Development Initiatives in the Mekong Basin

Development Initiatives in the Mekong Basin

Development Initiatives in the Mekong Basin

PP 9.2

Presentation OverviewPresentation Overview

Greater Mekong Subregion Economic Cooperation Program

Development GapASEAN Economic CommunityChallenges for Mekong CountriesCapacity Building for Economic

Integration

Thailand

Land area: 513 thou sq km

Population: 65.8 M

GDP per capita: US$3,133

Cambodia


Population: 14.1 M

GDP per capita: US$510

Myanmar


Population: 54.8 M

GDP per capita: US$255 (2005)

People’s Republic of China


Population: 97.3 M

GDP per capita: US$1,135

(figures for Yunnan and Guangxi only)

Viet Nam


Population: 84.1 M


Lao PDR


Population: 5.7 M


The GMS in 2006

Land area: 2.6 M sq km

Population: 323 M

GDP per capita: US$1,453*

* excludes Myanmar

Why do we need GMS Cooperation?

Why do we need GMS Cooperation?

ConnectivityCompetitivenessCommunity Building

Picture of War – Vietnam WarPicture of War – Vietnam War

Powerless - picturePowerless - picture

GMS Economic CooperationGMS Economic Cooperation

Vision: A more prosperous and harmonious GMS

Strategies– Connectivity– Competitiveness– Community Building

GMS Vision – MI VisionGMS Vision – MI VisionA more Prosperous and Harmonious Greater Mekong Subregion

Capacity Building for Regional Development and Cooperation

The Economic Corridor ApproachThe Economic Corridor ApproachThe Economic Corridor ApproachThe Economic Corridor ApproachInfrastructure is developed in specific geographical Infrastructure is developed in specific geographical

areas based on economic potential.areas based on economic potential.

Usually starts with transport links, but extends to other Usually starts with transport links, but extends to other infrastructure as well as the “software” for their optimal infrastructure as well as the “software” for their optimal use.use.

Some Characteristics of Economic CorridorsSome Characteristics of Economic Corridors::

– Create links to major markets;Create links to major markets;– With nodal points – centers of enterprise development;With nodal points – centers of enterprise development;– Extend the benefits of improved transport linkages to remote Extend the benefits of improved transport linkages to remote

locations and integrates them with more prosperous areas;locations and integrates them with more prosperous areas;– Open up investment opportunities;Open up investment opportunities;– Promote synergies through the clustering of projects;Promote synergies through the clustering of projects;– Provide demonstration effectsProvide demonstration effects..

12

East-West Economic Corridor (EWEC) East-West Economic Corridor (EWEC) Progress, Issues and Way ForwardProgress, Issues and Way Forward

East-West Economic Corridor (EWEC) East-West Economic Corridor (EWEC) Progress, Issues and Way ForwardProgress, Issues and Way Forward

15

LAO: East-West Corridor (Phin-Dansavanh)

VIE: East-West Corridor (Lao Bao-Dong Ha)

JBIC-assisted 2nd Mekong International Bridge

JBIC-assisted Hai Van Tunnel Construction and Da Nang Port Improvement

With assistance from the Royal Thai Government

East-West Economic CorridorEast-West Economic Corridor

North-South Economic CorridorNorth-South Economic CorridorProgress, Issues and Way ForwardProgress, Issues and Way Forward

North-South Economic CorridorNorth-South Economic CorridorProgress, Issues and Way ForwardProgress, Issues and Way Forward

North-South Economic North-South Economic CorridorCorridor

1919

Upgrading completed in 2006.

To be completely upgraded by 2010

Ongoing with ADB loan assistance

Upgraded with JBIC assistance; in good condition

Financed by of PRC and Thailand, and ADB

Recently upgraded with Govt financing

Financing of 4th Mekong bridge secured from PRC and Thailand

Completed in Dec. 2005

North-South North-South Economic CorridorEconomic Corridor

ADB loan approved in 2007 for new highway

20

Southern Economic CorridorSouthern Economic CorridorProgress, Issues and Way ForwardProgress, Issues and Way Forward

Southern Economic CorridorSouthern Economic CorridorProgress, Issues and Way ForwardProgress, Issues and Way Forward

21

Southern Economic CorridorSouthern Economic CorridorSouthern Economic CorridorSouthern Economic Corridor

•Inter-Inter-Corridor Corridor

LinkLink

•Central Central Sub-Sub-

CorridorCorridor

•Southern Southern Coastal Coastal

Sub- Sub- CorridorCorridor

•NortheNorthern Sub-rn Sub-CorridorCorridor

22•2222

•Mostly 4-lane Mostly 4-lane highways; not a highways; not a

constraint to cross-constraint to cross-border traffic.border traffic.

