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A Strategic Framework for theNext Ten Years of the

Greater Mekong SubregionEconomic Cooperation Program

November 2002

Published by Asian Development Bank, 2002

The Asian Development Bank encourages theuse of the material presented herein, withappropriate credit given to ADB.Please address inquiries for copies to thePrincipal Director, Office of External Relations,Asian Development Bank,P.O. Box 789, 0980 Manila, Philippines.

ISBN: 971-561-472-8Publication Stock: 100102

The analyses and assessments contained in this publication do not necessarily reflectthe views of the Board of Directors or the governments that they represent. The AsianDevelopment Bank does not guarantee the accuracy of the data included in this publica-tion and accepts no responsibility whatsoever for any consequence for their use. The term“country” does not imply any judgement by the Asian Development Bank as to the legal orother status of any territorial entity.

Cover photo: Carolyn Dedolph

ABBREVIATIONS

ADB Asian Development BankADTA advisory technical assistanceAFTA ASEAN Free Trade AreaAMBDC ASEAN Mekong Basin Development CooperationAPEC Asia Pacific Economic CooperationASEAN Association of Southeast Asian NationsEDL Electricité du LaosESCAP United Nations Economic and Social Commission for Asia

and the PacificEWIS early warning information systemEWEC East-West Economic CorridorFDI foreign direct investmentGMS Greater Mekong SubregionGMS Program Greater Mekong Subregion economic cooperation programGMSARN GMS academic research networkHIV/AIDS human immunodeficiency virus/acquired immunodeficiency

syndromeHRD human resource developmentIT information technologyJBIC Japan Bank for International CooperationLao PDR Lao People’s Democratic RepublicNGO nongovernment organizationODA official development assistancePPTA project preparatory technical assistancePRC People’s Republic of ChinaR & D research and developmentRETA regional technical assistanceSEF strategic environment frameworkSLMIN subregional labor market information networkSME small and medium enterpriseTA technical assistanceTNC trans national corporationUK United KingdomUNAIDS United Nations Programme on HIV/AIDSUNDCP United Nations Drug Control ProgrammeUNEP United Nations Environment ProgrammeUNICEF United Nations Children’s FundWHO World Health OrganizationWTO World Trade Organization

________________________________

In this report, “$” refers to US dollars

CONTENTS

Preface vii

THE FIRST TEN YEARS OF THE GMS PROGRAMTaking Stock 1

Accomplishments 1Lessons Learned 3

GLOBAL AND REGIONAL TRENDSThe Context of the Strategic Framework 9

Global Trends 9Regional Trends 12

KEY ISSUES AND CHALLENGESGearing Up for Global Demands 15

BUILDING ON SUCCESSA Strategic Framework for the Next Ten Years 19

Vision and Goal 19Strategic Thrusts 20

IMPLEMENTING THE STRATEGIC FRAMEWORKMaking It Happen 31

APPENDIXES 391 The First Ten Years of the GMS Program – Taking Stock

Table A1.1 – GMS ADB-Assisted Loan ProjectsTable A1.2 – GMS ADB Technical Assistance Projects

2 Flagship Programs

Prefacearking nearly ten years of theGreater Mekong Subregion eco-nomic cooperation program (GMSProgram), ministers from the sixparticipating countries

1have called

for formulation of a strategic framework for the nextten years of economic cooperation. The first tenyears have resulted in many important achieve-ments, particularly in infrastructure provision. Nowa new strategy for subregional economic coopera-tion is needed to respond to the changing globaland regional context and apply the key lessonslearned since the start of the GMS initiative.

The GMS countries recognize subregional co-operation as an important element in promotingeconomic growth and a better life for all. This rec-ognition is integral to Asian Development Bank’s(ADB’s) Charter, prompting ADB to take on a cata-lytic role in initiating and building the GMS Pro-gram. By working together and sharing resourcesin mutually advantageous ways, participatingcountries can reduce poverty and ensure sustain-able development in the subregion. For the pro-gram to succeed it is necessary that GMS coun-tries identify highly practical projects and initia-tives of mutual benefit.

Formulating a renewed strategic framework in-volved an extensive consultative and review pro-cess with stakeholders. These included the GMS

1 Cambodia, People’s Republic of China/Yunnan Province, Lao People’sDemocratic Republic, Myanmar, Thailand and Viet Nam.

The first ten

years have

resulted in

important

achievements,

but a new

strategy is

needed to apply

its lessons.

�

Building on Success

viii

The framework

must balance

between need

for further

economic

cooperation,

global and

regional

trends, and the

limits of public

resources.

governments, the private sector, the donor com-munity, and civil society. The process presentedmany challenges and opportunities, adding to thepotential scope and depth of the program. Reflect-ing the human and economic toll of recurrent flood-ing, several GMS countries believe that water re-source management should be added. All stake-holders agree that more can and should be donecollaboratively to protect the environment and theeconomic base of rural people. This view also ap-plies to human resource development and labormarket facilitation. Other interests and concerns(e.g., drug control, HIV/AIDS, agriculture) wouldfurther expand the GMS Program.

The strategic framework offers a renewed ap-proach for the GMS Program for the next ten years.Necessarily, a strategic framework for subregionaleconomic cooperation must be focused in order toensure that limited technical and financial re-sources are used effectively in meeting priorityneeds. It must balance between the considerablescope of and need for further economic coopera-tion, given regional and global trends and the lim-its of public and private resources to support thiscooperation.

The preparation of the strategic framework wasfacilitated by Toru Tatara, Head GMS Unit, MekongDepartment, ADB, with the assistance of DavidHusband, Senior Advisor of the GMS Program.The strategic framework was endorsed by theGMS Ministers during the Tenth GMS MinisterialConference.

RAJAT M. NAGDirector General

Mekong DepartmentAsian Development Bank

The First TenYears of theGMS ProgramTaking StockAccomplishments

The key accomplishments of the GMS Program in-clude the following: (A detailed stock-taking is at-tached as Appendix 1.)

��

Newly established peace in the subregion provideda window of opportunity for establishing the GMSProgram in 1992. One of the program’s most fun-damental accomplishments was the building oftrust and confidence among member countries.Numerous conferences and joint initiatives havecontributed to this highly positive result.

��

From its inception, the GMS Program has empha-sized practical results in a wide range of specificprojects. The initial focus on provision of infra-structure has brought significant benefits to thesubregion. To date, ten subregional infrastructureprojects with investments of approximately $2 bil-lion have been completed or are under implemen-tation. The key projects are in energy, road trans-

A key

accomplishment

is building

trust and

confidence

among

member

countries.

Building on Success

2

port, environment, and human resource develop-ment. These hard as well as soft infrastructureprojects play key roles in promoting economic de-velopment and reducing poverty. Without them thelocal communities would have difficulty in access-ing to markets and services.

��

Clearly, the focus of the GMS Program has becomemore balanced through the years. The initial em-phasis was on developing physical infrastructurelinkages as the means to increase trade and in-vestment among countries in the region. This wasevident in the high priority accorded to subregionaltransport projects, and to a lesser extent, energyand telecommunications projects. At the same time,it was recognized that policies and procedures hadto be harmonized so as to minimize distortionsacross GMS countries. Thus, towards the end ofthe first decade, the GMS Program began to em-phasize reducing non-physical barriers betweencountries. One illustration of this is the frameworkagreement that has been signed by Cambodia, LaoPeople’s Democratic Republic (Lao PDR), Thailand,and Viet Nam to facilitate the cross-border move-ment of goods and people.

��

A related accomplishment is its success in mobi-lizing co-financing for regional cooperation projects,particularly in the transport and energy sectors,and to a lesser extent in the environment and hu-man resource development sectors. Over $58 mil-lion from ADB, co-financiers, and GMS govern-ments has been mobilized for technical assistanceprojects.

The Program

successfully

mobilized co-

financing for

regional

projects.

3

Lessons Learned

Among the lessons learned during the first ten yearsare the following:

��

��

The “two plus” principle of the GMS Program en-ables subsets of member countries to pursue re-gional cooperation initiatives without requiring fullconsensus. As a result, GMS countries havereached numerous agreements, both bilateral andmultilateral. The relatively non-institutional natureof the GMS Program, with its minimum of proto-cols, bureaucracy and other formal structures givesthe members flexibility in reaching agreements.

��

��

Infrastructure projects dominated the early yearsof the GMS program. These required pre-feasibil-ity and feasibility studies and other steps that weretime-consuming as they involved two or more coun-tries. The complexity of subregional projects andthe limited institutional capacity of GMS countriesto coordinate, negotiate, and implement suchprojects further slowed down progress in severalsectors. In addition, the Asian financial crisis drewattention away from regional projects and under-mined resource mobilization, especially from theprivate sector.

The “two plus”

principle

enables

subsets of

member

countries to

pursue

regional

cooperation

without full

consensus.

The First Ten Years of the GMS Program

Building on Success

4

��

��

To maintain the momentum of regional coopera-tion, the costs and benefits of cross-border projectsshould be distributed equitably among the par-ticipating countries. This principle has been fol-lowed in important subregional infrastructureprojects such as the East-West Corridor and North-South Corridor projects. It is essential even fromthe project design stage to ensure equitable shar-ing of costs and benefits.

��

Economic cooperation initiatives should reflect theviews of all stakeholders, from project formulationto implementation. Central ministries have beenextensively involved in the decision-making pro-cesses, but local officials, civil society, nongovern-ment organizations (NGOs) and the private sectorhave not been adequately represented or involved.Steps are now being taken to make the GMS Pro-gram more inclusive. The next ten years will needto be more vigorous in building awareness andfostering broad-based participation.

2In particular,

local stakeholders must be encouraged to state theirneeds and become more involved in GMS activities.

