Cross-border Cooperation Case Study of Cambodia-Vietnam Border Point The 3rd Global Roundtable on Infrastructure Governance and Tools 24 May 2019 Seoul Kazumasa Sanui J I C A Chief Advisor Project for Improving Logistics System of Cambodia Cross-border Cooperation Contents Case Study of Cambodia-Vietnam Border Point 1. Characteristics of cross-border cooperation * 2. Introduction of the project 3. Preparation for the project 4. Critical challenges and lessons learned for cross-border cooperation * * Here, this presentation tries to extract common factors from the case study. Japan International Cooperation Agency 1 1. Characteristics of cross-border cooperation Cross-border cooperation projects commonly… • Have many stakeholders. • Require lengthy coordination process. • Are affected by state-state power balance. • Are unlikely to solve only by the countries concerned. • Are sometimes controversial, even though having reached agreement by countries concerned. Japan International Cooperation Agency 2 2. Introduction of the project OVERALL GOAL To strengthen connectivity between Cambodia and Vietnam through Southern Economic Corridor OBJECTIVE To reduce time and improve reliability for border-crossing at Bavet – Moc Bai TARGET COUNTRY Cambodia and Vietnam PERIOD 2018 – (preparatory stage) MODALITY Technical assistance, Loan (TBC) BACKGROUND AGREEMENTS Cross-border Transport Agreement in Greater Mekong Subregion, Bilateral agreements, MOU for expressway Japan International Cooperation Agency 3 Southern Economic Corridor (SEC) Features of SEC 1,230 km (HCMC – Dawei) Distance: 580 km 3 Border Points Topo: Flat Lane: 2-4 Pavement: Asphalt Most populous, biggest economy Htee Khee / Pou Namrong Surface: Good Aranya Prathet/ Poi Pet Dawei Distance: 65 km Topo: Flat Lane: 2-8 Pavement: Asphalt Surface: Good Distance: 139 km Distance: 446 km Ho Chi Minh Topo: Flat, Mountainous Topo: Flat, Mountainous Lane: 1-2 Lane: 2-8 Pavement: Asphalt, Earth Pavement: Asphalt Bavet/ Moc Bai Surface: Partially unpaved Surface: Good Japan International Cooperation Agency 4 Transport Time Vietnam Cambodia Thailand Myanmar 40.0 35.0 30 km/h Dawei Total time: 35.6 h Total distance: 1,255 km Htee Khee 30.0 Border-crossing 59 km/h Phu Nam Ron 25.0 Aranyaprathet Time (hrs) 20.0 Border-crossing Poipet 15.0 59 km/h 10.0 Bavet 5.0 Border-crossing Ho Chi Minh 0.0 Moc Bai 0 200 400 600 800 1000 1200 1400 39 km/h Distance (km) Source: JICA Survey Japan International Cooperation Agency 5 Geography of Bavet - Moc Bai Border Point Cambodia side Vietnam side Checkpoint Source: Google Map Japan International Cooperation Agency 6 Performance of Border Clearance Bavet Moc Bai Cambodia Vietnam 3.7 hours Time 2.8 hours 416.7 USD Cost 49.2 USD 7 Number of samples 6 Densavanh Lao Bao Reference Laos Vietnam Densavanh - Lao Bao Border 2.1 hours Time 2.0 hours 307.5 USD Cost 75.8 USD 4 Number of samples 4 Source: JETRO-IDE Japan International Cooperation Agency 7 Negative effects from slow and unreliable border-crossing The trend of manufacture sector is becoming more time-strict and cost-sensitive under global competition. Worsening border-crossing offsets their efforts. X Japan International Cooperation Agency 8 3. Preparation for the project Due to the complexity of the situation, deep-dive survey were done to properly understand the issues. 1 year 1 2 Now here 3 4 Set up Proper Project Preparation, Coordination Steps understanding the Propose the solution Implementation situation mechanism Key Who is doing what? How to solve the problems? How to coordinate the What is the suitable What are causing the Who should be responsible stakeholders for smooth financial modality? questions problems in detail? for what? decision-making? The situation gets better? A Site survey A Allocation of the roles A Effectuate the existing A Data analysis to each of players Government F/S Follow actual flow through motivating or Committee and the Financial arrangement Interview with relevant obligating secretariat organizations B Methodol B B B Project selection as the Facilitation setting up Project implementation ogy bilateral dialog Master Plan C with sorting out hard-soft, C Stakeholder analysis short-mid-long term Monitoring Approval of the Master Coordination Plan by both country Japan International Cooperation Agency 9 1 A Major issues found There are many issues identified over the entire border area. They are found not only in government side. Private sector also contributes to big congestion. Infrastructure Operation Private Sector Government Government Private • Lack of traffic lanes • First come, first served • Waiting time due to lack of • Lack of parking space • Difference of operating communication among hours drivers and brokers • Double inspections • Lack of