Economic Corridor Programmes and Projects

Maximising Economic Network Externalities

There are five priority economic corridors in IMT-GT. Each corridor has its own unique characteristics as defined by its geographic location and comparative advantage. However, what is common among them all is the deliberate policy to enhance connectivity and promote industrial clusters and cross-border production networks along these corridors. This is done with the specific goal of maximising economic network externalities along and beyond the corridors. The IMT-GT’s corridors therefore represent a confluence of regional economic integration and inclusive growth.

In this context, IMT-GT will identify, develop and implement programmes and projects that serve to connect the right economic agents in and outside of the corridors, including the MSMEs and SMEs which are the mainstay of IMT-GT economy both in terms of number of business establishments and employment generation.

IMT-GT CorridorKey Characteristics
Extended Songkhla– Penang–Medan Corridor (EC1) EC1 hosts some of the most agriculture-rich provinces in Southern Thailand that trade with Malaysia, Sumatra and Singapore and plays an important role in the supply chain of traded goods outside the subregion. EC1 covers several provinces in the border areas of these two countries and will serve as the anchor for clustering major economic activities through the development of industrial hubs and special economic zones.
Straits of Melaka Corridor (Trang–Satun–Perlis– Penang–Port Klang– Melaka) (EC2) Due to the proximity of this corridor to Sumatra, there is considerable potential to complement the various stages of the production chain with this province, especially if a series of economic and industrial zones are established at strategic points along the corridor. This corridor has the potential to serve as a food hub, especially for halal, since a number of food terminals and integrated food centres are being planned within the corridor.
Banda Aceh– Medan–Pekanbaru– Palembang Economic Corridor (EC3) This corridor, which is part of ASEAN Highway Network, is of critical importance for developing Sumatra, as well as an important building block for further enhancing connectivity within the IMT‑GT subregion. Its development is closely linked with that of the other three corridors.
Melaka–Dumai Economic Corridor (EC4) This maritime corridor has a long tradition of freight and passenger traffic between Sumatra and Malaysia. Dumai is the gateway port of Riau Province, one of the richest provinces of Indonesia with abundant palm oil plantations and on–shore oil and gas resources. Dumai is principally a palm oil-related export port with general cargo, fertiliser, cement and rice being the main import traffic.
Ranong–Phuket–Aceh Corridor (EC5) The Ranong Phuket–Aceh Corridor is envisaged to enhance the connectivity between Sumatra and Southern Thailand primarily through maritime mode. Connectivity will be established through the development of facilities in key ports in Sumatra.

Source: Adopted from Mid-term Review of IMT-GT Implementation Blueprint 2012–2016

IMT-GT Economic Corridor Map

Key Corridor Programmes and Projects

IMT-GT will continue to accord high priority to the implementation of programmes and projects that aim at expanding and enhancing the physical connectivity of these corridors, particularly in areas of transport, ICT and power connectivity.

To support infrastructure development, IMT-GT will tap into emerging funding vehicles such as the Asia Bond Fund, the Asian Bond Market Initiative, the ASEAN Infrastructure Fund, and the Asian Infrastructure Investment Bank. IMT-GT will also encourage more private sector investment in infrastructure in the corridors through putting in place robust public private partnership frameworks characterised by clear risk-sharing arrangements and project development. 28 Equal attention will be given to programmes and projects that aim at addressing the software deficits of the corridors as well as programmes and projects that contribute to the service performance and interoperability of the hardware and software of the corridors. Among others, this will include projects to streamline the CIQ rules, regulations and procedures along the corridors.

The next category of corridor programmes and projects are those that contribute to the development of industrial clusters and production networks along the corridors; and expansion, diversification and sophistication of the manufacturing, agribusiness and tourism value chains. This includes projects on developing Special Border Economic Zone (SBEZ), Special Economic Zones (SEZ), as well as projects on enhancing skills and technology infusion. The latter may involve collaborative activities between the governments, businesses, civil societies, universities (e.g., UNINET) and research organisations.

Maximising Economic Network Externalities Through Corridor Development

Underpinned By Results-Based Monitoring and Evaluation

IMT-GT acknowledges that producing quality outputs is simply not enough. In order to realise Vision 2036, IMT-GT projects must be able to deliver results close to where the intended beneficiaries are located.

To accelerate the strategic shift toward results, IMT-GT will mainstream the results-based monitoring and evaluation system as outlined in the IMT-GT Project Manual. The system will capture the delivery of project outputs, outcomes and impacts. Better decision making will be achieved through focusing systematically on the whole results chain, from inputs to impacts.

Vision 2036 will be reviewed every five years to monitor progress and evaluate outcomes and impacts with a view towards fine-tuning and enhancing the subregional cooperation and integration efforts.