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Central Asia Economic Cooperation
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ROADS CRITICAL Economic corridors are vital for linking countries—and the region with the rest of the world
"No country can go it alone in attempting to work economic miracles behind closed borders"
- Jin Liquin, PRC Vice Minister of Finance
Ministers from five Central Asian republics recently convened for the first time ever under the ADB’s aegis to tackle the region’s daunting development challenges and strengthen mutual trust among governments.
Delegations from People’s Republic of China (PRC), Kazakhstan, Kyrgyz Republic, Tajikistan, and Uzbekistan attended the Ministerial Conference on Central Asia Economic Cooperation, held in late March 2002 in Manila. The purpose of the conference was to rally support for regional economic cooperation in Central Asia. Observer delegations from Azerbaijan, India, Mongolia, Pakistan, Turkey, and Turkmenistan, and representatives of funding agencies also attended the conference.
Economic cooperation among the Central Asian republics and the PRC—perceived as extremely important before 11 September 11—“has become even more vital since then," said ADB President Tadao Chino in his welcome remarks.
The changes in Afghanistan have opened up new possibilities for expanding economic cooperation and for ADB’s regional program. After September 2001, the countries and ADB decided to strengthen their partnership by establishing an institutional framework for ADB’s regional program in Central Asia and to create more efficient coordination with other funding agencies.
A cornerstone of the framework is an annual ministerial conference, of which the Ministerial Conference in Manila was the first. The forum is intended to be the decision-making body to guide ADB’s regional program and to facilitate high-level dialogue that can work toward strengthening mutual trust and understanding among the Central Asian governments.
The ADB program, which began in 1997, seeks to address the region’s most daunting development challenge: its geographic isola-tion. Since the breakup of the Soviet Union, which left the Central Asian republics ill-prepared for self-governance, there have been extensive needs for nation building and infrastructure development.
Being landlocked and having small internal markets due to low population densities, the region’s governments agreed in 2001 that ADB-funded projects in the fields of transport, trade, and energy would best promote economic growth through market inte-gration within the region and with the outside world.
The 3-year project portfolio presented by ADB at the ministerial conference primarily envisages building and/or rehabilitating roads, railways, gas pipelines, and power transmission grids. It also emphasizes the importance of social infrastructure—notably human resource development—and policy reforms. The program, which includes technical assistance, feasibility studies, and loans, received general endorsement from the ministers and will be revised to take account of recommendations made by the delegates.
In addition to physical improvements, all countries confirmed during the ministerial conference that “software” priorities were of critical importance for nurturing commercial ties. The PRC delegation, speaking in terms of its Government’s commitment to a “Go West” strategy, offered facilities in the country’s western-most province of Xinjiang for a regional cooperation center, where customs training and research programs could be conducted.
Strengthening customs agencies and relationships in the region, according to many delegates, is a critical first step to enhancing trade and transport. “The terrorist attacks of September 11 have highlighted the important role customs plays in protecting the national security,” noted invited speaker Kunio Mikuriya, Deputy Secretary General of the World Customs Organization.
The Ministers reemphasized the importance of achieving tangible and mutual benefits and urged the expeditious setup of coordination committees for each of the priority sector areas.
Other issues highlighted were financing matters, including debt sustainability and sound macroeconomic policies, and the need for different funding agencies to work closely together, particularly at working group levels.
World Bank Director Shigeo Katsu, discussed the Ferghana Valley, which spreads across three Central Asian republics. Dele-gates representing those three Ferghana countries expressed interest in pursuing a special program for that area.
Among the casualties of the war in Afghanistan are 3,200 kilometers (km) of roads that ADB has decided to help rebuild. The veins of a nation, these roads connect the major Afghan cities with each other—and the country with its neighbors.
But the road rebuilding has more significance than just expanding trade opportunities, or even rekindling historic links. Reconstruction and development in Afghanistan is pivotal for the prosperity of all of Central Asia, according to delegates attending the Ministerial Conference.
“Our position is that there can be no real stability in Central Asia without sustainable development and the establishment of economic, political, and social stability in Afghanistan,” said Uzbekistan Deputy Prime Minister, Rustam Azimov, in his opening statement.
ADB’s commitment to help reconstruct Afghanistan was reiterated to the delegates. Working jointly with other organizations, ADB is helping mobilize financial and technical resources. The 3,200 km of priority road repair is part of ADB’s initial assessment of immediate priorities.
ADB has since been working on determining medium- and long-term needs assessments. The delegates were told that based on the findings of the preliminary assessment, ADB is considering $500 million of assistance over 2.5 years.
The delegates unanimously supported Azerbaijan and Mongolia in becoming full participants of the regional development partnership.
The statement of the conference reaffirmed the broad support for the 2002–2004 ADB program as a “strategic means to reducing poverty and achieving stability and prosperity in Central Asia, particularly in the wake of the September 11 events.”
“No country can go it alone in attempting to work economic miracles behind closed borders,” said PRC Vice Minister of Finance Jin Liqun, calling ADB’s program of regional economic cooperation “a timely initiative.”
The first Ministerial Conference on Central Asia economic cooperation concluded with hearty affirmation of ADB’s “unique” and “noble” role in the “difficult mission” of working out the strategy and implementation of regional and subregional development.
“I believe that we go away enriched spiritually, and otherwise we have made new friends,” said Zokir Vazirov, Deputy Prime Minister of Governance in Tajikistan. “We are now more aware of the problems facing Central Asia. And in this light, the leadership of the Bank has played a profoundly important role.”
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