The 9th National Conference on Road Engineering Speech by Dato Sri Dr Ir Judin Abdul Karim, the President of Road

Engineering of Asia & Australia (REAAA) at the plenary session of the main working paper : Strengthening Regional Economic Development through strengthening Regional Connectivity Jakarta, 15th November 2011 ___________________________________________________________________________

His Excellency, Dr A Hermanto Dardak, Vice Minister of Public Works, President of IRDA Ir Soehartono, Chairman of Sector I, NMB-IRDA, Chairman of the 9th NCRE Organizing Committee Ir Djoko Murjanto, Director General of Highways, Ministry of Public Works Drs Suroyo Alimoeso, Director General of Land Transport, Minister of Communication, IRDA Central Board of Governors Fellow REAAA Committee members Distinguished Speakers, Guests and Participants Ladies and Gentlemen Assalamualikum wrb and a very good morning

It is indeed a great pleasure to have the opportunity to address the distinguished audience in this superbly organized conference in this beautiful city of Jakarta. Todays conference with the theme Road Infrastructure Support to the Growth Centres of the Economic Corridors is both timely and appropriate. Timely because ASEAN in general, and Indonesia in particular, is undergoing a massive economic transformation on the back a devastating world economic downturn. And studies have repeatedly shown that infrastructure spending has consistently shown positive effects on long term economic growth. Appropriate because, history has given us a lesson that , interconnectivity within the economic corridors is fundamental to sustaining the performance of these corridors. Malaysias own experience in the success of its pioneer economic corridor, the Multimedia Super Corridor has inspired the establishment of five other corridors. These are Iskandar Malaysia (IM), East Coast Economic Region (ECER), Northern Corridor Economic Region (NCER), Sabah Development Corridor (SDC) and Sarawak Corridor of Renewable Energy (SCORE). The Malaysia Super Corridor in Cyberjaya, a high Technology Information

Technology Park, modelled along the Silicon Valley is so successful at generating the economic activities, the areas around Cyberjaya, Dengkil, Sri Kembangan and Putrajaya are experiencing similarly enhanced economic activities. In fact, the success of Cyberjaya Multimedia Super Corridor has sparked the creation of Information Technology Hub called Cyberabad in Hyderabad, India

Ladies and Gentlemen Coming back to the topic of my presentation this morning, it is evident that regional economic development will require enhanced regional connectivity. In the face of mounting challenges of liberalization, the only possible route to regional economic advancement is through regional economic integration. That, ladies and gentlemen brings us to the imminent manifestation of the regional economic integration known as ASEAN Economic Community. The establishment of ASEAN Economic Community has been accelerated and will now become a reality in the year 2015, less than four years away. As you are probably aware, major goals of AEC include achieving enhanced regional cooperation and enhanced global competitiveness. Both these goals are to be realised through stronger regional production networks, enhanced rules and good governance and enhanced connection to the economic centres. At the same time, there is an equally important agenda of narrowing the development gaps among ASEAN countries. For instance, there are gaps in the percentage of paved roads over all roads across ASEAN countries. The AEC goals are truly challenging. It is now becoming more urgent for ASEAN to develop connected infrastructure in order to accelerate physical connectivity. An improved and integrated transport and logistics system is an integral part of regional integration initiatives. Incidentally, transportation and logistics is only one aspect of physical connectivity. When we talk about ASEAN connectivity, we need to look at other modes as connectivity as well. Generally, it has been universally accepted that there are three kinds of connectivity; People to People Connectivity, Physical Connectivity and Institutional Connectivity. People to People connectivity are mainly concerned with enhancing and collaborating for tourism, education and culture. Institutional Connectivity will discuss issues on liberalization, custom and immigration integration, Mutual Recognition Agreement, structured capacity and capability building among others. Physical Connectivity is where we start putting all the infrastructures on the ground. These include transportation infrastructure comprising of land, air and sea transportation, energy infrastructure, ICT as well as communication infrastructure. Now, Ladies and Gentlemen, if we are serious in enhancing our regional connectivity, all three modes of connectivity need to be addressed. Of course, since most of us here are professionals and stakeholders connected to the road and transport infrastructure, I will focus our discussion on transport in general and roads in particular. All

the same, references to other modes of connectivity will be highlighted when the need arise.

