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Regions and Countries Regional Cooperation Greater Mekong Subregion Publications Proceedings of Ministerial, Forum, and Working Group Meetings 12th Ministerial Conference on Subregional Economic Cooperation
Greater Mekong Subregion: 12th Ministerial Conference |
1. The 12th Ministerial Conference on Subregional Economic Cooperaton in the Greater Mekong Subregion (the Conference) was held in Dali City, Yunnan Province, The People's Republic of China (PRC) from 17 to 19 September 2003. The Conference consisted of three events: Senior Officials' Meeting (the SOM) held on 17 September 2003, the Meeting with Development Partners (OPM) on 18 September 2003, and the 12th Ministerial Meeting on 19 September 2003.
2. The objectives of the Conference were as follows:
The Conference Agenda and Program is attached as Appendix 1.
3. The Conference participants included delegations from the Kingdom of Cambodia, the People's Republic of China, Lao People's Democratic Republic (Lao PDR), Union of Myanmar, Kingdom of Thailand, and the Socialist Republic of Viet Nam. Representatives from bilateral, multilateral, and international organizations, Officials from Asian Development Bank (ADB) and representatives from the private sector attended the Conference. The inaugural session was attended by H.E. Mr. Tang Jiaxiuan State Councilor, State Council PRC, who delivered the welcome and opening statement. The 12th ministerial Meeting was chaired by H. E. Renqing Jin, Minister of Finance, PRC and co-chaired by ADB's Vice President for Operations Group 1, Mr. Liqun Jin. The list of participants is attached as Appendix 2.
4. H. E. Tang Jiaxuan, State Councilor, State Council, PRC, in his welcome and opening statement, called for strengthening economic relations and recognizing mutual complementarities among the GMS countries to enhance the competitiveness of the region. H.E. Tang acknowledged ADB's important role in supporting the region through its financial and technical assistance that has resulted in a more dynamic cooperation in the GMS. H.E. Tang lauded the substantial achievements of the GMS Program and noted that it has injected fresh vitality in the social and economic development of the subregion. H.E. Tang reaffirmed China's continuing commitment to the GMS Program towards the goal of promoting common prosperity on the basis of consultation on equal footing and mutual benefit. He reported on China's impressive growth in 2003, in fact the highest in five years, despite the outbreak of the SARS epidemic. China's rapid economic growth and its recent accession to the WTO will have a significant impact on the subregion. PRC will thus engage in more active cooperation to create opportunities and improve conditions in the GMS. H.E. Tang indicated that developing good relations is the foundation of China's foreign policy -- developing friendships and building partnerships are part and parcel of China's democratic principle. H.E. Tang reiterated China's resolve to the progressive implementation of subregion projects in order to usher the program into a new era. H.E. Tang also cited the importance of establishing of the ASEAN-China Free Trade Area. He indicted that the Ministerial Conference would carry forward the GMS Summit vision into the future, and expressed hope that the GMS members can work together to realize that. Finally, H.E. Tang expressed confidence that PRC's hosting of the Second GMS Summit in 2005 will be a major milestone in promoting cooperation and common prosperity in the GMS.
5. Mr. Liqun Jin, ADB, in his opening remarks, expressed appreciation for the hospitality and excellent arrangements by of the Government of PRC. He particularly noted the enhanced cooperation between Yunnan Province and the GMS countries under the GMS Program. Recalling the vision of the GMS leaders articulated during the Summit, he noted that the Meeting provides an opportunity for the GMS countries to take more concrete measures in realizing the vision. Mr. Jin presented the GMS in the context of Asia's changing economic geography, noting that the GMS Program has played a catalytic role in helping the region realize its economic potential. He underscored the need to accelerate efforts in the subregion to achieve connectivity, competitiveness and an increased sense of community to take advantage of market integration in Asia. He outlined four major challenges that GMS countries need to face, namely
As economic interdependence and regional integration heightens, Mr. Jin encouraged GMS countries to forge closer ties in the unified pursuit of an integrated and cohesive development strategy for the subregion and expressed optimism that the GMS Program can indeed "make it happen".
