Cambodian logistics sector is set for a robust take off. Global transport service providers are eyeing the untapped logistics market in the Kingdom that is ideally located and can help in the movement of freight among developing economies in the region.

Straddled between Thailand and Vietnam, two robust production hubs in the Greater Mekong Subregion (GMS), Cambodia can play a vital role in regional logistics networks– plugging itself into the international supply chain.

“ Logistics sector is very important for Cambodia to bring goods from producers to customers everywhere. The logistics sector also involves other sectors and promotes international trade relations,” Sin Chanthy, president of Cambodia Freight Forwarders Association (CAMFFA) told The Post on Monday.

“Logistics sector brings goods to end users and absorbs a lot of labour force related to relevant sectors, such as factories. In addition, the relations between farms, factories and the whole world even becomes more stronger.”

The domestic logistics industry is on á strong growth trajectory. Over the last five years, nearly 500 registered logistics companies have started to operate in the country and supported by 13,500 workers.

He said according to the Japan International Cooperation Agency’s master plan, by 2023, the size of the country’s logistics sector is expected to double.

“Cambodia is a fast growing country here (in the region) and its GDP [gross domestic product] growth is also high. In terms of opportunity, there are lot of Chinese investments here and logistics (sector) is very important for manufacturing, to move goods to and from China,” said Jevan Chandran, CEO of MV International (or MiceVision Management Sdn Bhd).

Nearly 100 participants from 13 countries participated in the Global Logistics, Cargo and Supply Chain (GLCS) Conference: Shaping The Future Of The Supply Chain held in Phnom Penh recently.

The conference jointly organised by CAMFFA and MV International engaged decision makers from business (logistics, warehousing, manufacturing and banks) and the government to explore business possibilities in the domestic logistics sector.

According to the Asian Development Bank, the GMS covers 2.6 million square kilometres and home to about 326 million people.

Countries like Cambodia, China, Laos, Myanmar, Thailand, and Vietnam make up the GMS. All these countries are extensively involved in manufacturing activities.

The government has major plans to develop the logistics sector which can support the growing supply chain and has set targets under the Industrial Development Policy 2015-2025.

Under the sector’s development master plan, the government aims to create an integrated multimodal transport and logistics system, and connect three economic corridors – Phnom Penh – Sihanoukville, Phnom Penh – Bavet and Phnom Penh – Poipet.

“Lots of people want to manufacture from here (Cambodia) and export to China. What we need is good infrastructure, safety on road and shipment to deliver the goods. There should be safety, no smuggling or hijacking and zero corruption.

“We need to build logistics knowledge and move into digital [sphere]. Participants are here to see the opportunities and link up with the sector which is part of the One Road One Belt Initiative,” said Jevan.

With rapid economic growth, the volume of cargo recorded at major airports and seaports in the Kingdom have shown significant increase over the years. And, there is an urgent need to upgrade existing infrastructure as well.

Chanthy added: “In response to this rapid growth, infrastructure is a main concern. The government has worked hard to develop the infrastructure such as roads, waterway and air in response to the growth of the logistic market. However, the current infrastructure has not respond to this growth yet.”