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LMC Formation<\/strong><\/p>\n The world\u2019s 12th-longest river, the Lancang-Mekong meanders over 4,909 kilometres from its source – considered to be the Lasagongma Spring in Yushu – until it empties into the South China Sea via the Mekong Delta. Over 60 million people depend on the river and its tributaries for food, water and other aspects of their daily lives.<\/p>\n At the 17th China-ASEAN Summit in November 2014 in Nay Pyi Taw, capital of Myanmar, that Chinese Premier Li Keqiang proposed establishing the Lancang-Mekong cooperation mechanism. The establishment of the LMC was officially declared in November 2015 by the six member states, and the first LMC Leaders\u2019 Meeting was held in south China\u2019s Hainan Province in March 2016.<\/p>\n The mechanism identified three pillars of cooperation \u2013 political and security issues, economic and sustainable development, and social, cultural and people-to-people exchanges. The five priority areas under the LMC include interconnectivity, industrial capacity, cross-border economy, water resources, agriculture, and poverty reduction.<\/p>\n At the first LMC Leaders\u2019 Meeting, Li noted the LMC was a useful complement to China-ASEAN cooperation, which helps promote the economic and social development of its members, narrow their development gaps, and upgrade overall cooperation between China and ASEAN \u2013 the Association of Southeast Asian Nations. Apart from China, the other five members of the LMC are also members of ASEAN.<\/p>\n Xu Liping, a senior research fellow at the National Institute of International Strategy under the Chinese Academy of Social Sciences (CASS), said the proposal for the LMC mechanism was inspired by some domestic think tanks, which has suggested promoting more interaction among high level officials in the six countries. \u201cThe six countries are showing a \u2018spaghetti bowl\u2019 phenomenon due to the complexity of bilateral or multilateral cooperation on various levels, so the birth of the LMC is only natural considering it can better exhibit the geographic closeness and stimulate the economic complementary roles among member countries,\u201d Xu said. The \u201cspaghetti bowl\u201d effect occurs when the number of trade deals between countries actually slows down trade, instead of boosting it.<\/p>\n Before the LMC, China already had strategic partnerships with the other five countries. China is the biggest trading partner of Cambodia, Myanmar, Thailand, and Vietnam. It is also the biggest investor in Cambodia, Laos and Myanmar. According to Chinese government data, in 2015, China\u2019s total trade with the other five member countries reached USD 193.9 billion.<\/p>\n The LMC is the first multilateral cooperation mechanism in the Mekong River subregion to have been initiated by the six countries within the region. Other economic mechanisms in the region also involve players from outside the region, including Japan or the US. \u201cApart from economic cooperation, the LMC also focuses on poverty reduction, capacity building and security issues, which are also significant and creative,\u201d Xu said. \u201cIn addition, to be more effective, the LMC has a four-level meeting mechanism \u2013 working groups, senior officials, foreign ministers and leaders \u2013 to smooth out disagreement or potential conflicts.\u201d<\/p>\n So far, under the auspices of the LMC, there have been three leaders\u2019 meetings, three foreign ministers\u2019 meetings, five meetings of senior officials meetings and six working groups.<\/p>\n In early January, ahead of a visit to Cambodia, Li Keqiang wrote a commentary in The Khmer Times<\/em>, saying that in the context of a rising backlash against globalization and protectionist sentiments as well as lack of momentum in East Asian cooperation, the LMC as a basic component of regional cooperation will not only help narrow the development gap within ASEAN and advance ASEAN integration, but also enrich South-South cooperation and efforts to foster a more open, inclusive and balanced economic globalization that benefits all.<\/p>\n Achievements and breakthroughs <\/strong><\/p>\n Under the LMC framework, China has pledged to provide concessional loans of up to 10 billion yuan (USD 1.6 billion) and credit loans totalling another 10 billion yuan to promote industrial capacity cooperation and infrastructure construction within the region.<\/p>\n Additionally, China is committed to prioritizing the Mekong area for spending in the South-South cooperation aid fund totalling USD 200 million, and to setting up an LMC special fund to provide USD 300 million in five years to support small- and medium-sized cooperation projects within the region.<\/p>\n The LMC set up a number of model projects which have shown early achievements. These 45 \u201cearly achievement\u201d projects were identified at the LMC\u2019s first leaders\u2019 meeting in 2016. By late 2017, these projects had been implemented as scheduled.<\/p>\n According to Xu, among the 45 projects, some are pre-established and concern local livelihoods, while some were already existing infrastructure projects such as the China-Lao cross-border railroad or local power plant construction. Through the LMC mechanism, some infrastructure projects that had been suspended were successfully pushed forward. \u201cThe purpose of such \u2018early harvest\u2019 projects was to act as plot projects to enhance confidence in multilateral cooperation,\u201d Xu said.<\/p>\n The LMC advocates a \u201cbulldozer\u201d effect, indicating its efficiency in pushing forward unsolved issues or dealing with moribund projects within the region, through a series of communication channels.