Regional : Advancing Regional Cooperation and Integration through Brunei Darussalam–Indonesia–Malaysia–Philippines East ASEAN Growth Area and Indonesia–Malaysia–Thailand Growth Triangle

Industry and trade / Industry and trade sector development

Public sector management / Economic affairs management

The ASEAN Member States are taking concerted efforts to implement their RCI commitments under the AEC Blueprint and the ASEAN Vision 2025: Forging Ahead Together endorsed at the 27th ASEAN Summit in 2015. While substantial progress by the Program has been achieved, there are still many measures that need to be implemented and this TA will support some of the additional measures needed. In this, the bottom-up approach of the BIMP-EAGA and the IMT-GT subregional programs complement the top-down approach by ASEAN. Subregional programs are taking conscious efforts to link their activities with wider regional initiatives, while keeping their own independence and niches for regional cooperation. The need to widen and deepen regional and subregional synergies by identifying sector-wide approaches across programs is widely accepted. Increased efforts to enhance the potentials of BIMP-EAGA and IMT-GT to be core building blocks for AEC and beyond. In addition, greater consistency with the agreed policies and rules by ASEAN Member States would contribute to a more reliable and sustainable process of integration and could strengthen the support of central governments for their respective initiatives and projects. Identifying points of convergence and complementarity across subregional programs to support RCI enhance the effectiveness of these programs and save member countries resources. The TA will also support the objectives of the midterm review (MTR) of ADBs Strategy 2020, calling for enhancing ADBs role in catalyzing RCI efforts through: i) enhancing regional connectivity; ii) moving to 2nd generation regional integration; iii) taking an active role in project development and regional public goods; and iv) supporting trade facilitation.

Accentuating ADBs role as Development Partner and Regional Adviser to the two subregional programs, ADB support was successful in enhancing its strategic directions and in initiating efforts to develop investment projects. The subregional programs adopted Implementation Blueprints (IB) 2012-2016, including rolling pipelines of projects. At the 2014 BIMP-EAGA and IMT-GT Summits in Myanmar, the Leaders sought ADBs continued assistance in project implementation, identification and preparation of new project, and developing institutional capacities and sustainable mechanisms to manage development results. This shows that the subregions recognize the increasing complexity of identifying, structuring, financing and implementing 2nd generation RCI projects. Given that these two subregional programs are comprised of middle-income countries (MIC), future projects need to address development issues facing MICs: i) rapidly growing and increasingly congested urban areas, ii) lack of access to reliable power supplies, iii) the need to attract private investment in innovative sectors, iv) leveraging subregional cooperation to test new ideas and approaches in preparing communities to address climate change impacts, v) facilitating the movement of skilled labor within Asia, and vi) high logistic costs due to, among other reasons, obstacles in transport and trade facilitation.

To sustain subregional cooperation efforts to address these development issues, BIMP-EAGA and IMT-GT have recognized the importance of establishing effective institutional mechanisms at the program level. An example is the legalized and self-funded Centre for IMT-GT Subregional Cooperation (CIMT) which serves as the Secretariat for IMT-GT. BIMP-EAGA is also in the process of establishing a Facilitation Center (FC). However, the CIMT and BIMP-EAGA FC will need substantial capacity building to develop RCI project pipelines, implement projects, and, monitor and evaluate development results. The private sector also needs to participate more actively in both subregional programs through increased investment, trade and the transfer of knowledge and technical expertise.

The BIMP-EAGA and IMT-GT subregions are more integrated with themselves, and with the ASEAN region.

BIMP-EAGA and IMT-GT projects and initiatives under the implementation blueprints are implemented.

Both the BIMP-EAGA and IMT-GT subregional cooperation programs have concluded their respective Implementation Blueprints (IB) 2012-2016 and have taken into account the learnings from their experience in operationalizing the IBs, in crafting their new strategic documents.

The IMT-GT Vision 2036 (and the new IB 2017-2021) and the BIMP-EAGA Vision 2025 (BEV 2025) were both adopted by the Leaders at the 12th BIMP-EAGA Summit and 10th IMT-GT Summit held on 29 April 2017 in Manila, Philippines. ADB provided the key technical support to prepare the BIMP-EAGA Vision 2025; while CIMT led the preparation of the IMT-GT Vision 2036 and IB 2017-2021.

1. Improved sector coordination between the subregional programs and ASEAN

2. RCI thematic studies developed and implemented

3. Managing for development results enhanced

FOR OUTPUT 1:

BIMP-EAGA and IMT-GT serve as building blocks to the ASEAN Economic Community (AEC) initiative. It is important to establish formal institutional links with relevant ASEAN sectoral bodies and with the ASEAN Secretariat.

ADB successfully organized an ASEAN, BIMP-EAGA and IMT-GT Land Transport Facilitation Consultation Meeting on 24 April 2015 in Surabaya, Indonesia.