��

GMS countries need to enhance their capacity toformulate and implement projects involving two ormore member-countries, and to pursue regionalcooperation more generally. This is especially

Economic

cooperation

should reflect

the views of all

stakeholders

from formu-

lation to imple-

mentation.

2 Asian Development Bank. 1999. Impact Evaluation Study of the AsianDevelopment Bank’s Program of Subregional Economic Cooperation inthe Greater Mekong Subregion. Manila.

5

needed by countries in transition from centrallyplanned to market-oriented economies. The GMSstrategic framework for the next ten years mustinclude resources for building institutional andhuman capacities.

��

While there is an increasing sense of ‘ownership’of the GMS Program by member countries, theirleadership role needs to be further enhanced. Thestrategic framework outlines several measures tostrengthen ownership. The GMS Summit sched-uled for November 2002 will also be influential inthis regard.

�� !��

The sector approach of the GMS Program, whilehighly useful and focused, needs to be comple-mented with mechanisms for cross-sector linkages.Projects conducted at the sector level often lacksynergy with other sectors. Hence, they miss outon opportunities presented by such synergy, as inthe case of industrial and trade possibilities re-sulting from investments in subregional transpor-tation routes. The strategic framework for the nextten years outlines a more multidisciplinary ap-proach. As noted below, greater emphasis on cross-sector linkages is especially important in dealingwith the social and environmental dimensions ofinfrastructure projects.

��

During the early phases of the GMS Program, thesocial and environmental implications of subre-gional infrastructure development projects were notadequately assessed in some cases. Hydropower


The sector

approach,

needs to be

complemented

with cross-

sector linkages

that bring out

the synergy of

sectors.

Building on Success

6

projects resulted in unexpected social and envi-ronmental costs, leading to concerns expressed byvarious groups. Increasing attention is being paidto ensure exhaustive assessment of the social andenvironmental implications of infrastructureprojects at all stages of planning and implementa-tion.

�� "��

Scarcity of resources and complications in financ-ing have slowed down key projects. Compoundingthis problem, member governments have tendedto conserve concessional financing for nationalprojects, in the expectation that incremental fundswould be available for subregional projects. Thefull benefits of the latter are shared, and mecha-nisms are needed for better reconciling project fi-nancing with country-specific benefits. Another keylesson is the need to provide for maintenance, soas to ensure that expected returns from infrastruc-ture projects are realized. Some GMS countries alsohave limited absorptive capacities for foreign aid,while private financiers think that projects in theGMS require a high-risk premium. Given the ex-tensive resource requirements for subregionalprojects, a more concerted approach with other de-velopment partners is needed to generate additionalfinancing.

Mechanisms

are needed to

reconcile pro-

ject financing

with country-

specific

benefits.

7

��

Information is basic to progress in all sectors, moni-toring is critical to project implementation and as-sessment, and extensive coordination is essentialfor effective and efficient allocation of scarce re-sources.

3 The GMS Program needs to develop a

systematic and effective approach to: (i) compilingand disseminating information, including proac-tive public relations efforts to raise regional andglobal awareness of the achievements of the GMSProgram; (ii) monitoring progress; (iii) evaluatingthe effectiveness and efficiency of projects; and (iv)coordinating with other development partners.

3 Most information-related activities have been conducted on an ad hocbasis, and formal monitoring is often limited to basic project details. ImpactEvaluation Study of the Asian Development Bank’s Program ofSubregional Economic Cooperation in the Greater Mekong Subregion.1999.


�

Global andRegionalTrendsThe Context ofthe StrategicFramework

n addition to building on accomplishments anddrawing from lessons learned during the firstten years, the strategic framework of the GMSProgram for the next decade should reflectglobal and regional trends relevant to economic

cooperation.

Global Trends

Following are some of the main trends:

#�� "��

� �� "��

The globalization of production processes and fi-nancial markets, as well as advances in transportand telecommunications technology, have trans-formed the nature of business practices, makingworld economies increasingly interdependent.Trade liberalization has progressed considerably,

Production

processes and

financial

markets have

globalized, and

economies are

increasingly

interdependent.

Building on Success

10

as reflected by agreements under the World TradeOrganization (WTO) and the ASEAN Free TradeArea (AFTA). Countries that are slow to adjust tothese changes fall behind; firms must respond rap-idly to global demands in order to maintain theircompetitiveness and market position. At the sametime, globalization, interdependence and trade lib-eralization present risks, both political and eco-nomic. As illustrated by the 1997 Asian financialand economic crisis, the interdependence of econo-mies can trigger a contagion effect. Proper eco-nomic management and coordination of policiestherefore become increasingly critical.

��

The share of foreign direct investment (FDI) by de-veloping countries is now less than 20 percent ofthe global total, compared to 40 percent in the mid-1990s. In order to compete for FDI, GMS coun-tries will have to adjust to new investment deter-minants, which emphasize the domestic policyframework, progress in transport, communicationsand information technologies, the management andorganizational techniques of firms, and the pres-ence of industrial clusters. An abundance of natu-ral resources and low-wage labor is no longerenough. The ability of the GMS countries to at-tract FDI will depend significantly on the extent towhich they can provide complementary resources,adequate infrastructure, competent suppliers, andinstitutions that harness technology effectively.

#��

��

Another trend is the intensification of network-ing by Trans National Corporations (TNCs) as partof global supply, production, and distribution

Proper

economic

management

and coordin-

ation of

policies are

crucial.

11

chains. These chains are seen as a critical elementof modern business operations. Through them, do-mestic firms acquire better knowledge, upgradedskills, advanced technology and, at times, financ-ing. Foreign firms, on the other hand, benefit fromreduced costs and enhanced access to human andother resources. The increasing importance ofoutsourcing is also fueling the rapid growth of glo-bal business chains. As competition intensifies,firms are increasingly focusing on their ‘core com-petencies’ and outsourcing the rest. GMS govern-ments have an important role in helping domesticfirms participate in these global business chains.For example, they can provide information services,conduct training programs, promote industry as-sociations, and exempt exporters from value-addedtax.

$��

Two of the most important trends in productionand technology are the shortening life cycles of newproducts, and rapid advances in information tech-nology (IT). These developments are providing bothpressure and tools for regional cooperation. Al-though many developing countries are endeavor-ing to embrace IT, the speed with which they canabsorb it is typically slower than the rate at whichnew technologies are being developed. Even basicmanufacturing is becoming more technology-ori-ented in order to improve efficiency and productquality for more demanding consumers.

Shortened

product life

cycles and

advances in IT

are providing

both pressure

and tools for

regional

cooperation.

Global and Regional Trends

Building on Success

12

Regional Trends

Within the region, the pertinent trends are:

%�� &'%&(

The expanded membership of ASEAN presents op-portunities and challenges for GMS countries, es-pecially the new members – Cambodia, Lao PDR,Myanmar, and Viet Nam. It also poses challengesfor the Association of Southeast Asian Nations(ASEAN) itself, as it must address the issues asso-ciated with the emergence of a two-tier system andthe consequent difficulties of reaching consensus.The possibility of ASEAN plus three [Republic Ko-rea, Japan and the People’s Republic of China(PRC)] could fundamentally redefine the role ofASEAN, with important implications for the GMSProgram. AFTA and the new WTO round, and themove for an ASEAN/PRC free trade zone, will resultin considerable expansion of trade. GMS countriesshould be able to take full advantage of this expan-sion, with the resulting economies of scale, possi-bilities for resource sharing, and other initiatives tostrengthen productivity and product quality. Thereduction of physical and non-physical barriers totrade and resource sharing will be important inmeeting competition.

$�� )�*��

��

The PRC has succeeded in its 15-year quest forWTO membership. This makes the PRC’s economyincreasingly important to the region. The GMScountries that are already members or expect tobe admitted to the WTO will be able to gain greateraccess to the PRC market. Other GMS members

PRC and

ASEAN

are expected

to considerably

expand

trade in

the region.

13

will need to increase their competitiveness and ex-plore complementary linkages with the PRC.

(�� !�� '��&� �

Another key regional development is the growingimportance of South Asian economies. Erstwhileimport substitution-oriented, many of these econo-mies are now opening to external markets, mak-ing South Asia a potentially new market for GMScountries. However, it is also a competitor for la-bor-intensive industry. South Asia – India in par-ticular – has important advantages, including ad-vanced technology and a large number of univer-sity-educated people. GMS countries will need toforge supply, production and distribution chainswith South Asia. The GMS countries will increas-ingly find themselves a veritable land bridge link-ing the PRC, Southeast Asia, and South Asia.

South Asia

presents a

potentially new

market for

GMS

countries.

Global and Regional Trends

�

Key Issues andChallengesGearing Up forGlobal Demands

he key issues and challenges for theGMS Program derive in large part fromthese global and regional trends. Eco-nomic cooperation should help mem-ber countries respond to the pressures

of globalization, to new business practices, and theIT revolution. It should also help them diversify,specialize and modernize faster towards more pro-ductive economies and higher standards of living.Rural-urban migration, continued rapid popula-tion growth in some countries, and increasing la-bor mobility pose further challenges for the subre-gion. The environment is at risk. Land and othernatural resources that are the source of livelihoodfor the great majority of people are threatened.

The strategic framework for economic coopera-tion in the GMS addresses five strategic issues andchallenges:

��

��

Following the Asian financial crisis, and in the faceof the current world economic downturn, reestab-lishing investor confidence in the GMS is of para-

Economic

cooperation

will help GMS

countries

globalize,

diversify, and

specialize

towards more

productive

economies.

Building on Success

16

mount importance. Policy and institutional reformmust be continued and accelerated. This shouldcover the strengthening of financial markets, com-mercialization of state-owned enterprises, and lib-eralization of trade and investment regimes. Im-pediments to cross-border trade and investmentmust be reduced or eliminated. Among these areinefficient customs clearance procedures, lack oftransparent regulations and procedures, and in-adequate infrastructure.

