CAMBODIA and Laos have been assured first bites of a grand $200 million telecommunications

plan to link China, Burma, Laos, Thailand, Cambodia and Vietnam.

Telecommunication is one of seven areas where the Asian Development Bank (ADB) is

driving the Greater Mekong Subregion (GMS) toward a six-country "superlink."

Officials at a two-day forum recently in Phnom Penh acknowledged that the GMS's first

deals are likely to be in telecommunications and hydropower, because that's where

the region's private investors see the greatest potential for profit.

Cambodia and Laos were told by ADB project engineer Robert Rothery that they'll be

the first countries to benefit from the huge telecommunications plans, and later

will be Vietnam and Burma.

"It will allow them to intergrate their economies more closely with the big

countries like China and Thailand and to derive the benefits that the intergration

gives them."

Delegates, including the KfW (German Development Bank) agreed on construction and

policy priorities at the meeting.

Thirteen transmission projects linking each country with fiber optic cables, worth

$83.2 million, were discussed. The link would improve the reliability of the network,

delegates were told.

Cambodia had three of these projects: a link with Vietnam ($3.6 million); with Thailand

($9.4 million); and Laos ($18.3 million).

Soft loans from private commercial firms would be the prefered funding option. If

that didn't work, loans from the ADB and the World Bank would be sought as "lenders

of last resort".

Dr Karl Joachim Trede, project manager of KfW, said stability and security were important

issues, but he believed private investors would come to Cambodia if the political

situation was stable and the legal framework was in place.

He said KfW had already signed a $10 million agreement to build a network link between

Phnom Penh and Bangkok through Battambang, Pursat, Sisophon and Kompong Chhnang.

The project will begin next year and finish in 1998.