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TRANSPORT: Trans-Asian Highway to Prosperity

Tran Dinh Thanh Lam

HO CHI MINH CITY , Apr 13 2006 (IPS) - Though incomplete, the Trans-Asia Highway (TAH), conceived by countries of the Greater Mekong Sub-region (GMS) and supported by the Asian Development Bank (AsDB), is already proving its economic benefits and capacity to dramatically transform the region.

The highway itself, says Paul Turner who works with AsDB’s Mekong department, is ”an excellent place to invest”. In HCM city for a regional business forum, Turner said the East-West Economic Corridor (EWEC) or TAH signaled to investors that the “Mekong is open for business”.

Due to be completed in 2008, the East-West, North-South, and Southern Economic Corridors will link different parts of Vietnam to Laos, Cambodia, Thailand and Burma. The 1500km-long EWEC will link Vietnam’s central seaport of Danang with the Andaman Sea in Burma.

In a next step, AsDB will push the TAH further to India. “All the three corridors will be mostly finished by 2008, although in one sense they will never be entirely complete, since there will always be ongoing improvements and the expansion of investment,” Turner stressed.

The GMS countries hope the corridors would increase physical connectivity with other regional countries, help increase their competitiveness in the global marketplace, and increase the sense of a Mekong community that is peaceful and prosperous.

“Transport infrastructure is crucial to facilitating the trade and investment that will contribute to economic development and poverty reduction in the region,” said Hoang Van Dung, vice chairman of the Vietnam Chamber of Commerce and Industry that co-organised the conference.

He added that the TAH would greatly shorten the distance and reduce the cost of economic exchange between the Asia-Pacific countries and India.

Already, India has in place a ‘Look East’ policy as part of which it is developing the city of Guwahati, capital of eastern Assam state, so that it could serve as a future hub for trade and commerce in a region that includes China’s southern province of Yunnan.

India, which already does 25 billion US dollars worth of annual trade with members of the ten-nation Association of South-east Asian Nations (ASEAN), hopes to double that figure by signing an Indo-ASEAN free trade agreement (FTA) in January 2007.

Seven ASEAN countries, Burma, Thailand, Cambodia, Laos, Vietnam, Malaysia and Singapore will become readily accessible from India once the TAH is complete. The other countries, Indonesia, the Philippines and Brunei will benefit indirectly.

”The development of the TAH is of immense importance to India,” Rajiv Sikri, a senior Indian diplomat told IPS earlier in an interview. ”India is anxious to revive overland links in the region that have existed for centuries but closed down in recent history.”

The Hai Van Tunnel linking EWEC to Danang sea port has been completed, together with the road linking Vietnam to Laos.

Turner said that about five years ago, his travel along the EWEC, from Vietnam’s central city of Hue to Savannakhet in Laos was difficult and took a whole day. Now, with infrastructure improvements, he could have breakfast in Hue, lunch in Savannakhet and dinner in Thailand’s Khon Khaen. “After only a few short years, not only is the road infrastructure largely in place, but much new investment has been made along the corridor.”

Several travel agencies in Vietnam, Laos, and Thailand have already taken the opportunity to launch short-travel bus trips allowing tourists to visit major cities of the three countries. Vietnamese newspapers report that on a single day as many as 500 international tourists enter Vietnam by the EWEC.

Vietnam’s Lao Bao Border Economic Zone continues to attract investors, and the Cross Border Transport Agreement has been implemented at the Dansavanh (Laos) – Lao Bao (Vietnam) border point. Copper exports from the Lao Sepon mine have commenced, and copper is being transported to markets using the EWEC.

So far, 60 companies have invested in Quang Tri Province’s Lao Bao Economic Border Zone, on the EWEC at the Laos-Vietnam border.

“We have already seen significant mining operations open up, plantation forestry projects being developed. Jobs are being created and new production opportunities are emerging. Poverty levels along the EWEC have also come down.” Turner said.

“In short, much is being achieved across a range of sectors to improve the daily lives of people in the GMS.”

With reduced production costs, businesses are investing more and that means increased employment opportunities for people living near the EWEC.

“The benefits of EWEC are numerous, but let’s remember that it is still very early days,” said AsDB’s Turner. “Those benefits have the potential to impact the lives of GMS people for generations to come.”

Since the GMS Economic Cooperation Programme began in 1992, AsDB has provided not only financial support but also technical advice on the economic and social development of the GMS countries.

“But the best contribution we bring to the EWEC is partnership. We have worked with EWEC stakeholders and the GMS to sustainably reduce poverty and create better life for people in the region,” Turner said.

“The results of the stakeholders’ collective efforts are there for everyone to see,” Turner said, but admitted that “much remains to be done in order to turn EWEC into a true economic corridor.”

Work on a cross-border transport agreement to facilitate the movement of goods and people along the EWEC has just commenced recently and needs to be accelerated.

Key inputs essential to efficient transit along the corridor, such as infrastructure, information technology, streamlining of rules and regulations associated with moving people and commodities along an international corridor need to be established.

“One of our big concerns is the absence of adequate safeguards to protect against the possible negative social and environmental impacts on an international highway, such as the trafficking of women and children and illegal wildlife trade,” Turner said.

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