ACMECS and Thailand ACMECS and Thailand Dr. Porametee Vimolsiri Dr. Porametee Vimolsiri

Senior AdvisorSenior Advisor Workshop on Investment, Trade and Transport Facilitation Workshop on Investment, Trade and Transport Facilitation

in ACMECSin ACMECS

Office of The National Economic and Social Development BoardOffice of The National Economic and Social Development Board

Outline• Overview of ACMECS

• Priority Areas : Existing Condition & Constraints

- Trade & Investment

- Transport

• How to overcome?

- Role of Thailand

ThailandThailand

Lao Lao PDRPDR

CambodiaCambodia

VietnamVietnam

MyanmarMyanmar

ACMECSACMECS

Members : Cambodia LaoPDR Myanmar Thailand and Viet Nam Population : 213 mil. Areas : 1.94 mil. Kms2 Total GDP : 225110,mil. USD

Established since 2003

Initiated and Drived by member countries

Andaman sea

Siam Gulf

South China Sea

CambodiaCambodia

BangladeshBangladesh

ThailandThailand VietnamVietnam

LaosLaosMyanmarMyanmar

ChinaChina

IndiaIndia

MalaysiaMalaysia

IndonesiaIndonesiaSingaporeSingaporeBruneiBrunei

Sri LankaSri Lanka

PhilippinesPhilippines

JapanJapanAfghanistanAfghanistan

PakistanPakistan

KoreaKorea

Rationale : Why We need ACMECS?

Existing Forum --- GMS/BIMSTEC/IMT-GT/JDS

15 Year of Cooperation : Much Progress on 15 Year of Cooperation : Much Progress on Transport ; Transport ; Software for Trade and Investment are in Software for Trade and Investment are in ProcessProcess

1992 1993

GMSMaster Plan Formulation

Hardware Development

Software Development

1994 1996 2001 20122012

- Road Network Connectivity- Power Grid Line

1995 1997 2002

- Cross-border Transport Agreement- Single Stop Inspection

- ACMECS (Sister Cities)- Economic Corridors

Private ParticipationSocial + Global

CompetitivenessCompetitiveness

ConnectivityConnectivity CommunityCommunity

- Trade Facilitation/ Trade Logistics- Development Partners- Infrastructure Utilization

2005

ConnectivityConnectivity CompetitivenessCompetitiveness

Imbalance of Economic and Social Development

GMS Country Poverty Incidence* (%) Gini Coefficient**

  1992 2004 1992 2004

CAMBODIA 39 36 0.37 0.45

PRC 23.8 7.9 0.31 0.35

LAOPDR 43 32.7 0.29 0.37

MYANMAR N/A 22.9

N/A

N/A

THAILAND 23.2 9.8 0.54 0.5

VIET NAM 58.1 28.9 0.18 0.2* Based on National Poverty Line

** Measures Degree to Which an Economy’s Income Distribution Diverges from Perfect Equal Distribution

1993

394332 326 300 296

0

200

400

600

800

1000

1200

1400

1600

1800

2000

Thailand Yunnan PRC Viet Nam Lao PDR Myanmar Cambodia

GDP Per Capita (PPP) Y2005

Underutilization of ACMECS Core Value

JDS – Stability &Security

IMT-GT –Avail Influenza Energy Tsunami Earthquake Security

Important development Agenda

ACMECS –

Co-Production, Sister Cities

GMS -- Connectivity Competitiveness Community

BIMSTEC -- New Emerging Economies

Poverty Eradication

Anti Terrorism

Yangon

Lao PDR

PRC

Danang

Gulf of Thailand

Andaman Sea Vietnam

Myanmar

BKK.

Chiang Rai

Mukdahan -

Savannakhet

MaeSod-Myawaddy

Trad- Koh Kong Hochiminh City

Cambodia

Develop Sister Cities as a production bases

SEC

EWEC

NSEC

Development Strategy of ACMECS

THAI CityTHAI City

MYAMAR City MYAMAR City

Co-Production ConceptCo-Production Concept

Border Border MarketMarket

Economic Zone Economic Zone

CheckpointCheckpointRoad LinkRoad Link

SMEs by Industrial Clusters

SMEs by Industrial Clusters

Border LineBorder Line

ACMECS : Goals & Benefits Bridge the economic gap among the four countries and

Promote prosperity in the sub-region in a sustainable manner.

Transform the border areas of the five countries into zones of economic growth, social progress and prosperity, and to blend local, national and regional interests for common benefits, shared prosperity, enhanced solidarity, peace, stability and good neighborliness.

Act as a catalyst to build upon existing regional cooperation programs, and complement bilateral frameworks, and move ASEAN forward

Trade and Investm

ent

Trade Opportunity: Trade Opportunity: Intra-GMSIntra-GMS

Note: Population and GDP per capita in 2004Source: ADB

MYA THA LAO CAM VIE PRCyn

% Intra-GMS trade to total trade

1990s

2004

Population (million)

GDP per Capita(Current, $)

54.4 64.2 5.8 13.1 82.1 44.2

176 2,544 406 348 500 681

Likewise, tremendous potential for intra-GMS trade has been shown during the past decade.

1. Cost of Starting/Doing Business

• Doing business in the GMS takes more time and resources on the average compared to other countries in the region

(56-198 Days Vs 52 days) • Lack of Sufficient/Standard Information • Difficulties in Finding Focal Point and

Partners

2. Regulatory Impediments

Legal and regulatory framework for trade is largely primitive or restrictive in most ACMECS countries

Difference in Level of Development among countries leads to the protection of domestic market

A number of quantitative restrictions, such as import licensing, and other non-tariff measures still exist

Non- Tariff Barriers (NTBs)

2. Regulatory Impediments (2)

Inter-country and intra-country differences in rules and procedures i.e. Customs

Inconsistency in Implementation of laws & regulations (National-wide

and Regional-wide)

Inherent weaknesses in the system of recording &monitoring border trade, including transit trade.

