Conclusions

The greatest and glaring inefficiency in the Asian-Pacific region is in the urban agglomerations that are the main locus of economic activity. Considerable care needs to taken to ensure that the new enthusiasm for land based infrastructure in cross-border regions is not at the expense of high-yielding investments in vital urban infrastructure (Roberts and Kanaley, 2006). In determining trade-offs there is a need to consider a door-todoor logistics approach to all transport modes and seek to undertake the best calculus and ranking. There is a need to go beyond transport modes because cities are networks. Drainage networks have to be considered as they affect flooding and sewerage networks concern health. As the efficiency of the city depends on more than transport links, it is important not to be too sectoral in approaching this task.

These observations are most true of mega-cities like Bangkok, Jakarta, and Manila but less so of small cities, sometimes little more than overgrown towns like Port Moresby, Suva and Nuku'alofa, the capitals of Papua New Guinea, Fiji, and Tonga, respectively National governments are often reluctant to undertake large infrastructure projects in transport, sewerage and drainage within cities, but catastrophic flooding will overwhelm smaller scale projects designed to resolve urban poverty issues (e.g., slum improvement schemes). While up-country and border regions need investment, by and large, the scale of project is modest (village and rural roads, telecommunications towers, small airports), which do not necessarily need international aid funds. Indeed, in those countries that are democracies there is a political process to deliver local infrastructure and it is perhaps the quality of governance that needs to be addressed rather than lack of local capital per se. Up-country areas should not have to wait for international agencies to solve their problems.

There are also trade-offs between international and domestic projects. Within the Greater Mekong Subregion, the coastal highway between Ho Chi Minh and Hanoi would inter-mesh with transnational corridors. Similarly, the coastal tollway in Java and its extension into the Trans-Sumatra highway would benefit from some aid component of funding, even though not contributing directly to cross-border movements.

As noted, the ‘national' calculus for setting infrastructure priorities has obvious limitations, especially for small countries but also for the border regions and gateways of large countries. Conventional cost benefit calculus can underestimate the importance of crossborder movements in ‘glueing' multiple actors on different sides of the divide together and ‘lubricating' economic cooperation (Chen, 2006; Edmonds and Fujimura, 2008). Conversely, the ‘transnational' calculus can also skew investment to cross-border movements at the expense of domestic needs. There is also a high risk that elevating the priority of infrastructure investment located adjacent to physical borders may accommodate temporary distortions in national policy regimes that will be more effectively addressed by intra-regional liberalization and harmonization. In the European Union where resources are allocated fairly efficiently between countries, one does not observe large economic agglomerations at national borders. Thus a cross-border focus may be too narrow.

The vision explored here is designed to strengthen Asia's competitive position in global commerce by creating reliable, efficient and secure connections between main urban gateways to permit both seamless and fast movement. This regional policy framework for strategic gateways and multimodal corridors will guide future actions (Bohunicky, 2007). Strategically located gateways and border crossings play a vital role in fostering international competitiveness. Support is needed for gateway strategies and multimodal corridors to enhance trade competitiveness and the development of a regional transport network. A system-based approach is required that tackles infrastructure, policy, governance and operational issues in an integrated public and private sector strategy. As evident from the contrasting studies of Mainland Southeast Asia, Island Southeast Asia and the Pacific Islands, there is no ‘one-size-fits-all' package.

What is needed is a policy that distinguishes main flows of goods, people and information from the actual contours and gradients of economic space and pays attention to door-to-door logistics movements. Where are the highest returns from investment in network infrastructure such as transport, telecommunications and sewerage? The best returns are likely to be derived from large infrastructure projects in the main cities (e.g. to combat flooding in Bangkok, Manila and Jakarta) and specific intra-city transport links (e.g. Trans- Viet Nam and Trans-Java highways and railways). Given that there is no such thing as homogeneous economic space, attention should be should directed to the composition of flows through gateways and along corridors and identification of where the main obstacles, sometimes physical, and sometimes administrative, are to be found. It may be better to address the very real problems of congestion and pollution in urban areas to overcome externalities and bottlenecks than to spend a lot of money in improving or opening up lower density inter-city corridors to revitalize agriculture, small business and small cities and towns. In turn, SEZs are not a panacea but should be more closely aligned with the infrastructure development of the host cities to minimize the inefficiencies (e.g. congestion) as they impede the movement of people and goods. More specifically, there is the issue of how to determine priorities between modes in infrastructure development.

Investment planned in 2008 looks to the post-Kyoto world beyond 2012. In the 10-15 years hence it has to be assumed that increasing scarcities of fossil fuels will result in higher fuel prices across Asia. This will shift the relative prices of transport modes. For example, small unit truckloads will become more expensive relative to consolidated shiploads. In other words, pending the design of more fuel-efficient engines, road transport will become more expensive relative to sea transport. Rail transport will also be favoured at the expense of road transport, suggesting that Viet Nam, and Java and Sumatra in Indonesia, less so the Philippines, could support more efficient rail networks. While it is difficult to substitute the role of pick-up and delivery trucks within urban areas, the costs of road traffic and congestion will rise markedly increasing the need for rail-based public transport (e.g. in Jakarta and Ho Chi Minh City). Although these observations hint at the direction of change occurring in modal split, this issue needs further in-depth investigation to help international lending agencies determine priorities.

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