6. H.E. Rongkai Xu, Governor, Yunnan Province, PRC who also delivered a statement at the Inaugural session, stated that it was an honor for Yunnan Province to host the Meeting as an inaugural event of the newly constructed Dali-Longshan Convention Center. He noted that through the concerted efforts of ADB and the GMS Governments, the GMS Program has improved over time and the fields of cooperation have expanded. Supported by the Central Government of PRC, H.E. Xu considered Yunnan Province as the PRC's bridge and window to the outside world and as a beneficiary of the several initiatives under the GMS Program. He also considered Yunnan Province as the gateway of PRC to South Asia and South East Asia, and noted that the GMS Program should take advantage of its location to maximize the benefits of cooperation and partnerships. Given the subregion's rich natural endowments and huge potential for growth, he encouraged broader cooperation. H.E. Xu reiterated the importance accorded by PRC to the establishment of the ASEAN-China Free Trade Area. He announced the holding of a Kunming Commodities Fair to promote further cooperation in trade.
7. In his opening remarks, H.E. Cham Prasidh, Minister of Commerce, Kingdom of Cambodia, noted that the meeting was an opportune occasion for representatives from the GMS countries and the donor community to review progress, evaluate key proposals and discuss development issues in the subregion. He summarized progress made in, and the key benefits of, two key GMS initiatives that are being supported by ADB. These are the GMS Cambodia Road Improvement Project, which will upgrade the road in the Thai-Cambodian border from Poipet to Siem Reap; and the Phnom Penh Plan for Development Management, which will provide a mechanism to enhance development skills of senior officials in the GMS countries. H.E. Cham Prasidh reiterated the request of the Government of Cambodia made during the 11th Ministerial Conference, to convene a high-level private-public consultation meeting in early 2004, and for Thailand to host this event. He also proposed that the Phnom Penh Plan (PPP) for Development Management be officially launched in early December 2003. He noted that the PPP is a good mechanism to enhance development skills of GMS senior officials so that they could induce meaningful policy change in the GMS. He therefore emphasized the need to ensure funding of the PPP to allow it to support capacity building and institutional strengthening initiatives in the region. H.E. Cham Prasidh recalled the various proposals made by Leaders at the GMS Summit and proposed that decisions be taken up on pending issues so that Ministers can revert back to their respective Leaders.
8. H.E. Renqing Jin, Minister of Finance, PRC reaffirmed the importance accorded PRC to the promotion of economic cooperation in the GMS. This has been manifested in PRC's participation in, among others, the implementation of the Kunming-Bangkok Road Project, the finalization of the GMS Cross-Border Transport Agreement, the forging of bilateral power tariff agreements, and cooperation in technical assistance and training in the agriculture sector. H.E. Renqing Jin reiterated the proposals made by the PRC during the SOM, namely:
H.E. Renqing Jin expressed the hope that ADB can continue to play its important role as coordinator of the GMS Program, and be able to mobilize more resources for the Program. H.E. Renqing Jin emphasized the importance of establishing the ASEAN-China Free Trade Area to the attainment of prosperity in the GMS.
