According to the World Bank, Asia’s smallest economies are growing faster than giants like China.
Cambodia, Laos and Myanmar will expand fastest in Asia after India between 2017 and 2019, maintaining growth rates of near 7 percent, in keeping with forecasts released this week. Among the least developed countries, the three economies have a combined size of lower than $100 billion, a few third of neighbors equivalent to Singapore, Malaysia and the Philippines.
Southeast Asian countries situated within the Mekong region are stepping up infrastructure efforts to spice up economic growth and diversify their economies, searching for to shed the region’s image of backwardness.
“The promise of turning the Mekong into a manufacturing hub has great potential,” said Victorina. “Vietnam is a model for export-led growth from agriculture. We have seen Myanmar, Laos and Cambodia try to emulate Vietnam’s model of attracting foreign direct investment (FDI) to sustain their export capabilities.”
They are counting on China, which is investing in all three countries in all the pieces from railways to real estate.
After many years of military rule, Myanmar is liberalizing its economy and embracing market reforms because it transitions to democracy. China is its largest trading partner and is constructing a special economic zone, an influence plant and a deep-water seaport on its western coast.
In Laos, a long-delayed $5.7 billion railway from China through northern Laos officially began construction last month, Global Construction Review reported. Cambodia has turn out to be particularly attractive to Chinese manufacturers seeking to relocate there, consistent with China’s technique to export manufacturing capability through initiatives equivalent to its One Belt, One Road program.
Source: Bloomberg