&��

The pace of regional integration will not only de-pend on how fast the GMS countries can adapt tothe AFTA, APEC, WTO and other trade/investmentliberalization initiatives. Much depends also on howefficiently they can establish cross-border infra-structure and streamline the flow of goods andpeople. The GMS Program can complement the‘rule-based approaches’ inherent in these initia-tives by concentrating on practical measures atthe national level. These could include the provi-sion of transportation and telecommunications in-frastructure and securing cross-border agreementson the inter-country movement of goods andpeople.

+��

Skills development and labor force upgrading arenormally country-based initiatives that are criticalto reducing poverty and achieving national goals.However, subregional economic cooperation canalso contribute much in these areas. Networks ofhigher education and research institutions can bestrengthened in order to facilitate the transfer ofresearch, technology and know-how among GMScountries, and to help create centers of excellence.

Policy and

institutional

reform should

strengthen

financial

markets, and

liberalize trade

and

investment.

17

To facilitate sharing of skilled labor resources, astandardized system of trade certification and ac-creditation is needed. Common health problems,such as HIV/AIDS, must also be given priority inthe strategic framework.

$��

��

To achieve sustainable development in the GMS,the social and environmental consequences of pub-lic and private investment projects must be fullyanticipated, and corresponding safeguards in-stalled to mitigate undesired effects. Pro-poor sus-tainable economic growth demands an overarchingenvironmental strategy that is fully integrated withthe development process. Such a strategy shouldinvolve all stakeholders in the decision-makingprocess. Successful pro-poor sustainable economicgrowth also requires that the interests of those mostaffected by investment decisions are fully respected,and that compensation offsets unavoidable costs.

�� "��

The availability or lack of project financing bearsstrongly on the pace of economic cooperation. Thisis one of the lessons of the ten years of the GMSProgram and is especially true with infrastructureinvestments designed to link the subregion. Mecha-nisms must be created for mobilizing resources.The private sector must also be given a greater rolein financing subregional projects.

Pro-poor

sustainable

economic

growth

demands an

environment

strategy

integrated with

the

development

process.

Key Issues and Challenges

��

Building onSuccessA StrategicFramework forthe Next TenYearsVision and Goal

he strategic framework of the GMS Pro-gram for the next ten years builds onaccomplishments to date, lessonslearned, and trends and challenges fac-ing the subregion. The framework is

founded on a common vision, goal, and strategicthrusts for regional cooperation. The vision andgoal are:

� GMS countries envision a Mekong subregionthat is more integrated, prosperous andequitable.

� The GMS Program will contribute to realizingthe potential of the subregion through (i) anenabling policy environment and effectiveinfrastructure linkages that will facilitate cross-border trade, investment, tourism and other

The vision is

an integrated,

prosperous

and more

equitably

developed

Mekong

subregion.

Building on Success

20

forms of economic cooperation; and (ii) thedevelopment of human resources and skillscompetencies.

� To ensure that this development process isequitable and sustainable, environment andsocial interests will be fully respected in theformulation and implementation of the GMSProgram.

Strategic Thrusts

The GMS Program is defined in terms of what isachievable through regional economic cooperation.While eight priority sectors were the focus duringthe initial years of the Program, a more multisectoraland holistic approach to regional cooperation willbe pursued in the next decade. Accordingly, fivestrategic thrusts are identified:

� Strengthen infrastructure linkages through amultisectoral approach

� Facilitate cross-border trade and investment

� Enhance private sector participation andimprove its competitiveness

� Develop human resources and skillscompetencies

� Protect the environment and promotesustainable use of shared natural resources

A more

multisectoral

and holistic

approach to

regional

cooperation

will be pursued

in the next

decade.

21

�� Strengthen Infrastructure LinkagesThrough a Multisectoral Approach

This strategic thrust will include the following ini-tiatives:

�� #,'�$��

��

As the global and regional integration process in-tensifies, regional priority projects and national de-velopment plans should increasingly be made con-sistent and mutually reinforcing. Thus, cross-bor-der infrastructure projects under the GMS Programwill be linked with the national development plansto ensure consistency in policy and maximize de-velopmental impact. For example, feeder and farm-to-market roads are essential to extending the eco-nomic benefits of the subregional transport corri-dors to local communities and remote villages.

-� � �� !��

In building physical infrastructure linkages, amultisectoral and holistic approach will be taken.Investments in priority infrastructure sectors(transport, energy, telecommunications and tour-ism) will focus on the same geographic space andcorridors to maximize their development impactand to minimize costs. To achieve this holistic ap-proach, the investment planning process will bestrengthened through the preparation of integratedregional development plans. The needs of the localcommunity, especially the poor in rural and bor-der areas, will be a priority consideration in projectdesign and implementation. Economic corridorswill be developed in selected transport routes inthe GMS. The aim is to come up with a carefullyplanned and managed process involving policy,

Regional

priority

projects will

increasingly be

made

consistent and

mutually-

reinforcing.

A Strategic Framework for the Next Ten Years

Building on Success

22

regulatory and infrastructure initiatives support-ing selected business opportunities.

��

As the GMS countries have disproportionately largerural populations, and since poverty is largely arural phenomenon, the agriculture sector is seenas playing a vital role in addressing the criticalneeds of the poor. Thus, the GMS infrastructureprojects should be closely linked with agriculturaldevelopment projects at the national level. At thesame time, the GMS Program will address subre-gional agricultural issues, such as: (i) price con-trol of agricultural products that discourage re-gional trade and specialization; and (ii) the role ofinfrastructure in reducing the cost of selling agri-cultural products in subregional markets.

�� Facilitate Cross-Border Trade and Investment

To take advantage of the move towards free tradearrangements involving ASEAN and the PRC, andto maximize the benefits of cross-border infrastruc-ture linkages, the Agreement for the Facilitation ofthe Cross-border Movement of Goods and Peoplemust be implemented immediately. This will con-tinue to be a major agenda of the GMS Program.Moreover, the annexes and protocols which stipu-late the detailed procedures for the cross-bordermovement of goods and people will be implementedby 2005 as agreed during the Ninth Ministerial Con-ference in January 2000. In addition, the follow-ing objectives will be pursued:

The

agriculture

sector is seen

to play a vital

role in

addressing

rural poverty

in largely

rural-based

GMS.

23

��

Cross-border trade facilitation will first focus onsimplifying customs procedures at selected bor-der crossings. Notable among these is the single-stop customs inspection for border crossings atPoipet and Bavet (Cambodia), Mukdahan andAranyapratet (Thailand), Savannakhet andDansavanh (Lao PDR), and Lao Bao and Moc Bai(Viet Nam). Based on experience gained, single-stop customs inspection systems will be refinedand replicated in other areas. Coordination of com-mon hours of operation will also be enhanced. Sub-sequent phases of cooperation will cover transpar-ency of customs procedures and adherence to theKyoto Convention.

��. ��

The important role of the financial sector in facili-tating cross-border trade and investment has beenhighlighted by the private sector in GMS. One ofthe major impediments to cross-border businesstransactions, for example, is the lack of a reliablepayment system among commercial banks in theGMS. At present, commercial banks involved incross-border transactions apply different bankingregulations. Harmonizing banking regulations hasbeen identified as another important area to beaddressed.

��$��

The GMS will contribute to creating a favorableenvironment for private firms, especially for smalland medium-sized enterprises. The establishmentof economic corridors and other cooperation ini-tiatives will bring economies of scale in productionand distribution and improve the member coun-

Banking

regulations

and cross

border trade

procedures

will have to be

harmonized.


Building on Success

24

tries’ capacity to export. Agriculture-based and la-bor-intensive products have been identified as ar-eas of comparative advantage for enterprises lo-cated along the major economic corridors. Techni-cal, marketing, credit and management supportwill be made more accessible. The GMS BusinessForum, in collaboration with the governments andlocal business, will help promote investment.

�� $��

The GMS possesses vast potentials for tourism de-velopment because of its rich historical and cul-tural heritage and ecological attractiveness. Tour-ism development will directly contribute to the in-crease in income and employment of the poor. TheGMS Program will promote joint tourism initiativesin the subregion as a single tourist destinationthrough the simplification of the visa issuance pro-cess, improvement of the tourism infrastructure,and other activities in partnership with the privatesector.

�� Enhance Private Sector Participation andImprove Its Competitiveness

The private sector is the main engine of growth forthe subregion. Measures to enhance the competi-tiveness of the private sector will include: (i) lower-ing production and distribution costs through effi-cient utilities/infrastructure services; (ii) improv-ing the skills competencies of the labor force; (iii)training entrepreneurs for small and medium en-terprise (SME) management, production and mar-keting; and (iv) extending credit lines for the provi-sion of working capital. Further, the policy envi-ronment for private sector enterprises will be bet-ter harmonized.

The private

sector is the

main engine of

growth for the

subregion;

measures to

entice its

participation

will be

undertaken.

25

The private sector is also a potential source offinancing for GMS infrastructure projects. This,however, raises a complex set of issues, includingthe risk premium of investing in the subregion andthe investment regimes of GMS countries. Public-private sector partnerships, including guaranteefacilities and other mechanisms, will likely beneeded before private sector participation in infra-structure projects can be secured.

The private sector is a major beneficiary of re-gional economic cooperation. It should be activelyinvolved in the process. However, to date, privatesector involvement in the GMS Program has beenrelatively limited. The newly established GMS Busi-ness Forum provides an entry point for more ac-tive private sector participation. Once fully estab-lished with an active membership base (includingthe Chambers of Commerce), the GMS BusinessForum will serve as a channel for communicatingwith the GMS governments and resolving impedi-ments to business development.