In 2018, a joint dialogue with BIMP-EAGA, IMT-GT and ASEAN secretariat was held in 30 April 2018 in Jakarta, Indonesia to discuss complementarities of the BEV 2025 and the IMT-GT Vision 2036 (including its IB 2017-2021) with the ASEAN Vision 2025 and the Masterplan for ASEAN Connectivity (MPAC) 2025. Both the new BIMP-EAGA Vision 2025 and the IMT-GT Vision 2036 highlight the subregions as important building blocks contributing to ASEAN goals.

FOR OUTPUT 2:

IMT-GT

Under the TA, Green City Action Plan (GCAP) Songkhla/Hat Yai (Thailand) was completed. ADB also has completed Green City Action Plans for Medan, Kendari and Batam in Indonesia led by SEUW. SERC printed the GCAPs as knowledge products for the 12th BIMP-EAGA and 10th IMT-GT Leaders Summits.

The TA supported the 2nd Asia-Pacific Forum on Urban Resilience and Adaptation and 16th International Convention on Melaka Twin Cities on 2-4 March 2016 in Melaka, Malaysia. This event attended by 500 delegates enabled the GCAP cities to share learning, identify new tools, and enhance regional integration of GCAPs.

In addition, a publication brochure for dissemination on the GCAP in Melaka: Sustainable Urban Management Support for Follow-up Activities in Melaka, Malaysia, was prepared in close collaboration with SEUW. This was distributed at the 13th Chief Ministers and Governors Forum and 22nd IMT-GT Ministerial Meeting in Phang Nga, Thailand on 22-23 September 2016.

ADB also organized, together with Green Growth Asia, a high-level Green Cities Conference: Leveraging Regional Cooperation and Integration for a Green Growth Cities Network in ASEAN on 5-6 September 2017 in Melaka, Malaysia. The Chief Minister of the State of Melaka launched the ASEAN Green Cities Network, which supports green and livable cities in the ASEAN region. About 200 delegates attended the Conference which discussed green city action plans and pilot projects, climate-resilient cities, sustainable green transport and energy efficiency.

The TA also supported the preparation of terms of reference (TOR) for the second phase of the Special Border Economic Zones study. A side meeting of Malaysia and Thailand was arranged during the IMT-GT Strategic Planning Meeting on 3-5 February 2015 in Penang, Malaysia. Phase II of the study would focus on the Sadao (Thailand) - Bukit Kayu Hitam (Malaysia) border crossing area including Padang Besar (Thailand and Malaysia) crossing. Thailand also signified interest in looking at the Narathiwat-Bukit Bunga border for the next phase. The countries both agreed on a study, with a single team of consultants, jointly financed by both countries, and using the CIMT as a financial vehicle and overall coordinator. ADB would provide minor support as for a facilitator to assist the team if needed.

In 2016, both Malaysia and Thailand agreed to jointly finance a single SBEZ study with the CIMT secretariat as the overall coordinator. ADB provided support in preparing a TOR for the study in March 2016. A steering committee was formed and a bidding process has been undertaken by CIMT for the project.

The TA is supported the preparation of a Tourism Strategic Framework (TSF) 2017-2036 and Action Plan (AP) 2017-2021 in IMT-GT. The TSF & AP were endorsed at the 23rd Ministerial Meeting on 29 September 2017 in Bangka Belitung, Indonesia. ADB will print the TSF for the adoption of the Leaders at the the 11th IMT-GT Summit in April 2018.

In 4-5 September, the TA supported the Conference on Integrated Transport Plans held in Phuket, Thailand. ADB is also supporting the Green Cities Conference to be held on 1-2 October 2018 in Melaka, Malaysia.

BIMP-EAGA

The study on the corridor investment profiling for BIMP-EAGA (Phase II), wherein the TA is assisting on the compilation and assessment of key corridors. This followed the Phase I of the study, which determined a set of uniform templates for which investment and trade information (completed under the previous RETA 6462). Findings of the corridor investment profiling study entitled Investment Guide to Value Chains in BIMP-EAGAs Economic Corridor was presented at the BIMP-EAGA Senior Officials Retreat on 26 February 2016 in Davao City, Philippines. The final reports were provided to the countries. In April 2016, ADB completed the study on corridor investment profiling for BIMP-EAGA (Phase II), with a report composed of two parts: (i) BIMP-EAGA Investment Opportunities in Corridor Value Chains; and (ii) BIMP-EAGA Economic Corridors: Business Perceptions about the Investment Climate. ADB printed the reports as knowledge products for the 12th BIMP-EAGA Leaders Summit. ADB has also since received requests for the 2nd phase of the study in the identification of value chain in selected priority sectors.

The TA also completed a study on land transport facilitation, which provided recommendations to improve the implementation of the BIMP-land transport MOUs in the areas of insurance, transit, authorized economic operators and common permits to cross borders.

The TA also conducted a BIMP-EAGA Customs, Immigration, Quarantine and Security (CIQS) assessment with final report presented at the 24th BIMP-EAGA Senior Officials Meeting on 7 December 2015 in Kota Kinabalu, Malaysia.

ADB is also supporting work on enhancing the connectivity on the West Borneo Economic Corridor (WBEC) especially on the state of Sabah given its geographical location at the intersect between WBEC and its sister economic corridor, the Greater Sulu Sulawesi Corridor (GSSC) which incorporates Mindanao and Palawan.