9. In his opening remarks, H.E. Somphong Mongkhonvilay, Minister to the Prime Minister's Office, Lao PDR expressed his gratitude to the Yunnan Provincial Government for its generous hospitality and excellent arrangements for the Conference as well as to the ADB for its continued support of the GMS Program. He cited the substantial progress made in infrastructure linkages among the GMS countries since the GMS Summit held in November 2002, particularly in the transport and communication sectors. H. E. Somphong Mongkhonvilay congratulated Myanmar for its accession to the Cross-Border Agreement and expressed Lao PDR's support in accelerating the implementation of the Agreement. He recognized the importance of energy development in ensuring Lao PDR's economic progress, alleviating poverty, and in forging mutually beneficial power exchanges in the GMS. In this light, H. E. Somphong Mongkhonvilay lauded the signing of the Inter-Governmental Agreement for Power Interconnection and Trade (IGA) on the occasion of the GMS Summit. He also cited Lao PDR's focus on the telecommunications flagship project in view of its importance to Lao PDR's objective of being a regional hub. He reiterated Lao PDR's full commitment in the design and implementation of development programs and expressed appreciation for the continuing generosity and partnership of the international community. He emphasized the need to focus on the distribution of costs and benefits of subregional projects to ensure effective implementation. He noted the important role of the 12th Ministerial in discussing progress of implementation of the GMS strategic framework, and also in articulating new projects and new priorities. The Ministerial Conference also provides an opportunity for the GMS member countries to update the development matrix and mobilize support from development partners.
10. H.E. U Khin Maung Win, Deputy Minister, Ministry of Foreign Affairs, Myanmar expressed his sincere thanks to the Government of the PRC and Yunnan Province for the gracious hospitality and excellent arrangements for the Conference and to ADB for the impeccable work. He agreed that the second decade of the Program should be the devoted to pursuing the Program's strategic thrusts and it was therefore appropriate that the Conference emphasize connectivity, competitiveness and community as key themes. He discussed Myanmar's endeavors to improve transport linkages in the region, taking advantage of the country's geographic position as a land bridge to South and Southeast Asia and China. These include the bridge crossing Thanlwin at Mawlamyine, and upgrading of Mongla-Keng Tung- Tachilek road connecting with Mae Sai in Thailand. He informed of two projects being planned to link the GMS with South Asia ¾ the highway linking India, Myanmar and Thailand, and road link between Myanmar and Bangladesh. He stressed that Myanmar's accession to the GMS Cross-Border Transport Agreement is part of its strategy to develop connectivity with its neighbors. He added that the interest shown by development partners indicates the strong possibilities for accelerating the implementation of GMS projects. He concluded by reiterating Myanmar's commitment to the goals, ideals and programs of the GMS.
11. H.E. Mr. Korn Dabbaransi, Deputy Prime Minister, Thailand extended his sincere appreciation to the Government of PRC and ADB for organizing the meeting in Dali City. He cited the substantial progress achieved under the GMS Program, which resulted in sustained expansion of cross-border trade with neighboring countries. He then enumerated Thailand's efforts to extend all possible land, air and water transport corridors with its neighbors. Financial assistance was given to Myanmar for the construction of the bridge between Ta Chi Lek in Myanmar and Mae Sai in Chiang Rai, Thailand. The quadrilateral agreement among PRC, Lao PDR, Thailand and ADB was made to complete the North-South corridor link. Assistance was given to Lao PDR for its portion of the Chiang Rai- Kunming road as well as for two other projects, namely the road from the Northern Thailand border to Pak Baeng (Lao PDR) and the railway from Nong Khai to Tha Na Laeng in Lao PDR. Thailand and Yunnan Province have signed an agreed minutes to formulate a joint economic cooperation plan, which will guide multi-dimensional development along the North-South Economic Corridor. For Cambodia, Thailand has provided financial assistance for constructing four bridges and two road linkages that will boost the Southern Coastal Corridor. He stressed that the provision of subregional transport link will help narrow the development gap between old and new ASEAN members. He cited the Prime Minister's endeavor to reduce such disparities through the Economic Cooperation Strategy (ECS). He then recalled the Prime Minister's proposals during the GMS Summit, one of which was to utilize Chiang Mai as an aviation hub, which is a means to attract more tourists and economic activities to the GMS subregion, and the other is the establishment of the Special Border Economic Zone (SBEZ) in Chiang Rai as a major component to the North-South Economic Corridor Development. He proposed a future agenda for the GMS Program that would consist of facilitating cross border movements, enhancing the role of the private sector, and establishing a network of partnership with development partners. He concluded his statement by reiterating the strong desire of the GMS countries to promote even further cooperation towards the shared vision of integration and cooperation. He expressed his confidence that deliberations during the meeting will advance mutually beneficial relationships among the GMS countries.