�� Develop Human Resources and SkillsCompetencies

The GMS has a large labor force, much of which isgreatly underutilized, as shown by the high ratesof unemployment and underemployment. Also,productivity is low, reflecting, among other factors,lack of skills. The population-age structure is rela-tively young, with large annual additions to thelabor force. While Thailand and the PRC have suc-ceeded in reducing fertility rates, other GMS coun-tries continue to experience relatively rapid popu-lation growth. This has exacerbated the labor sur-plus problem.

In Cambodia, Lao PDR, Myanmar, and to lesserextent Viet Nam, the PRC, and Thailand, labor pro-

The region

has a large,

young but

underutilized

labor force,

and a labor

surplus

problem.


Building on Success

26

ductivity is hindered by low literacy/schooling lev-els and, in some cases, malnutrition and generallypoor heath. National development strategies forthese countries focus on poverty reduction andimproved labor productivity. Assistance goesmostly to basic health and education services whichtake precedence over skills training and higher edu-cation. The challenge remains for GMS countriesto upgrade their labor force for more skilled jobs.

GMS countries face different challenges in hu-man resource development. Because of these andbecause of diverse languages and cultures, the nor-mal tendency is to favor national education, trainingand health programs. Nevertheless, there are hu-man resource development (HRD) issues where sub-regional cooperation is logical and urgently needed.These include the following:

��

��

��!��

An earlier technical assistance (TA) project on Co-operation in Employment Promotion and Trainingin the GMS established the groundwork for a Sub-regional Labor Market Information Network. It alsooutlined a certification and accreditation systemregarding graduates of training institutions. GMScountries need to further strengthen the labor mar-ket information system and the capability to re-solve issues concerning the cross-border movementof workers. Moreover, it is important to harmonizetraining standards, skills certification, and accredi-tation of training institutions. This could beachieved through capacity building in labor mar-ket management, policy formulation, legal frame-works, and institutional development. It would alsohelp if subregional agreements on skills certifica-tion and accreditation could be made.

Some HRD

issues require

subregional

cooperation

over national

programs of

education,

training and

health.

27

There is need

for GMS

countries to

upgrade their

research and

development

base.

&��

��

Health and other social problems associated withmobile populations must be addressed by regionalas well as national programs. These problems orissues include the spread of communicable dis-eases (e.g., HIV/AIDS), the rights of migrants andguest workers, and the trafficking of women andchildren. The HRD Working Group will continueto address these issues and, through joint projects,strengthen partnership with specialized agencies,such as the United Nations International DrugControl Programme (UNDCP) and the United Na-tions Programme on HIV/AIDS (UNAIDS). In ad-dition, subregional approaches are needed to takeadvantage of economies of scale which can beachieved with some health programs, such as theGMS vaccine program for malaria control.

(��! ��

��

To keep pace with rapidly changing production andinformation technology, there is an increasing needfor the GMS countries to upgrade their researchand development (R&D) base. For this purpose,the GMS Academic Research Network (GMSARN)was established in 2000, with membership frommajor higher education institutions in the GMScountries. This initiative is the first step towardsestablishing centers of excellence in the Mekongsubregion. The GMS Program will explore partner-ship with the GMSARN in addressing higher edu-cation and training needs.


Building on Success

28

�� Protect the Environment and PromoteSustainable Use of Shared NaturalResources

The serious extent of environmental degradationin the subregion must be stopped and reversed.Proper management of shared natural resourcesand collective action to resolve cross-border envi-ronmental problems are among the steps neededto achieve this goal. Environmental considerationsmust be at the forefront of all decision-making re-garding development projects. While the primaryresponsibility for environmental protection restswith national and local governments, cooperationwith neighboring countries is critical to resolvingunintended negative outcomes of development ac-tivities that go beyond national borders. Coopera-tion is also needed to ensure sustainable use ofshared natural resources. Thus, the strategicframework for the GMS Program includes the fol-lowing initiatives:

'��

��

Large-scale infrastructure investments in the GMSin the next ten years will put additional strain onthe environment. To minimize the adverse socialand environmental impacts of these projects, a sub-regional approach will be adopted. The StrategicEnvironment Framework (SEF) for the GMS pre-pared over the past two years provides the policy,technical and procedural basis for subregionalplanning and monitoring. The Early WarningInformation System (EWIS) included in the SEFwill enable GMS governments to monitor the cu-mulative environmental impact of developmentprojects, and respond to it in a proactive manner.The ultimate goal of the SEF is to engender sus-

Environmental

considerations

must be at the

forefront of all

decision-

making

regarding

development.

29

tainable rural development, improve forestry cov-erage (and thus reduce soil erosion, siltation andflooding), restore fish stocks, protect endangeredspecies, and reduce pollution in international wa-terways.

'��

��

Priority will be given to the protection and man-agement of watershed areas and wetlands, con-sidering their severe degradation. To reverse de-forestation and environmental degradation of wa-tersheds, GMS countries will adopt a frameworkof mutually consistent policies, strategies andguidelines for environmental protection and sus-tainable use of shared resources. The frameworkwill include measures to reduce poverty in water-shed areas, such as creating employment alterna-tives to slash-and-burn agriculture and other un-desirable activities.

$��

� � ��

The GMS countries recognize that regional coop-eration on the environment should link with glo-bal initiatives, such as the World Summit on Sus-tainable Development. The GMS Program will helpmember countries share experiences with other na-tions in international environmental initiatives. Inparticular, opportunities will be explored and pur-sued for developing projects eligible for supportthrough the Global Environmental Facility. TheGMS Working Group on the Environment will co-operate with international programs to strengthenthe subregion’s capacity for environmental assess-ment and management.

GMS will

strengthen its

capacity to

assess and

manage the

environment.


��Priority

subregional

projects that

support the

Program’s

strategic

thrusts will be

identified.

Implementingthe StrategicFrameworkMaking ItHappen

he strategic thrusts and operationalpriorities of the GMS Program will beimplemented through the sector fo-rums, working groups, and thestrengthened national secretariats. The

critical measures for implementation are as fol-lows:

/�� *�� $��

To achieve its desired outcomes, the ten-year stra-tegic framework for the GMS Program will requirea highly focused set of activities. The most essen-tial steps are: (i) to identify priority subregionalprojects that support the strategic thrusts; and (ii)prepare a rolling investment and TA program forimplementing these projects. A comprehensive de-velopment matrix will be developed to serve as abasic document for planning and programming ofsubregional projects. This will include projects pre-viously endorsed by the GMS working groups andforums.

Building on Success

32

To further focus the Program, ‘flagship’ pro-grams have been identified. These are multisector,large-scale initiatives representing major advancesin regional cooperation. Eleven flagship programs

4

are listed below, the components of which are de-tailed in Appendix 2.

� North-South Economic Corridor

� East-West Economic Corridor

� Southern Economic Corridor

� Telecommunications Backbone

� Regional Power Interconnection and TradingArrangements

� Facilitating Cross-Border Trade and Investment

� Enhancing Private Sector Participation andCompetitiveness

� Developing Human Resources and SkillsCompetencies

� Strategic Environment Framework

� Flood Control and Water Resource

Management

� GMS Tourism Development

Following the endorsement by the GMS Minis-terial Conference of the ten-year GMS StrategicFramework, GMS working groups and forums willstart discussions to prepare detailed implementa-tion plans for the flagship programs. These planswill assign the primary responsibilities for projectimplementation, and identify the respective rolesof individual GMS governments, ADB, other devel-opment partners, NGOs, and the private sector.

Multisector

and large-

scale, the

flagship

programs

represent

major

advances in

regional

cooperation.

4 The Eleventh GMS Ministerial Conference held in Phnom Penh, Cambodiaon 23-25 September 2002 endorsed the inclusion of GMS TourismDevelopment as the eleventh flagship program.

33

,�� " ��

The implementation of the ten-year strategy willalso require a concerted effort among the GMScountries in mobilizing resources. The GMS gov-ernments must ensure that the national compo-nents of flagship programs get priority in their pub-lic investment programs, whether the funds comefrom domestic sources or development assistance.GMS governments should also provide counter-part funds in support of investment and technicalassistance (TA), in keeping with their commitmentto the goals and priority projects of the GMSProgram.

Given the dwindling resources for TA grants,the GMS could establish a financing mechanismthat will give grants to project preparation (feasi-bility studies) and capacity building projects. ADB,in its role as catalyst and supporter of the GMSProgram, will assist in financing as well as mobi-lizing resources for selected priority projects.Cofinancing arrangements with bilateral and mul-tilateral donors will also be strengthened throughpartnership arrangements and other mechanisms.

-� � ��'�� &�� $��

The scarcity of ODA grant funds and the growingnumber of economic cooperation initiatives for thesubregion all the more call for better coordinationamong development partners. Economic coopera-tion initiatives for the GMS include the ASEANMekong Basin Development Cooperation (AMBDC),the Comprehensive Program for Indochina Devel-opment (Japan), and the Mekong River Commis-sion. Partner organizations that have been activelyinvolved in the GMS Program include: the WorldBank (energy, transport and environment); UnitedNations Economic and Social Commission for Asia

GMS

governments

must ensure

that flagship

programs get

priority in

each

government’s

public

investment

program.

Implementing the Strategic Framework

Building on Success

34

and the Pacific (ESCAP) (trade, investment andtourism); UNDCP (drug prevention and control);United Nations Environment Programme (environ-ment); and European Union (environment, humandevelopment and governance). Bilateral develop-ment agencies of Japan, Australia, Nordic coun-tries, Germany, France and United Kingdom (UK),among others, continue to be strategic partners inthe GMS Program.

The relationship between the GMS Program andASEAN is of special importance, as five of the sixGMS countries are also members of ASEAN. Dur-ing the 34

th ASEAN Ministerial Meeting in Hanoi

(July 2001), foreign ministers called for the nar-rowing of the development gap between its origi-nal and new members in order to facilitate ASEANeconomic integration. GMS Program initiatives playan important role in this regard. Close coordina-tion with ASEAN, especially in planning and imple-menting transport, energy, trade and drug controlinitiatives, is vital.

