Today the prime ministers of China, Laos, Myanmar, Thailand, Cambodia and Vietnam and the head of the Asian Development Bank formally inaugurated the final link of the so-called "north-south economic corridor", a 1,800-kilometer (1,100-mile) road network connecting Kunming with Bangkok.

The former opium smuggling route which now links the Greater Mekong Subregion (Yunnan, Myanmar, Thailand, Laos, Vietnam and Cambodia) - or GMS - will dramatically improve road connectivity in one of Asia's most pristine and poorest regions. China is expected to send more tourists to the area while also bringing in natural resources and other commodities from Southeast Asia to feed its ravenous economic boom.

While speaking at the GMS summit, Chinese Premier Wen Jiabao (温家宝) called on GMS members to work together to improve the region's transport infrastructure, streamline transport and trade and increase rural development.

The road network is expected to increase Chinese investment in the region – especially in Laos, where the government has given a Chinese company a 50-year lease for a major tract of real estate near the Laotian capital of Vientiane in exchange for the building of an athletic stadium. Another Chinese company has been given 30-year rights to construct and run a large casino compound.


According to a Xinhua report, trade in 2007 between Yunnan province and the 10 member states of the Association of Southeast Asian Nations (ASEAN) reached US$3.03 billion, up nearly 40 percent over 2006.

Recent rapid growth of trade with ASEAN has made the region Yunnan's largest trading partner. According to Kunming customs statistics cited in the report. Yunnan's exports to the region were up 32.9 percent, reaching US$2.17 billion.

Yunnan is preparing to serve as China's gateway to ASEAN as the two emerging economic regions prepare for the China-ASEAN Free Trade Area (CAFTA), the first phase of which will launch in 2010. CAFTA will reduce and eliminate tariffs on goods moving between the two regions, creating the world's largest free trade area in terms of population.

GMS summit image: Xinhua

Laos highway image: International Herald Tribune

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Tags: Asian Development Bank, CAFTA, Cambodia, Greater Mekong Subregion, Laos, Myanmar, North-south corridor, Thailand, Vietnam, Wen Jiabao

Trade in 2007 between Yunnan province and the 10 member states of the Association of Southeast Asian Nations (ASEAN) reached US$3.03 billion, up nearly 40 percent over 2006, with Vietnam replacing Myanmar as the province's top trading partner, according to a Xinhua report.

Recent rapid growth of trade with ASEAN has made the region Yunnan's largest trading partner. According to Kunming customs statistics cited in the report. Yunnan's exports to the region were up 32.9 percent, reaching US$2.17 billion.

Yunnan – bordered by Myanmar, Laos and Vietnam – is being groomed by the Chinese government to serve as China's gateway to ASEAN as the two emerging economic regions prepare for the China-ASEAN Free Trade Area (CAFTA), the first phase of which will launch in 2010. CAFTA will reduce and eliminate tariffs on goods moving between the two regions, with analysts expecting raw materials and natural resources to flow into China and finished products to flow out.

Major road, rail and air transport infrastructure projects in Yunnan and its Southeast Asia are currently underway to further facilitate trade with ASEAN. Some of the more notable projects include a highway linking Kunming with Singapore, a rail network linking Kunming and Singapore via three trunk lines passing through Myanmar, Laos, Thailand, Vietnam, Cambodia and Malaysia, a new international airport in Kunming and a road/rail transport corridor linking Kunming with Haiphong, Vietnam – the closest seaport to Kunming.

Last month the Asian Development Bank announced its largest-ever financing project, a US$1.1 billion highway project that will connect Vietnamese capital Hanoi with Yunnan.

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Tags: ASEAN, Asian Development Bank, business, CAFTA, foreign trade, Haiphong, Hanoi, Laos, logistics, Myanmar, Singapore, Vietnam

Last week the Asian Development Bank (ADB) announced plans to finance a US$1.1 billion highway project that will connect the Vietnamese capital of Hanoi with Yunnan province via a 244-kilometer (151 mile) highway. The road is the largest single financing project by the ADB to date.

At present, travel times for passenger cars and trucks traveling from Kunming to Hanoi are two and three days, respectively. After the road in Vietnam is completed, the trip between the two cities will take less than a day. Completion of the highway is projected to take place in 2012.

Hanoi and Lao Cai province – on the Vietnamese border with China – are part of the Haiphong transport corridor that is expected to provide economic opportunities to impoverished northwest Vietnam plus greater access to social services for communities near the highway.

The road will also give Kunming greater access to the port of Haiphong, the closest seaport to the Spring City. This will make it easier for companies in Kunming and Yunnan to ship goods internationally. Similarly, agricultural and maritime products from Vietnam will have greater access to Yunnan, Sichuan and elsewhere in China's landlocked west.

The highway is also expected to be a boon to tourism between northern Vietnam and Yunnan, both of which are home to major tourist destinations such as Ha Long Bay and Sa Pa in Vietnam and Xishuangbanna, Dali, Lijiang and Shangri-la (Zhongdian) in Yunnan.

Traffic on the existing roads between Hanoi and Lao Cai has been averaging an annual increase of 12 percent in recent years. More than 5.5 million vehicles are projected to use the new road in 2012, with traffic expected to triple to 17 million over the following ten years.

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Tags: Asian Development Bank, business, Ha Long Bay, Haiphong transport corridor, Hanoi, Kunming-Hanoi highway, Lao Cai, logistics, Sa Pa, tourism, Vietnam

The Associated Press reports that the Association of Southeast Asian Nations (ASEAN) is expecting a US$15 billion railway connecting Singapore with Kunming to be completed by 2015, which is several years later than had been previously hoped.

The 5,000 kilometer (3,000 mile) rail line's development has been hampered by a lack of funds, technical issues and varying levels of enthusiasm among countries involved.

There is already an existing rail link from Singapore to Bangkok, passing through Malaysia; it is the two branches extending north from Bangkok that have proven more difficult. The western branch will travel through Myanmar and the line's eastern branch will cut through Cambodia and Vietnam, with an additional section of track connecting it to Laos.

ASEAN secretary-general Ong Keng Yong told the AP that the Asian Development Bank has recently given Cambodia US$40 million in soft loans, with an additional US$5.4 million in grants also being secured for the rail line, which is expected to dramatically increase the flow of people and cargo throughout the region.

Read more here.

Tags: ASEAN, Asian Development Bank, Bangkok, Cambodia, Laos, Malaysia, Myanmar, Ong Keng Yong, railways, Singapore