(GMS) Cross Border Transport Agreement

The Greater Mekong
Subregion (GMS) Cross
Border Transport Agreement
Managing Regional Public Goods:
Cross-Border Trade and Investment:
Labor Migration and Public Health
Bangkok, 15-21 June 2005
Silvio Cattonar
1

Scope of Presentation
I. Overview of GMS
II.
The GMS Cross-Border
Transport Agreement
III. Sample Modality of Single-
Stop Inspection
IV.
Conclusion
V. Discussion
2

I. Overview of GMS
3

Myanmar
Land area: 677 thou sq km
Population: 53.2 M
GDP per capita: US$320
Yunnan & Guangxi, PRC
Land area: 624 thou sq km
Population: 92.3 M
GDP per capita: US$680
Thailand
Land area: 513 thou sq km
Population: 64.0 M
GDP per capita: US$2,240
Viet Nam
Land area: 332 thou sq km
Population: 80.9 M
GDP per capita: US$480
The GMS in 2003
Land area: 2,554 th sq km
Population: 309.4 M
GDP per capita: US$875
Lao PDR
Land area: 237 thou sq km
Population: 5.7 M
GDP per capita: US$410
GMS Transformation, 1992- 2003
Total Exports: +193.4%
Intraregional Exports: + 969.7%
Annual Tourist Arrivals: + 56.8%
FDI: + 140.5%
Cambodia
Land area: 181 thou sq km
Population: 13.3 M
GDP per capita: US$320
4

Transformation of GMS
Real GDP (1992 = 100)
1992
2003
300.0
250.0
Cambodia
Lao PDR
Total exports
(US$ million)
36,343 a/
106,644 a/
200.0
150.0
Myanmar
Thailand
Intraregional
exports (US$
million)
1,097 a/
11,735 a/
100.0
50.0
0.0
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
Viet Nam
Yunnan
Province
GMS
Foreign direct
investment
(US$ million)
Tourist
arrivals
(thousands)
a/ Excludes PRC
2,144
9,603
(1995)
5
5,156
15,054

The THREE Cs
• Connectivity
• Competitiveness
• Community
6

11 Flagship
Initiatives
1 Development Matrix
• From transport corridors into
economic corridors.
• Multistage projects with
potential for private sector
investment.
• Trade and investment,
private sector participation
and competitiveness
• Human Resources and Skills
Competencies
• Sustainable use of shared
resources in the six GMS
countries.
• Promoting the continued
growth of the subregion as a
single tourist destination.
• Corresponding investment
projects:
• $10 billion to $15 billion
• the GMS Development
Matrix
7

Connectivity
GMS: Infrastructure
Improvement 1992-2012
8

Enhancing Competitiveness
• Inter-Governmental Agreements on travel and
trade facilitation and power trade
• Dramatic reduction in travel time
• Removal of non-tariff barriers (Cross Border
Transport Agreement)
• Customs facilitation
• Enabling policy environment for private
investments (financial sector reform, judicial
reform)
• Capacity Building – Phnom Penh Plan for
Development Management
9

Building a Community
• Joint promotion of trade, investment, and tourism
• New initiatives for closer cooperation such as ACMECS
• Integrating Ethnic Minorities in mainstream GMS
development
• Joint work on HIV/AIDS, Malaria, and Avian Flu
• Preservation of shared environmental and cultural heritage
• Economic Integration: A Common Market? From an
integrated market to an economic community?
10

II. The GMS Cross-Border
Transport Agreement
• History of CBTA
• Issues
• CBTA Geographic Coverage and Content
• Status of Implementation of CBTA
• Key Implementation Issues of CBTA
• Sample Modality for Single-Stop Stop Inspection
11

History of the CBTA
• Identification of issues and review of existing international
conventions (Jul-Dec 1996 under ADB SSTA)
• Sixth GMS Transport Forum mandated preparation of a Framework
Agreement in lieu of near-term accession to international
conventions (Dec 1996)
• Preparation of Framework Agreement (Jan-Sep 1998 under ADB
RETA)
• Negotiation of Framework Agreement (Dec 1998-Nov 1999 under
ADB RETA)
• Signing of the Framework Agreement by LAO, THA, and VIE (Nov
1999)
• Preparation of Annexes and Protocols (Nov 1999-Dec 2000 under
RETA)
• Accession by CAM, PRC, MYA (Nov 2001-Sep 2003)
• Negotiation of Annexes and Protocols (Jan 2003- present under
ADB RETAs)
12