Phenomenon Expansion of Informal Trade

Transparency of the Procedures

3. Trade Logistics

Inefficient multimodal transport infrastructure

Relatively High Cost

Ineffective logistic system i.e. competitive carriers and service providers; competent transport intermediaries; and fast, efficient, and transparent cross-border procedures

Less Competitiveness in Global Value Chain

4. Institutions/Private Sector

institutions and organizations dealing with and supporting business remain underdeveloped. Financial institutions often have very restricted lending practices to private businesses. Educational and technical support institutions are understaffed, ill equipped, and unable to meet the demands of modern industry. Business associations are relatively weak.

Insufficient Capacity Building for Private Sector

Less Competitiveness in Global Value Chain/Network

Transport

Road Transport NetworkRoad Transport Network20052005 20152015

Key Issues and Challenges• Equitable sharing of benefits and costs of

regional projects • Financing of needed infrastructure

investments

• Structuring public-private partnerships • Managing risks i.e. currency, investment

risks, socio-economic impact of the project

• Sustainable development in transport i.e. maintenance, capacity building, etc.

How to Achieve ?

As a Development Partners

As an Active Member

Provide Technical Assistances through TICA; Financial Assistances through NEDA; Implement Various Projects under Plan of Actions

Thailand’s Role in ACMECS

Initiate ACMECS; Build Network with Development Partners; Act as Virtual Secretariat; Create Efficient Mechanism for Cooperation i.e. AWG; Border Committee

As a Business SupporterCreate ACMECS Business Council; Create Favorable Business Environment through Various Development Projects; Simplified Complicate Business Process and Lower Logistics Cost.

Mawlamying

Myanmar ThailandChiang Rai SBEZ Yangon

Sea Port 10,000-15,000DWT Tak

SBEZ

Pitsanulok Logistics

Center

Khon Kaen

Logistics Center/IE

Mukdahan Distribution Center

Savan-Seno SEZ

Dong Ha

(Tourism)

Da Nang Deep Sea Port 35,000 DWT and Dung Quat IE

Kota-Perdana

Malaysia

Bangkok

Lao PDR.

กัมพูชา

Dansavan

Aranyaprathet Poipet

Trad

Koh Kong

Phnom Penh

Hue (World

Heritage)

Lao Bao SEZ

Ho Chi Minh Vung

Tao Deep Sea Port

VietnamEconomic Activities Along Economic Activities Along

the Corridorsthe Corridors

Thailand’s Assistances to Thailand’s Assistances to Neighboring Countries Neighboring Countries

Thailand

Myanmar

Cambodia

LaoPRC.

PRC

12

Kunming

DaweiTrat

Vung Tau

DanangYangon 6

3

4

1011

12

14

13

5

Viet Nam

8

7

9

16 ProjectsTotal 7,792 mil.

baht

Construction & Improvement of

Roads, Bridges, Railways, Airports and Local Ports

Joint Utilization of Airport

Savannakhet - Mukdahan

Flagship Initiatives: Flagship Initiatives:

Cross-border Transport Agreement

Thailand can Provide Assistance in Customs &Cross Broder Management to CLMV

The Negotiation of All Annexes& Protocols has been finalized and Signed by March 2007, waiting for the ratification from countries. After ratification, full implementation of CBTA has scheduled in 2008

First Step

Second Step

Single Stop Inspection

One Stop Service

Second Step : Nong Khai, Chiang Kong, Chong Mek and Trat

First step : Mukdahan, Aranyaprathet , Mae Sai, Mae Sot

For CBTA in Thailand

Industrial Estate and Economic Zone Industrial Estate and Economic Zone under ACMECSunder ACMECS

Industrial Estate Establishment Mae Sot SBEZ

and IE in Myawaddy

Pa-anMawlamyine and

Maw Taung

Koh Kong Industrial

Estate

Savan Xeno SBEZChiang Rai SBEZ

Existing Thailand’s SBEZ and IEAT’s projects in CLM Countries

Thialand’s Border Economic Zone 1.Tak SBEZ2.Chiang Rai SBEZ Thailand provide assistance to Myanmar LaoPDR and Cambodia

Agriculture

Single VISA

Trading

Use of Local Currencies

Facilitation of Import & MOU of Contract Farming; R&D on field crops,livestocks, SPS Tech Transfer Thailand and Cambodia as a Pilot Project; Details had finalized, will signed MOU in 2007 OSS at 10 Checkpoints in THA; Study of Wholesales Market & Distribution Centers in Cambodia; Providing AISP for CLMV products

BOT’s Study finished.Implementing pilot projects at Commercial Banks at Thai-Lao borders. Energy

SecurityRegional Power Grids, Alternatives Energy i.e. Biofules,Biomass,HydropowerCapacity

Building Community

Scholarship provided by Thailand and VN for Vocational Trainings and Other Areas Implementing Sister Cities; Coordination Mechanisms Established at the Local Level ACMECS Business Council at Local Level

Other Attempts to Support ACMECS

3

ACMECS Midterm Review (Cebu, January 2007)

4

1

2

Approved New Version of Plan of Approved New Version of Plan of Actions and Promote Networking Actions and Promote Networking with Development Partners on with Development Partners on resources mobilizationresources mobilizationExpedite Investment to Complete ACMECS Transportation Network and software to facilitate movement of goods, people, and tourism Closer Relationship among Stakeholders i.e. Sister Cities, Central local government, Government & Private, People to PeoplePriority Issues i.e. Contract Farming, Establishment of Rice Producing Countries Association, Alternative Energy i.e. NGV, Hydropower and Biofules, Public Health

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