Catalog

New Members, New Scope, New Momentum
ADB Review [ October 2005 ]

As the only forum that brings together an alliance of countries and key multilateral and regional institutions within a single framework, CAREC is actively promoting economic cooperation in Central Asia

By Craig Steffensen, (csteffensen@adb.org)
Head, ADB’s Central Asia Regional Economic Cooperation Unit

The 4th Ministerial Conference of the Central Asia Regional Economic Cooperation (CAREC) Program will be held in Bishkek, Kyrgyz Republic on 5–6 November 2005. Russia and Afghanistan will be represented at the conference for the first time, as full participants in the CAREC Program. “Expanding the program to include Russia and Afghanistan adds significantly to CAREC’s profile, scope, and depth,” says Satish Rao, Director General of the Asian Development Bank (ADB)’s East and Central Asia Department.

FUTURE HOPE A youthful group in rural Kyrgyz Republic: like the newly independent countries of Central Asia, they have strong growth potential

CAREC is an ADB-supported initiative to encourage economic cooperation in Central Asia. Initiated in 1997, the program to date has focused on regional initiatives in transport, trade facilitation, trade policy, and energy critical to improving the economic performance of the region and the livelihoods of all people—especially of the poor. The original participants include Azerbaijan, People’s Republic of China [PRC] (Xinjiang Uygur Autonomous Region), Kazakhstan, Kyrgyz Republic, Mongolia, Tajikistan, and Uzbekistan.

CAREC is also an alliance of multilateral institutions active in promoting economic cooperation in Central Asia, namely, the European Bank for Reconstruction and Development (EBRD), International Monetary Fund, Islamic Development Bank, United Nations Development Programme (UNDP), and World Bank—in addition to ADB. The CAREC Program also operates in close partnership with other key regional cooperation programs/institutions, particularly the Shanghai Cooperation Organization and the Central Asia Cooperation Organization. CAREC, indeed, is the only forum that brings together the countries of the region and the key multilateral and regional institutions cited above within a single institutional framework.

Some 200 delegates are expected to attend the 4th Ministerial Conference, including Ministers and senior officials from the CAREC countries, senior representatives of member multilateral institutions, and observers from neighboring countries and bilateral and other regional organizations. In addition to reviewing regional cooperation to date in transport, trade facilitation, trade policy, and energy, Ministers will review a comprehensive plan of action to 2008, including sequencing and prioritizing regional cooperation initiatives and developing performance indicators. Most importantly, Ministers will consider the ultimate goals under the CAREC Program: Is regional cooperation intended to result in some form of economic union or free trade area? If so, by when, and what short- and medium-term steps are needed to realize the goal?

Other agenda items include capacity building initiatives for regional cooperation; a video documentary on regional cooperation in Central Asia; and presentation of UNDP’s Human Development Report on Central Asia, prepared with contributions from ADB and the World Bank. Further, in conjunction with the ministerial conference, a regional business roundtable for Central and South Asia will be held, supported by ADB and EBRD. Senior business representatives from throughout the region have been invited to attend, offering the likelihood of contributing importantly to public/private sector partnership and dialogue.

The importance of regional cooperation in Central Asia is threefold:

• While neighboring the world’s largest and fastest-growing markets (PRC, India, and Russia), Central Asia’s landlocked status means regional transport costs are a serious impediment to development. Cooperation in transport, trade, and transit will yield important benefits.
• Central Asian countries share vital resources, notably energy and water. Harnessing these resources in a sustainable manner and managing their shared use in support of agriculture, industry, and livelihoods require a high degree of regional cooperation and third party assistance.
• Although most regional cooperation programs relate only indirectly to regional “goods” (e.g., knowledge sharing) and regional “bads” (e.g., HIV, tuberculosis, drug trade and use, terrorism), their contribution to building trust and confidence in Central Asia is part of the needed response.

The CAREC Program is gaining new members, new scope, and new momentum. The 4th Ministerial Conference will be pivotal in advancing the regional agenda in Central Asia.

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