Erle Frayne Argonza y Delago
Magandang araw! Good day!
Around two (2) years ago, I articulated in one article the gigantic project that will
rise in the Mekong
River very soon. I was at
that time already very supportive of the project, a support that I will re-echo
at this moment.
For those unfamiliar with the project, a plan was hatched at the middle part of the
decade for an integrated project along the Mekong River.
Since the river begins upstream at the China
logically has to be involved in it. Finally, with blueprints for implementation
on the go around 2007 yet, China
committed to fund the projected cost of $100 Billion.
So huge a project, it will have couples of components into it. Power generation,
irrigation, flood control, transportation, and tourism comprise the core sector
components. A project of that size is four (4) times bigger than China’s own
3-Gorges Dam (it cost $23 at 2000 price index) and could be the largest that the
world will ever have experienced once fully accomplished.
Benefiting approximately 300 million beneficiaries along its courses, the project is bound
to spur development and generate incomes many folds larger than its total
investments. If we use the econometric index of annual income yield that is
10X, then we can expect an annual income yield of $1 Trillion from out of the
upstream and downstream industries induced by the project.
Since China is involved in it
right now (as implementation is going on), then we expect China to
receive the ROI (return on investments) in the widest expanse of benefits
possible. That means, once fully operational, China will infuse more investments
in the region to fully benefit from the project alone. The ROI will then be
much greater than the original $100 accruing to China alone on an annual basis.
We can therefore hope for an excellent win/win situation for China and the ASEAN countries involved (Vietnam is the
lead country executor). In the long run, we should hope that the same project
would accrue to the growth & development of the entire ASEAN region that is
bound to institute an economic union by 2015.
A win/win formula for the ASEAN itself is for it to use the Mekong project as
exemplar to design and implement similar projects in other member countries,
particularly in island southeast Asia. A
particular office can be created in the ASEAN secretariat to oversee and help
similar projects that can spin off in other parts of the region.
Since an ASEAN central bank is due for institution by 2015, let us expect that
monetary instruments for financial packages can be had for gigantic
infrastructure projects of the magnitude of the Mekong project. Probably an
ASEAN Development Bank can also rise alongside the central bank, thus
reinforcing the potency for launching gigantic projects that will be financed
internally by the region itself.
If ever the ASEAN will wish to tap other countries for co-financing of the
projects, it should be the emerging markets as top priority such as China, India,
countries that will be more sympathetic to regional development. The option
will help us veer away from the mal-intents of Northern banks that tied up
developing countries in debt peonage and won at the expense of the developing
As a matter of goodwill, ASEAN should better enter into the picture and look at
other facets of the project that the future union can fund. The expansion
phases of the Mekong project, for instance,
can be taken over by the ASEAN itself, thus lessening dependence from external
There are always pains to any large project, these being part of the costs of any
undertaking. Nonetheless, the Mekong project
should be supported and must go on until full completion. This will render it
as an exemplar just right in time for the creation of the ASEAN economic union
[Philippines, 05 November 2010]
[See: IKONOKLAST: http://erleargonza.blogspot.com,