VZCZCXRO7123
PP RUEHCN RUEHDT RUEHGH RUEHHM RUEHVC
DE RUEHCHI #0052/01 0880940
ZNR UUUUU ZZH
P 280940Z MAR 08
FM AMCONSUL CHIANG MAI
TO RUEHC/SECSTATE WASHDC PRIORITY 0719
INFO RUEHZS/ASSOCIATION OF SOUTHEAST ASIAN NATIONS
RUEHOO/CHINA POSTS COLLECTIVE
RUCPDOC/USDOC WASHINGTON DC PRIORITY 0003
RUEHKO/AMEMBASSY TOKYO PRIORITY 0041
RUEHCHI/AMCONSUL CHIANG MAI 0775

UNCLAS SECTION 01 OF 03 CHIANG MAI 000052 
 
SIPDIS 
 
SIPDIS 
 
EEB/CBA (DENNIS WINSTEAD) 
EEB/EX 
STATE PASS USTR AND USTDA 
 
E.O. 12958: N/A 
TAGS: ECON ELTN ECIN ETRD EWWT PREL TH BM CH LA CB
MY 
SUBJECT: REGIONAL BUSINESS CONFERENCE ON LOGISTICS BRINGS TOGETHER 
U.S. AND MEKONG REGION BUSINESSES 
 
CHIANG MAI 00000052  001.2 OF 003 
 
 
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Summary 
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¶1. In an effort to promote development in the Greater Mekong 
Subregion (GMS) logistics and transportation sectors and to 
underscore U.S. interest in deepening investment in the region, 
post hosted a conference on March 18-19 bringing together public 
and private sector representatives from across the GMS. 
Speakers reported on current trends in logistics development in 
the Asian Development Bank's GMS project and discussed the 
challenges ahead.  The participation of several U.S. firms 
highlighted our interest in economic development in the GMS and 
provided an opportunity for those companies to promote 
themselves to a regional audience.  End summary. 
 
¶2. The Asian Development Bank's GMS program is an infrastructure 
development project that seeks to expand trade through a network 
of highways.  Northern Thailand is situated at the crossroads of 
the two main routes, the North-South and East-West corridors. 
As a result, the northern provinces of Thailand have the unique 
potential to develop into a logistics and transportation hub for 
regional trade. 
 
¶3. To help explore these concepts, ConGen organized a regional 
business conference on "Logistics Development in the Greater 
Mekong Subregion: Managing Trade and Expanding Markets" on March 
18-19.  The event helped highlight the 175th anniversary of 
U.S.-Thai diplomatic relations, which was celebrated the same 
week.  The conference was made possible thanks to financial 
support from the Business Facilitation Incentive Fund (BFIF) and 
the United Parcel Service (UPS), as well as assistance from 
Embassies Bangkok, Phnom Penh, Vientiane and Consulates General 
Chengdu and Guangzhou.  With speakers and participants from 
China, Cambodia, Laos, Thailand, and the United States, the 
conference was an opportunity for regionally-based firms in the 
logistics, transportation, and supply chain sectors not only to 
learn about current trends in the Asian Development Bank-backed 
Greater Mekong Subregion project, but also to network with one 
another with the goal of developing a sophisticated, domestic 
logistics sector.  The presence of American companies, such as 
co-sponsor UPS, helped to highlight how U.S. business can also 
play an active role in the development of this region. 
 
--------------------------------------------- ----- 
Ambassador, Transportation PermSec Open Conference 
--------------------------------------------- ----- 
 
¶4. Ambassador Eric John opened the conference with a speech 
citing the strong trade and investment relationship between the 
U.S. and Thailand and calling for stronger links in logistics 
and transportation.  He also acknowledged the growing economic 
presence of China in Asia and quoted Assistant Secretary 
Christopher Hill saying that "more China doesn't mean less of 
the U.S." in Southeast Asia.  The Ambassador noted that 
transportation costs in Thailand are well above the average for 
countries in the region, a reminder that Thailand has the 
potential to make its trading network more cost-effective and 
efficient. 
 
¶5. Ministry of Transportation Permanent Secretary Chaisawasdi 
Kittipornpaiboon emphasized the importance of implementing an 
efficient highway management system and international supply 
chain through Thailand.  He predicted that Chiang Mai and Chiang 
Rai will be the provinces which benefit the greatest from the 
GMS project and the new Mekong river port at Chiang Saen 
expected to be completed by 2011.  The Permanent Secretary 
argued that Chiang Mai and Chiang Rai should be at the forefront 
of trade and tourism growth in the GMS.  While the Permanent 
Secretary praised the development of the GMS infrastructure, he 
 
SIPDIS 
acknowledged that Thailand is still struggling with utilization 
of the roads and bridges.  He cited that although it takes only 
three years to construct a new road or bridge, it takes at least 
six more years to implement using the infrastructure. 
 
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Regional Speakers Gather in Chiang Mai 
-------------------------------------- 
 
¶6. BFIF support brought together over 20 speakers and panel 
moderators from the GMS to discuss and debate current trends in 
logistics development.  Asian Development Bank Thailand Country 
Director Jean-Pierre Verbiest provided participants with an 
overview of logistics development from the perspective of the 
 
CHIANG MAI 00000052  002.2 OF 003 
 
 
GMS project's funding source, the ADB.  Presentations from the 
Thai and Chinese governments on logistics trends in those 
countries complemented the ADB's presentation.  Representatives 
of the Federation of Thai Industries (FTI) and UTI, an American 
logistics firm operating in Thailand, reported on how they 
applied lessons learned from management of trade across the 
Thai-Malaysian border. 
 
