On 11 May, the Brunei Darussalam–Indonesia–Malaysia–Philippines East ASEAN Growth Area (BIMP-EAGA) and the Indonesia–Malaysia–Thailand Growth Triangle (IMT-GT) held their respective leaders’ summits in Labuan Bajo, Indonesia, along the sidelines of the ASEAN Summit. ADB President Masatsugu Asakawa joined the leaders at both summits, where they reviewed the gains made in recent years despite COVID-19 and other challenges, and charted the way forward with ambitious new development agendas.
In their joint statement, BIMP-EAGA leaders noted significant achievements after almost three decades of cooperation. Despite setbacks due to the prolonged impact of the COVID-19 pandemic, the BIMP-EAGA economy has rebounded, with combined GDP standing at $358.6 billion in 2021, and total trade in goods up by $65.8 billion in 2022.
“Our stable macroeconomic fundamentals are a testament that our steadfast cooperation contributes significantly to regional economic resilience notwithstanding geopolitical tensions, soaring inflation, and fiscal tightening,” the leaders said.
In IMT-GT’s joint statement, the leaders noted that between 1993 and 2021, subregional GDP jumped to $405.7 billion from $127.9 billion, with trade rising to $618 billion from $97.9 billion. The labor force has also quadrupled in the past 30 years.
“We recognize the significant achievements of IMT-GT over the past 30 years in advancing economic growth, narrowing the development gap within and among its members, and empowering all stakeholders to play a role in subregional cooperation to ensure people are the centerpiece of subregional economic development,” the leaders said.
BIMP-EAGA was established to spur development in remote and less developed areas in the four participating Southeast Asian countries. Likewise, IMT-GT provides a subregional framework to accelerate economic cooperation and integration among the member states and provinces in the member countries. Both promote market-driven and private sector-led growth.
Cooperation amidst crisis
Early in the pandemic, ASEAN leaders “emphasized the critical importance of a coherent, multi-sectoral, multi-stakeholder, and whole-of-ASEAN Community approach in ensuring a timely and effective response to the pandemic.” In addition, the 10-country bloc prepared an “exit strategy” from the COVID-19 crisis to support a resilient recovery.
Both BIMP-EAGA and IMT-GT are vital building blocks for ASEAN integration. These subregional mechanisms were also at work in containing and mitigating pandemic risks, and have previously played an important role in protecting against economic shocks. The resilience of the BIMP-EAGA and IMT-GT economies demonstrates that there is strength in unity.
ADB has long supported subregional cooperation efforts in Southeast Asia to assist developing member countries in reaping the full benefits of economic integration. As BIMP-EAGA’s Regional Development Advisor, and IMT-GT’s Regional Development Partner, ADB supports both subregional programs in promoting cross-border infrastructure and economic integration, and in strengthening climate action and other regional public goods.
At the BIMP-EAGA and IMT-GT summits, ADB President Masatsugu Asakawa praised member countries for their economic and development achievements in the last 30 years. At the same time, he identified priority areas that need to be addressed to sustain recovery.
In his address at the BIMP-EAGA Summit, he said, “As we look ahead, several priority areas are crucial for shaping BIMP-EAGA’s future.” He urged member countries to expand economic corridors and bolster special economic zones, address climate change impacts, and strengthen efforts to revive tourism.
In his address at the IMT-GT summit, ADB’s President noted that the challenges confronting the subregion today are different from those of 3 decades ago. “It is crucial that we work together to tackle these threats, three of which are climate change, food and energy insecurity, and potential trade and supply chain disruptions.”
ADB supports a range of projects in the two subregions in trade, energy, tourism, agriculture, climate adaptation and mitigation, and urban development, among others.
In BIMP-EAGA, ADB supports countries’ efforts to strengthen inclusive development along its economic corridors, including the enhancement of transport networks in Mindanao, Philippines, and East and North Kalimantan in Indonesia. ADB also supports cross-border energy projects between Indonesia and Malaysia, and the expansion of sustainable energy access for remote communities in Sulawesi, Indonesia.
Closer regional trade and financial integration in Asia and the Pacific has huge benefits that drive economic growth and development.
Asia and the Pacific is stronger and more resilient when it works collectively to address challenges such as climate change, pandemics, and financial shocks.
Recent ADB knowledge support to BIMP-EAGA includes strong assistance in preparing the Accelerating Cooperation Together (ACT) BIMP-EAGA Vision 2025 Mid-Term Review, which was endorsed at the Summit.
ADB also recently supported the development of a joint tourism recovery communications plan and toolkit for BIMP-EAGA and IMT-GT. Member countries can also avail of assistance from the Southeast Asia Sustainable Tourism Hub, which ADB set up to increase support for investments in the sector.
With IMT-GT and the larger ASEAN community facing dual food and fuel crises, ADB supports food security in the region with a comprehensive $14-billion program through 2025. It is also strengthening food systems with climate-smart agriculture and nature-based solutions.
Given that IMT-GT has a critical role to play in strengthening systems and identifying new growth areas amid a changing trade landscape, ADB has conducted studies on IMT-GT economic corridors and special economic zone development to identify crucial measures that can help achieve pro-poor and people-centered growth. These include easing trade and transport barriers, enhancing trade facilitation, and developing a digitally savvy workforce.
With climate change posing a severe threat to Southeast Asia, ADB has helped both BIMP-EAGA and IMT-GT develop Green City Action Plans, which detail specific and localized plans for green development and investment, and cover urban management and institutional aspects, capacity development, and financing, as well as performance monitoring indicators.
At present, ADB is exploring opportunities to support the development of the subregions’ blue economy.
Both BIMP-EAGA and IMT-GT can benefit from ADB’s pilot of the Energy Transition Mechanism to help countries transition to a lower-carbon future.