12. H.E. Tran Dinh Khien, Vice Minister, Ministry of Planning and Investment, Viet Nam expressed his sincere thanks to the PRC and ADB for the excellent arrangements for the meeting. He noted that 2003 has been a difficult year for Viet Nam but the country's political and social situation has remained stable. Recognizing the significance of the 12th Ministerial Meeting following the First GMS Summit in 2002, H.E. Tran Dinh Khien highlighted the need to set effective measures to continue promoting GMS cooperation for the sake of common interest. Cognizant of the importance of the flagship programs, he noted that Viet Nam has concentrated its human, capital and physical resources in the implementation of GMS projects. He presented the progress made in the GMS priority projects being implemented in Viet Nam. H.E. Khien indicated that human resource development is the key factor for the development of the subregion, citing that the Phnom Penh Plan is a good means for staff to avail themselves of training opportunities. H.E. Khien reported that Viet Nam is preparing a project to build a training center for agriculture, forestry and fishery experience extension in the central part of Viet Nam to complement the Mekong Institute, and requested support from development partners. H.E. Khien reiterated Viet Nam's adherence to the principles of GMS cooperation in the implementation of flagship programs to ensure mutual benefit. The determination of the GMS countries coupled with the assistance of development partners are the means to realize the vision of the GMS.
13. The Chairperson of the SOM, Mr. Xiaoyu Zhao, Director-General, International Department, Ministry of Finance, PRC, presented the Report of the SOM to the GMS Ministers. The Report of the SOM, as adopted by the Ministers, is attached as Appendix 3.
14. As recommended by the SOM, the records of discussions of all the meetings of the GMS forums and working groups held since the 11th Ministerial Meeting were adopted.
15. The following comments were raised during the session:
16. As the Chairperson of the DPM, Mr. Rajat M. Nag, Director-General, Mekong Department, ADB presented a summary report of the DPM held on 18 September 2003. The meeting agreed on the need to enhance dialogue and partnership between development partners and GMS countries umbrella of the GMS Program. The report on the DPM, as adopted by the Ministers, is in Appendix 4.
17. The following interventions were made during the session:
18. H.E. Cham Prasidh, Cambodia, highlighted the importance of convening the high-level public-private consultation meeting, which is proposed to be held in Thailand in early 2004. H.E Cham Prasidh underscored the need to mobilize resources to implement the development matrix for the 11th flagship programs. He also emphasized the need for training in order to enhance technical capacity in the GMS. In this regard, he specifically cited the Thailand Institute for Trade and Development, which offer training courses to prepare countries for WTO compliance and accession.
19. H.E. Korn Dabbaransi, Thailand, requested clarification regarding the transfer of the chairmanship of the GMS Business Forum (GMS BF) from Lao PDR to Myanmar. He also requested for the timetable and agenda for the next GMS BF Annual Meeting that would indicate the specific role of the private sector. H.E Korn Dabbaransi also proposed the formation of a working group to look into the possible role of the private sector in the nine priority sectors. He then confirmed the inaugural date of the Northern Thailand Trade Fair to be held in Chiang Rai and invited GMS member countries to participate.