Issues
• Inconsistent and difficult border crossing
formalities and procedures
• Restrictive visa requirements
• Restrictions on entry of motor vehicles
• Different standards on vehicles and
drivers across countries
• Transit traffic difficult/not allowed
13

Overview of the GMS Cross-Border Transport
Agreement (CBTA)
• Multilateral instrument ratified by all GMS countries
• Includes references to existing international conventions
• Covers key aspects of cross-border transport facilitation
• Applies to selected and mutually agreed upon routes and points
of entry and exit
(for information on CBTA – visit http://www.adb
adb.org/ .org/gms/agreement)
14

Geographic
Coverage of CBTA
• Mukdahan – Savannakhet
• Lao-Bao – Dansavanh
• Aranyaprathet – Poipet
• Bavet – Moc Bai
• Hekou – Lao Cai
• Myawaddy – Mae Sot
• Mae Sai – Tachilek
• Nongkhai – Thanaleng
• Houayxay – Chiang Khong
• Ruili – Muse
• Mohan – Boten
• Nam Phao – Cau Treo
• Chongmek – Wang Tao
• Veune Kham – Dong Kralor
• Hat Lek – Cham Yeam
15

Contents of CBTA
1. Facilitation of Border Crossing Formalities
• Single-window inspection (SWI) and single-stop
stop
inspection (SSI)
• Coordination of hours of operation
• Advance exchange of information and clearance
• Harmonization and simplification of border
documents
• Priority order of border crossing clearance
• Application of risk management techniques
• Provision of required facilities and services
16

Contents of CBTA
2. Cross-Border Movement of People
• Issuance of visas for people engaged in cross-
border transport operations
• Compliance with international health quarantine
conventions
• Duty free allowance for private persons
• Provision of cross-border passenger transport
services
• Implementation of carrier liability regime for
cross-border passenger services
17

Contents of CBTA
3. Cross-Border Movement of Goods
• Grant of freedom of transit through each GMS
country
• Exemption of goods in transit from border
inspections
• Guarantee mechanism for cargo in transit
• Compliance with international
sanitary/phytosanitary
agreements
• Classification of dangerous goods
• Classification of perishable goods and
implementation of recommended standards for its
carriage
18

Contents of CBTA
4. Requirements for the Admittance of Road Vehicles
• Mutual recognition of vehicle registration
certificate, registration plate, and inspection
certificate
• Adoption of international standards on road
traffic regulations and signage
• Compliance with host country third party motor
vehicle liability insurance requirements
• Mutual recognition of driving license
• Grant of temporary admission to motor vehicles
without payment of import duties and taxes
19

Contents of CBTA
5. Exchange of Commercial Traffic Rights
• Allowing of transport operators in a GMS country
to undertake cross-border transport operations
• Agreement on criteria for licensing transport
operators for cross-border transport operations
• Setting of prices of transport services in line with
market forces
• Implementation of carrier liability regime for
carriage of goods
6. Infrastructure Requirements
• Compliance of CBTA routes in line with minimum
standards and specifications (ASEAN Highway
Standards)
20

Contents of CBTA
7. Institutional Framework
• Establishment of national transport facilitation
committees
• Establishment of Joint Committee
• Coordination between border authorities of
adjacent countries
8. Other Provisions
• Nondiscriminatory treatment
• Promotion of multimodal transport and adoption
of multimodal carrier liability regime
• Adoption of container customs regime
21

Status of Implementation of CBTA
• Negotiation, Finalization, and Signing of all the
remaining annexes and protocols, 2004-2005
2005
• Initial implementation of the Agreement at
selected border crossing points, 2005-2008
2008
(Dansavanh-Lao
Bao, Bavet-Moc
Bai, Poipet-
Aranyaprathet, Mukdahan-Savannakhet
Savannakhet, Hekou-
Lao Cai, , Mae Sot-Myawaddy
Myawaddy, , Mae Sai-Tachilek
Tachilek)
• Ratification of all annexes and protocols, 2004-
2006 (Stage 1 signed in April 2004, Stage 2 in Dec
2004, and Stage 3 in 2005)
• Full implementation of the GMS Cross-Border
Transport Agreement and its Annexes and
Protocols, 2007-2008
2008
22

