Changing Viet Nam -New Phase of Development ADB Viet Nam Resident Mission

Input-driven Growth Trade has been one of most important drivers of Viet Nam’s phenomenal growth and poverty reduction, together with the substantial public and private investment, including FDI; Trade (imports and exports combined) represents 150% of Viet Nam’s GDP However, this diagram shows that what is needed is to improve the efficiency of Viet Nam’s economy: while investments have continued to grow, the Incremental Capital Output Ratio has remained stagnant; with greater efficiency, Viet Nam’s economic growth could have been in double-digit

Road Transport Network 1992 Progress in terms of enhancing connectivity in the GMS can be clearly seen by looking at the evolution of the road network connecting the subregion, starting from the time of the Program’s inception in 1992, moving on to the present network, and then to the projected network by 2015, should all the projects identified in the new Transport Sector Strategy be implemented. This slide shows you the situation when the GMS Program started in 1992. All weather roads were mostly found only within Thailand and do not connect with neighboring countries. At that time, the basic question was, “Can goods, people, and vehicle cross borders?”

Road Transport Network 2006 Let’s look at the situation in 2006: Clearly, connectivity has significantly improved in terms of existence of roads capable of handling subregional traffic. Linkages along the east-west, southern, and north-south economic corridors have been established, except for a few missing links, which are being/about to be addressed. The question being asked now is “How long does it take to cross GMS borders?”

Road Transport Network 2015 By 2015, this is what is projected are: If all the projects identified in the recently-completed transport sector strategy come to reality, the GMS will be interconnected by a series of all-weather subregional highways in 8 years’ time. These links will also facilitate connectivity between the GMS and the rest of the PRC, South Asia, and the rest of continental Southeast Asia.

1992 2012 2004 For power and telecommunication links, what is shown on the screen is the projected situation by 2012. But let me just describe the evolution since the beginning of the GMS Program. In 1992- For power, the only cross-border transmission line is the one linking Lao PDR with Thailand. Also, telecommunication links are mostly in Thailand. In 2004- • For power transmission lines, there is massive development along the coastal areas in Viet Nam and more interconnections between Lao PDR and Thailand. • The telecommunications backbone in 2004 extends to Cambodia, Vietnam, Thailand, Lao PDR and Yunnan Province of PRC. By 2012, it is projected that- • For power transmission lines, there will be an increasing number of cross-border connections such as Thailand with Cambodia; Cambodia with Viet Nam; Cambodia with Lao PDR; Lao PDR with Viet Nam; and Viet Nam with Yunnan, PRC. • For the telecommunications backbone, the optical fiber cable links for all GMS countries would have been completed, and enhancements to the completed infrastructure component of the Information Superhighway Network would have been in place. Power Transmission Line Telecommunications Backbone

The GMS region’s strongest advantage is its strategic location. The GMS serves as a landbridge between South Asia, and East and Southeast Asia, as well as between continental Southeast Asia and the rest of China. The GMS connects to the large markets of China on the north and northeast through Yunnan Province and to South Asia on the west through Myanmar. India serves as the subregion’s gateway to South Asia. Initiatives are in progress to establish road links between the Mekong subregion and South Asia as you can see on this map. Abundant natural resources and strategic location combined make the Mekong Region a new frontier of Asian economic growth. STRATEGIC ROAD LINKS BETWEEN SOUTH ASIA AND THE GREATER MEKONG SUBREGION