¶7. The conference also hosted three panel sessions.  The first 
panel on "Transportation and Customs" included speakers from the 
Thai Ministry of Transportation, the Cambodian Ministry of 
Public Works and Transportation, TNT Express Worldwide, and UPS. 
 Panelists' presentations showed the contrast between the public 
sector's focus on infrastructure development and the private 
sector's demand for a streamlining and sophistication of 
regulations, logistics, and customs.  A second panel led by 
American Chamber of Commerce member firms UPS, TNT Express, and 
UTI highlighted international best practices in logistics and 
supply chain management and provided an opportunity for American 
firms to promote themselves to local producers and business 
leaders.  A third panel on the "Expanding GMS Market" 
underscored the economic potential in some of the peripheral 
markets of the region, including Cambodia, upper northern 
Thailand, and Guangxi province in China. 
 
--------------------------- 
Participants Take the Stage 
--------------------------- 
 
¶8. Over 170 participants and observers from Thailand, Laos, 
Cambodia, and China joined this conference, which was hosted at 
the Shangri-La Hotel Chiang Mai.  Of these, the majority were 
local Thai businesses including manufacturing firms, logistics 
companies, and freight forwarders.  Other participants included 
representatives of academic institutions, non-profit 
organizations, and members of the RTG, including the Bank of 
Thailand.  During the UPS-sponsored lunch and reception, 
participants had the opportunity to network with one another and 
establish links both regionally and across these various sectors. 
 
¶9. During the second day of the conference, participants shared 
their own perspectives on logistics and GMS-related 
developments.  The approximately 100 participants who joined on 
March 19 separated into four workshops on human resource 
development, supply chain management, building a business 
network, and tourism and services.  Each workshop, under the 
moderation of a local business leader or academic, led 
participants through case studies and discussion questions on 
the group's respective topic.  Each group was asked to compile 
tasks that businesses, governments, or other interested parties 
could pursue in the months following the conference.  Each 
moderator shared their workshops' tasks with the full plenary 
before the conference's closing.  (See para. 10 for workshop's 
recommendations.) 
 
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Looking Ahead 
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¶10. The four workshops concluded with each moderator briefing 
the full plenary with suggested tasks for the future.  All four 
groups supported the idea of building a GMS center in northern 
Thailand to serve as a training center, logistics hub, and 
convention hall for trade shows.  The workshops agreed that a 
lack of information and sense of community among all parties in 
the GMS is an obstacle that a major hub could help overcome. 
The Supply Chain Management workshop also raised concerns about 
impacts of the GMS on farmers, who participants called "the 
origin" of the agricultural supply chain.  The Tourism and 
Services group also pointed out that China's impact on Mekong 
River water levels is an obstacle to the development of tourism 
along the river. 
 
¶11. The conference concluded with a speech by Embassy Bangkok 
Counselor for Economic Affairs Robert Griffiths who emphasized 
that, with speakers from the public and private sectors and 
participants from across the GMS and southeast Asia, the 
conference was an opportunity to make "new friends and build up 
relationships that will be useful in the future." 
 
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Reactions 
--------- 
 
 
CHIANG MAI 00000052  003.2 OF 003 
 
 
¶12. ADB Thailand Country Director Jean-Pierre Verbiest told 
EconCouns that of the many Greater Mekong Subregion conferences 
he has attended, this one was "the best one I ever attended," 
referencing especially the joining of private and public sector 
actors for a lively dialogue.  Press coverage by local daily 
print and broadcast media also highlighted the significance of 
the conference for the region. 
 
¶13. With about 180 participants at the opening, this two-day 
conference maintained over 100 attendees until the closing 
session on the second day.  About half of the participants 
completed and submitted survey forms on the second day, rating 
almost every session a score of 3 or better on a scale of 1 to 
5, 1 meaning "needs improvement" and 5 meaning "excellent." 
 
¶14. One participant noted on a survey that the conference 
"provided opportunities to the private sector to bring up their 
concerns to other parties."  Another wrote that the management 
of the conference was excellent, especially the multi-national 
approach of the panels.  All participants expressed the view 
that the conference was useful for business planning and 
research in some way. 
 
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Comment 
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¶15. Post greatly appreciates the Department's support of this 
conference through the BFIF program.  The United Parcel Service 
(UPS) also supported the conference with funding for a lunch and 
evening reception.  Support from BFIF and UPS was essential for 
the conference's success. Post would also like to express its 
gratitude to the U.S. Commercial Service office of Embassy 
Bangkok for its expert guidance during the planning of this 
event.  In addition, post relied upon Embassies Bangkok, Phnom 
Penh, Vientiane and Consulates General Chengdu and Guangzhou for 
providing excellent speakers who contributed to the conference's 
lively panels and networking sessions.  Post greatly appreciates 
the support of these neighboring embassies and consulates. 
 
¶16. In addition to strengthening the network of regional public 
and private sector actors interested in the GMS program, the 
conference helped forge relationships between the U.S. and these 
parties in the region.  The conference offered the opportunity 
for local governments, businesses, and NGOs to understand that 
the U.S. remains active in Southeast Asia, in particular in 
economic development.  Participation from American firms such as 
UPS underscored that the U.S. is interested and enthusiastic 
about deepening economic ties with the region.  To reemphasize 
U.S. interest in Mekong regional development, post plans to 
follow up with conference participants in six months to inquire 
about the impact of the event on their businesses.  End comment. 
MORROW