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Better Together
Mechanism for cooperation among Lancang-Mekong River countries matures
By Yu Lintao | NO. 04 JANUARY 25, 2018

Participants in the Second Lancang-Mekong Cooperation Leaders' Meeting pose for a group photo in Phnom Penh, Cambodia, on January 10 (XINHUA)

Our River of Peace and Sustainable Development. This was the theme of the Second Lancang-Mekong Cooperation (LMC) Leaders' Meeting in Cambodia, on which the curtain was lowered on January 10. The conference resulted in the release of the Phnom Penh Declaration and the adoption of the Five-Year Plan of Action on Lancang-Mekong Cooperation (2018-22). These documents are expected to chart the course for the LMC's development into the next decade.

The sub-regional cooperation mechanism is named for the Lancang River, which originates on the Qinghai-Tibet Plateau in southwest China and flows through Myanmar, Laos, Thailand, Cambodia and Viet Nam where it becomes the Mekong before emptying into the sea. The 4,880-km-long waterway, which flows through an area of more than 795,000 square km, nourishes a population of 326 million people in the six LMC countries.

As the LMC mechanism matures, it is growing into an important platform not only conducive to narrowing the development gap within the Association of Southeast Asian Nations (ASEAN) and advancing ASEAN integration, but also one capable of enriching South-South cooperation and efforts to foster a more open, inclusive and balanced economic globalization that benefits the whole world.

New blueprint

Proposed by China in 2014, the LMC mechanism operates on a "3+5" framework, which refers to the three central pillars of political and security issues, economic and sustainable development, and cultural and people-to-people exchanges, as well as the five high priority areas of connectivity, production capacity, cross-border economic cooperation, water resources, and agriculture and poverty reduction. The First LMC Leaders' Meeting was held in the city of Sanya, south China's Hainan Province, in 2016.

Since its inception, the LMC has seen both rapid development and positive results. Over the past two years, every one of the 45 early harvest projects identified at the first leaders' meeting have been implemented according to schedule. Additionally, a global center for Mekong studies, a water source cooperation center and an environmental cooperation center for the river have already been set up and put into operation. The first batch of projects created by the LMC Special Fund has also been completed, and other funding pledges that China has made continue to be fulfilled. The construction of the Kunming-Bangkok Road, China-Laos Railway, China-Thailand Railway, Long Jiang Industrial Park in Viet Nam, Vientiane Saysettha Development Zone in Laos, and the Sihanoukville Special Economy Zone in Cambodia are also underway.

The LMC five-year plan covers more than 20 cooperative areas and is the first comprehensive development blueprint put forward since the establishment of the mechanism. It will serve as a guideline for the development of the LMC over the next five years, taking regional cooperation to a new level.

According to the plan, by synergizing the China-proposed Belt and Road Initiative with the ASEAN Community Vision 2025, the Master Plan on ASEAN Connectivity 2025 and the visions of other Mekong sub-regional cooperation mechanisms, the LMC is moving toward a new system of multilateral collaboration with unique features driven by internal strength and inspired by South-South cooperation, which will support the regional integration process, as well as promoting the implementation of the UN 2030 Agenda for Sustainable Development.

Based on the plan, 2018 and 2019 will constitute the foundation-laying stage, focusing on strengthening sectorial cooperation planning and implementing small and medium-sized projects. The period from 2020 to 2022 will emphasize consolidation and expansion, when member countries will further strengthen collaboration according to the five high priority areas, while also exploring new areas that help respond to their development needs, optimizing the cooperation model and gradually exploring the possibility for larger cooperative projects.

Chheang Vannarith, Vice Chairman of the Cambodian Institute for Strategic Studies, said in an interview with China's Xinhua News Agency, "The Second LMC Leaders' Meeting reflects the participants' joint efforts and commitment toward building a community with a shared future in the region."

He described the meeting as another milestone in deepening political trust, fostering practical cooperation, and promoting comprehensive regional connectivity.

Song Junying, a researcher at the China Institute of International Studies, compared the action plan released after the leaders' meeting as a ladder on which the six member countries can climb toward an LMC community with a shared future.

In the Phnom Penh Declaration, the six countries stressed the importance of the LMC vision in contributing to the socio-economic development in the sub-region and enhancing the well-being of their peoples as well as narrowing their development gap.

Visitors walk by a model of China's next generation bullet train "Fuxing" during the Economic and Technological Exhibition for Lancang-Mekong Cooperation in Phnom Penh, Cambodia, on July 13, 2017 (XINHUA) 

Constructive role

China has been playing an active and constructive role in promoting the advancement of the LMC, by offering assistance in the form of loans, medical aid and scholarships to other member countries in order to nurture common development.

