Asian Development Bank ADB Role in The North South Economic Corridor NSEC: the Greater Mekong Subreg

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Asian Development Bank (ADB) Role in The North
South Economic Corridor (NSEC) the Greater
Mekong Subregion Economic Cooperation Program
Trade Creation from Neighboring Countries to
ThailandBy Rattanatay Luanglatbandith,
Economist (Regional Cooperation), ADB Thailand
Resident MissionChiang Rai, 4 July 2008
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Overview

• The ADB via the GMS Economic Cooperation Program
• Hardware
• Software
• Competitiveness
• Regional Public Goods

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Peoples Republic of China Land area 633 thou sq
km Population 97.3 M GDP per capita
US1,135 (figures for Yunnan and Guangxi only)
The Greater Mekong Subregion (GMS)
Myanmar Land area 677 thou sq km Population
54.8 M GDP per capita US255 (2005)
Viet Nam Land area 332 thou sq km Population
84.1 M GDP per capita US724
Thailand Land area 513 thou sq km Population
65.8 M GDP per capita US3,133
Lao PDR Land area 237 thou sq km Population
5.7 M GDP per capita US601
The GMS in 2006 Land area 2.6 M sq
km Population 323 M GDP per capita US1,453
excludes Myanmar
Cambodia Land area 181 thou sq km Population
14.1 M GDP per capita US510
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ADB RoleThrough the GMS Program

• GMS Sectors
• Transport
• Telecoms
• Energy
• Environment
• Tourism
• HRD
• Trade Facilitation
• Investment
• Agriculture

• Started in 1992
• Pragmatic and informal
• Promotes mutual trust and goodwill
• Multifaceted role of the ADB
• Financier
• Honest broker
• Coordinator/Secretariat

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Why regional cooperation in the GMS?

• Allows countries to take advantage of their
  complementarities and linkages
• Provides an important tool to address shared
  challenges
• Enables countries to support each other in
  pursuing their respective national development
  goals
• Regional cooperation is the only answer to the
  development challenge of land-locked countries

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Role of the GMS Program in the Regional
Cooperation and Integration (RCI)

• Hardware Physical connectivity
• Software - Human connectivity, Increased
  competitiveness
• A sense of GMS community Regional public Goods

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Economic Corridor Development

• Opportunities for cooperation exist
• Cross-border trade and investment
• Co-production
• Over-land tourism
• Integration of infrastructure, services

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North-South Economic Corridor
Recently upgraded with Govt financing
Financed by of PRC and Thailand, and ADB
ADB loan approved in 2007 for new highway
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North South Economic Corridor Lao PDRconnecting
Peoples Republic of China with Thailand
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Software - Human connectivity, Increased
competitiveness

• Nonphysical Impediments to the Cross-border
  Movement of Goods and People
• Inconsistent and difficult border crossing
  formalities and procedures
• Restrictive visa requirements
• Restrictions on entry of motor vehicles
• Different standards on vehicles and drivers
  across countries
• Transit traffic difficult/not allowed

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The GMS Cross-Border Transport Agreement (CBTA)

• CBTA is multilateral agreement ratified by all
  six GMS countries with a purpose to eliminate
  non-physical barriers to cross-border transport
  in the GMS
• CBTA covers in one document all the relevant
  aspects of cross-border transport facilitation,
  which includes
• Facilitation of cross border movement of goods
• Single-stop/single-window inspection
• Harmonization/integration of systems
• Exchange of traffic rights
• Customs Transit System
• Cross-border movement of persons

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Trade Facilitation

• Strategic Framework for Action on Trade
  Facilitation and Investment
• Trade logistics
• Customs
• Inspection, quarantine, and sanitary/
  phytosanitary
• Business mobility

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Transport and Trade Facilitation(2008-2011)

• Comprehensive assistance for integrated approach
• Transport facilitation and customs harmonization
• Sanitary/phytosanitary cooperation
• Business support and logistics Development
• Regional information platform

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Bangkok Kunming Cost vs Distance (2006)
Source Ruth, Bhanomyong, NSEC Logistics Study
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Bangkok Kunming Cost vs Distance (2015)
Source Ruth, Bhanomyong, NSEC Logistics Study
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Highlight of Chiang Rai International Trade, 2007
(Unit million Baht)

Source Chiangsaen and Chiang Khong, Customs
Report, 2007
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Competitiveness

• Integrating private sector into the GMS program
• Helping improve competitiveness through
  promoting
• Working with the GMS Business Forum (GMS-BF) to
• Promote and facilitate trade and investment in
  the GMS
• Capacity development for local CCIs along
  economic corridors
• Integration of SMEs and local producers along the
  economic corridors into global value chains and
  trade and investment forum.
• Trade and Investment Forum
• www.gmsbizforum.com

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GMS Core Agriculture Support Program

• Cross-border agricultural trade/investment
• Public-private partnerships in sharing
  agricultural information
• Capacity building in agricultural science
  technology
• Emergency response mechanisms for agricultural
  and natural resource crises
• Institutional linkages/mechanisms for cooperation

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GMS Cooperation in Tourism

• Promote multi-country tourism through joint
  marketing
• Upgrade skills of tourism leaders and trainers
• Manage natural and cultural resources for
  conservation and tourism
• Identify and address impediments to travel to and
  within the subregion
• Develop tourism infrastructure to ensure wider
  distribution of tourism benefits

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Promoting the GMS as a Single Tourist
Destination 2005 GMS Tourism Sector Strategy
(2006-2015) 7 strategic programs and 29
priority projects, including development of 16
thematic strategic projects and 13 priority
tourism zones
Source GMS Tourism Sector Strategy (2006-2015)
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Regional Public Goods

• Health
• Communicable disease control
• Labor and migration
• Promotion of safe migration and prevention of
  trafficking of girls and women
• Education
• Phnom Penh Plan for Development Management
  short-term training for middle-level to
  senior-level public officials

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GMS Core Environment Program
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Thank you
For more information on the GMS Program
visit http//www.adb.org/gms Or
email gms_at_adb.org.