7 Feb 2018
China-Backed Cambodian Deep-Water Port Emerges as BRI Focal Point
The strategically significant Sihanoukville port has become a nexus for Cambodia-China Belt and Road collaboration.
The port city of Sihanoukville has emerged as the focal point of Cambodian-Chinese co-operation as the two countries work ever more closely together to deliver the aims of the Belt and Road Initiative (BRI). As well as the initial investment in the port – Cambodia's only deep-water freight-handling facility – the city has also benefitted from a number of subsidiary China-backed projects, many of which are intended to capitalise on the growing number of Chinese businesspeople and tourists who now frequent the region.
Sihanoukville's suitability to be a prime BRI way station is unarguable. Set along Cambodia's 443km coastline with strategically significant access to Vietnam, Thailand and Laos, the port is surrounded by a string of islands, many of which have also benefitted from the recent investment rounds. Long a key maritime hub, recent infrastructure investments have boosted its land and air connectivity, ensuring it has all the assets required to function as a multi-modal trade and tourism interchange.
One of the most crucial upgrades to the port's resources will be the 190km Phnom Penh-Preah Sihanouk Expressway, a relatively short but vital addition to the 2,000km of China-funded roads being constructed across the country. With final agreement on the project reached during last November's Belt and Road Forum in Beijing, work on the four-lane highway connecting the port and the Cambodian capital is scheduled to be completed by 2021.
With the kind of positive domino effect that has characterised many BRI projects, the go-ahead for the construction of the expressway has spurred the growth of another of Cambodia's key economic developments – the Sihanoukville Special Economic Zone (SEZ). Jointly operated by Jiangsu Taihu Cambodia International Economic Cooperation Investment and the Cambodia International Investment Development Group, the zone is just 12km away from Sihanoukville Port and is already home to more than 100 Chinese companies, with the majority specialising in textiles, electronics or light-industry-related sectors.
Sihanouk International Airport, the locally set air-freight and passenger terminal, is another beneficiary of Chinese investment, with its current US$15 million upgrade being bankrolled by Beijing. Once its extended facilities come online later this year, it will have the capacity to handle up to 500,000 passengers per annum, allowing it to compete for passengers and cargo with Phnom Penh and Siem Reap, Cambodia's two primary international airports. Overall, it is expected that about 70% of international flights from Sihanoukville will be bound for destinations across China, taking the number of direct weekly flights between the two countries to more than 100.
In addition to the rising demand for air-cargo services, growing tourism levels – with many of these leisure travellers originating in China – have also helped spur the airport's development. Cambodia welcomed about one million Chinese tourists in 2017, with many of them destined for Sihanoukville, lured by the city's luxury resorts, Chinese fine-dining establishments, resorts and supermarkets where the shelves are stacked high with Chinese products.
In order to cater to the still higher visitor numbers anticipated, construction work is under way on a number of five-star hotels, both in Sihanoukville proper and on several of the adjacent islands. With the city's upgraded port capable of handling the largest cruise ships, up to two million Chinese tourists a year are expected to visit the city from 2020.
Geoff de Freitas, Special Correspondent, Phnom Penh