To resolve the “Mekong congestion,” the SixthMinisterial Conference in August 1996 concludedthat ADB should coordinate economic cooperationinitiatives involving the subregion. The Tenth Min-isterial Conference reaffirmed ADB’s lead coordi-nating role. During the consultations on the stra-tegic framework, member countries suggested thepreparation of a comprehensive development ma-trix to help coordination. This would highlight thepriorities for regional cooperation, as well as thecurrent initiatives of governments and donors. ADBwill consult with donors on the development ma-trix. Donor consultation meetings will also explorepossible modalities of assistance for GMS priorityprojects, including the possible establishment of aGMS development facility.

GMS Program

initiatives play

an important

role in

facilitating

economic

integration

and narrowing

the

development

gap.

35

'��

The implementation of the strategic framework en-tails complex and comprehensive tasks. Some ofthese may involve new modalities of cooperation.The institutional framework for the program willthus need to be strengthened. This can be achievedthrough: (i) an expanded role for the GMS SeniorOfficials Meeting to address cross-sector linkagesand economic corridor initiatives; (ii) establishmentof sector secretariats to involve member countriesmore in the management of GMS working groupsand forums; and (iii) establishment of national GMSsecretariats to serve as focal points for all GMS-related activities. Technical assistance will helpGMS countries to respond to these expanded re-sponsibilities.

The member countries’ ownership of the GMSProgram in the next ten years will be strengthened.Ownership by member countries has been a long-standing principle of the GMS Program, but theGMS Summit of Leaders, scheduled for November2002, will strengthen it further. Strong ownershipis essential for effective and efficient implementa-tion of priority subregional projects.

-�� '��$��

Genuine participation by all stakeholders — not justgovernment but civil society, NGOs, the private sec-tor, academe and the donor community as well –is needed in the management and coordination ofthe Program. This means stakeholders are not justconsulted, but involved as joint partners in the de-velopment and implementation of policies, strate-gies and projects. GMS sector forums and work-ing groups will henceforth invite greater participa-tion from key stakeholders. Because of this, thestructure and process of the working groups/fo-

Strong

ownership of

the Program

and genuine

participation

by all

stakeholders

are important

in ensuring

success.


Building on Success

36

rums, senior officials’ meetings (SOM), and theMinisterial conference will have to be improved.

$��

Improved public relations is important to the suc-cessful implementation of the GMS strategic frame-work. Better understanding of the vision, goals andstrategic thrusts of the GMS Program is vital.

��

As noted earlier, member countries should agreeupon and convey to key stakeholders their visionand goals for subregional economic cooperation.Public relations tools need to be developed for thispurpose. These may include, among others: (i) in-troductory brochures; (ii) sector studies that focuson investment opportunities; (iii) press kits andpress releases; and (iv) project profiles. The publicrelations strategy should also include informationexchanges with journalists, potential investors anddevelopment agencies.

��

To support broader participation, public relationsmust increase community participation. Commu-nities affected by development projects should befully involved in all stages of planning, design andimplementation. This will require greater informa-tion sharing with community members. Havingproject summaries in the local language, for one,would be very helpful.

��

Projects under the GMS Program complementnational projects. As such, their exact contribu-tion to development objectives (e.g., poverty reduc-

Member

countries

should agree

on and convey

to key

stakeholders

their vision

and goals for

subregional

economic

cooperation.

37

tion) is very difficult to evaluate. Nevertheless, broadindicators should be identified for assessingprogress, however generally, in achieving theprogram’s vision and goals.

Monitoring and evaluation at the project levelis conventional and straightforward. However, withregional cooperation projects, it is difficult to mea-sure cross-border benefits and costs and their dis-tribution among participating countries. This re-quires new capacities and skills for project ap-praisal and evaluation.

The GMS Ministerial Conference, as the high-est decision-making body of the GMS Program,should ensure that program priorities are adjustedin line with developing needs. GMS working groupsand forums must monitor project implementationand resolve issues that hamper implementation –especially those regarding flagship programs.

- specific product categories (including volumeand value traded, tariff and non-tariffmeasures, and factor costs of production),industrial facilities (e.g., export processingzones), investment incentives, business-related services (e.g., banking, insurance,shipping and travel), and existing and potentialbusiness opportunities;

- construction of data bases for trade andmarket access conditions, data basemanagement, design and implementation ofan Internet-based searchable data baseapplication; and

- training components for systems deve-lopment.

Broad

indicators will

be identified

for assessing

progress and

evaluating

performance.


Appendixes

Number Title Page Cited onpage

1 The First Ten Years of the GMS Program– Taking Stock 41 1

2 Flagship Programs 53 32

41

Appendixes

THE FIRST TEN YEARS OF THE GMS PROGRAM

TAKING STOCK

ince 1992, when the six member countries first entered intothe program of economic cooperation, there have been manyaccomplishments. Economic linkages among the six countries

have been strengthened through a series of infrastructure and otherhighly pragmatic projects. In turn, the emergence of a new tradearea attracted investor interest, promoting economic growth and so-cial development in the subregion. The GMS Program has also had apeace dividend – it contributed to trust and better relations amongthe member countries. Indeed, this contribution may be its mostsignificant accomplishment: nothing could be more determining forthe welfare of people in the subregion than their peace and security.

The first phase of the Program, from 1992-1993, entailed closeconsultations with member countries to determine the frameworkfor economic cooperation, and the areas of cooperation best suited forpractical results. The second phase, from 1993-1996, involved de-tailed sector studies to identify priority subregional projects and ini-tiatives. This second phase strengthened the consultative processand intensified resource mobilization for priority projects. The thirdphase, from 1996 to date, has been a period of implementation andconsolidation. Several infrastructure projects and numerous techni-cal assistance initiatives were undertaken during this phase. De-spite the Asian financial and economic crisis, the program has deep-ened and broadened in recent years, reflecting the increasing com-mitment of member countries to subregional cooperation.

Under the GMS Program, a series of feasibility studies led to teninfrastructure projects, with overall investment amounting to about$2 billion. Among these was the upgrading of the Phnom Penh-HoChi Minh City Highway and the East-West Corridor Project. Invest-ment in transport infrastructure was complemented by attention tothe regulatory framework. A framework agreement has been signedby the governments of Cambodia, Lao PDR, Thailand, and Viet Namto facilitate the cross-border movement of goods and people. The agree-ment covers such issues as customs procedures, rights of cross-bor-der passage for vehicles and drivers, vehicle and load specifications,insurance provisions, and transit or user fees. In addition, signifi-cant progress has been made concerning trade in energy and in es-tablishing a telecommunications network for the subregion. The twohydropower projects amounting to $380 million were breakthroughs,

Appendix 1

�

Building on Success

42

both in terms of bilateral partnership (between Lao PDR and Thai-land) and private sector participation. They have also promoted power-sharing arrangements on a multilateral basis, along with technicalassistance.

Initiatives concerning human resource development, tourism,the environment, trade and investment have been supported by 18advisory TAs from ADB and co-financiers. Human resource develop-ment initiatives include: harmonization of training standards andaccreditation/certification; mitigating of the transborder spread ofcommunicable diseases; and improvement of health and educationservices for ethnic minorities in border areas. Subregional coopera-tion has led to establishment by the private sector of the MekongTourism Forum. The member countries have also established theAgency for Coordinating Mekong Tourism activities. The agency over-sees a variety of training, and promotion and planning activities tostrengthen the sector. Environment initiatives included: joint moni-toring and information systems; training and institutional strength-ening; area-specific projects to protect the natural resource base;and a comprehensive strategy for sustainable development. Tradeand investment initiatives have been closely coordinated with ASEANand ESCAP, so as to avoid duplication of efforts and to focus on localarea impediments. The GMS Business Forum was recently estab-lished to promote private sector participation in the GMS Program.

Significantly, the program has acted as a catalyst for encourag-ing broad-based economic cooperation and resource mobilization. ADBhas provided $772 million in loans for subregional infrastructureprojects and mobilized a further $234 million for co-financing them.In addition, $58 million in technical assistance has been provided byADB, co-financiers, and the GMS governments. Other subregionalinitiatives have been encouraged by the GMS Program, includingthe following: the Forum for the Comprehensive Development ofIndochina; the ASEAN-Mekong Basin Development Cooperation Ini-tiative; and the ASEAN Economic Ministers - Ministry of Economy,Trade, and Industry (Japan) Economic and Industrial Cooperation Com-mittee. ADB has a Partnership Arrangement with the Mekong RiverCommission to coordinate activities with the GMS Program.

Most important of all, the GMS Program has served as a catalystfor the member countries to take the initiative in forming coopera-tion agreements. Examples are: the opening of new air routes andinternational airport designations in the subregion (e.g., Siem Reap,

Appendix 1THE FIRST TEN YEARS OF THE GMS PROGRAM (cont’d.)

43

Appendixes

Luang Prabang); and the Quadripartite Agreement on CommercialNavigation along the Upper Reaches of the Mekong River. Bilateralagreements include: Lao PDR’s access to Sihannokville Port in Cam-bodia; the opening of the railway bridge linking PRC and Viet Nam atLao Cai; and Thailand’s energy needs leading to hydropower projectsin Lao PDR and development of the natural gas fields in the Gulf ofMartaban, Myanmar.

The tables attached list ADB’s investment and technical assis-tance projects under the GMS Program.

Appendix 1THE FIRST TEN YEARS OF THE GMS PROGRAM (cont’d.)

