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Implementation of Transit Transport Arrangements in Lao PDR

Implementation of Transit Transport Arrangements in Lao PDR. Country Background. Land Area : 236,800km2 Population: 5,6 millions Population density: 23 persons/km2 Border with Vietnam, China, Myanmar, Thailand and Cambodia

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Implementation of Transit Transport Arrangements in Lao PDR

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  1. Implementation of Transit Transport Arrangements in Lao PDR

  2. Country Background • Land Area : 236,800km2 • Population: 5,6 millions • Population density: 23 persons/km2 • Border with Vietnam, China, Myanmar, Thailand and Cambodia • The economy Base is Agriculture accounting for 50% of GDP • GDP growth rate : 5.7% • Per capita income : 329 USD.

  3. Road transport is a dominant mode of Transport in Laos covering more than 90% of total freights • Total road networks 32,010km of which: 7,160km National roads, 8,952 provincial roads and 15,898km local roads. • Road No. 13 is backbone road (1,230km) • 8 ASEAN Highway routes of which 5 has been designated as Asian Highway routes.

  4. Transit Transport Arrangements • Lao Government has policy to transform its country from landlocked to landlinked. • Laos as being both landlocked and transit country for its neighboring countries • The main duties of transit countries are: -Provision of sufficient infrastructure and facilities -Facilitate trucks of neighboring countries -Facilitate customs clearance (procedures, formalities), inspection…

  5. Transit Transport Arrangements(cont’d) Two main transit countries: Vietnam and Thailand. • Through Vietnam , there are two main transit transport corridors: - Road No. 8 from Paksane (Laos) to Cua Lo Port , Vinh (Vietnam) : 257km - Road No. 9 from Savannakhet (Laos) to Danang port (Vietnam): 944km - There are two other potential corridors: R12 from Thakhek to Vung Ang port (Vietnam): 313km and R18 from Pakse to Danang(Vietnam) : 561km

  6. Transit Transport Arrangements(Cont’d) • Through Thailand, there are three main transit transport corridors: - Thanaleng transit corridor: from Vientiane to Bankkok: 642km of which 22km are in Laos - Savannakhet Transit Corridor: the distance between Savannakhet and Bangkok is 663km - Pakse Transit Corridor: the distance between Pakse and Bangkok is 747km of which 42km are in Laos.

  7. Transit Transport Arrangements(Cont’d) Transit Transport Infrastructure Development • 8 routes have been designated as ASEAN highway routes of which 5 routes are Asian Highway routes • Ongoing Transit Transport Development projects: AH-3, AH-4, AH-5, AH-6, AH-7, AH-7A, AH-7B, AH-8(including third Mekong bridge), AH-8B and R16A

  8. Transit Transport Arrangements (Cont’d) • Road Maintenance Fund has been established by the Prime Ministerial Decree of dated 15 January 2001 • This Road Maintenance Fund is used to maintain existing road networks. • Resources:RMF is derived from fuel fee, road charges, fines on excessive loading, and foreign donors contributions

  9. Transit Transport Arrangements(Cont’d) Transit Transport Policy issues Lao -Thailand • In implementing the 1978 Agreement on Road Transport: - Lao trucks were not allowed to enter into Thai Territory -five transport operators of Thailand were authorized to perform transit transport between Laos and Thailand -customs escort necessary. • In implementing the 1999 Agreement on Road Transport and its 2001subsidiary Agreement has been considerably progressed.

  10. Transit Transport Arrangements(Cont’d) Lao-Thailand (Cont’d) • Goods transport operation has been opened free all transport operators of two sides and has became into effective since first March 2004. • Simplify document and joint inspection on unnecessary cost rendered to transport. • Transit Transport Cost has now been significantly reduced by 20%

  11. Transit Transport Arrangements(Cont’d) Lao -Vietnam • In implementing the 1996 Agreement on Road Transport and its 2001 protocol amendments has made progress significantly. • The bilateral Agreement on the use of Vung Ang deep sea port has been signed and two Experts Working Group Meetings have been held in Ha Tinh, Vietnam and Vientiane, Laos for deliberating the details implementation of the said Agreement

  12. Transit Transport Arrangements(Cont’d) Lao-Cambodia • The implementing draft protocol of the 1999 Agreement on Road Transport has forwarded to Cambodian authorities for consideration in 2002. • Since the transit transport route between Southern of Laos and Sihanouville port, Cambodia is not operated yet, the protocol of the said Agreement has yet concluded. • This corridor will provide Cambodia with direct access to China through Laos.

  13. Transit Transport Arrangements(Cont’d) Lao-China • China is not a transit country for Lao PD • Road Transport Projects R3 has been constructed will serve as transit traffic to/from China through Laos to Thailand. • To further implement the 1993 Agreement on International Road Transport and its 1994 protocol.

  14. Transit Transport Arrangements(Cont’d) Lao-Myanmar • Lao PDR has not yet Road Transport Agreement with Myanmar. • The construction of the Friendship bridge across the Mekong River has been projecting • The completion of this bridge, Laos will become transit country for Myanmar to Vietnam and Cambodia.

