From ai268@freenet.carleton.ca Wed May 22 08:00:18 1996 Received: from bud.sandelman.ocunix.on.ca by sandelman.ocunix.on.ca with SMTP id AA20005 sender ai268@freenet.carleton.ca (5.65a/IDA-1.4.2); Wed, 22 May 96 07:58:32 -0400 Received: from freenet.carleton.ca (root@freenet.carleton.ca [134.117.1.25]) by bud.sandelman.ocunix.on.ca (8.6.12/8.6.12) with ESMTP id EAA09108 for ; Wed, 22 May 1996 04:33:39 -0400 Received: from freenet3.carleton.ca (ai268@freenet3.carleton.ca [134.117.1.22]) by freenet.carleton.ca (8.6.12/8.6.4) with ESMTP id IAA02046 for ; Wed, 22 May 1996 08:07:11 -0400 From: Reid Cooper Received: (ai268@localhost) by freenet3.carleton.ca (8.6.12/NCF-Sun-Client) id IAA03023 for dianne@sandleman.ocunix.on.ca; Wed, 22 May 1996 08:07:10 -0400 Message-Id: <199605221207.IAA03023@freenet3.carleton.ca> Subject: MEKONG SEEN RIPE FOR FUNDING (fwd) To: dianne@sandleman.ocunix.on.ca Date: Wed, 22 May 1996 08:07:09 -0400 (EDT) X-Mailer: ELM [version 2.4pl23 NCF 1.1] Content-Type: text Content-Length: 6449 Status: RO Forwarded message: >From free-burma@wingra.adp.wisc.edu Wed May 22 00:24:57 1996 Date: Tue, 21 May 1996 23:32:10 -0500 Message-Id: <199605220417.AAA08381@gramercy.ios.com> Errors-To: owner-free-burma@lists.stdorg.wisc.edu Reply-To: MOE@GRAMERCY.IOS.COM Originator: free-burma@lists.stdorg.wisc.edu Sender: free-burma@lists.stdorg.wisc.edu Precedence: bulk From: MOE@GRAMERCY.IOS.COM (JULIEN MOE) To: Multiple recipients of list Subject: MEKONG SEEN RIPE FOR FUNDING X-Listprocessor-Version: 6.0b -- ListProcessor by Anastasios Kotsikonas BANGKOK, May 22 (Reuter) - One of Asia's largest rivers, for decades seen as a war-torn backwater, is being touted as the thread linking the region's last great investment frontiers. The Mekong river and the six countries on its banks, including some of east Asia's poorest and most isolated areas, promise untold opportunities, fund managers say. ``The opportunities are great,'' said Gene Simmons, managing director of Finansa Thai which is organising three investment funds for the region worth $100 million. The Mekong rises in southern China and flows south, where it forms the borders between the opium-growing hills of Burma and Laos, and then between Laos and Thailand. It continues on to cross Cambodia and flows into the sea through a broad delta in southern Vietnam. ``Because of the regional geo-politics these countries have been (inward looking) for many years,'' Simmons told Reuters. ``Now it's clear that the rest of the world won't let them get away with that and everyone's killing themselves to get in there.'' As well as vast hydro-power potential, the region is seen as offering opportunities in a host of sectors including tourism, mining, transport and light manufacturing. But much investment is necessary before its potential can be fully tapped. The Asian Development Bank (ADB) estimates that the Greater Mekong Sub-region will require more than $25 billion in infrastructure expenditure and it is going all out to rally private sector investment to the cause. ``A key challenge to project implemention is financing,'' Noritada Morita, the ADB's director of programmes, told a conference. ``The costs associated with most of the priority sub-regional projects, particulary those in infrastruture, exceed the financial capacity of the six governments and official development assistance commitments.'' As well as Finansa, which is organising its funds with HG Asia, the Crosby Group has recently announced the closure of a $25.6 million dollar fund which will invest in unlisted companies in the six countries. ``The Greater Mekong Sub-region has a population of 225 million and is an interdependent trading and economic area with Thailand as the engine for growth,'' Crosby said in a statement. ``Governments in the Mekong region...are liberalising their economies, promoting foreign investment and regional cooperation which is resulting in strong economic growth.'' Thailand's southeastern Asian neighbours, including Malaysia and Singapore, are also keen to see that their businessmen get a piece of the action and are pushing for a role in the planning and development of the area. Simmons and others said the ADB, which is investing $10 million in the Crosby fund, was a catalyst, helping to finance large-scale infrastructure such as roads and bridges, thereby facilitating private sector investment. ``The ADB is the one which has been really pushing projects which have strong sub-regional elements,'' said Peter Brimbell, of consultants The Brooker Group. While stressing the opportunities for private investment, Brimbell said not all areas would be equally attractive to investors. ``Telecommunications is an area where the private sector will come in without too much trouble. The power sector is a bit more complicated. As for roads, it's very hard to imagine private sector involvement and railways, forget it,'' he said. Brimbell warned that investment in the region should be seen as long-term and problems were bound to arise. A $1.1 billion hydro-power project in Laos, the Nam Theun 2 project being built by an international consortium, has been stalled while the World Bank seeks further studies on its environmental impact. ``There are going to be a lot of problems (in investing in the region) but there are going to be successes too,'' Brimbel said. ``It's going to take time but I say roll with it.'' Despite the delay to the Nam Theun 2 project, a representative of one of the companies involved said the region had great opportunities. ``I would imagine that the Greater Mekong Sub-region has one of the highest growth rates and private sector involvement in the world,'' David Iverach, of Australia's Transfield told Reuters. ``It's competitive as hell.'' Plans to develop the Mekong river have been on the drawing board since the 1950s when the United Nations set up the Mekong Commission, grouping the river's four lower basin countries -- Thailand, Laos, Cambodia and Vietnam. But decades of war in Indochina, coupled with fundamental disagreements over water usage, prevented any progress. The four lower Mekong countries finally reached a broad argeement on water usage last year which the Mekong River Commission hailed as a landmark. The commission, funded by donor governments, stresses sustainable development, poverty alleviation and the need for environmental impact studies. ``If you let investors, private or state, go in without proper studies, without considering all the pros and cons, that can never be a good thing,'' said the commission's Lars Andreasson. The commission is trying to draw both China and Burma into the group amid fears that China, which has plans for a series of hydro-power dams on its stretch of the upper Mekong, might ignore the water needs of downstream countries. ``Unfortunately China controls the upper part of the Mekong so it's quite important to make sure they play along but it's not so easy to make sure they do,'' said one government offical. Andreasson declined to comment on worries about China but said its membership of the commission would be welcome: ``If you have one river it must be preferable to have all countries involved in the cooperation.'' 22:54 05-21-96 -- Reid Cooper