Rapid economic growth has put pressure on Indochina's infrastructure, and new investment plans are needed, the Asian Development Bank pointed out. It has plotted the 10-year strategic framework for infrastructure development in Indochina through 2022.
The strategic framework is focused on 9 sectors – energy, telecom, trade and investment, tourism, environment, human resource development and agriculture, said Thailand Country Director Craig Steffensen at Thailand Focus 2012's session on Indochina.
ADB has recently launched an assessment report on Myanmar, which concluded that Myanmar has very strong potential for growth with lots of opportunities for foreign investors.
“Myanmar’s geographic position will allow it to unleash its incredible opportunity for trade and commerce the same way Afghanistan plays or will play and has played historically, a role of a hub for trade and commerce in South Asia. Myanmar has the ability to play that role, moving forward to Southeast Asia, South Asia and China with a little help from Thailand,” he said.
However, Myanmar has many challenges to solve – lacking of infrastructure, including electricity. Currently, only one in four of Myanmar’s population has access to electricity. Myanmar should expedite an economic reform process and enhance the business and investment climate to maximize benefits of integration.
“To realise the potential of the country, we must focus on strengthening iconic activities via infrastructure, transport, power and telecommunication services with its neighbours.”
Though many are still reluctant about the liberalisation in the country, Steffensen said the country has come too far to turn its back on the recent development.
“I’m hopeful and I’m optimistic and cautious aren’t in my vocabulary anymore. Things in Myanmar are going to work out ok. I think things have gone so far; there is no turning back at this stage,” he said.
The main purpose of ADB working with the six countries in the Great Mekong Subregion (GMS) is to eradicate poverty and improve competitiveness by developing infrastructure within the group.
“GMS programme was established in 1992. The aim was to link the GMS countries to improvement in infrastructure. The overall vision is a more integrated, prosperous and harmonious sub-region. We called our approach the 3Cs, that is to improve connectivity, competitiveness and a sense of community,” Steffensen elaborated.
The bank’s project of constructing intra-region transportation routes has created almost 250,000 kilometres of the network, which connects all major cities in the area together.
“There are two initiatives we have been working on for a long time, together with our development partners, the first is the Asian Highway, second is the transaction railway. The Asian Highway and railway was conceived during the1960’s and 1980’s respectively, comprised of 250,000 km of roads and rail link designed to connect the entire region. ADB has been the largest financier of investments in its network so far, ” Steffensen said.
ADB is the largest creditor with US$20 billion and 55 projects which have been implemented. The development of infrastructure in the area has boosted the growth the economy. Stefensen cited the example of Phnom Penh --Ho Chi Minh City Highway boosted bilateral trade between Cambodia and Vietnam by 40 per cent. Meanwhile the border crossing was up by 50 per cent and many jobs were created along the border.