20. Mr. Chanpeng Bounaphol, the Chairperson of the GMS Business Forum (GMS BF) proposed the inclusion of a special session between the GMS Business Form and the Ministers during the next Ministerial Conference in Vientiane. He stated that if the GMS BF were to be more actively involved in the activities of the GMS Program, it would need more resources to support its various activities. In response, Thailand requested GMS BF to lay down its concrete agenda in support of the nine sectors of cooperation covered by the GMS Program. The GMS BF should also specify its role in the high-level public-private sector consultation meeting to be held in early 2004 in Thailand. The Ministers agreed to meet with the GMS BF and other private sector representatives as part of the 13th Ministerial Conference in Lao PDR in 2004. The Ministers noted that the GMS BF would have its Fourth Annual Meeting on 27 October 2003 in Yangon, Myanmar. Participants to be invited will include representatives from the GMS governments, ADB, ESCAP, and other development partners from bilateral and multilateral organizations.
21. As informed by Thailand, the Ministers noted that the Mekong Institute has been transformed into a regional center for human resource development and is ready to respond to the HRD requirements of the GMS countries.
Japan
22. The representative of the Government of Japan, highlighted that as the single biggest donor to the GMS Program, Japan is committed to continue its support to the GMS economic cooperation program as demonstrated by their contribution to the two economic corridors, in addition to various types of assistance extended during the past 11 years. He stressed the importance of private sector participation, in particular through the GMS Business Forum. He expressed the view that in order for the GMS Program to be effective, it is important that each GMS country has a strong sense of ownership and requested the respective focal points in each GMS country to engage in close and meaningful dialogue with ADB and other development partners. He cited ADB's preparation of a Regional Cooperation and Strategy Program (RCSP) for the GMS, which will provide a roadmap for implementing ADB's program of assistance for the GMS. He concluded by indicating the intention of the Government of Japan to formulate its own strategy for the GMS, which will also involve the participation of bilateral and multilateral development institutions.
23. The representative from Japan Bank for International Cooperation (JBIC) underscored JBIC's involvement in a number of high-priority GMS projects, including in the East-West Economic Corridor. He highlighted the importance of transport facilitation in ensuring maximum benefits for subregional transport projects. He stated that most of JBIC's operations are concentrated in Cambodia and Lao PDR, and are financed mostly in the form of concessional assistance. In extending assistance to GMS countries, he mentioned that the key challenge is to maintain debt sustainability while providing much needed financial assistance to GMS countries.
World Bank
24. The representative of the World Bank expressed satisfaction for the strong support that is emerging for the GMS Program, and is encouraged by the participation of the private sector at the DPM. Mr. Porter explained that World Bank's support to the GMS program will be provided mostly through its national programs in the GMS countries, focusing on infrastructure, HRD, and other flagship programs. Mr. Porter informed the Meeting that funds have been allocated for technical studies in priority areas, including power trade, and transport and trade facilitation, and Mekong water resources management. Mr. Porter expressed the World Bank's commitment to participate in working groups and forums in areas where the World Bank is involved, as well as in future Ministerial Conferences.
Government of France
25. The representative of the Government of France, informed the Meeting that an inter-ministerial coordination committee to support the GMS program has been established by the Government of France in order to mobilize resources from official development agencies as well as to encourage investment from the private sector to the GMS countries. He confirmed that the Government of France will mobilize additional resources to support the GMS Program, and that it will endeavor to build effective partnerships with the GMS countries, ADB, and other development partners in this regard.
Mekong River Commission
26. The MRC representative noted the strong partnership of MRC and ADB in the program for flood management and mitigation, which is recognized as a separate flagship program in the GMS Strategic Framework. He cited MRC's Basin Development Program as a guide to Mekong river basin cooperation and development. He expressed satisfaction that discussions during the meeting gave prominence to environmental concerns, especially environmental impact assessment and planning. He hoped the GMS countries would utilize more intensively the technical information available in MRC.
ESCAP
27. The representative from the UN Economic and Social Commission fro Asia and the Pacific (ESCAP) stated that its programs emphasize HRD for the business sector and enterprise development. In relation to its support for private sector development, he suggested a review of the functions of the GMS BF. He suggested further strengthening of the GMS BF so that it becomes more effective in promoting networking and interaction among business entities in the GMS. One priority area for HRD is information technology development (ITD). ESCAP has been working with the World Trade Organization (WTO) on information technology development promotion in the business sector.
