ASEAN economic cooperation has brought about encouraging results in recent years, laying a more solid foundation for the much-expected formation of the ASEAN Economic Community in 2015. However, ASEAN is still facing uncertainties because the development gap between more developed countries (ASEAN-6) and later members remains a major problem. This difference is seen in many aspects like personal income, GDP, import and export turnover, and infrastructure. This not only causes difficulty for Cambodia, Laos, Myanmar and Vietnam (CLMV), but also affects the central role of ASEAN and slows down the growth of all ASEAN countries.
Narrowing development divide
Before this reality, the 6th ASEAN Summit held in Hanoi, Vietnam in 1998 underscored the narrowing of the ASEAN development gap as a priority. The 34th ASEAN Foreign Ministers Meeting 2001 in Hanoi adopted the Hanoi Declaration on Narrowing the Development Gap, which set out specific directions for implementing the Initiative for ASEAN Integration (IAI). IAI has promoted the implementation of subregion programmes and projects and encouraged ASEAN partner countries to finance investment and trade projects. To date, more than 200 projects are being carried out, including 165 financed projects. ASEAN countries are building instructive documents for Fair Economic Development and framework documents on fulfilling development gap goals. In addition, ASEAN creates incentive mechanisms for CLMV nations by lowering tariffs in the scope of free trade areas inside ASEAN, and between ASEAN and other partners.
Mr Le Quang Lan, Deputy Director of Multilateral Trade Policies Department under the Ministry of Industry and Trade, said: IAI was carried out from 2002 to 2010, but CLMV’s achievements didn’t match its potential. Vietnam’s trade turnover with the other CLMV countries is relatively low, especially Myanmar and Laos, where trade revenue with Vietnam ranged from US$148 million to US$400 million a year. These values are much lower in the general ASEAN trade picture.
In November 2004, a joint CLMV cooperation committee was founded, aiming to become a synchronised engine in the ASEAN machine. Particularly, the four countries adopted the Vientiane Declaration on Economic Cooperation and Integration at the first CLMV Summit. In November 2008, they agreed to promote economic cooperation and narrow the development gap among ASEAN members at the fourth CLMV Summit, but the divide remains a continuing challenge to CLMV’s objective of forming the ASEAN Economic Community by 2015.
What CLMV countries need to do?
The reason for this continuing divide is partly attributed to CLMV’s limited cooperation in deploying IAI, and its less than ideal results. The focal point is soft infrastructure development that fails to meet CLMV’s needs, while human resources and infrastructure development lack proper investment. In addition, economic cooperation among CLMV countries is discrete and Vietnam looks as if it is separating from CLM, thus outweighing risks of development gap and CLM position.
Dr Le Quang Lan said that to narrow the development gap, CLMV’s endeavour is the most important. In addition, CLMV needs to promote internal cooperation, expand export markets, and boost trade and investment exchange by means of border trade preferences, trade facilitation, infrastructure connectivity development, and joint search of financing partners for CLMV projects.
Besides, Dr Lim Hong Hin, a researcher at ASEAN and East Asia Economic Research Institute, noted that CLMV needs to uphold existing cooperation mechanisms on the basis of ASEAN connectivity, commitment to ASEAN cooperation priorities, proactive coordination in CLMV cooperation projects to unify project proposing basis and call for finance for the sake of their best interests.
Que Chi
Vietnamese
