Mekong Monitor: Vietnamese Prime Minister launches Vietnam’s 2020 ASEAN Chairmanship
Photo credit: Viet Nam News
TRADE, ECONOMY, AND INVESTMENT
Vietnamese Prime Minister launches Vietnam’s 2020 ASEAN Chairmanship
(7 January 2020) Vietnamese Prime Minister Nguyễn Xuân Phúc chaired a ceremony in Hanoi on 6 January launching Vietnam’s 2020 ASEAN Chairmanship. The Prime Minister stated that Vietnam intends to build upon the achievements and efforts of previous ASEAN chairs and work to identify the future direction of the ASEAN Community until 2025 and beyond. The ASEAN 2020 theme of ‘Cohesive and Responsive’ will be centered on five priorities: strengthening ASEAN unity and regional centrality, intensifying economic integration, promoting the ASEAN identity, enhancing ASEAN’s global partnership for peace and stability, and developing the bloc’s institutional capacity and effectiveness.
Vietnam’s total export of seafood in 2019 misses goal for second year in a row
(8 January 2020) Vietnam exported a total of US$8.6 billion worth of seafood in 2019, a 2.2% y-o-y drop and lower than the year’s goal of US$10.5 billion. This is the second year in a row in which Vietnam missed its seafood export goal, exporting a total of US$8.8 billion in 2018 (well below then target of US$10 billion). The sale of shrimp, the largest contributor to Vietnam’s total seafood export value, was US$3.38 billion in 2019, a 5% reduction y-o-y. Vietnam has once again set a target of US$10 billion for its seafood exports in 2020, an expected increase of 16.3% increase from 2019.
Cambodia benefitted from US-China trade war, claims National Bank of Cambodia
(7 January 2020) The National Bank of Cambodia has claimed in its latest report that Cambodia benefited from the trade war through the relocation of production from China to the country to avoid US tariffs. A think tank quoted stated that while Cambodia may benefit from Chinese investors seeking to relocate their production base, in the long term the country will experience negative impact due to China possibly reducing investment if a global economic crisis occurs. However, neighbouring countries such as Vietnam and Thailand have absorbed more investments from relocating companies due to superior capacity and infrastructure.
195 MW of electricity from Laos dam linked to Cambodia’s national grid
(8 January 2020) Nearly 200 MW of electricity from the Dan Sahong Dam in Laos was linked to Cambodia’s national grid on 7 January after tests on the dam’s four electricity generators were completed. The power linkage between interim transmitters in Laos and transmitters in Cambodia’s Stung Treng province was carried out in preparation for the official importing of power from Laos to Cambodia in the first quarter of 2020. The US$500 million dam has an installed capacity of 260 MW. Cambodia and Laos had also reached an agreement for a 2,400MW power purchase scheduled to start in 2024.
Myanmar economy expected to remain flat at 6.5% growth in fiscal year 2019/2020
(8 January 2020) A British research firm projected in a recent report that Myanmar’s economy will remain flat at 6.5% growth in the fiscal year 2019/2020. The growth forecast was reportedly the lowest yet among other projections: the ASEAN+3 Macroeconomic Research Office forecasted 7.1% while the World Bank projected a 6.6% growth. Among the reasons attributed to the flat growth was poor access to credit for the country’s SMEs (which account for a third of the contribution to Myanmar’s GDP), and the poor business environment that deters foreign direct investment. High projected inflation of 6.5% in the fiscal year and uncertainty caused by an upcoming general election will also curtail growth. Nevertheless, sectors which are expected to grow include manufacturing, trade, transportation, and tourism.
About Greater Mekong Subregion (GMS)
The Greater Mekong Subregion (GMS) Economic Programme was launched by the Asian Development Bank in 1992 connecting five developing ASEAN countries, namely Cambodia, Laos, Myanmar, Vietnam and Thailand, and Chinese provinces of Yunnan and Guangxi Zhuang Autonomous region. The region has some of the most robust economies sharing the Mekong River Basin thanks to its reform and liberalisation. The subregion is growing at a faster pace than the whole of East Asia and the Asia Pacific as the GDP growth rate for 2017 was at 6.4 percent, according to the World Bank. The population at the subregion as of 2016 is at 340 million while the GDP at PPP is at US$3.1 trillion in 2016. In 2015, trading within the region was at US$444 billion.