BIMP-EAGA: Opportunities and challenges in the context …mima.gov.my/v2/data/img/content/Session2Paper3Prof.Jennifer.pdf · BIMP-EAGA: Opportunities and challenges in the ... PhD

1ST SULU SULAWESI SEA COFNERENCE 2015: KESBAN AT SEA: EXPLORING OPPORTUNITIES FOR HOLISTIC

SECURITY IN THE ESSZONE

BIMP-EAGA: Opportunities and challenges in the context of current development

Jennifer Chan Kim Lian PhD in Tourism and Hospitality Management Head of Unit BIMP-EAGA for Tourism Development Faculty of Business, Economics and Accountancy

Universiti Malaysia Sabah Email: [email protected]

18 Nov 2015

Auditorium YTL Building, UMS Campus. Kota Kinabalu

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BIMP-EAGA (Brunei Darussalam-Indonesia-Malaysia-Philippines East ASEAN Growth Area) Established in March, 1994-emerging growth area with the vision of economic integration using the growth triangle strategy

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“ last frontier” of

South East Asia

Main Purposes BIMP-EAGA

Exploit Economic complementarities

Export competitiveness Borderless

economies;

New regional growth- trade ,

investment , tourism

Improve people standard of living

Close cooperation -4

countries

Balance regional development - high economic

growth rate

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Capturing BIMP-EAGA Potential

and Opportunities

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5 clusters in the strategic framework- BIMP-EAGA Cooperative Initiative, 2008

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Total population of 70 million; land area of 1.6

million square ( Asian Development Bank, 2014 )

The growth area : 4 countries

1. Brunei Darussalam

2. 10 Indonesian provinces in the islands of Sulawesi and

Kalimantan, Maluku and Irian Jaya

3. Malaysian states of Sabah, Sarawak and Labuan

4. the Philippines islands of Mindanao and Palawan.

1) Size and Population

JCKL/6/3/14

7 2) Natural resources : Key activities and Sectors in BIMP-EAGA

Transport and Shipping.- connected

by sea and air to most major cities in

Asia

Agro-industry-coconut, palm oil, livestock and poultry, and high-value

tropical fruits and vegetables

Ecotourism destination-pristine rainforests and vast coral reefs,

culturally diverse

22 World heritage sites : 8 in Indonesia, 5 in Malaysia and 9 in The

Philippines

Fisheries-global centre for the

production and processing of

important marine products, with tuna

and seaweed

Abundant energy –oil, natural gas and

coal resources

76 universities in BIMP-EAGA region-10 in

island of Borneo; Academic programme.-

Marine, aquaculture, agriculture, forestry,

biodiversity, tourism and education

Cooperation strategies and programs ( ADB, 2004)

• 34 projects , $37.7 millions (ADB,2004)

• 50% -agri business and ecotourism

• 50%- trade, investment, transportation, communication and power

Geographic focus:

• 50% global reach

• 31%-intra –regional

• 19% -extra-regional

8 3) BIMP-EAGA in the regional and global environment-

strategic location within ASEAN

9 4) The BIMP-EAGA- ( infrastructure and resource-based projects (BIMP-EAGA Roadmap to development ,2006-2010)

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Road improvements in Brunei and Malaysia Construction of the Trans Borneo Grid interconnection between Sarawak and Kalimantan Kalimantan -national road programs enhance connectivity with Malaysia- the West Borneo Economic Corridor Expansion of ports in The Philippines The Philippines- upgrade of strategic roads in Mindanao to improve access to key ports, linking Mindanao and the rest of BIMP-EAGA under the Greater Sulu Sulawesi Corridor

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USD $1.1 billion pipeline of connectivity projects- Blueprint 2012-2016 Strong transportation network within the subregion transport connectivity systems by the Philippines -by strengthening several transport facilities, including the Davao-GenSan-Bitung Shipping Service; Brooke’s Point Palawan-Kudat RORO service, and Davao-Manado air Linkage. Boosting Internet connectivity in Mindanao through the BIMP-EAGA Submarine Terrestrial Cable Project to bring out the advantages in Mindanao’s outsourcing businesses (http://business.inquirer.net/190574/dti-vows-

to-pursue-bimp-eaga-initiatives

Regional connectivity

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Area of Opportunities: 1.Expansion of Air Linkages- Brunei Darussalam