  15. Transit Transport Arrangements(Cont’d) GMS Agreement • Tripartite Agreement on Facilitation of Cross Border Transport of Goods and People between and among the Lao PDR, Thailand and Vietnam had been signed in Vientiane in 26 November 1999 • Cambodia China and Myanmar has now became a party to this Agreement. • This Agreements has 16 annexes and 3 protocols • ADB assist in drafting the Agreement and its annexes and protocols

  16. Transit Transport Arrangements(Cont’d) • ADB and ESCAP jointly assist in the negotiation process • 8 Annexes and protocols in stage 1 had been negotiated and signed in Cambodia in April 2004. • 5 Annexes and protocols for stage 2 to this Agreement has now been finalized and will be signed in Vientiane in December 16, 2004. • The Annexes and protocols for stage 3 will be commencing in early 2005.

  17. Transit Transport Arrangements(Cont’d) • This Agreement will become into effective in early 2007. • The main purpose of this Agreement is to facilitate transit transport through establishment of Single Window Inspection at the border • The First Tripartite meeting between Laos, Vietnam and ADB had been in Vientiane in August 2004 to deliberate the draft MOU on the initial implementation of the said Agreement.

  18. Transit Transport Arrangements(Cont’d) • The Second Tripartite meeting between Laos, Vietnam and ADB will be held in Hue, Vietnam in 6-8 December 2004 to conclude and finalize the above said MOU. • This MOU will be signing at the GMS Ministerial meeting to be held in Vientiane in 16 December 2004. • The similar MOU will also be made with Thailand at Savannakhet-Mukdahan border crossing

  19. Transit Transport Arrangements(Cont’d) Substances of MOU are as follows: • Establishment of Single Window Inspection and Single Stop Inspection at Dansavanh and Lao Bao border crossing points by 31 March 2005 • Coordination hours of operation and related issues • Advance Exchange of information and clearance • Harmonisation, simplication and Language of documents

  20. Transit Transport Arrangements(Cont’d) • Commodities classification system • Facilitation of border crossing formalities • Priority order of border crossing clearance • Border crossing and Transit Facilities and Services • Visas • Exemption from Physical Customs Inspection, Bond Deposit and Escort • Transit and Inland Customs Clearance Regime

  21. Transit Transport Arrangements(Cont’d) • Recognition of Technical Inspection Certificates • Road Traffic Regulations and Signage and Road Signs and Signals • Compulsory Third-Party Motor Vehicle liability Insurance • Driving Permit and Criteria of Driving Licenses • Temporary Importation of Motor Vehicles

  22. Transit Transport Arrangements(Cont’d) ASEAN Agreements • Five out of nine protocols to the ASEAN Framework Agreement on the Facilitation of Goods in Transit have been concluded • The ASEAN Framework Agreements on Multimodal Transport and ASEAN Framework Agreements on the Facilitation of Inter-State Transport are still pending.

  23. Transit Transport Arrangements(Cont’d) International Conventions and Agreements • Many countries in the region including Lao PDR have not yet acceded to the International Conventions under ESCAP Resolution 48/11 • Laos has now submitted 11 out of 17 International Agreements and Conventions in the field of transit transport to Government for approval in acceding them.

  24. Transit Transport Arrangements(Cont’d) National Transport Committee(NTC) • NTC has been established by Prime Minister Decree No 03/PM of 28 January 2002 to serve as advisory body and focal point for all International Transport Cooperation. Lao Int’l Freight Forwarder Association (LIFFA) • LIFFA has been established by Ministerial decree No. 4149/MCTPC of December 13, 2001 to play a vital role in transit transport operation.

  25. Transit Transport Operation Constraints • Custom procedures and border crossing regulations are still major obstacles. • The custom procedures in both Lao PDR and its transit countries remain unchanged • Some imported cargoes to the Lao PDR are still examined by the customs of transit countries • No computerized system such as EDI, ASYCUDA, ACSIS to help simplify and harmonize the custom procedures and shorten process

  26. Transit Transport Operation Constraints (Cont’d) • Most of the neighboring countries are not party to the international Agreements and conventions. • Lao trucks so far are unable to enter deeply into the territory of transit countries due to lack of driving competence, not familiar with traffic signs and signals and trucks are aging and substandard. • If Lao trucks can carry Lao transit goods to ports of transit countries, the transit transport cost will reduce dramatically up to 40-50%

  27. Conclusion • A smooth transit transport can be performed only through good understanding between and among neighboring countries. • Single Window Inspection and Single Stop Inspection may be good solution for facilitating the cross-border transport and reducing transport costs • Landlocked and least developed country needs assistance for transit transport infrastructure and transport operators development for the provision of transit arrangements and competitiveness.

  28. Conclusion (Cont’d) Laos as being least developed and landlocked country can not solve the problems of transit transport operation alone and need the cooperative efforts of its transit countries, donors countries and international financial and development institutions in providing financial assistance for improving and upgrading transit transport networks and their facilities including ICD or Freight Distribution Centers. • Laos also need assistance in strengthening and helping transport operators to have sufficient capacity and knowledge in handling and improving Lao transit transport industry efficiently and effectively.

  29. Thank You for your attention

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