Cambodia’s Funan Techo Canal project: A catalog of worries (analysis)
“Early briefs on the project described it as a build-operate-transfer venture within the scope of China’s Belt and Road Initiative (BRI). It was said that Chinese firms would execute a BOT contract budgeted at $1.7 billion and, after recouping their investment, hand over the canal to Cambodian partners 40 to 50 years later. Projects by China in its Belt and Road Initiative typically require a loan interest rate of 7-10%. By comparison, the World Bank offers interest-free project loans for the first 10 years and an interest rate of only 2.5% from year 11 to 50.”
“There appears to be little scope for expanding cultivation in the vicinity of the proposed canal. The supply of freshwater to the Mekong Delta during the dry season in recent years — specifically to Kandal, Takéo and Kampot, and just across the border, to Vietnam’s An Giang and Kiên Giang provinces — has already reached a critically low level.”
“There is already an efficient cargo connection between Phnom Penh and Cambodia’s coast. The four-lane Phnom Penh–Sihanoukville Expressway, completed in 2023 at a reported cost of $2 billion, is designed to withstand 40-ton traffic loads. The Funan Techo Canal will be as long as the highway but three to four times wider. The canal structure must be engineered to withstand both water pressure and turbulence from moving merchant ships up to 5,000 DWT. That heavy load requires that the canal have a stronger bed than the expressway. According to Vannarith, some experts, particularly from China, have noted that a similar 100-km (62-mi) canal in China cost over $10 billion.”
Source: Mongabay