PUBLISHED: 27 August 2019
Sand dredging industry
a. Reviewing license (unregulated dredging): there are 142 sand dredging companies operating in Cambodia, but only 37 of them have licenses. MME reviewed and ended license agreement and fine the companies that do not follow the license agreement.
b. Conducting impact assessment of sand dredging: MME has put a hold on new applications for licenses to conduct sand-dredging operations in the country’s rivers and lakes in order to study the environmental and social impact of a practice that has caused deadly incidents of river bank collapse. In the past the ministry only conducted environmental and social impact studies in specific cases where companies had requested to dredge, but now it will conduct an industry-wide assessment to ensure all companies operate sustainably.
c. Setting sand price cap: the ministry justified its price regulation measures to prevent the formation of a sand cartel that would overcharge a price sensitive construction industry that had previously mourned the increased cost of sand in May, after dredging was halted until environmental impact studies could be conducted. While the companies have to sell sand to depots for a fixed $3.30, depots can charge the end customer up to $4.50 per cubic meter. If any company in the supply chain increases the prices over the caps it would lose the license.
d. New process for license: the bidding process was transparent because the ministry disclosed the prices companies bided with. The dredging license lasts two years. The companies must also put down a $50,000 deposit for the license. If the companies perform irregular or illegal acts during the two-year the license, the ministry would confiscate both the license and the deposit. The Ministry of Mines and Energy started issuing sand-dredging licenses in 2006.