A Tale of Three Dry Ports

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1 A Tale of Three Dry Ports Tengfei Wang Economic Affairs Officer UNESCAP Seminar on the Development of an Integrated Transport and Logistics System in ASEAN Countries and the Pacific Subregion November 2012 UNCC, Bangkok

2 Outline of presentation Introduction to the project Studies of the potential dry ports in Lao PDR, Cambodia and Myanmar Some key conclusions The way forward

3 Background Successful dry ports in the region have greatly facilitated transport and trade Not all dry ports, however, have been successful (Pre)feasibility study is the key and first step to ensure the success of dry port The prefeasibilities were the components of the project entitled Capacity building for dry port planning through prefeasibility studies of selected dry ports in ASEAN Subregion, which was financially supported by Korea Maritime Institute (KMI).

4 Selection of dry ports In Lao PDR: Boten or Natuey near the border between Lao PDR and China In Cambodia: Trapeang Phlong Border Crossing Gate In Myanmar: Mandalay area

5 Methodology Desk research Field missions National workshop

6 Classification of dry port: Rail based dry ports transport mode In Russia, TransContainer owns a network of rail side container terminals located at 46 railway stations with a throughput of approximately 1.46 million TEUs in In China, a programme is underway to construct 18 large inland container rail transfer and logistics distribution centres Road based dry ports

7 Classification of dry port: functions Serve as inland extension of sea ports Facilitate border crossing and cargo handling Serve large cities, and/or industrial and economic zones

8 Component 1: Structure of the study report the general background of the prefeasibility study report Ch I. Introduction Component 2: Social and economic context of developing a dry port Ch II. Ch III. Ch IV. Socio-economic features and international trade Policy and institutional issues of development of dry port Development of transport and logistics Component 3: Functions, locations, economic and financial analysis, social and environmental issues of development of a dry port. Ch V. Freight demand forecast of dry port Ch VI. Physical development plan Ch VII. Cost estimates Ch VIII. Economic and financial analysis Ch IX. Environmental and social impact assessment Component 4: Conclusion Ch X. Conclusions and recommendations

9 In Lao PDR Thailand Lao PDR China Cargoes Vehicles Cargoes Vehicles Dry port Services to Vehicles Services to cargoes Railway service in the future Cargoes Vehicles Source: the project team

10 In Lao PDR 1,600, , , ,662 1,492,962 1,426,706 1,360,451 1,294,195 1,227,940 1,161,684 1,095,429 1,029, ,

11 In Lao PDR: Traffic forecast of the dry port by year 2025 Functions Required capacity (tons) Capacity for noncontainerized cargoes (tons) Capacity for containerized cargo (tons) bonded warehouse: 29,860 Including 5,973 23,887 cargoes from Lao PDR and Thailand to China (consolidation) cargoes from China to Lao PDR and Thailand (distribution) 95,788 Including 19,157 76,631 27,352 Including 5,470 21,882 total designed capacity (tons) 153,000 Comprising 30, ,400

12 Design of dry port

13 In Cambodia

14 In Cambodia

15 In Cambodia Net weight (ton) Customs value (US$ million) Type of cargo Foodstuff 2,921 10,351 23,270 39, mineral and chemical products 8, ,641 10, Base metals 431 1,002 3,627 6, Stone, plaster, cement etc 3,992 4,145 6,536 6, Textile and fabrics 11,928 9,956 3,693 4, Wood and Paper 432 1,078 2,736 4, Machinery, vehicles, aircraft and the parts 3,517 3,356 3,497 4, Plastic and rubber products 2,018 1,730 2,753 3, Furniture and toys etc , Footwear, umbrellas etc 96 1, Total 34,387 37,094 51,307 82, Source: derived from the data provided by Ministry of Commerce, Cambodia

16 Distance between Trapeang Phlong to some cities in Cambodia and Viet Nam (km) Kratie Thu Dau Mot Kampong Chhnang Ninh Kampong Cham 80 Trapeang Phlong 129 Ho Chi Minh city Kampong Thom Bien Hoa Phnom Penh Vung Tau Port Note: the date on distances should be treated as indicative only as they are collected from different channels Source: the project team

17 In Myanmar Mandalay area is strategically located Serve a large economy Can be linked to important sea ports Meeting points for important transport routes to sea ports, China and India

18 In Myanmar: Location of dry port

19 Costs Lao PDR Total Project Cost without land concession fee : US$ 7,469,751 Land concession 46,000/year * 20 years Myanmar Total Project Cost without land concession fee : US$ 10,598,149 Land concession 42,496/year * 20 years Financial and Economic analysis Lao PDR Financial Internal Rate of Return: 11.50% Economic Internal Rate of Return: 16.79% Myanmar FIRR: 8.31% EIRR: 19.15%

20 Key findings Lao PDR and Myanmar The dry port is financially, economically, socially and environmentally feasible Cambodia To provide a dry port is not an optimal solution. Study should be focused on facilitating border crossing and allowing more trucks to be involved in crossborder transport. The Way Forward Lao PDR and Myanmar Full scale feasibility studies should be carried out with the possible assistance of international organizations and donors Cambodia To take measures to facilitate cross border transport.

21 Thank you for your attention

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