•Upgrading to be Upgrading to be completed by 2008 completed by 2008 with ADB and Japan with ADB and Japan

assistance.assistance.

•Bridge over Mekong Bridge over Mekong to be financed by to be financed by

Japan Japan

•Mostly 4-lane Mostly 4-lane highways; not a highways; not a

constraint to cross-constraint to cross-border trafficborder traffic

•Upgrading Upgrading completed in 2007 completed in 2007

with Thailand, Korea, with Thailand, Korea, World Bank and ADB World Bank and ADB


•Upgrading to be Upgrading to be completed by 2010 with completed by 2010 with

ADB, Korean, and ADB, Korean, and Australian assistance.Australian assistance.

•Upgrading Upgrading completed in 2007 completed in 2007

with PRC assistance.with PRC assistance.

•In good In good conditioncondition

•Upgrading to be Upgrading to be completed by 2009 completed by 2009 with ADB and Japan with ADB and Japan


•Upgrading of a section Upgrading of a section in Cambodia (70 km) to in Cambodia (70 km) to be completed by 2010 be completed by 2010

with assistance from Viet with assistance from Viet Nam; Financing Nam; Financing

requested for remaining requested for remaining sections.sections.

•GMS Southern Economic CorridorGMS Southern Economic Corridor

•RoaRoadsds

Road Road Transport Transport NetworkNetwork

19921992


20062006


20152015

R3 a 228 km

R3 b 253 km

R 9 EWEC 246

3rd Bridge Nakhon Panom – Takek

4th Bridge – Chiang Kong - Hoisai

1992

2004

2012

Power Transmission Line

Telecommunications Backbone

• GMS GMS PowePower Gridr Grid

• Info. Info. Super Super HighwaHighway y NetworkNetwork

GMS Optical Fiber

Subregional Fiber Optic Links will soon be completed in 3 loops i.e. East, North and West Loops.

Lower logistic cost in telecommunications will be enabling factor to attract more investment from outside the region into GMS.

Proposed Transmission Network of Point to Point Architecture

Proposed Transmission Network of Ring Architecture

Proposed Transmission Network of Point to Point Architecture

• Ruili – Muse

• Mohan – Boten

• Veune Kham – Dong Kralor

• Hat Lek – Cham Yeam

• Mukdahan – Savannakhet

• Lao-Bao – Dansavanh

• Aranyaprathet – Poipet

• Bavet – Moc Bai

• Hekou – Lao Cai

• Myawaddy – Mae Sot

• Mae Sai – Tachilek

• Houayxay – Chiang Khong

• Nam Phao – Cau Treo

• Chongmek – Wang Tao

• Nongkhai – Thanaleng

Geographic Geographic Coverage of Coverage of

CBTACBTA

FIRST PHASE (commencing in 2005/06)

SECOND PHASE (commencing in 2007)

THIRD PHASE (commencing in 2008/2009)

POTENTIAL NEW BORDER CROSSING

POINTS

YOUYIGUAN (PRC) - HUU NGHI (VIE)

THAKHEK (LAO) – HA TINH (VIE)

LORK (CAM) – XA XIA (VIE)

BY 2009

FULL IMPLEMENTATION

Promoting the Promoting the GMS as a GMS as a Single Tourist Single Tourist DestinationDestination

2005: GMS Tourism 2005: GMS Tourism Sector Strategy Sector Strategy (2006-2015) – (2006-2015) –

1.1. Mekong River Mekong River CorridorCorridor

2.2. Golden TriangleGolden Triangle3.3. East-West CorridorEast-West Corridor4.4. Emerald TriangleEmerald Triangle5.5. Southern CoastalSouthern Coastal6.6. Green ClusterGreen Cluster7.7. Houphanh-Than-Hoa Houphanh-Than-Hoa