44Table A1.1: GREATER MEKONG SUBREGIONADB-Assisted Loan Projects

(as of 30 June 2002)

LOAN COUNTRY PROJECT NAME DATE TOTAL FINANCINGNO. APPROVED PROJECT

COST($million) ADB Government Co-financing

National Projects with Subregional Dimensions1325 PRC Yunnan Expressway 29-Sep-94 461.4 150.0 311.41329 Lao PDR Theun Hinboun Hydropower 8-Nov-94 270.0 60.0 a 14.5 a 195.5 b

1369 Lao PDR Champassak Road Improvement 31-Aug-95 60.1 48.0 12.11456 Lao PDR Nam Leuk Hydropower Development 10-Sep-96 112.6 52.0 22.1 38.5 JBIC1503 Cambodia Siem Reap Airport 12-Dec-96 17.0 15.0 2.01691 PRC Southern Yunnan Road Development 24-Jun-99 770.3 250.0 520.3

Subtotal 1,691.4 575.0 882.4 234.0

Purely Subregional Projects

1659 Cambodia Phnom Penh - Ho Chi Minh City Highway 15-Dec-98 52.7 40.0 12.71660 Viet Nam Phnom Penh - Ho Chi Minh City Highway 15-Dec-98 144.8 100.0 44.81727 Lao PDR East-West Transport Corridor Project 20-Dec-99 40.0 32.0 8.01728 Viet Nam East-West Transport Corridor Project 20-Dec-99 36.0 25.0 11.0

Subtotal 273.5 197.0 76.5

Total (10 projects) 1,964.9 772.0 958.9 234.0

a The financial participation of the Government of Lao PDR, through Electricité du Laos (EdL) is as follows: Equity - $66.0 million; Debt - $8.5 million. $60.0 million of the Government’s project equity was provided as a loan by ADB.

b Other financing sources for the project are as follows: Equity - Nordic Hydropower ($22.0 million), MDX Power ($22.0 million); Debt - Commercial Loan ($81.5 million), Export Credit ($70.0 million).

Source: GMS Economic Cooperation Program

Appendix 1

45Table A1.2: GREATER MEKONG SUBREGION

ADB-Assisted Technical Assistance Projects(as of 30 June 2002)

TOTAL FINANCINGTA No. PROJECT NAME DATE PROJECT

APPROVED COST

($ 000) TASF JSF Government Co-financing

A. Core Projects

5487 Studies on Subregional Cooperation among Cambodia, 9-Mar-92 270.0 270.0the PRC, Lao PDR, Myanmar, Thailand and Viet Nam— Phase I

5535 Promoting Subregional Cooperation among Cambodia, 10-Jun-93 5,260.0 1,500.0 3,000.0 760.0 — Swedenthe PRC, Lao PDR, Myanmar, Thailand and Viet Nam— Phase II

5643 Subregional Electric Power Forum — GMS 20-Sep-95 78.0 78.0 — Norway

5645 Meeting of Telecommunications Officials 2-Oct-95 30.0 30.0 — Australia

5693 Promoting Subregional Cooperation among Cambodia, 23-Jul-96 3,250.0 3,000.0 250.0the PRC, Lao PDR, Myanmar, Thailand and Viet Nam— Phase III

5741 Subregional Telecommunications Forum—GMS 18-Jun-97 50.0 50.0 — Australia

5886 Promoting Subregional Cooperation among Cambodia, 22-Dec-99 860.0 800.0 60.0the PRC, Lao PDR, Myanmar, Thailand and Viet Nam— Phase IV, Year 1

Source: GMS Economic Cooperation ProgramContinued on the next page

Appendix 1

46Appendix 1 Table A1.2: ADB-Assisted Technical Assistance Projects (cont’d.)


APPROVED COST


A. Core Projects

5961 Promoting Subregional Cooperation among Cambodia, 14-Dec-00 860.0 800.0 60.0the PRC, Lao PDR, Myanmar, Thailand and Viet Nam— Phase IV, Year 2

Subtotal 10,658.0 1,770.0 7,600.0 370.0 918.0

B. Feasibility Study/Project Preparation

5586 Study of the Lao-Thailand-Viet Nam East-West 18-Jul-94 1,000.0 1,000.0 — FranceTransport Corridor

5649 GMS Infrastructure Improvement: Ho Chi Minh City to 9-Nov-95 3,100.0 3,000.0 100.0Phnom Penh

5691 Thailand-Cambodia-Viet Nam Southern Coastal 18-Jul-96 100.0 100.0Road Corridor

5697 Se Kong-Se San and Nam Theun River Basins 22-Aug-96 2,500.0 500.0 2,000.0 — FranceHydropower Development Study

5710 Study of the Lao-Thailand-Vietnam East-West 11-Dec-96 3,100.0 3,000.0 100.0Transport Corridor

Continued on the next page



APPROVED COST



5728 Chiang Rai-Kunming Road Improvement via Lao PDR 27-Feb-97 625.0 600.0 25.0

5738 East Loop Telecommunications Project in the GMS 28-May-97 820.0 50.0 770.0 — France

2903 Border Towns Urban Development - Thailand 27-Oct-97 1,000.0 800.0 200.0

2926 Nam Ngum 500 kV Transmission - Lao PDR 28-Nov-97 605.0 580.0 25.0

3222 Se San 3 Hydropower - Viet Nam 14-Jul-99 1,248.0 998.0 250.0

5885 GMS Preinvestment Study for the East-West 22-Dec-99 350.0 350.0Economic Corridor

5893 Mekong/Lancang River Tourism Infrastructure 28-Dec-99 770.0 600.0 170.0Development

5915 Establishment of Backbone Telecommunications 17-May-00 180.0 150.0 30.0Network Project Phase I

3544 Nam Ngum River Basin Development - Lao PDR 14-Nov-00 1,015.0 850.0 165.0




APPROVED COST



3642 Preparing the Western Yunnan Roads Development 20-Mar-01 970.0 770.0 200.0Project - PRC

3780 North-Northeast Region Area Development - Thailand 26-Nov-01 1,430.0 1,000.0 430.0

3817 Preparing the Northern Economic Corridor Project 19-Dec-01 710.0 600.0 110.0- Lao PDR

3852 GMS: Cambodia Road Improvement Project - Small- 4-Apr-02 188.0 150.0 38.0Scale Technical Assistance for Economic Analysis

3854 GMS: Cambodia Road Improvement Project - Small- 11-Apr-02 75.0 60.0 15.0Scale Technical Assistance for Environmental Assessment

3855 GMS: Cambodia Road Improvement Project - Small- 11-Apr-02 187.5 150.0 37.5Scale Technical Assistance for Resettlement Study and Social Impact Assessment


49


Appendix 1 Table A1.2: ADB-Assisted Technical Assistance Projects (cont’d.)


APPROVED COST



3868 GMS: Cambodia Road Improvement Project Engineering 31-May-02 500.0 400.0 100.0Design Update

Subtotal 20,473.5 1,510.0 13,148.0 2,045.5 3,770.0

C. Advisory TA

5622 Subregional Environmental Monitoring and 9-Feb-95 4,000.0 1,000.0 2,000.0 1,000.0 — UNEPInformation System

5647 Regional Program to Train Trainers in Tourism in the GMS 23-Oct-95 149.0 130.0 16.0 — Singapore3.0 — Thailand

5681 Cooperation in Employment Promotion and Training 18-Apr-96 920.0 600.0 50.0 270.0 — ILOin the GMS

5684 Subregional Environmental Training and Institutional 9-May-96 2,370.0 800.0 705.0 765.0 — NorwayStrengthening in the GMS 100.0 — Finland

5686 Mitigation of Nonphysical Barriers to Cross-Border 29-May-96 232.0 180.0 24.0 28.0 — ESCAPMovement of Goods and People



APPROVED COST



C. Advisory TA

5743 Mekong/Lancang River Tourism Planning Study 24-Jun-97 655.0 600.0 55.0

5749 Cross-Border Movement of Goods and People 26-Aug-97 730.0 550.0 40.0 140.0 — ESCAPin the GMS

5751 Prevention and Control of HIV/AIDS in the GMS 17-Sep-97 150.0 150.0 — Australia

5771 Poverty Reduction and Environmental Management 31-Dec-97 3,800.0 1,000.0 600.0 2,200.0 — Finlandin Remote GMS Watersheds

5783 Strategic Environmental Framework for the GMS 20-Mar-98 1,900.0 600.0 270.0 1,000.0 -- Switzerland30.0 — UNEP

5794 Study of Health and Education Needs of Ethnic 30-Jun-98 850.0 300.0 50.0 500.0 — UKMinorities in the GMS

5807 Tourism Skills Development in the GMS 29-Sep-98 135.0 125.0 10.0 — Thailand

5822 Protection and Management of Critical Wetlands in the 22-Dec-98 2,070.0 1,000.0 420.0 650.0 — FinlandLower Mekong Basin

5850 Facilitating the Cross-Border Movement of Goods and 16-Jul-99 990.0 950.0 40.0People in the GMS

51

3225 Analyzing and Negotiating Financing Options for the 16-Jul-99 140.0 140.0Nam Leuk Hydropower Project Cost Overruns- Lao PDR

5881 Preventing HIV/AIDS Among Mobile Populations in the 16-Dec-99 610.0 610.0Greater Mekong Subregion

3348 East-West Corridor Coordination - Lao PDR and Viet Nam 20-Dec-99 690.0 690.0

5899 Subregional Environmental Monitoring and 29-Dec-99 600.0 100.0 500.0 — NorwayInformation System (Phase II)

3396 Assessing A Concession Agreement for the Lao PDR: 2-Feb-00 150.0 150.0

5920 Regional Indicative Master Plan on Power Interconnection 14-Jul-00 950.0 158.0 50.0 742.0 — Norwayin the Greater Mekong Subregion

5951 Small and Medium-Size Enterprise Growth and 17-Nov-00 750.0 750.0Development in the Mekong Region

5958 Rollback Malaria Initiative in the Greater Mekong 7-Dec-00 750.0 600.0 75.0 75.0 — UNICEFSubregion & WHO

Appendix 1 Table A1.2: ADB-Assisted Technical Assistance Projects (cont’d.)