During the Phnom Penh meeting, Chinese Premier Li Keqiang said China will provide another 7 billion yuan ($1.08 billion) in government concessional loans to Myanmar, Laos, Thailand, Cambodia and Viet Nam. He also announced the establishment of a $5-billion credit line for supporting production capacity and equipment manufacturing cooperation among the LMC countries.

This most recent contribution follows an ongoing pattern of Chinese support, with China having previously supplied the other LMC nations with 10 billion yuan ($1.54 billion) of concessional loans, $5 billion of export credit and $5 billion for production capacity cooperation as part of more than 20 infrastructure and industrial projects.

Conducted by Chinese medical teams, the Mekong Brightness Action project has helped around 800 cataract patients regain their sight in Cambodia, Laos and Myanmar. Over the past two years, more than 12,000 students from Myanmar, Laos, Thailand, Cambodia and Viet Nam received scholarships from the Chinese Government, and more than 10,000 people from these countries have been sent to China for professional training programs.

According to Lu Guangsheng, a researcher at Yunnan University in China, China's constructive role in the LMC framework reflects its sincerity and commitment in building an LMC community with a shared future.

When addressing the Second LMC Leaders' Meeting, Premier Li proposed plans for member countries' connectivity, and action plans for production capacity cooperation, as well as the construction of economic and trade cooperation zones and cross-border economic cooperation zones.

The premier also expressed his hope that the Lancang-Mekong can become a river of friendship, cooperation and prosperity. "China is willing to work with others to strengthen the LMC as China benefits from regional stability and its neighbors are beneficiaries of China's economic vitality," he said.

For the LMC countries, there is huge potential for economic and trade cooperation and trade between them has seen rapid growth in recent years.

According to China's Ministry of Commerce (MOFCOM), China is the largest trading partner of Cambodia, Myanmar, Viet Nam and Thailand and the second largest of Laos. Trade between China and the five countries totaled $220 billion in 2017, up 16 percent year on year. Some 80 percent of China's rice imports are from these countries, while their fruit exports to China have increased at an annual rate of 21 percent over the past decade. In addition, China is the largest source of foreign investment in Cambodia, Laos and Myanmar, and the third and fourth largest in Thailand and Viet Nam in 2017.

A recent MOFCOM press release shows that China is increasing investment in other LMC countries, with direct investment in the non-financial sector up 25 percent year on year, reaching $3.2 billion. Chinese enterprises have also made progress in the construction of economic and trade cooperation zones as well as infrastructure cooperation with the countries.

Cambodian dancers perform during the Lancang-Mekong Cultural Festival held in Xishuangbanna, southwest China's Yunnan Province, on December 18, 2016 (XINHUA)

Strengthening ties

Following the Second LMC Leaders' Meeting, Premier Li embarked on an official visit to Cambodia.

China and Cambodia have enjoyed a sound friendship and in recent years have exchanged frequent high-level visits. In 2016, Chinese President Xi Jinping visited Cambodia, taking the comprehensive strategic partnership between the two countries to new heights. In December 2017, Cambodian Prime Minister Samdech Techo Hun Sen met with Xi in Beijing while attending the Communist Party of China in Dialogue With World Political Parties High-Level Meeting.

At the end of 2017, China directed $7.3 million from the LMC Special Fund to Cambodia for the implementation of a variety of projects, which cover areas such as agriculture, tourism, technology, public health, education, air interconnectivity, and cultural exchange.

The Sihanoukville Special Economic Zone, set up jointly by the two countries in 2008 and named in memory of late Cambodian King Father Norodom Sihanouk, is the biggest special economic zone in the country. It has attracted more than 100 foreign companies from China and beyond, creating nearly 20,000 jobs for the local community.

The year 2018 marks the 60th anniversary of the establishment of diplomatic ties between China and Cambodia.

While meeting with Prime Minister Hun Sen, Premier Li said China hopes to cement high-level contacts, deepen cooperation in various areas and expand cultural exchanges with Cambodia.

The Cambodian prime minister expressed gratitude for China's firm, long-term support and assistance to Cambodia. He said both sides enjoy a high-degree of mutual political trust, active practical cooperation in various fields and a profound traditional friendship between their two peoples.

The two leaders also witnessed the signing of 19 bilateral cooperative documents regarding politics, the economy, trade, public health, agriculture, forestry and culture.

According to a joint communiqué released after Premier Li's visit, China and Cambodia plan to accelerate the alignment of the China-proposed Belt and Road Initiative and China's 13th Five-Year Plan with Cambodia's national development strategy and Industrial Development Policy (2015-25), while promoting cooperation in production capacity and investment.

Copyedited by Laurence Coulton

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