, the expressway stretches 190km between Phnom Penh, the capital, and the port city of Sihanoukville.
The toll road is targeted toward commercial drivers who place a premium on transport time and safety.
“This is the first expressway I’ve ever driven on in my lifetime,” Raksmey, a 40-year-old company worker said after the expressway officially started paid operations in November. “I was able to get to my destination in a short time, and it was a lot more convenient than I imagined.”
Raksmey travels frequently between Phnom Penh and Sihanoukville to conduct sales, a task made considerably easier by the opening of the highway.
The expressway cuts the time of the trip between the cities from five hours to two. That convenience comes at a cost: The fee is currently set at US$12 for conventional vehicles and US$60 for large trucks. Those prices suggest that the operator, the Chinese state-owned China Road and Bridge Corporation (CRBC), hopes to make a profit off the road relatively quickly.
CRBC was also responsible for the construction of the expressway. China and Cambodia first signed a deal for the road in 2018 under the build-operate-transfer model.
Under the agreement, CRBC will collect tolls for five decades, before transferring ownership of the road to Cambodia. In return, Cambodia is believed to be responsible for virtually none of the costs.
CRBC is headquartered in Beijing and has offices in about 60 countries and territories. Although CRBC’s earnings are unclear, its parent entity, the China Communications Construction Group (CCCG), recorded 842.8 billion yuan (US$119.9 billion) in group sales last year.
CCCG is the third-ranked contractor in the world in terms of overseas revenue, according to Engineering News-Record, a US construction industry publication. The group serves as one of the biggest players in the Belt and Road Initiative, Chinese president Xi Jinping’s signature foreign policy that aims to deepen China’s trade and commerce links with the rest of the world.
In a reflection of CCCG’s role in spearheading the Cambodia project, red and blue banners sporting the words “China Communications Construction” in Chinese characters are hung prominently near the Phnom Penh entry onto the toll road.
The exact site of the road remained unclear up until the start of the project in 2019. CRBC ultimately completed the highway ahead of schedule.
“China is prepared to do its utmost to improve the quality of life for the Cambodian people,” Chinese premier Li Keqiang said during the opening ceremony of the toll road on Nov 9.
The two countries were “ironclad friends”, Cambodian prime minister Hun Sen said at the same event, underscoring the honeymoon status of Beijing and Phnom Penh’s relationship.
For Cambodia, the expressway is expected to drive investment in the country. Phnom Penh and Sihanoukville are already connected by National Highway 4, but congestion on the two-lane road has worsened each year.
Trucks frequently use the opposite lane to pass vehicles, a practice that has haunted drivers.
“There’s always the risk of a head-on collision, and I’ve gone through such terrifying experiences many times,” said one delivery operator.
The new expressway is safer, with two lanes in each direction separated by a central median.
As foreign investment into neighbouring Myanmar has ebbed over the past few years amid the country’s political instability, Cambodia has enjoyed an opposite trend.
Its “potential has grown, relatively speaking”, said Hiroshi Suzuki, CEO of the Business Research Institute for Cambodia, a Phnom Penh-based think tank. “The opening of the new expressway and the port work will spur new foreign investment.”
Sihanoukville is home to the Ream Naval Base, which is undergoing a China-funded expansion and could be used by the Chinese military as it seeks to strengthen its military presence in the South China Sea. Chinese entities have also ramped up investment in hotels and casinos in Sihanoukville.
In its overseas infrastructure push, Beijing has faced accusations of saddling countries with debt without considering their ability to repay. The build-operate-transfer model may mitigate such scrutiny, but in Cambodia’s case it effectively gives China control of a key road, adding to its already sizable influence – China contributed more than 60% of Cambodia’s foreign direct investment last year.
Leaving the operation of key infrastructure in the hands of a foreign company also comes with the risk that it could be cut off. Though drivers could be directed toward other routes in such a scenario, Cambodia will likely consider this possibility as it weighs similar investment models for essential utilities such as electricity.
The build-operate-transfer model is expected to see broader use in frontier markets; CRBC adopted the approach for an expressway in Kenya that opened for traffic on a trial basis in May.
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