Greater Mekong Subregion: From Geographical to Socio-economic Integration

7. China (Yunnan)–GMS Economic Cooperation: New Development and New Problems

7 china (yunnan)–gmS economic cooperation new development and new problems Guangsheng Lu deveLopment and current Situation yunnan and gmS: a Survey Located in southwest China, Yunnan is the country’s eighth biggest province in terms of size (394,100 km2 ) and population (45.53 million, 2008). Besides the Han people, there are twenty-five ethnic minority groups, seventeen of them transnational. Yunnan shares a 4,060-km common border with Myanmar, the Lao PDR, and Vietnam and is close to Thailand, Cambodia, India, and Bangladesh. It has about 600 rivers which belong to six different river systems. Major rivers are the Dulongjiang, the headwaters of the Irrawaddy; the Nujiang, which is the upper reaches of the Salween; the Lancangjiang, known as the Mekong in the Lao PDR and Vietnam; the Red River which empties into the Gulf ofTonkin (Beibuwan in Chinese) through Vietnam.The strategic location of Yunnan does have great geopolitical and geo-economical significance, and its multinational water issues are complicated and sensitive. (See Table 7.1 for Yunnan’s economic indicators.) 103 104 Guangsheng Lu Yunnan was one of the earliest provinces in China to be engaged in regional economic cooperation with neighbouring countries. In the early 1990s, after the Cold War, Yunnan joined the Greater Mekong Subregion (GMS) which was proposed and financially supported by the Asian Development Bank (ADB). The GMS is a regional economic cooperation mechanism within the Langcang-Mekong River Basin. It comprises the six countries of Cambodia, China, the Lao PDR, Myanmar, Thailand, and Vietnam. In 1992, with ADB’s assistance, the six countries entered into a programme of subregional economic cooperation designed to enhance economic relations among them. Yunnan was the only Chinese province to participate in the GMS at the time, and Guangxi followed suit in 2005 when the second GMS Summit was held in Kunming. There are eleven sectors for cooperation in the GMS, namely, agriculture, energy, the environment, human resource development, investment, telecommunications, tourism, trade, transportation, multisector, and the development of economic corridors. Over the past two decades, the GMS is the important reason for, and the highlight of, Yunnan’s opening up and its regional economic cooperation with the GMS countries. trade, investment, and aid between yunnan and the gmS In recent years, Yunnan’s trade with ASEAN and the GMS grew quickly. Between 2005 and 2009, Yunnan’s total trade with the GMS reached US$93.38 billion and the country maintained a positive trade balance with the other GMS countries all these years (Table 7.2). The main goods Yunnan exported to the GMS were phosphorus chemicals, non-ferrous metal, mechanical and Table 7.1 Key economic Indicators in Yunnan, 2009 GDP (billion Government revenue Per capita yuan) and ranking (billion yuan) income (yuan) and ranking and ranking Yunnan 616.8 (24) 149.0 (17) 8,686 (14) Guangxi 770.0 (18) 96.6 (21) 9,116 (12) Guangdong 3,908.1 (1) 862.0 (1) 13,405 (4) China 33,535.3 (n/a) 6,847.7 (n/a) N.A. (n/a) Note: 1. Numbers in parentheses show domestic rankings. 1. Numbers in parentheses show domestic rankings. 2. N.A. = not available; n/a = not applicable. Source: National Bureau of Statistics of China. GMS-Yunnan Economic Cooperation 105 electrical products, and textiles. Goods imported from the GMS into Yunnan were metallic mineral ore, semi-manufactured non-ferrous metal, rubber, and agricultural products. In 2009 the trade volume between Yunnan and ASEAN was US$3.15 billion, US$2.1 billion for exports from Yunnan to ASEAN, and US$1.05 billion for imports from ASEAN to Yunnan. Trade with ASEAN accounted for almost 40 per cent of Yunnan’s total foreign trade, and trade with the GMS at US$2.41 billion accounted for 30 per cent (Table 7.3). The trade volume of Yunnan with Myanmar, Vietnam, Indonesia, Thailand, Malaysia, Table 7.2 Yunnan’s Imports from and exports to GMS Countries in 2005–9 (US$ million) From Import and Export Export Import Balance Myanmar 4,617.39 3,075.19 1,542.20 1,532.99 Vietnam 3,236.93 2,570.65 666.27 1,904.38 Lao PDR 459.62 230.83 228.79 2.04 Thailand 987.76 827.27 160.48 666.79 Cambodia 37.01 36.26 0.75 35.51 Total 9,338 6,740 2,598 4,142 Source: Author’s...