<\/p>\n Easing tensions with Myanmar <\/strong><\/p>\n Construction of the Myitsone Dam<\/a> in northern Myanmar, a joint project involving Chinese investors, which proved controversial in Myanmar, has been on hold for political and social reasons by the Myanmar government since 2011. The fallout from the suspension has damaged both official and non-governmental communications and exchanges between China and Myanmar for some time.<\/p>\n Dialogue and projects have resumed in the last couple of years as diplomatic ties between the two countries improved along with the setting up of the LMC. Rather than purely engaging with regional governments in Myanmar, Chinese companies have recently started showing more willingness to listen to communities and hold dialogues with local NGOs.<\/p>\n In 2017, the GEI was appointed by China\u2019s National Development and Reform Committee (NDRC) to implement a South-South cooperation aid fund, which included distribution of solar panels<\/a> and clean cooking stoves in Myanmar, through its established community channels. The project has had a positive effect. \u201cIt is apparent that whether community-level projects can be effectively implemented depends on local peoples\u2019 impression and recognition towards China and its companies,\u201d Ji Lin, Executive Secretary of GEI.<\/p>\n Xu Liping also confirmed that the LMC offers a new multilateral channel to solve unsettled bilateral issues including, for example, the suspended Myitsone Dam.<\/p>\n Considering the political disturbances between China and Myanmar, an effective multilateral mechanism could allow more stakeholders such as Thailand and Vietnam into the investment, which would offer possibilities for the suspended project to resume.<\/p>\n Water management <\/strong><\/p>\n Among all five priority areas under the LMC, water resource management is most important. Historically, as China and the Lower Mekong countries strengthened their efforts to develop the waterway, in particular dam construction, the parties are also going through a growing trust crisis due to a lack of negotiation or an overall effective water management mechanism. If there is flooding, or low flow levels due to upstream drought, the six countries find it difficult to share objective information on water flow and enter into quick negotiations. This sometimes means parties resort to a blame game<\/a>, making the water issue more complicated.<\/p>\n An effective water cooperation mechanism is vital to achieve fair and rational solutions to water disputes and combat the negative impact of drought and flood in the lower reaches. The LMC has fostered the setting up of a water resource research centre to coordinate among member countries on river flow information sharing and the distribution of water resources.<\/p>\n \u201cIn recent years, China has indicated greater willingness to share information on river flows with neighbouring countries and to build cooperation with neighbours with which it shares water resources,\u201d Maureen Harris, Southeast Asia Program Director of International Rivers said. \u201cThat\u2019s critical because the Mekong urgently needs meaningful cooperation that involves all riparian countries and gives due priority to environmental protection and the human rights of river-basin communities.\u201d<\/p>\n From late 2015 until early 2016, Vietnam, Cambodia and Thailand suffered from severe drought due to the El Nino weather event. In March 2016, as requested by members under the LMC mechanism, China released water to the Mekong River, alleviating the dire situations in Lower Mekong Countries.<\/p>\n Harris, apart from confirming the role of the LMC in water management, also cautioned that LMC governments should think about the projects in a longer-sighted and holistic way, since dams are being approved on an ad hoc, project-by-project basis, without basin-wide assessments and planning,<\/p>\n \u201cIt is therefore very important for China to lead by ensuring that the LMC enables effective cooperation over the entire basin and establishes stronger procedures for achieving sustainability,\u201d she said. \u201cChina would show leadership and impress the global stage if the LMC prioritised the ecological importance of the river and the participation of the region\u2019s local peoples in key decisions over the river\u2019s future.\u201d<\/p>\n Complementary role <\/strong><\/p>\n The Mekong River area is a hotspot for various multilateral mechanisms. Apart from the LMC, multilateral mechanisms in various forms have been set up between the lower Mekong states and the US, Japan, South Korea and India, among others. All these mechanisms have been competing against one another.<\/p>\n Two of the most well-known are the Greater Mekong Subregion Economic Cooperation Program (GMS) founded in 1992 involving six countries and the Mekong River Commission(MRC) set up in 1995 between Cambodia, Laos, Thailand and Vietnam. The GMS, initiated by the Asia Development Bank, focuses on multilateral cooperation in the economic field. China and Myanmar are not members of the MRC, but are involved as dialogue partners.<\/p>\n Despite some observers saying that the LMC is a rival to the longstanding MRC, high-level statements from the LMC argue it is complementary to existing cooperation mechanisms.<\/p>\n According to Professor Lu Guangsheng, director of the Institute of Southeast Asian Studies at Yunnan University, the LMC stands out though, since it is expected to get the biggest input and advance most quickly.<\/p>\n Anoulak Kittikhoun, Chief Strategy and Partnership Officer of the MRC, admitted to our reporter in a recent email that although the MRC per se is not a party to the LMC framework at this stage, it recognises the LMC initiative as being one that could cement future cooperation among the six basin countries, and it would certainly contribute to reaching the MRC\u2019s goals.<\/p>\n![\"\"](\"\/wp-content\/uploads\/2018\/03\/lower_mekong_dams_map_june2017.jpg\")