2.Sea Linkages, Transportation & Shipping Services- Indonesia

3.Joint Tourism Development -Malaysia

4.Expansion of Fisheries Cooperation -Philippines

5.Construction & Construction Materials- Philippines

Areas of cooperation : 1.Telecommunications- Brunei Darussalam

2.Environmental Protection & Management-Brunei Darussalam

3.Forestry- Indonesia

4.People Mobility- Indonesia

5.Human Resources Development –Malaysia

6.Capital Formation & Financial Services- Malaysia

7.Energy -Malaysia

8.Agro-Industry Philippines

5) Areas of opportunities and cooperation

6) BIMP-EAGA: Record of Growth and Investment

• BIMP-EAGA’s combined GDP rose to $567 billion in 2013 from $424 billion in 2009 ( http://business.inquirer.net/190574/dti-

vows-to-pursue-bimp-eaga-initiatives#ixzz3qsn2OUFj)

• Growth 4.7% -2013

• Foreign direct investment -23% from USD 8.2 billion to USD 10.2 billion

• Domestic investment grew from USD 1.1 billion to USD4.6 billion

• Total trade –USD 166.35 billion 2013 vs USD 166.05 billion in 2012

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Increase cross border flows of goods and people

Sub regional value chains

Attract more private sector investment

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Potentially threatening challenges

Key challenges

1)Regional security and safety issues Peaceful borderless trading, fishing , educational and tourism areas without any borders and protocol ( Minda News, 2014),

• Improvements in regional connectivity via sea, land and internet bring security and safety threats, especially along the maritime border of Sabah and the Philippines.

• Security issues become more complicated and added concern about international terrorism

• Kidnapping incidents in Sabah and Palawan island -> negative perception and affect business confidence

• Tourism is greatly affected by the peace and order problems of the recent kidnapping events;

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Figure 1: The Philippine-Malaysia maritime border ( source: Michael Fabinyi et al., 2014, Development Policy Review, 2014, 32 (6): 715-732)

2) Business, trade and investment

•Ensuring regional peace and harmony, liberalizing rules, and law enforcement.

•Lack of smart partnership or core strategic amongst the member countries for flows of goods and peace and harmony in the region ( Mindanao Business Conference, 2001)

•Partnerships, alliances – fundamental pillars of growth and towards sustained prosperity , peace and development

•Coordinate and harmonize public policy to create business climate to invest ( source : http//www.mb.com.ph/bimp-eaga-and-imt-gt-asean-growth-engines/#uISgcYmQs0PY5beG.99)

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3) Narrowing the development gap

•Slow progressing in achieving economic integration and competitiveness -stable socio-economic and political regional environment ;

•Stay ahead of global changes - physical and social infrastructure –connectivity – land, sea and air.

•Issue of connectivity biggest challenge in joint tourism development ( Brunei, Times, 2011)

4) Climate change- constant threat to forest and marine ecosystems

•Potential impacts on livelihoods, productivity and competitiveness

•Actions to improve the resilience of local communities to climate change

•Sustainable growth, clean and environmental friendly –ensure cost reduction

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20 The Coral Triangle

Key environmental preservation region 76% of the known species of coral in the world and 37% of all reef fish species 30% of tuna caught in the world comes from the Coral Triangle

Moving forward……..

• BIMP-EAGA -an important building block for further political, social and economic integration of the ASEAN region

• Broader support framework and holistic approaches to regional security and safety, committed human and financial resources at the sub regional, national and local levels

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The roles of UMS

Assisting BIMP-EAGA to achieve its target and objectives in numerous ways:

1.Capacity building human resource development

2.Assist in various working groups under the clusters

3.Link and close cooperate with the private sectors and industries–driven R&D and innovation activities

4.Cooperate closely with other higher learning institutions for student and staff exchanges and sharing expertise

5.Provide advises and support , especially in tourism development and security and safety

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7.Conducting research in the critical areas to facilitate and achieve BIMP-EAGA mains

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Thank you

Thank you