Int'l Cooperation

Last updated: Friday, March 22, 2019


GMS Business Summit: Opportunity to Seek Economic Growth Drivers

Posted: Thursday, April 12, 2018

Recently, the GMS Business Summit was held for the first time within the framework of the 6th GMS Summit. The event opened up a lot of opportunities to look for motivators for economic growth and also point out many challenges that need to be addressed.

Opportunity to connect business community
After 25 years of cooperation, GMS has made great achievements and contributed significantly to member states’ development. The share of intra-regional trade rose from 5.7 per cent to 9.1 per cent in 2010 and 2016, respectively. Total foreign investment among GMS countries increased from US$436 million to US$1.28 billion. GMS exports jumped from US$304 billion to US$500 billion and imports surged from US$310 billion to US$471 billion. At the same time, GMS countries have pursued an open and more liberal trade policy. The region’s gross domestic product (GDP) growth averaged 6.3 per cent. This is a promising result but there is still room for further trade-driven development and strengthened cooperation. For that reason, organising a business forum within the framework of the summit is essential to meet, exchange experience, unlock cooperation opportunities and boost economic development.

GMS countries are rich in natural resources, and have abundant and dynamic labour resources for future breakthrough development, if a specific goal, a right direction and a good strategy can be deployed.

Dr Vu Tien Loc, President of the Vietnam Chamber of Commerce and Industry (VCCI), said, “With significant geo-economic, geo-political, abundant natural and human resources, an ever-deepening and broad reform and integration due to the industrial revolution 4.0., we have comparative advantages in agriculture and tourism. We can become “the kitchen of the world”. We can also become a new manufacturing hub of the world, due to inexpensive labour and young population.”

The GMS Business Summit discussed economic outlook, future development drivers, and private development action programmes in 2018. In addition, with the participation of the President of the Asian Development Bank (ADB), the Secretary General of ASEAN, the Executive Director of the World Bank, and representatives of nearly 100 national organisations and development partners and particularly the presence of more than 200 enterprises inside and outside GMS, about 300 Vietnamese and international journalists, the GMS Business Forum opened up great opportunities for authorities, strategic planners, as well as GMS businesses.

The forum thus became a great opportunity to enhance dialogues between governments, business communities and development partners, promote the participation of local and regional business communities in GMS activities while unlocking opportunities for future cooperation.

Challenges on institutional quality and corporate competitiveness
Although GMS cooperation has obtained many achievements and there are a lot of new opportunities for future cooperation, GMS generally remains the low land of development in comparison with ASEAN, Asia and the world by GDP per capital, infrastructure, technology, finance, and human resource quality. Therefore, to take full advantage of opportunities and reap striking successes, GMS must overcome many challenges.

Dr Loc also pointed out, “The biggest challenge of the GMS economies is institutional quality and business competitiveness in order to meet the international standards and to connect to the global supply and demand chains. The GMS economic drivers in the coming years will be entrepreneurship, micro, small and medium enterprises, and women-led enterprises.”

Specially, GMS must develop new business models and utilise technologies to change the competition landscape. Facing the boom of the Fourth Industrial Revolution, human resources must be sharp enough to approach, unlock and apply new achievements. However, to improve the workforce quality, there must be positive impacts from other factors such as education, health and food.

What’s more, it is necessary to promote the “reciprocal connectivity” in trade and investment. Given similarities in product categories, the GMS countries have more opportunities to link their business bases to reduce competition against each other and improve overall GMS competitiveness.

Moreover, GMS member states need to improve their institutions and standards, improve governance, provide equal opportunities for all economic sectors, and ensure harmonious and balanced interests of all parties, governments, businesses and peoples. Vietnamese Prime Minister Nguyen Xuan Phuc said, “It is essential to have sincere and straight-forward cooperation to create the confidence for more effective actions to build the GMS into a community of really mutual benefit and respond to and solve challenges together.”

And, a bigger challenge is the solution to “achieving development but ensuring sustainability and harmony, achieving fast growth but necessarily preserving and protecting the ecological environment and natural resources, especially sustainably managing and using Mekong River’s water.”

This GMS Business Summit is, without doubt, a breakthrough initiative of the Government of Vietnam as it has brought in many opportunities for business development cooperation and pointed out difficulties, challenges and goals aimed to further develop the Mekong subregion in the future.

Giang Tu

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