China aims to develop border area with Laos

China has announced that it will invest US$31.4 billion in the Mengla economic zone in Yunnan province of the country, which shares a border with Lunag Namtha and Phongsaly provinces in northern Laos.

The investment will cover more than 240 projects in such fields as transportation, education and energy for the Mengla zone in Xishuangbanna Dai Autonomous Prefecture in Yunnan province, according to the China Daily report yesterday.

The 4,500-sq-km zone, approved by the State Council, China’s cabinet, in July includes an economic development park at Mohan on the border.
 

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Last month, the governments of Laos and China signed a cooperation agreement to establish an economic cooperation zone in the Boten-Mohan border area, aiming to boost trade, investment and tourism in the region.

The agreement was signed in China between Deputy Prime Minister in charge of economic affairs, Somsavat Lengsavad and Chinese Minister of Commerce Gao Hucheng and witnessed by the visiting President Choummaly Sayasone and Chinese President Xi Jinping.

This is the second cross-border economic cooperation zone that China has established with its neighbors, which should serve as a significant driver for economic cooperation in the region.

An official from the Yunnan planning department Ruan Jianzhong was quoted in China Daily as saying that the Mengla pilot zone will be important for strategic cooperation between China and Laos, a comprehensive transport hub linking China with the Indo-China peninsula and an economic growth engine for the border area.

Construction started on a railway linking Yuxi to Mohan, part of the China-Laos international railway, in August and preparations for Mengla airport are underway. The railway and airport are expected to be in use by 2020.

The zone will focus on agriculture, biological industries, processing, logistics and cultural tourism. The Chinese government aimed to develop this region as a gateway and an economic hub between Asean and China.

The rail project linking Vientiane to the Lao-China border is expected to commence construction in November.

On the Lao territory, Boten is currently designated as a specific economic zone, covering a total area of 1,640 hectares with a current investment capital of US$500 million.

The zone is being developed by two Chinese companies – Yunnan Hai Cheng Industrial Group Stock Co., Ltd and Hong Kong Fuk Hing Travel Entertainment Group Ltd with a concession period of 99 years.

The Chinese developers have announced that they will focus on four mega projects in the zone including a duty free center, bus station complex, warehousing and a resort that shall feature a large natural marsh, hotel, meeting hall and other relaxing places.

Boten is located in Luang Namtha province of northern Laos, which is accessibly by Road No. R3; the governments of Laos and China have agreed to explore potentials for economic cooperation in this region.