When the fourth Mekong Bridge linking Chiang Khong and Huay Sai is completed in 2012, the transportation network between Thailand, Vietnam, Cambodia, Laos, Myanmar and South China will be almost complete.

However, transport service providers in the Greater Mekong Sub-region are still troubled by complicated cross-border procedures, particularly in terms of transportating goods into China.  Although bilateral negotiations between Thailand, Laos and Vietnam have been successful, the implementation of the Greater Mekong Sub-region Cross-border Transport Agreement (GMS-CBTA) will greatly accelerate the growing momentum of trade and transportation activities between the 10 member countries, thereby ensuring that the ASEAN Economic Community becomes a reality by 2015.

Ongoing GMS cooperation aims to create a regional transportation network to reduce production and service costs and strengthen the competitiveness of member countries.  Thailand’s logistics costs account for 19% of GDP, and transportation costs make up 8.7%.

Thailand has signed several bilateral and multilateral agreements with a view to facilitating international trade

and transportation.  By 2013, ASEAN nationals will be allowed to own 70% of shares in logistic businesses in other ASEAN countries, including shipping, trucking, and other related services.  Six ASEAN countries have already eliminated intra-regional import tariffs.  Vietnam, Laos, Myanmar and Cambodia will follow suit in 2015, paving the way towards the rational utilization of resources and raw materials.

Relying mainly on bilateral negotiations, development of the GMS transportation network has made substantial progress, particularly with respect to transportation of passengers and cargo between Thailand and Laos, and tourist trade between Thailand and Vietnam.  Cargo transportation between Thailand and Vietnam will be fully liberalized by the end of 2010.

A Draft Memorandum of Understanding on implementing an agreement to facilitate cross-border transportation of goods and passengers at Chiang Khong-Huay Sai (Thailand-Laos) and Boten-Bohan (Laos-China), which has been submitted to China, includes issues such as the Thailand-Laos-Vietnam agreement.

“When negotiations with Vietnam are completed, double handling of containers will be eliminated while customs clearance will be undertaken either at the Thai or Laotian checkpoint, provided that the category of goods and domestic transportation routes are clearly specified,” said Mr. Chairat Sanguanchue, Director General, Department of Land Transport.

A train-the-trainers program has been organized for Thai/Laos and Vietnamese truck drivers while the Thai Chamber of Commerce will host a meeting to consider comprehensive cross-border insurance packages.

Transportation Standards
Aside from providing information and technical assistance to prepare for the liberalization of regional transport services, the Department of Land Transport has established quality assurance standards covering four areas of trucking services: organization systems, operational aspects (including vehicle/cargo monitoring, accident prevention & management), personnel, vehicle management, customer relationships and other matters.  Relevant rules and regulations have been incorporated into a manual.  Quality assessment and certification processes have also been established.  To promote quality upgrading and prevent price cutting, the department has developed a GIS database and a Thai Truck Center to help service users locate trucks in their areas that can share cargo transportation space.

Commissioned to study the feasibility of setting up Cargo Depots in main cities and border areas, Asian Engineering Consultants has proposed four criteria for the selection process: provincial economic conditions, cargo volume transported from/to the region and province, strategic policy, provincial development plan and projects, logistics and environmental factors.

Based on this, 13 provinces were selected as potential depot sites.  These were Song-kla, Chiang Mai, Nong Khai, Udon Thani, Sra-kaew, Ubon Rachathani, Mukdaharn, Tak, Surat Thani, Chiang Rai, Nakorn Ratchasima, Khon Kaen, Nakorn Sawan

A loan application for 2.5 billion baht loan has been submitted phase I of the project, which involves construction in Chiang Mai, Songkla, Nong Khai, Ubon Rachathani, Chiang Rai and Tak.  Another Baht 545million allocation in 2011 is also pending approval from the Budget Bureau.

“Private enterprises have been preparing for ASEAN liberalization of logistics services during the past 2-3 years while the government is shifting from a supervisory role to focus more on providing support and assistance to the private sector.  Within the framework of ASEAN plus 3 (China, Korea, Japan) and ASEAN plus 5 (including New Zealand & Australia), potential partners with strong transportation systems could participate in setting up a Professional Transportation Institute. A law is also needed to determine undertakings by foreign nationals,” said Director General, Department of Land Transport.

However, the most urgent question is how to develop local service providers’ technological capabilities, upgrade transport equipment and install computerized systems to issue purchase orders, determine production volumes and delivery schedules to various destinations.