Ladies and Gentlemen Malaysias experience has proven again and again that connected transport infrastructure is crucial in facilitating trade and investment that will contribute to economic development and poverty reduction. The first thing the government did when the Cyberjaya MSC was first envisioned was to develop a comprehensive transportation network linking Cyberjaya with both the airports and seaports. Linkages with business and financial centres of Kuala Lumpur and production centres like other Technology and Industrial parks were also enhanced. Similar infrastructure facilities are also being made available in the five corridors which are currently being developed. Moving on to inter-country connectivity, physical connectivity through cross border infrastructure development is crucial for enhanced regional cooperation and economic integration and allows the production and exchange of goods and services. Cross border infrastructure provides countries with greater access to regional production centres and markets, promotes efficient production, trade competitiveness and trade flows through access to regional production network and supply chains. We need to build the bridges that will link ASEAN with the vast market of economic powerhouse, China and India. With ASEAN population of over 600 million people and Chinas 1.34 billion and Indias 1.0 billion, the opportunity for enhanced trade and the resulting economic advancement can only be described as colossal. By extending the reach of regional connectivity to access the larger markets in China and India, not only trade will be enhanced but the cost of doing business with these two large markets can be reduced quite significantly. Chine is currently the second biggest economy after the USA and India is on course to become the fourth biggest after USA, China and Japan. With markets as big as these, ASEAN stands to become the biggest beneficiaries from the economic growth of China and India.

Ladies and Gentlemen Connectivity within ASEAN and its regional economic powerhouse is key to ASEAN economic enhancement. This is where the ASEAN Highway Network (AHN) plays its biggest role. AHN, as you all know quite well already, is an extension of Trans-Asian Highway which started off as Greater Mekong Sub-region (GMS) initiatives. It is part of pan-Asian infrastructure initiative that we called the Asian Land Transport Infrastructure Development (ALTID). Altogether, it has 23 designated roads and a total length of more than 38,400 km. It aims to establish efficient, integrated, safe and environmentally sustainable regional land transport corridors linking ASEAN member states and beyond. I am happy to note works on AHT is

progressing well and the first hurdle of network configuration and designation of national routes have already been completed On-going is the upgrading of all designated routes to at least Class III standards, construction of all the missing links (mainly in Myanmar) and operationalization of all cross-border points. Efforts will also include the upgrading of Transit Transport Routes (TTR) and the installation of common road signs in all designated routes. I would like to urge all of us here who are professional and practitioners in this area, to contribute in whatever way that we can to see the success of AHN. I firmly believe that success of ASEAN Economic Community goals will rely heavily on the successful completion of the ASEAN Highway Network Apart from the AHN described earlier, we must also collaborate to see the success of other physical infrastructure initiatives. These will include 1. Singapore Kunming Rail Link, a 7,000 km rail network to link major ASEAN cities and the People Republic of China 2. Integrated Inland waterways Network and competitive maritime transport system 3. ASEAN power grid and Trans-ASEAN Gas Pipeline 4. E-ASEAN Agreement for telecommunication and IT regional cooperation I am not going to go into details in these infrastructure, suffice to say that they are all designed to enhance our regional connectivity with the aim of enhancing regional economic prosperity.

Ladies and Gentlemen OF course, in this world nothing is gained without the need to address and overcoming the current and future issues and challenges that we are likely to face. The biggest challenge will of course be how to finance the massive infrastructure development. Infrastructure development, by its nature, is expensive and securing favourable terms loans from financial institutions will prove challenging. Malaysia has successfully develop a public private partnership(PPP) in delivering the much needed infrastructure development. Most of the trunk highways connecting economic growth centres are financed and built by the private sectors. Some of the power projects and telecommunication facilities are built with heavy participation by the public sector. Other ASEAN states could similarly benefit from working in close partnership with the private sectors to deliver the needed infrastructure. Another major concern will be the grave possibility that we do not put in place, adequate safeguard to protect against the possible negative social and environmental impacts on an international highway once these facilities are put in place. These could include the trafficking of women and children, illicit drugs and weapons and trades in illegal wildlife. Of course, I am sure that these issues and concerns would have been addressed by the

respective parties and governments and we should be able to deal with the problem effectively together in close collaboration and partnership.

Ladies and Gentlemen Once again, I must emphasize that ASEAN has improved its ability to respond to the challenge of regional integration and globalization. Regional integration has enabled countries in the region to overcome their capacity constraints and specialize on specific activities where they have the cost advantage. We have seen that in order to achieve an economically integrated ASEAN Economic Community, the region current and future demand for infrastructure must be met. There is now a real need to build and sustain ASEAN regional infrastructure initiatives on a shared strategic vision with strong commitment of all participating economies and regional neighbouring countries. On that basis , we would also like to see better coordination of sub-regional initiatives such as GMS (Greater Mekong Sub region), BIMB-EAGA (Brunei, Indonesia, Malaysia and Philippines East Asia Growth Area) and IMT GT (Indonesia, Malaysia, Thailand Growth Triangle). It cannot be overemphasized that the success of the regional economic transformation will be driven largely by our collaborative effort to enhance our regional connectivity and regional integration and we, as professionals should play more meaningful roles in helping to achieve the level of connectivity needed to take regional prosperity to greater heights. Thank you