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