ADB’s Work in Regional Cooperation and Integration | Asian Development Bank

ADB’s Work in Regional Cooperation and Integration

Stronger Together

Border check point on the Lao PDR side of the Mekong River
Border check point on the Lao PDR side of the Mekong River

Bringing Asia and the Pacific together through projects that promote regional cooperation and integration has been a cornerstone of ADB’s work since it was created. The fruits of those efforts can be seen in roads, power plants, bridges, border crossings, and other points of cooperation throughout the region.

In 2008, the Lao People’s Democratic Republic (Lao PDR) finished building the Route 3 Highway, which stretches from the country’s northern border with the People’s Republic of China (the PRC) to its southern border near Thailand. In 2013, the Fourth Thai–Lao Friendship Bridge spanning the Mekong River was completed.

“After the road was completed, trade volume increased by more than 70%,” says Tinnawat Silarug, a customs official in Thailand. “Then, after the Friendship Bridge was completed, the trade volume increased by a further 12%.”

The road and bridge are part of an ADB-supported project that is connecting Kunming in the PRC to Bangkok, Thailand via the northwest region of Lao PDR. The Greater Mekong Subregion North–South Economic Corridor Project is upgrading roads, building bridges, easing border restrictions, and taking other measures to make it easier for the three countries to trade, travel, and cooperate.

The project is one of dozens across Southeast Asia, Central Asia, South Asia, the Pacific and others areas where ADB is promoting regional cooperation and integration, a cornerstone of the institution’s work in the region.

Goods find their way to consumers in neighboring markets
Goods find their way to consumers in neighboring markets

Reasons to cooperate

Regional cooperation and integration is a process by which national economies become more connected regionally, allowing them to make greater connections, including on global agendas. The process builds stronger institutions and closer trade integration, intraregional supply chains, and stronger financial links. Reducing or removing barriers at the border and behind the border allows economies of scale to be tapped.

Trade in goods and services, cross-border investment, labor mobility, technology transfers, and financial transactions all support the creation of a much larger, regionally integrated market. The supply chains and production networks that thrive on economic efficiency and integration have made Asia’s enormous manufacturing growth possible.

As poorer countries’ economies become more integrated with those of their richer neighbors, they have the opportunity to move up the value chain, boost their growth potential, speed their expansion, and gradually forge convergence. Such cooperation provides a platform for all participating countries to reduce poverty and economic disparity, and work toward achieving rapid and sustained growth.

ADB and its partners across Asia and the Pacific have recognized that regional cooperation and integration can be a powerful mechanism for unlocking the vast economic potential of Asia and the Pacific for the benefit of its people.

Working together also helps policy makers in the region better respond to global challenges such as financial shocks, climate change, and threats of global pandemics. It creates safety nets—whether financial, social, environmental, or disaster-related—and enables countries to collectively confront cross-boundary challenges. For example, ADB is helping countries in the region work together to enhance their responses to infectious diseases that are posing new threats.

By speaking with a unified voice, the countries of Asia and the Pacific can make a greater impact on the global agenda, commensurate with the region’s growing economic might.

" ADB is paving the way for a new dimension of economic corridor development, leveraging trade and transport networks, and helping economies integrate into regional and global value chains and production networks."

Wencai Zhang
Vice-President Operations 1
ADB

A history of cooperation

From the 1960s to the late 1980s, ADB helped the region work together primarily through technical assistance projects, including regional studies, seminars, and policy dialogue. This improved relations and understanding between countries.

Regional cooperation efforts were ramped up dramatically in the early 1990s with the establishment of the Greater Mekong Subregion (GMS) in 1992, which linked two provinces of the PRC with five neighboring Mekong countries—Cambodia, the Lao PDR, Myanmar, Thailand, and Viet Nam. The program supports priority subregional projects in transport, energy, agriculture, the environment, and trade facilitation.

In 1994, ADB launched a formal Regional Cooperation Policy, which identified three complementary functions for the institution as provider of knowledge, honest broker, and a means of leveraging public and private resources for regional investments. Much of the policy’s initial focus was on the development of the GMS.

Cross-border roads facilitate the movement of goods and people.
Cross-border roads facilitate the movement of goods and people.

Subsequently, ADB helped establish the Central Asia Regional Economic Cooperation program in 1997, which supports priority projects in cross-border infrastructure and trade in the 11 member countries. In 2001, ADB helped set up the South Asia Subregional Economic Cooperation program, with a focus on transport, trade facilitation, energy, and economic corridor development.

ADB serves as the secretariat for the GMS, South Asia Subregional Economic Cooperation, and Central Asia Regional Economic Cooperation programs.

The Asian financial crisis of 1997–1998 brought greater urgency to the issue of cooperation and integration. After the economic devastation brought about by the crisis, the GMS countries deepened their resolve to pursue regional cooperation and integration, and cemented their commitment to a shared vision of an integrated, prosperous, and harmonious subregion.

In 1999, the Regional Economic Monitoring Unit, which became the Office of Regional Economic Integration in 2005, was established to drive ADB’s regional cooperation agenda. A new Regional Cooperation and Integration Strategy was established in 2006, and it was supported by ADB’s long-term planning document, Strategy 2020. This was followed by an increase in the volume and share of regional cooperation and integration projects in total operations.

Regional cooperation and integration was further mainstreamed into ADB’s operations in 2015 when the Economic Research Department and the Office of Regional Economic Integration were merged into the Economic Research and Regional Cooperation Department. Following the merger, a new Regional Cooperation and Integration Operational Plan, 2016–2020 was formulated and approved in 2016.

The result of this sustained effort to promote regional cooperation and integration has been better dialogue, increased people-to-people exchanges, more economic ties, and improved physical connections throughout the region.

As the region has developed, so too have its regional cooperation and integration needs. Wencai Zhang, ADB vice-president, outlines the current thrust: “ADB is paving the way for a new dimension of economic corridor development, leveraging trade and transport networks, and helping economies integrate into regional and global value chains and production networks.”

This article was originally published in a special edition of Together We Deliver, which tells 50 stories highlighting the importance of good partnerships in Asia and the Pacific in meeting the complex development challenges of this dynamic region.