Oun La Tourism Oun La Tourism CircuitCircuit

8.8. Andaman Coast and Andaman Coast and IslandsIslands

10. Red River Valley10. Red River Valley11. Guangxi-North 11. Guangxi-North

Vietnam IslandsVietnam Islands

Yuxi

Vung Tau

Dung Quat

Quy Nhon

Nha Trang

Thap Cham

Phan Thiet

Vinh

Tanap

Dong Ha

Than Hoa

Nam Doth

Haiphong

Bei Hai

Da Nang

Hue

Cau Treo

Ngoc Hoi

Duc Co

Nam Can

Tay Trang

Pathein

Pyay

Kyeeni

Mandalay

Yatsouk

Loilem

Kengtung

Jinghong

Tachilek

Mae SaiChiang Kong

Nateuli

Mohan

Denchai

PhitsanulokMawlamyine

Nakhon Sawan

Bannet Narong

Tavoy

Nam Tok SuphanburiAyuttaya

Kanchanaburi

Petchaburi

Hua Hin

Prachuap Khiri Khan

Sattahip

Chunburi

Nakhon Ratchasima

Bua Yai

Khon Kaen

Nong Khai

ChongmekSurin

Trat

Koh Kong

Sihannoukville

Surat Thani

Svay Rieng

Kampong Cham

Stung Treng

Attapeau

Pak Mong

Vang Vieng

Xieng Khouang

Hoa Binh

Gejiu

Hekou

Nuihong

Kep

Lang Son

Myitkyina

Muse

Lashio

MangshiXiangyun

Chuxiong

Bigu

Baoxiu

Mohei

Budalin

ShanglinNapo

Bose

Tianlin

Xilin Hechi

Liuzhou

Guilin

Longsheng

Ziyuan

Zhongshan

Wuzhou

Laibin

Yulin

Dahua Yaozu

Guiyang

Dongxing

Pingxiang

Longzou

Daxing

Bagan

Ruili

Lijiang

Baoshan

Zhongdian

Siem Reap

Phuket

Udon Thani

Chiang Mai

Ben Nape

Ban Dong

Cham Toal

Ban Panghok

KilometersScale 1 : 13,000,000

0 300150

GIS Mapping by :

Asia PacificProjects Inc.

10°

30°

25°

20°

15°

10°

30°

25°

20°

15°

95° 100° 105° 110°

95° 100° 105° 110°

Gulf of Thailand

Andaman Sea

Gulf of Tonkin

HANOI

VIENTIANE

BANGKOK

YANGON

PHNOM PENHHo Chi Minh

Nanning

Kunming

Poipet

MYANMAR

Yunnan Province PRCGuangxi Zhuang Autonomous Region PRC

Hat Yai

Dali

Tengchong

Menghai

Lao Cai

LAO PDR

CAMBODIA

Dao Phu Quoc

Mae Sot

Chiang Rai

BotenLuang Namtha

Louang Phrabang

Pak Tho

Songkhla

Ko Samui

Aranyaprathet

PhanomSarakham

Ha Tien

Kampot

Pakse

Mukdahan

Nakhon Phanom Thakhek

Na Duoung

Cai Lan

THAILAND

VIET NAM

Do Dau

Legend :

The Greater MekongSubregion

Priority Tourism Zones

Shoreline

Railway

Proposed Subregional Road

Major River Network

National Capital

City / Town

Nature/Adventure-based Tourism

Culture/Nature-based Tourism

Marine/River-based Tourism

Map 11

1. The Mekong River Corridor

11. Guangxi-Northeast Vietnam Karst Borderlands10. The Red River Valley9. Shangri-la/Tengchong/Myitkyina Cluster8. Andaman Coast and Islands7. Houaphanh-Thanh Hoa-Son La Tourism Circuit6. The Green Triangle5. The Southern Coastal Corridor4. Emerald Triangle3. East West Corridor2. The Golden Quadrangle

North-South Economic Corridor

East-West Economic Corridor

Southern Economic Corridor

999999999

222222222

111111111111111111101010101010101010

777777777

111111111

333333333

444444444 666666666

333333333

888888888555555555

111111111

111111111

UbonRatchathani

Ayuthaya

SukhothaiSavannakhet

Ban Lao

Pakkading

Lao Bao

Na Meo

Simao

Ban Xayden

Huay Xai

Nong Haet

Source: GMS Tourism Sector Strategy (2006-2015)Source: GMS Tourism Sector Strategy (2006-2015)

• Resources:

Available: Gas, Teak, Gemstone Needs: Refined Oil

Available: Tin, Rubber, Natural GasNeeds: Fuel

Available: Timber, Fisheries, Product, GemstoneNeeds: Fuel

Available: Copper, Lead, Zinc, Tin, IronNeeds: Powdered Ores, Timber, Fisheries Products

