Asia-Pacific Regional Partnerships for Connectivity and Sustainable Development
Delivered at the Dialogue on Strengthening Connectivity Partnership, 22nd APEC Economic Leaders Meeting in Beijing, China
Honourable Presidents and Prime Ministers,
China’s leadership in APEC has been key on many counts. Augmenting and deepening APEC’s development agenda, you have been promoting a cohesive and coherent regional trade framework, integrated regional connectivity, and supportive newer infrastructure financing mechanisms and approaches. As a global driver of growth, trade, innovation and finance, China has taken strong leadership in all of these areas on our platform at ESCAP.
China also brings its unique voice and position to these issues. Its strategic location, respect for the sovereignty of all nations, determination to pursue people-centred development, and a foreign policy that reaches out beyond its neighbours, all offer a new context and dimension to the future of global peace and shared prosperity in this multilateral world.
Your Excellencies, this forum on “Strengthening Connectivity Partnership,” organized under your leadership, offers an opportunity to foster Asia-Pacific regional economic cooperation and integration. Over the years, the emergence of a range of strategic regional groupings with overlapping membership call for effective coordination to unleash mutual advantages. This is possible for us as most members of APEC, in particular ASEAN, are represented at the ESCAP intergovernmental platform, and given our broad based membership we work closely with other subregional groupings too, including the South Asian Association for Regional Cooperation (SAARC) and the Pacific Island Forum (PIF). In this context, the current APEC-non-APEC dialogue is timely indeed. The APEC Blueprint for Regional Connectivity resonates very much with the architecture and solutions being tabled for Asia and the Pacific at the ESCAP intergovernmental platform, and will mutually synergize these two plans, which could bring prosperity for all.
So what can ESCAP bring to this process?
As the largest and most inclusive intergovernmental platform for the region, ESCAP is a neutral and honest broker. It facilitates effective negotiations between the large and small economies based on the emerging architecture for new corridors of prosperity; and fosters consensus and legal agreements for regional connectivity.
Our member States have provided us with a new mandate now to advance regional cooperation and integration for shared prosperity. This is structured as multi-country, multi-sector and multi-stakeholder work, and calls for the promotion of cooperation in regional connectivity, trade, and finance, and addressing shared vulnerabilities.
ESCAP is encouraging a move from “segmented approaches” to connectivity (anchored predominantly in transport) to a holistic, integrated and sustainable approach to ensure contiguous and seamless networks. This architecture complements and reinforces your strategic vision, which capitalizes on the lucrative ancient routes over land and sea across the Silk Road Economic Belt and the 21st Century Maritime Silk Road which, among others, will foster Eurasian integration which we are also working on.
To its credit, our region, with the support of ESCAP, has been engaged in the development of
- The Trans-Asian Railway and Asian Highway networks, with supportive dry ports, for which we just concluded the intergovernmental agreement;
- The Asian Energy Highway; and
- The Asian Information Super-Highway, which involves deployment of terrestrial and submarine cross border optic fibre cable links, and for which work is underway.
Integrated intermodal connectivity, where roads lead to the railway networks linked effectively to ports, offers the most cost-effective, long haulage of cargo option for our region.
Reinforced by ICT regional connectivity, it has the potential to enhance economies of scale and externalities by (i) optimizing the use of each transport mode, (ii) generating capacity reserves, (iii) reducing the carbon footprint of the transport industry, (iv) generating economic vitality through enhanced virtual exchanges, and (v) enhancing people to people connectivity across the continent.
So how do we translate the overall vision into reality? I will highlight a number of areas:
First, with ESCAP’s facilitation and involvement, the region already has begun efforts to promote regional connectivity. Among others, these are:
- The Greater Mekong Subregion Cross-border Transport Agreement, which opens traffic along the East-West economic corridor for Lao PDR and links it with Thailand and Viet Nam;
- The Road Transport Facilitation Agreement which has just been signed and opens nearly 10,000 km of transit routes between the landlocked Central Asian Republics and key sea ports in the Russian Federation and in China;
- China, Mongolia and the Russian Federation have augmented their inter-state transport agreements to offer transit rights to Mongolia for goods traffic flowing back and forth through this transit corridor; and
- The Asian Energy Highway, which will be transformed through better integration of energy corridors and deployment of smart grid technologies, which could bridge subregional power interconnections.
Second, tapping the regional pool of savings and fast-tracking operationalization of the emerging financing vehicles will be critical for meeting the huge financing requirements, and supportive credit enhancements for mitigating cross border infrastructure risks, with ESCAP supporting the intergovernmental consensus and legalities. We are pleased that newer complementary and supplementary financing vehicles, such as the Asian Infrastructure Investment Bank (AIIB) and the New Development Bank (BRICS Bank), given its capital base, will allow us to leverage private financing. The role of institutional investors in infrastructure financing needs to be encouraged by, among others, spinning off infrastructure bonds. I would be remiss in not mentioning that tapping tax/GDP potential in 16 countries alone can mobilize $300 billion as a recent study of ESCAP has indicated.
In conclusion, regional partnerships have to be at the core of the unfinished regional connectivity agenda. The magnitude and size of the task at hand calls for tapping public-private partnerships with supportive credit enhancement arrangements to mitigate the different types of risk so typical of cross-border infrastructure. In prioritizing and sequencing regional projects, there is a need to promote the railway networks which lag the most and the energy links which operate below capacity and aggravate supply constraints and pricing margins.
Riding on the wave of connectivity, the time is now right and ripe for innovative and sustainable solutions to lead our region for a prosperous and resilient future, and we count on your continued leadership in all these forums.
I thank you.