Swedish International Development Agency (SIDA)
28. The representative from the Swedish International Development Agency (SIDA) noted the strengths of the GMS Program in terms of clear vision, comprehensive program and strong ownership by the GMS countries. He mentioned four challenges that SIDA will address in dealing with the GMS. One is in understanding the countries' political priorities and how to translate these into projects. The second is in determining how to assist the GMS countries in advancing sustainable development in the light of its rich natural resource base. The third challenge is in developing programs to develop human resources and reduce poverty, especially among the ethnic minorities. A final challenge is in determining ways to be more involved in the GMS Program.
Nordic Development Fund (NDF)
29. The representative from the Nordic Development Fund (NDF) stated that the Nordic member countries determine the strategies, policies and priorities of NDF, and that NDF activities are complementary to the bilateral activities of the Nordic countries. Among the priority areas are poverty reduction, governance and private sector development. NDF undertakes regional cooperation through its main financing instrument, the public sector loan. This provides emphasis on private sector development. Past NDF activities in this area include participation in equity funds and public private partnerships, the most outstanding example of which is NDF's participation in the Theun Hinboun Power Company (THPC).
Geselleschaft für Technische Zusammenarbeit (GTZ)
30. The representative from (GTZ) stressed the crucial partnership among government, private sector and international development agencies for the sustainable development of the subregion. He expressed satisfaction that soft investments in HRD and sector strategy formulation have played an important role under the GMS Program. He agreed that the GMS working groups have served as useful platforms for the discussion of soft sector issues. He stated GTZ's plan to increase its cooperation program in the Mekong subregion through its bilateral programs. He called for more relevant dialogues, which would result into more efficient development contributions by the Partners.
Consideration and Adoption of the Joint Ministerial Statement
31. The Conference considered the Joint Ministerial Statement, which is attached as Appendix 5 [ PDF ], as adopted.
Closing Remarks
32. In his closing remarks, H.E. Renqing Jin, Chairperson of the Meeting echoed the commitment of the GMS Ministers to thoroughly carry out the strategic thrusts and priorities endorsed by the GMS Summit of Leaders. H. E. Renqing Jin stressed that the GMS Program should continue to have a practical focus, emphasizing project implementation as the basis of cooperation. H.E. Renqing Jin enjoined the GMS countries to make good use of its resource advantages, and, in this regard, noted that special attention should be given to HRD. H.E. Renqing Jin emphasized the important role of ADB and other development partners, including the private sector, in mobilizing both financial and technical resources for the GMS Program. H.E. Renqing Jin stated that ADB should play a bigger role in the GMS Program. H.E. Jin formally accepted on behalf of the Ministers Lao PDR's offer to host the 13th Ministerial Conference.
33. ADB's VP Jin cited the goodwill that abounds in the GMS which provides the impetus for the GMS Program to move forward in a win-win situation. He commended the GMS countries for the substantial achievements of the GMS Program since the November 2002 GMS Summit. He noted the special cooperative efforts of the GMS countries, which reflect a strong sense of ownership, auguring well for the future of the GMS. He added that the needs and potentials of the subregion have grown immensely, making it imperative to broaden and deepen involvement of all stakeholders. He noted that the resources of the donor community, private sector and civil society could help realize the subregion's development agenda, and partnerships among them should be able to increase the momentum of regional cooperation. He emphasized the role of connectivity, competitiveness and community as fundamental building blocks for achieving growth, equity and prosperity in the GMS, and reaffirmed ADB's continued support for the subregion and the GMS Program. He closed by thanking the Government of PRC, especially the Yunnan Provincial Government and Dali Prefecture, for the excellent arrangements and warm hospitality. He also thanked the Excellencies and country delegations, as well as the development partners for their time and effort in making the 12th Ministerial Conference truly productive.
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