Thursday, June 21 2018

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Securing the Greater Mekong Sub-region’s future

Update: March, 29/2018 - 09:00
ADB President Takehiko Nakao
Viet Nam News

By Takehiko Nakao

The Greater Mekong Subregion (GMS) countries have made stunning progress over the past quarter century. Once plagued by poverty, they are now economic success stories.

The GMS Economic Cooperation Programme has contributed significantly to this transformation. Since it was established in 1992 to enhance economic relations and promote regional co-operation, its six member countries - Cambodia, China, Laos, Myanmar, Thailand and Việt Nam - have built a platform for economic co-operation that has mobilised almost US$21 billion for high-priority infrastructure projects. Foreign direct investment into the sub-region has surged ten-fold and trade between its countries has climbed from $5 billion to more than $414 billion.

But the sub-region faces challenges to its prosperity. Further reducing poverty, climate change adaptation and mitigation, energy efficiency, food security and sustainable urbanisation remain priorities of the GMS Programme. Countries also face new challenges, including growing inequality, rising levels of cross-border migration and the potential impact on jobs of the fourth industrial revolution.

Additionally, GMS countries have agreed to significant commitments under the Sustainable Development Goals and the Paris Agreement on climate change.

There are also emerging opportunities for the region, including incorporating new technologies in various sectors such as education, agriculture, health and finance. GMS countries are situated at the crossroads of South and Southeast Asia, and hence they can benefit from increased growth momentum in South Asia.

As GMS leaders gather this week in Hà Nội to chart the future of the programme, it’s a good time to consider how new initiatives can ensure the GMS Programme remains relevant and responsive to the sub-region’s needs.

The Hà Nội Action Plan and the GMS Regional Investment Framework 2022, both proposed for adoption at the 6th GMS summit on Saturday, provide a platform for countries to strengthen their co-operation through continuous innovation. These two documents will have a sharpened focus on the GMS Programme’s goals of enhancing connectivity, competitiveness and community in the sub-region.

Connectivity, the first objective, has been dramatically improved. More than 10,000km of new or upgraded roads and 3,000km of transmission and distribution lines have been added under the programme. These transport networks have been transformed into an interconnected network of transnational economic corridors, building on 25 years of work to extend the benefits of growth to remote areas. The Hà Nội Action Plan calls for the continued expansion of these economic corridors to boost connectivity both between and within countries.

The sub-region’s competitiveness is improving through ongoing efforts to facilitate transport and trade flows, enhance agriculture exports and promote the GMS as a single tourism destination after receiving a record 60 million visitors in 2016. Looking ahead, it will be important to continue cutting red tape and to remove barriers to transport and trade.

Finally, communities are being strengthened through cross-border initiatives to control the spread of communicable diseases, expand educational opportunities, protect the sub-region’s rich biodiversity and mitigate the impacts of climate change.

GMS countries have identified a new pipeline of 227 projects worth about $66 billion under the GMS Regional Investment Framework 2018–2022. These projects will expand economic prosperity by developing cross-border transport and energy infrastructure.

The Asian Development Bank (ADB), which has been the programme’s secretariat since its inception, expects to provide $7 billion over the next five years for a range of projects supporting transport, tourism, energy, climate change mitigation and adaptation, agribusiness value chains and urban development. This builds on more than $8 billion in financing provided by the ADB so far under the programme.

To deliver these projects and make headway on other priorities such as infectious disease control and environmental preservation, strong partnerships are vital. The GMS Programme depends on the collaboration of many stakeholders, including local administrations and communities, development partners, academia and the media.

The GMS will benefit from strengthened partnerships with other regional and global-operation platforms, leading to new opportunities for future development.

Partnerships with the private sector will also be increasingly important, and it is gratifying to see them deepening through the GMS Business Council, the Mekong Business Initiative, the e-Commerce Platform, GMS tourism and agriculture forums and the recent Finance Sector and Trade Finance Conference.

I am optimistic that the sub-region will meet its challenges and capitalise on emerging opportunities. By working together, GMS countries can deliver rapid, sustainable and inclusive growth for another 25 years and beyond. The ADB will continue to be an important and trusted partner in that endeavour.

* Takehiko Nakao, President of the Asian Development Bank

 

 

 

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