APPROVED COST


C. Advisory TA



APPROVED COST


C. Advisory TA

5970 Drug Eradication in the Greater Mekong Subregion 21-Dec-00 150.0 150.0

6004 GMS Telecommunications Sector Policy Formulation 2-Nov-01 750.0 700.0 50.0and Capacity Building

6017 Capacity Building for National Institutions Involved in the 21-Dec-01 800.0 500.0 300.0GMS Economic Cooperation Program

6020 Facilitating Cross-Border Trade and Investment for Small 21-Dec-01 900.0 600.0 300.0and Medium Enterprise Development in the GMS

6032 Support to the Greater Mekong Subregion Summit of 17-May-02 500.0 500.0Leaders and Related Activities

6034 Study on Subregional Issues in the Agriculture Sector in 31-May-02 180.0 150.0 30.0the Greater Mekong Subregion

Subtotal 26,871.0 2,128.0 11,505.0 5,059.0 8,179.0

TOTAL AMOUNT 58,002.5 5,408.0 32,253.0 7,474.5 12,867.0

53

Appendixes

54

Building on Success

55

Appendixes

56

Building on Success

GREATER MEKONG SUBREGIONSTRATEGIC ENVIRONMENT FRAMEWORK

57

Appendixes

Appendix 2

FLAGSHIP PROGRAMS

��

Objectives:

i. To serve as an “initializing project” for subregional eco-nomic cooperation which could serve as a “locomotive” foreconomic development along the north-south axis of theGMS;

ii. To facilitate trade and development between and amongthe participating GMS members, namely, Lao PDR,Myanmar, Thailand, Viet Nam, and Yunnan Province ofthe PRC;

iii. To reduce transport costs in the project influence area,and increase the efficiency of the movement of goods andpassengers; and

iv. To reduce poverty, support development of rural and bor-der areas, increase the earnings of low-income groups,provide employment opportunities for women, and promotetourism in the project influence area.

Components:

i. Update of the feasibility study and cumulative impact as-sessment of the Chiang Rai-Kunming via Lao PDR RoadImprovement Project;

ii. Feasibility study and cumulative impact assessment ofthe Kunming-Hanoi-Haiphong Multimodal Transport Cor-ridor Project;

iii. Civil works for the Chiang Rai-Kunming via Lao PDR RoadImprovement Project and the Kunming-Hanoi-HaiphongMultimodal Transport Corridor;

iv. Preinvestment study for the North-South EconomicCorridor;

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Building on Success

Appendix 2 FLAGSHIP PROGRAMS (cont’d.)

v. Accession by the PRC to the Framework Agreement forthe Facilitation of the Cross-Border Movement of Goodsand People (Framework Agreement); and

vi. Finalization and implementation of the Framework Agree-ment, including the annexes and protocols.

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Objectives:

i. To further strengthen economic cooperation between andamong the participating GMS members, namely, Lao PDR,Myanmar, Thailand and Viet Nam;

ii. To facilitate trade and development between and amongthe participating GMS members;

iii. To reduce transport costs in the project influence area,and increase the efficiency of the movement of goods andpassengers; and

iv. To reduce poverty, support development of rural and bor-der areas, increase the earnings of low-income groups,provide employment opportunities for women, and promotetourism in the project influence area.

Components:

i. Completion of the East-West Transport Corridor involvingLao PDR and Viet Nam, including the second inter-na-tional bridge crossing the Mekong River between Lao PDRand Thailand;

ii. Feasibility study and cumulative impact assessment ofthe western portion of the EWEC in Myanmar;

iii. Civil works for the western portion of the EWEC, specifi-cally the reha-bilitation of road links from Myawaddy toMawlamyine and upgrading of the Myanmar port;

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Appendixes

iv. Finalization and implementation of the Framework Agree-ment for the Facilitation of the Cross-Border Movement ofGoods and People, including the annexes and protocols;

v. Implementation of trade facilitation arrangementsthrough customs cooperation;

vi. Industry-specific enterprise development and investmentpromotion; and

vii. Tourism promotion and infrastructure development.

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Objectives:

i. To promote regional cooperation, foster economic and so-cial integration, support increased trade and investment,and facilitate exchange and development along the east-west axis between and among Thailand, Cambodia andViet Nam; and

ii. To facilitate the development of economic corridors en-compassing major cities in Thailand, Cambodia and VietNam through the provision of road and rail infrastructurelinking the said cities.

Components:

i) Bangkok-Phnom Penh-Ho Chi Minh City (HCMC)-VungTau Road Improvement, now ongoing in the Phnom Penh-HCMC road under financing by an ADB loan. Expectedcompletion is 2004.

ii) Pilot testing of customs facilitation arrangements at theBavet-Moc Bai border crossing;

iii) Thailand-Cambodia Road Corridor (Poipet-Siem Reap).This is first in line in the Cambodian Government’s pri-ority investment program in the road sector. It would in-volve upgrading the 154-km road section from Poipet toSiem Reap. The project would enhance the development


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Building on Success

of tourism in Siem Reap, where employment and income-generating opportunities of rural people would also be im-proved.

iv) Cambodia-Thailand-Viet Nam Railway Development. Thiswill involve the reconstruction of the 48-km railway trackfrom Poipet to Sisophon in Cambodia. It covers the provi-sion of ballast, sleepers, rails, fastenings and other trackmaterials, bridge repairs, and other upgrading works. Theproject will also involve emergency repairs and restora-tion of the 330-km existing railway line from Sisophon toPhnom Penh to make rail operations efficient and safe byappropriate standards.

v) Extension of the railway line from Phnom Penh to the Cam-bodian/Vietnamese border. A feasibility study of the sec-tions of the planned rail connection from Sisophon toPhnom Penh in Cambodia (about 337 km), and from PhnomPenh to Ho Chi Minh City in Viet Nam (about 190 km) willbe prepared.

vi) Southern Coastal Corridor. This will link Trat Province inThailand, Koh Kong and Kampot in Cambodia, and Ha Tienin Viet Nam. The specific scope of the project will be de-termined by the project preparatory technical assistancescheduled for 2003. In Cambodia, the required improve-ments include sections of routes 48, 4, 3, and 33. Alterna-tive alignments could be considered, including the pos-sible extension of the project eastward to Can Tho, aMekong River port city in southern Viet Nam.

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Objectives:

i) To expand the telecommunications network in the sub-region and make it more efficient by providing access tovoice and data services (including the Internet) at afford-able commercial rates;


61

Appendixes

ii) To reduce the incidence of the “digital divide” in the GMS;

iii) To improve the backbone telecommunications infrastruc-ture in order to attract private investment in national tele-communications networks; and

iv) To allow the interconnection of the national telecommu-nications networks of the six GMS countries.

Components:

i) ADB regional technical assistance (RETA) for the Tele-communications Sector Policy Reforms Study in Cambo-dia, Lao PDR and Viet Nam;

ii) ADB-assisted investment project to construct the Phase Itelecommunications backbone;

iii) Telecommunications sector policy reforms in Cambodia,Lao PDR and Viet Nam as recommended by the ADB RETA,including provision of ADB assistance to mitigate fiscalburdens arising from the sector reforms;

iv) Feasibility study of Phase II backbone telecommunicationsproject;

v) Telecommunications Sector Policy Reforms Study for thecountries involved in the Phase II project;

vi) Investment project to construct the Phase II telecommu-nications backbone;

vii) Telecommunications sector policy reforms in the coun-tries involved in the Phase II telecommunications back-bone project; and

viii) Study and implementation of proposed harmonization andintegration of the technical aspects of the GMS telecom-munications networks. This would include network syn-chronization, common channel signaling number 7, tele-communications management network, numbering, andtariffs and tariffs policy.


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Building on Success

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Objectives:

i) To promote the development of the regional power tradein the GMS through agreement on, and implementationof, the regional power protocol and regional power tradeoperating agreement;

ii) To finance the construction of transmission lines thatwould interconnect the various GMS power systems, ini-tially of Lao PDR, Thailand and Viet Nam. The project willalso include the associated switching stations and sub-stations;

iii) To encourage mobilization of private sector investmentsin the power market; and

iv) To promote the development of a corps of engineers andtechnical personnel for integrated GMS power system op-eration and management.

Components:

i) Analysis of required GMS power systems operations, in-cluding the management structure of the power marketenterprises/operators at the national/subregional levels;

ii) Establishment of procedures and processes for reliable op-erations under the market operating agreement, includ-ing: plans for technology transfer; development of trans-mission pricing methodology; and mechanics for ancil-lary services;

iii) Extension of the committed interconnections in the GMS,including the identification of right of way, and determi-nation of alternative project configurations and cost esti-mates;

iv) Conduct of power system study for the merged systems,with verification of load flow and dynamic conditions;


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Appendixes

v) Securing financing for interconnection projects, and ex-ploring alternative financing schemes such as joint ven-tures between government power entities;

vi) Examining the impact of power interconnections on for-estry and fisheries, and other resources along the routesof transmission projects;

vii) Upgrading the capability of training institutions on powertechnology education, including provision of IT and relatedequipment; and

viii) Undertaking training needs analysis, and conducting ac-tual training for staff of GMS power market systems.

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Objectives:

(i) To promote the competitiveness of the subregion by fa-cilitating cross-border trade and investment in the GMS;

(ii) To address information inadequacies for trade and invest-ment in order to facilitate and stimulate business expan-sion in the GMS border areas;

(iii) To develop a system of support to small and medium en-terprises as the primary beneficiary of cross-border tradeand investment facilitation measures; and

(iv) To implement trade facilitation measures initially focus-ing on single-stop customs inspection procedures.