capacity for customs clearance Japan International Cooperation Agency 10 1 B Stakeholder analysis Key facts: Existing agencies (Customs and Immigration) do not have enough incentive to reform. Private sector is possible to become the driving force. Incentive for Organization remarks improvement Governm Central Government ent Cambodia High - The connectivity with the neighboring countries is important. Vietnam Low - Trade volume with Cambodia is not so big as with the other world. Customs Partly high - Focuses on Customs check rather than speed up. Immigration Low - Focuses on security assurance rather than speed up. Ministry of Potentially - Is aware of traffic problem at the border, but usually not involved. Transport high Local Government High, but - Represents the country in the local-level bilateral meeting as the chair. not powerful Private Logistics Service High - Claimed hectic process of Customs. Sector Providers - Got used to the lengthy situation. Manufacturers High, but - Are suffering from longer cargo transit time, which directly causes to shorten not powerful manufacturing time. Land developers High - Are planning to develop the border area in commercial basis, in some of which include parking space and container station. Japan International Cooperation Agency 11 2 A Strategy to motivate, obligate the players Key strategy: As seemed that Cambodia is more beneficial, we encourage Cambodia first. MoT should be the initiator with simplifying the overall issue as a traffic congestion. Total coordination mechanism should involve the highly motivated private sector. Incentive for Organization Strategic measures improvement Governm Central Government - The project facilitates bilateral dialog and mainly encourages Cambodia ent Cambodia High side to bring in Vietnam in justification with regional agreements. Vietnam Low Customs Partly high - Should follow regional agreements such as NSW, CBTA. Immigration Low - Should support other agencies to follow regional agreements. Ministry of Potentially - Should take a lead to initiate the interventions because this is a problem of Transport high traffic and transport. Local Government High, but - Should keep the same position to take a lead local-level coordination. not powerful Private Logistics Service - Should be involved in the process as a driving force as a member of TWG. Sector Providers High - Vietnamese companies with high willingness to expand business to Manufacturers Cambodia will play an important role to take the Vietnamese Government Land developers on board. Japan International Cooperation Agency 12 2 B Solutions to be proposed as 3-phased approach The existing national agreements are ambitious and need time, so we will propose phased plan in which quick impacts will be produced. Short-term Mid-term Long-term Steps 2019-2020 2021-2025 2026-2030 In the mid-point towards the For realizing quick impact, it final system proposed, it figures To achieve the agreed target, specifies streamlining of current Principle out the interim system with namely single stop border with operation using present possible infrastructure connected by expressway. infrastructure. development. Proper allocation of the traffic Plan lane by cargo type Operational Operationalizing National Single Becoming single stop border by measures ning Window system both government 2019 Information sharing system by smart app Using the unused area Construction of the detour route Construction of expressway, as truck waiting zone for cargo trucks in both sides and connecting with the existing with pager system separate from passengers border facility Infrastructure development Cambodia Vietnam Cambodia Vietnam Cambodia Vietnam Japan International Cooperation Agency 13 3 A B Coordination mechanism The expecting mechanism will be a network to be resilient, where the players can interact. Cambodia Vietnam [TBC] Agreement [TBC] Regional Meetings e.g. CLMV, ASEAN Ministries in charge of Discussion Ministries in charge of Report to Central level Planning, Finance, Transport Planning, Finance, Transport Committee Interior, Foreign Affairs Defense. Foreign Affairs TWG Secretariat Monitoring, instruction Monitoring, instruction Reporting Reporting Harmonization Local Government in operation Local Government Police, Customs Army, Customs Transport Transport open to Local level Private involvement Private involvement (Project site) TWG Business Public Relations Private Sector Private Sector Logistics Service Providers partnership Logistics Service Providers Manufacturers Land developers Land developers Japan International Cooperation Agency 14 4. Critical challenges and lessons learned for cross-border cooperation Critical challenges Different position, different degree of interests, different legal and