Key Implementation Issues of CBTA
• Capacity building at national and border levels
• Establishment of required border infrastructure
• Development of ICT/MIS for efficient border
management
• Passage of new legislation to establish various
transport facilitation regimes
• Continue to strengthen goodwill and trust among GMS
countries
23

III. Sample Modality for Single-
Stop Inspection
Performance in
Foreign Territory - Four
Steps
24

Step I: Joint Customs Inspection in Common Control Area
(CCA) at Country of Entry
Country A
Country B
C-A C-B
Physical Inspection
CCA
As required
“No-Man’s Zone”
Export/Transit Cargo
C Q I
Submission of
documents
I Q C
Submission of
documents
Legend:
Export/Transit Cargo
C-Customs; Q-Quarantine; I-Immigration
C-A C-B
Physical Inspection
CCA
As required
25

Step II: Joint Customs Inspection in Common Control Area
(CCA) and Clearance/Processing of Customs Documents at
Country of Entry
Country A
Country B
C-A C-B
Physical Inspection
CCA
As required
“No-Man’s Zone”
Export/Transit Cargo
C-A Q I
C-B
Submission of
documents
I Q C-B
Submission of
documents
C-A
Legend:
Export/Transit Cargo
C-Customs; Q-Quarantine; I-Immigration
As required
C-A C-B
Physical Inspection
CCA
26

Step III: Joint Customs and Quarantine Inspection in Common Control
Area (CCA) and Clearance/Processing of Customs and Quarantine
Documents at Country of Entry
Country A
Country B
C-A,C-B Q-A,Q-B
Physical Inspection
CCA
As required
“No-Man’s Zone”
Export/Transit Cargo
C-A
C-B
Q-A
Q-B
I
Submission
of documents
I
Submission of
documents
Q-B
Q-A
C-B
C-A
Legend:
Export/Transit Cargo
C-Customs; Q-Quarantine; I-Immigration
As required
C-A,C-B Q-A,Q-B
Physical Inspection
CCA
27

Step IV: Single Window and Single Stop: Joint Customs and Quarantine Inspection
in Common Control Area (CCA) and Clearance/Processing of Customs, Quarantine,
and Immigration Documents
Country A
at Country of Entry
Country B
C-A,C-B Q-A,Q-B
Physical Inspection
CCA
As required
“No-Man’s Zone”
Export/Transit Cargo
C-A
C-B
Q-A
Q-B
I-A
I-B
Submission
of documents
Submission
of documents
I-B
I-A
Q-B
Q-A
C-B
C-A
Legend:
Export/Transit Cargo
C-Customs; Q-Quarantine; I-Immigration
As required
C-A,C-B Q-A,Q-B
Physical Inspection
CCA
28

IV. Conclusion
• Connectivity: CBTA is essential in maximizing
the benefits of subregional transport
infrastructure
• Competitiveness: CBTA will result in improved
efficiency arising from easier flow of goods and
people across borders:
• Community: CBTA fosters greater sense of
community and promotes harmonization of
rules and procedures
29

Thank You
For more information:
• GMS Program – http://www.adb
adb.org/ .org/gmsgms
• GMS countries - http://www.adb
adb.org/Mekong
• CBTA – http://www.adb
adb.org/ .org/gms/agreement
30

V. Discussion
31

Major Achievements of the GMS Program
• Mutual trust and confidence
• Ownership and commitment at the highest political
level
• Unique institutional arrangements for cooperation
• Major capacity building support (Phnom Penh Plan)
• 18 loan projects (completed and ongoing) worth US$3.9
billion
• 95 TA projects (completed and ongoing) worth US$104
million
• Agreement to facilitate the cross-border transportation
of goods and people
• Inter-Governmental agreement on regional power trade
• Promotion of the GMS as a single tourist destination
• Cooperation on HIV/AIDS
• Development of a strategic environment framework
32