Available: Timber. Hydropower, TinNeeds: Fuel

Available: Crude Oil, Gas, Coal, ApatiteNeeds: Steel, Refined Oil

Available: Tin, Fisheries, ProductsNeeds: Manganese, Iron

Interdependency of GMS Countries

II. Diversity of GMSII. Diversity of GMS

Source: IMF and National Bureau of Statistics of China *Data in 2008

II. Diversity of GMS (cont)II. Diversity of GMS (cont)

GDP per capita (Current USD)

GDP per capita at PPP (Current

USD)

Thailand 3,940 8,059

Guangxi* 2,155 na

Yunnan* 1,812 na

Vietnam 1,060 2,942

Lao PDR 878 2,266

Cambodia 775 2,015

Myanmar 459 1,197

Source: IMF and National Bureau of Statistics of China *Data in 2008

Purchasing power in 2009:

“One Vision, One Identity, One Community”

ASEAN GMS Countries - 2010

Land area: 1.94 M sq Km

Population: 232 M

ASEAN Countries - 2010

Land area: 4.48 M sq Km

Population: 614 M

Source:–AEC Chartbook 2010

Per Capita GDP – US$

Limitation of GMS ECLimitation of GMS EC

Uneven development – 3 LDCsCBTA implementation difficultiesLarge economy vs small economyIrregular MigrationNeed to integrate into ASEAN and

Global value chains

World Factory – ASEAN + 6World Factory – ASEAN + 6

import of intermediate goods increased from 26.9% to 33.1% in 2008

and export of final goods increased from 30.1% to 33.1%

One-third of the world export come from this region

World Consumption MarketWorld Consumption Market

ASEAN + 6 occupies around 49% of the world population and 25% in the world GDP

ASEAN 600 million people – become a trade hub of Asia.

ACFTA covers about 1.9 billion people and US$6000 billion in terms of GDP – making it the largest free trade area in the world.

Free Trade AgreementsFree Trade Agreements

ACFTAASEAN – Japan Comprehensive

Economic Partnership (AJCEP) – 2008 AKFTAAANZFTAASEAN – India Regional Trade and

Investment AREA (RTIA) 2002AIFTA - 2010

AEC 4 PillarsAEC 4 Pillars

Single market and production base Competitive economic region Equitable economic development 0%

tariffIntegration into the global economy

ChallengesChallenges

Spaghetti bowl effect Mega-competition in industry Contract farming, agriculture land

concessionLabor and migration issues Political and border disputes Environmental destruction

ASEAN Community(APSC, AEC, ASCC)ASEAN Community(APSC, AEC, ASCC)

ASEAN Competitive Advantage

IMT- GTIMT- GT

GMSGMS ACMECSACMECS

GMSGMS ACMECSACMECS

BIMSTECBIMSTEC

NAFTA

APEC

EUEUASEM

WTOWTOWTOWTO

KoreaKoreaJapanJapanPRCPRC

ACDACD

FTAs FTAs e.g. Japan, China, Australia, New Zealand, Bahrain, Peru, India, USA, BIMSTEC etc…

IndiaIndia

Spaghetti bowl effect

Mega-competitive Economy

Chinese Production

base in Thailand, bring

parts and components from China

(ACFTA, sales to India AIFTA

Bring skilled workers from

China

Mega-competitive EconomyMega-competitive Economy

China move down to CLMVTJapan has to manage its risks, quake,

nuclear – may force SMEs to relocate their plants to other countries

Replacement, reallocation, repositioning, geographical realignment and reorganization of industry.

Contract Farming and Big Agri. Land Concession will displace small land holders

InterdependentInterdependent

Labor Migration– Second Wave Migration– Brain drain vs Brain gain

Transborder value chainsExport dependency

Thai economy depends 70% on export

Thai economy depends 70% on export

ASEAN 21.4%EU 12.8%US 12/6%Japan 11.8%China 9.7%

(NESDB 2008)

Priority HRD/Capacity Building Issues

1. Limited capacity to implement FTAs and trade and investment policies

2. Limited absorptive capacity for agriculture policies

3. Limited SME ability to integrate into GVC

4. Limited Good Agricultural Practices (GAP)

Trade and Investment

Limited capacity to implement FTAs and

Investment Policies

Small and Medium Enterprises

Limited ability to integrate into ASEAN

and global value chains

AgricultureLimited absorptive capacity and adjustment

of agriculture policies and practices to a

larger and more competitive economy

Lack of GAPs and Good Postharvest Practices

Development Initiatives in the Mekong Basin

Documents

Transcript of Development Initiatives in the Mekong Basin