The Mekong and ASEAN’s fast lane: Who’s left behind?

SUMERTNET's Research and Policy Forum 2011 addressed mechanisms that might be needed to ensure greater equity and the preservation of environmental services vital to the region’s long-term social and economic sustainability amidst accelerating regional economic integration.

It's 2022, and an ambitious business leader Bang Mihn boards the Mekong Express, the high speed rail link recently completed linking China to all its neighbors within the Mekong Region. His GMS Trading and Investment Corporation in Bangkok, Kunming and Ho Chi Minh City handles any imaginable product and financial service, from investment banking and insurance, to IT products, construction materials, timber, agricultural and wildlife products. He's conversant in Thai, English, Vietnamese, Khmer, Mandarin, Hokkien and numerous other regional dialects, as are most of his 1,000 or so employees stationed across the region.

Professor Hu Tao, chief economist of the Beijing-based Policy Research Center for Environment and Economy, utilizes the fictional Minh to emphasize the extensive economic opportunities emerging to people in the region as trade and investment increasingly crisscross political boundaries on the heels of greater economic integration facilitated by trade agreements including the upcoming ASEAN Economic Community in 2015.

But not all 600 million people in the region will benefit like Minh from these opportunities. Dr. Hu and participants of the Sustainable Mekong Research Network (SUMERNET) annual research forum entitled “Changing Livelihoods in the Mekong: Surviving in the Fast Lane” discussed the other side of this story while meeting in Bangkok from 11-13 January 2012. 

“The fast lane is expensive to build and not everyone can get in it,” says Dr. Charit Tingsabadh, Chulalongkorn University’s professor of environmental economics and SUMERNET steering committee member. “We have to provide other lanes to accommodate everyone.”

Winners and losers

For decades, the vast majority of economic activity in the region has been driven by farmers, fishermen, unskilled laborers and small and medium enterprises. This composition is changing as advancing investment in infrastructure and business accelerates under regional integration. 

“Inequality increased while trade prospers,” says Dr. Le Dung Doanh, respected senior economist from Viet Nam. “Viet Nam [for example] joined the WTO in 2007 and we see an ever widening gap between the rich and the poor. We trade more with Laos, Thailand and Cambodia but our deficits with China grow larger every year.”

Community activist Ravadee Prasertcharoensuk, Director of the Sustainable Development Foundation, points out that beyond the highrises and high speed rail lies a different story. “Despite statistics of higher average income in Thailand, poverty has increased. I mean poverty in every sense. Today people in communities work longer and harder to make ends meet. They have no time for family, no recreational lifestyle or cultural activities. Even their simple desire to have enough food in their bowl, to sleep well at night, to smile happily and to die free of worries cannot come true. They no longer have control over their lives or future.”

Blazing alternative trail

So what does the fictional Mihn think about all these challenges, says Hu Tao. “I care about my company and it’s image. I don’t break laws. But when it comes to environmental impact from, for example, timber trade with Laos, that’s for other people like SUMERNET to monitor and propose EIA and other sustainable policies.” 

The challenge for SUMERNET, a community of some 40 multi-disciplined researchers in Laos, Cambodia, Thailand, Vietnam and Myanmar committed to accelerating the implementation of policies that foster greater sustainability within the Mekong basin, is to ensure policies are put in place to steer regional integration and economic growth that fosters equity and environmental protection.

“Regional integration cannot be driven by the market alone,” Ravadee asserts. “My research questions to SUMERNET are how to promote good governance in decision making? How to vastly expand the range of regional stakeholders consulted? What kind of political, socio-economic structures are needed to prevent most people from losing out.”

Kanokwan Manorom of Ubon Rachathani University concurred, noting regulatory safeguards need to be created that protect people from being disadvantage, citing her recent study on contract farming commissioned by the Asian Development Bank. “Contract farming which is mushrooming in many Mekong countries is not necessarily negative, but there must be a mechanism to increase the negotiation power of small farmers for them to stand on a level ground with investors.” So far this growing trend is leading to declining real income for farmers, Kanokwan says. 

However, Kanokwan is wary that national governments have the will to add any controls to the transboundary economic integration, thus we should possibly “focus more time and energy to influencing good corporate practice.”

Improved education and greater flow of information are also important factors to promote successful regional integration. Even if policies are in place to increase farmers’ negotiating position with agricultural companies, will they have sufficient knowledge and training to ensure they are not taken advantage of? For example adds Paul Steele, of the United Nations Development Program, Chinese companies operating in the Lao PDR are ignoring Chinese sustainable practice regulations that govern their operations abroad, but neither the farmers nor the Lao government are aware of these laws or how to get them enforced. 

Spending more than two decades reporting and analyzing changes in Asia, Don Pathan of The Nation agreed that the extent of success of regional integration as promoted by the ASEAN Economic Community depends on how much the majority feels there is a sense of fair play between all sectors and stakeholders in the region.

Forum members also stress that economic prosperity must go hand in hand with political transparency. Citing diving transparency indices across the region, Dr. Christer Holtsberg, SUMERNET co-founder and steering committee member expresses concerns that welfare of people in the region cannot be achieved if the problem persists.

Participants point out there’s much more to regional integration than the economy. “It’s people’s interactions, trust and cultural sensitivities that touch ordinary people’s life,” adds The Nation’s Don Pathan. “There are also so many security landmines such as freer flow of drugs that comes with the opening of borders that need to be dealt with by social strength.”