ADB completed a Pre-Feasibility Study of the Sabah-North Kalimantan Cross-Border Value Chains. The study maps the optimal configuration of North KalimantanSabah cross-border trade and investment in goods and services; and provides a preliminary (pre-feasibility) design of a border area development plan for the two territories. Findings of the report will were formally presented to Indonesia and Malaysia in December 2017 in Tarakan, Indonesia. The report was circulated to the countries and final inputs expected by March 2018 before printing of the report will commence as a deliverable for the next 22nd Ministerial Meeting.

ADB has also started a pre-feasibility study on West Kalimantan integrated border area development including establishment of the Entikong-Tebedu cross-border economic zone. This study will be undertaken in collaboration with ERCD, who will be studying Indonesias borders with Papua and Timor-Leste. Initial findings and concept (Phase I) of the pre-feasibility study on West Kalimantan integrated border area development was presented at the 2018 Strategic Planning Meeting. Phase II of the study will commence in April 2018.

BIMP-EAGA has launched its Green Cities Initiative and ADB is currently assisting the development of GCAP for Kota Kinabalu expected to be completed in October 2018. The first city within BIMP-EAGA with a completed GCAP is Kendari.

ADB also completed a study on BIMP-EAGA Eco-Tourism Pilot Project: Mantanani Island, which was printed as a knowledge product and distributed at the 21st Ministerial Meeting in Tarakan, Indonesia on 3 December 2017.

ADB is also supporting a study on power supply options including the feasibility of importing low power from Sabah to Palawan through a submarine cable expected to be completed October 2018.

FOR OUTPUT 3:

The TA has organized two capacity enhancement training programs for government officials and the subregional secretariats of BIMP-EAGA and IMT-GT. The first training program was a Regional Training in Project Management on 4-8 May 2015 held in Penang, Malaysia, which was participated by 24 officials from Brunei, Indonesia, Malaysia, Philippines and Thailand. The second program organized by the TA was the Community-Based Eco-Tourism (CBET) training workshop, which was held on 5-7 August 2015 in Kuching, Malaysia. This training program was participated by a total of 40 officials from Brunei, Malaysia and the Philippines.

ADB is organized two (2) capacity building workshops on project design (refresher course) at both Strategic Planning Meeting for BIMP-EAGA and IMT-GT in February and March 2018, respectively. The National Secretariats, Working group/cluster chairs and subregional secretariats were equipped with these workshops..

As part of the process of establishing and institutionalizing two subregional statistical databases for BIMP-EAGA and IMT-GT, the TA has organized a Joint BIMP-EAGA and IMT-GT Meeting on Subregional Statistics and Database on 28-29 July 2015 in Bangkok, Thailand and agreed on the next steps on the database and possible deliverables for the next Summit. A 2nd Joint BIMP-EAGA and IMT-GT Meeting on Subregional Statistics and Database was organized by ADB on 4-5 May 2016 in Kuala Lumpur, Malaysia. A BIMP-EAGA Statistical Leaflet was also launched at the Summits on 28 April 2015 in Langkawi, Malaysia. ADB also assisted in the preparation of IMT-GT and BIMP-EAGA statistical brochures launched at the 22nd Ministerial Meeting in Phang Nga, Thailand on 23 September 2016 and at the 20th Ministerial Meeting in Palawan, Philippines on 30 November 2016, respectively. The same statistical brochures were provided to the Leaders at the 12th BIMP-EAGA and 10th IMT-GT Summits. In both Strategic Planning Meetings of BIMP-EAGA and IMT-GT early in 2017, ADB has presented to the Working Group on Trade and Investment and the Trade and Investment Facilitation Cluster the statistical database management and next steps. The subregional secretariats CIMT and BIMP-FC now take the lead in compiling and consolidating the subregional statistics in coordination with National Statistics Offices. ADB will only provide ad hoc technical advisory role if countries convene regional meetings on the statistics.

The TA has also helped the CIMT in the preparation of their business plan, operations manual and CIMT board of directors guidelines and responsibilities, which was presented to the senior officials in August 2015 in Jakarta. A similar support will be provided to the BIMP-EAGA FC once it is legalized.

A total of 76 person-months of international consulting services and 57 person-months of national consulting services have been recruited under the TA. Most international consultants were engaged to do short-term studies. One national consultant was hired to work full time as regional development analyst for the TA. Consultants were recruited as individuals in accordance with ADB's Guidelines on the Use of Consultants (2013, amended from time to time), as the services to be delivered are too diverse and specialized for a single firm to cover. Output-based contracts for consulting services wereused, when feasible.

ADB is actively involved in the implementation of the TA. SERD organized a team of ADB staff. The team includes staff from SERD sector divisions working on topics covered by the TA in BIMP-EAGA and IMT-GT. ADB's knowledge departments and communities of practice are also involved on some of the TA activities. SERC has appointed 2 international staff, one national officer and one operations assistant to coordinate this TA.