PHNOM PENH, November 13, 2026—Cambodia is advancing the Funan Techo Integrated Water Resources Management Project, a major infrastructure initiative designed to strengthen inland water transport, improve access to maritime routes, and support the development of the country’s southwestern economic corridor.
The project aims to connect Cambodia’s inland waterway network, including the Mekong and Bassac river systems, with the sea in Kep province. By creating a new domestic water transport route, the government expects to provide businesses and agricultural producers with additional logistics options, improve transport efficiency, and strengthen the country’s connectivity with international markets.
Beyond navigation, the project is also intended to incorporate water-management functions, including flood discharge and provisions for irrigation connections, reflecting a broader approach to the development and use of water resources.
Funan Techo Waterway Project at a Glance
Key facts, project scope, infrastructure components and implementation timeline of Cambodia’s Funan Techo Integrated Water Resources Management Project.
| Category | Project Information |
|---|---|
| Project Name | Funan Techo Integrated Water Resources Management Project |
| Main Purpose | Inland water transport, maritime connectivity and integrated water resources management. |
| Total Planned Length | Approximately 172.6 kilometres, according to 2026 government information. |
| Section I | Approximately 21 kilometres. |
| Section II | Approximately 151.6 kilometres. |
| Starting Point | Prek Po, Bassac River, Kandal Province. |
| Destination | Sea in Kep Province, southwestern Cambodia. |
| Provinces Along the Route | Kandal, Takeo, Kampot and Kep. |
| Project Timeline |
|
| Section II Investment | Approximately US$1.17 billion. |
| Financing Agreement | Nearly US$1 billion, under an agreement with China Exim Bank. |
| Financing Institution | Export-Import Bank of China (China Exim Bank). |
| Main Infrastructure | Navigation channels, hydro-junctions, riverbank protection, embankments and related facilities. |
| Supporting Functions | Flood discharge and reserved irrigation connection points. |
| Project Objectives | Strengthening domestic water transport, improving logistics connectivity, supporting agriculture and contributing to integrated water resources management. |
A New Waterway Connecting the Mekong to the Sea
The planned waterway begins at Prek Po on the Bassac River in Kandal province and extends south through Takeo and Kampot before reaching the coast in Kep province.
According to Cambodian government information released in 2026, the project has a total planned length of approximately 172.6 kilometers, divided into two sections. Section I covers 21 kilometers, while Section II extends 151.6 kilometers from Prek Po to the sea in Kep.
The route follows a combination of existing natural waterways and historical channels, with engineering works designed to establish navigation standards along the corridor. These include canal excavation, dredging, improvements to waterway bends, and the construction of associated navigation infrastructure.
Section II officially broke ground on April 11, 2026, at a ceremony in Takeo province presided over by Prime Minister Hun Manet and attended by senior Cambodian officials and China’s ambassador to Cambodia. Construction of this section is expected to take 36 months, with an announced investment of approximately US$1.17 billion.
The project is expected to pass through four provinces—Kandal, Takeo, Kampot, and Kep—creating a new transport connection between inland communities and Cambodia’s southwestern coastline.
Strengthening Cambodia’s Transport and Logistics Capacity
One of the project’s central objectives is to expand Cambodia’s options for transporting goods by water.
Inland waterways can provide an alternative to road transport for suitable types of cargo, particularly agricultural products, construction materials, and other bulk goods. A direct waterway connection to the coast could also create opportunities to improve links between production areas, logistics facilities, and maritime transport services.
For Cambodia, improved domestic water transport connectivity is strategically important as the country seeks to strengthen its logistics capacity, diversify transport routes, and support the competitiveness of its export-oriented industries.
Government officials have described the project as a major step towards greater independence in water transport and the development of a new economic corridor. Potential opportunities include logistics hubs, industrial zones, agricultural processing facilities, and tourism-related activities along the route.
However, the actual economic benefits will depend on the canal’s construction, operational efficiency, connections with ports and other transport infrastructure, and the demand for waterway freight services.
A Financing Milestone for a Major Infrastructure Project
The project reached an important financing milestone on September 9, 2026, when China Exim Bank and Funan Techo Coastal-Inland Waterways Company officially signed a financing agreement worth nearly US$1 billion.
The signing took place in Xiamen, China, in the presence of Cambodian Deputy Prime Minister Sun Chanthol, First Vice Chairman of the Council for the Development of Cambodia.
The agreement represents an important step in mobilizing financial resources for the project. It also reflects cooperation between Cambodian project stakeholders and Chinese financial institutions in supporting large-scale infrastructure development.
The nearly US$1 billion financing agreement should be distinguished from the approximately US$1.17 billion investment figure announced for Section II. They refer to different financing and project-cost descriptions and should not automatically be treated as identical figures.
Combining Navigation with Water Resource Management
Although navigation is the project’s principal purpose, its broader concept also includes water-resource management functions.
The project information provided by the Cambodian side identifies flood discharge and reserved connection points for irrigation systems among the functions to be considered. The objective is to develop water infrastructure that can serve transport needs while contributing to wider water management and agricultural development.
These functions are particularly relevant to communities in Cambodia’s southern provinces, where livelihoods and economic activities are closely connected to seasonal water conditions.
The project’s long-term value will therefore depend not only on its ability to accommodate vessels but also on how its water-control infrastructure is designed, operated, and maintained.
Effective coordination among navigation, flood management, irrigation, and environmental protection will be essential to ensuring that the infrastructure delivers benefits across different sectors.
Environmental and Community Considerations
Large water infrastructure projects require careful assessment of their potential effects on river systems, wetlands, agricultural land, and communities along their routes.
The Funan Techo project has attracted regional and international attention because of its connection to the Mekong and Bassac river systems. Questions have been raised by researchers and environmental organizations concerning water flows, floodplain conditions, fisheries, wetlands, and possible effects on communities.
Cambodia formally notified the Mekong River Commission (MRC) of the project in August 2023. In April 2025, the Cambodia National Mekong Committee said the government was working with expert institutions to assess the feasibility of providing additional documentation requested by the MRC Secretariat.
The MRC’s regional procedures provide a framework for member countries to share information and discuss proposed water-use projects that may have significant implications for the Mekong mainstream’s flow, water quality, or environmental and socio-economic conditions.
Independent research has also highlighted the importance of understanding the project’s navigation-lock operations, water-management arrangements, and potential interactions with the Mekong floodplain. These are matters that require reliable technical information, transparent monitoring, and continued regional cooperation.
Land acquisition, compensation, and the livelihoods of affected households are additional considerations. Reporting by Cambodian and international media has documented concerns among some residents along the proposed route about land impacts, relocation, and the availability of information on compensation.
Addressing these issues through clear communication, fair procedures, environmental monitoring, and meaningful engagement with affected communities will be important to the project’s long-term implementation.
A Long-Term Investment in Cambodia’s Connectivity
The Funan Techo Integrated Water Resources Management Project represents a significant investment in Cambodia’s transport and water infrastructure.
If successfully completed and operated, the waterway could provide an additional logistics route between inland production areas and the country’s southwestern coast, supporting trade, agriculture, industrial development, and regional connectivity.
Its broader significance will ultimately be measured not only by the length of the canal or the scale of investment but also by the practical benefits it delivers to businesses, farmers, communities, and the national economy.
As construction progresses, effective project management, sound water-resource planning, environmental safeguards, and cooperation with neighboring Mekong countries will remain important to ensuring that the project contributes to sustainable development.
For Cambodia, the ambition is to turn improved waterway connectivity into greater economic opportunity while managing the responsibilities that come with developing shared and interconnected water resources.