Components:

(i) Development and maintenance of a cross-border trade andinvestment information system which is responsive tothe needs of the private business sector. This would in-clude the establishment of public-private partnershipmechanisms at the local level to maintain this informa-tion system. Specific activities will include:


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Building on Success

- collection of detailed information on cross-border andtransit trade for specific product categories (includingvolume and value traded, tariff and non-tariff measures,and factor costs of production), industrial facilities (e.g.,export processing zones), investment incentives,business-related services (e.g., banking, insurance,shipping and travel), and existing and potential businessopportunities;

- construction of data bases for trade and market accessconditions, data base management, design andimplementation of an Internet-based searchable database application; and

- training components for systems development.

(ii) Development of products and services to support SMEs.These include:

- guides for business planning and development;investment guides; organization of trade and investmentmissions; and a directory of SME enterprises, amongothers;

- market encounters to promote matching of businessopportunities among SMEs in the subregion; and

- assistance in the formulation of business developmentplans.

(iii) Implementation, on a pilot basis, of single-stop customsinspection at selected border crossings in Poipet and Bavet(Cambodia), Savannakhet and Dansavanh (Lao PDR),Aranyapathet and Mukdahan (Thailand), Lao Bao and MocBai (Viet Nam), with possible replication of the pilot schemeto other cross-border sites based on experience gained andlessons learned;

(iv) Expansion of customs facilitation measures to other ar-eas, namely: single-window inspection, coordination ofhours of business operations; transparency of customsprocedures; and automation of customs procedures;

(v) Reduction of barriers to trade in agricultural products; and


65

Appendixes

(vi) Coordination of policies and regulations on trade-relatedfinancial services.

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Objectives:

i) To strengthen the microeconomic foundations of competi-tiveness in the GMS by focusing on support to SMEs;

ii) To strengthen the indigenous private sectors in the GMScountries, especially in the transition economies;

iii) To develop a network of private institutions in the GMS topromote business, trade and investment opportunities inthe region;

iv) To strengthen and expand mechanisms for private sectorparticipation in the GMS; and

v) To encourage private sector participation in financing sub-regional projects.

Components:

i) Assistance in managerial, entrepreneurship and skillstraining, business development, production and market-ing, and access to working capital specifically targeted atSMEs and indigenous private sector organizations;

ii) Capacity building assistance to the GMS Business Forum(BF) to enable it to expand its membership base and pro-vide services to its members. These services include,among others: (a) business advisory and inquiry services;(b) investment guides: (c) export promotion programs; and(d) organization of investment missions;

iii) Preparation of a comprehensive work plan to guide theGMS BF Secretariat in providing products or services toits members;


66

Building on Success

iv) Development of public-private sector mechanisms at thelocal level, taking into account unique local conditionsand resources;

v) Establishment of a GMS Business Support Center, a web-based facility that will provide up-to-date marketing, in-vestment and other relevant information on the GMS;

vi) Establishment of a private sector networking mechanismin the GMS, with special focus on mechanisms at the lo-cal level; and

vii) Studies on the establishment of risk mitigation mecha-nisms for private sector participation in project financ-ing in the GMS (e.g., feasibility studies fund, guaranteefacility).

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Objectives:

i) To address the lack of transparency and comparability inskills testing and certification by further strengtheningthe labor market information exchange network (SLIN);

ii) To set up and support systems for harmonizing trainingstandards and skills certification systems;

iii) To build a system for accrediting training institutions;

iv) To undertake capacity building for technical and vocationaltraining (TVET) institutions and other centers of excel-lence;

v) To identify issues related to cross-border migration, in-cluding related health and other social issues, and un-dertake studies to address said issues; and

vi) To implement cooperative arrangements for addressinghealth and other social issues related to cross-border mi-gration.


67

Appendixes

Components:

(i) Inventory and analysis of technical studies on labor mar-kets/migration, vocational standards, and certificationand accreditation of centers of excellence;

(ii) Upgrading of the capacity of SLIN through staff trainingand provision of equipment;

(iii) Capacity building for labor planning, policy formulation,legal frameworks and institutional development;

(iv) Support for forging subregional agreements on skills cer-tification and institution accreditation systems;

(v) Assistance to certification and testing centers and TVETaccreditation bodies through staff training, equipmentupgrading and formulation of technical procedures andguidelines;

(vi) Capacity building of TVETs and centers of excellencethrough faculty training, equipment upgrading and cur-riculum development;

(vii) HIV/AIDS assessment and conduct of prevention and con-trol activities for mobile populations in the GMS;

(viii) Improvement of health and other social services deliveryto ethnic minorities in border areas of the GMS;

(ix) Prevention and control of malaria for border areas in theGMS; and

(x) Integration of drug control aspects in GMS activities, in-cluding analysis of success factors and design and imple-mentation of drug control projects (with alternative devel-opment and demand reduction elements).


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Building on Success

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Objectives:

i) To establish the technical and procedural requirementsof the strategic environment framework in the GMS coun-tries;

ii) To strengthen the subregional environmental informa-tion and monitoring system and ensure its comprehen-sive coverage;

iii) To support the GMS countries in building effective insti-tutions for better governance of their natural resources;

iv) To foster broad, community-based stakeholder participa-tion in decisions concerning the sustainable use and de-velopment of natural resources;

v) To formulate and implement mutually consistent policies,strategies and projects to address the severe degradationof watersheds and wetlands. The ultimate goal is to main-tain the beneficial uses of the wetlands and watershedsover the long term, improve the welfare of local ripariancommunities, and increase government capabilities inresource management.

Components:

i) Pilot testing of the recommended multi-disciplinary ap-proaches in responding to environmental threats in criti-cal sectors or hotspots;

ii) Further strengthening of environmental performancemonitoring through improvements in design and collec-tion of data for environmental quality indicators (EQIs) andthe early warning information system (EWIS);

iii) Conduct of training programs and capacity building ac-tivities to improve GMS countries’ capacity to manage stra-tegic environment framework (SEF) processes such as the


69

Appendixes

EIA, EWIS, EQIs, hotspots analysis and the Geographic In-formation Systems (GIS);

iv) Provision of a program loan to assist the GMS governmentsin building effective institutions for better governance ofthe natural resource sector;

v) Building the capacity of GMS governments to perform ana-lytical, participatory and policy-oriented processes underSEF, to better guide GMS investment decisions in trans-port, water and other infrastructure sectors;

vi) Implementation of programs to strengthen the public con-sultation/ participation aspects of the aforementioned SEFprocesses;

vii) Undertaking ancillary investments in community orga-nization to build the collective capacities of affected groupsfor making collective decisions, monitoring, and rightsprotection. These investments will also turn environmen-tal protection activities into income-generating opportu-nities for local communities (tree farming, eco-tourism,environmental patrolling, etc.);

viii) Implementation of several subprojects to reduce rural pov-erty and improve natural resource management in re-mote watershed areas through intervention strategiessuch as community development, rural infrastructure,livelihood systems development and reforestation, amongothers; and

ix) Support for activities that promote sustainable resourceuse and enhance livelihood of poor communities in wet-land areas.

This includes setting up water inventory and monitoringsystems, alternative livelihood development, and rehabili-tation of multi-purpose harbors, among others.


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Building on Success

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Objectives:

i) To strengthen land use planning in GMS countries to en-sure that people and vulnerable activities are kept out ofhazardous floodplain areas;

ii) To strengthen structural measures (development andbuilding controls) to reduce flood damage to structures inurban/settlement areas;

iii) To strengthen institutional capacities for flood prepared-ness and emergency management; and

iv) To finance the construction of flood mitigation dams, em-bankments, flood detention basins, and other structuresthat minimize the damage caused by regional flood eventson people and settlements.

Components:

i) Development/analysis of regional flood maps that showflood hazard and flood damage risk areas;

ii) Conduct of research on transboundary impacts of land usechanges on flooding;

iii) Developing guidelines for an integrated land use plan forflood hazard/ catchment areas, and devising an imple-mentation plan for this;

iv) Providing technical assistance, training, tools/softwareand public education on best practices for land use plan-ning in flood-prone/ catchment areas;

v) Analysis of flood patterns/frequency and flood inundationmaps in relation to existing and planned infrastructurein the lower Mekong basin, and the risk factors of struc-tures;

vi) Development of guidelines on flood proofing (building anddevelopment control) and compilation of current and bestpractices in the GMS in this area;


71

Appendixes

vii) Establishment of an effective flood forecasting and warn-ing system in the GMS through technical and financialsupport for a Regional Flood Information Center (RFIC).The center will undertake flood mapping, field data collec-tion, remote sensing, GIS analysis, improved weather fore-casting, and formulation of guidelines for flood prepared-ness;

viii) Setting up of timely and accessible flood data for emer-gency operations. Data will include information on safehavens/evacuation channels in real-time emergencies;

ix) Preparing common standards for reporting damage assess-ment; and

x) Providing training and capacity building support for emer-gency managers of GMS countries. Training should in-corporate new technologies and latest scientific findings.

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Objectives:

i) To promote and strengthen subregional cooperation andtourism development in the GMS countries; and

ii) To promote increased tourism in the GMS in order to aug-ment hard currency earnings, reduce poverty, mitigateenvironmental degration from unplanned and unsustain-able development, and develop human resources in theGMS.

Components:

i) Promoting the GMS as a single tourist destination;

ii) Developing tourism-related infrastructure

iii) Improving human resources in the tourism sector;

iv) Promoting pro-poor community-based sustainable tourism;


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Building on Success

v) Encouraging private sector participation in the GMS tour-ism sector; and

vi) Facilitating the movement of tourists to and with the GMS.


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