*3.2.4. Foreign economic and trade relations*

process. The influence of the transport infrastructure on urban development primarily emanates from two important aspects. First, we consider metropolitan transportation and exterior traffic conditions. Very convenient transportation conditions can optimize the industrial layout of the city, and its changes can directly affect the city's structure and industrial layout. Second, convenient transportation conditions also have a substantial impact on economic development, thus accelerating urbanization. Moreover, the direction of emigration is decided by the transport infrastructure, and convenient transportation conditions provide opportunities for labor‐force exchanges. In the cities of the Indochinese Peninsula, in addition to the influence of seaway transportation, regional railways' transportation conditions determine urban development. **Figure 7** shows that the big cities in the region all follow convenient railway transportation. This phenomenon can be better illustrated by the urban development differentials among the five countries. As mentioned above, the level of urban development in the five countries reveals heterogeneity, and the urbanization process for the period from 2000 to 2015 varies by country. Thailand, Vietnam, and Myanmar, which have more developed railway networks, show much stronger capabilities in their urban develop‐ ment than do Laos and Cambodia. To improve the railways, basic facilities construction is essential for urbanization in Laos and Cambodia. Furthermore, with the development of high‐ speed rail, the cities in the Indochinese Peninsula will obtain a new development opportunity.

Most empirical studies report that economic growth promoted the increase of both the built‐ up areas and UP growth, and there is a strong correlation between economic growth and urbanization [81, 82]. **Table 11** shows the summary statistical results from the linear regression model examining the relationship between urbanization and GDP in the countries of the Indochinese Peninsula during the period from 2001 to 2014. In general, we learn that there is an obvious correlation between UP (% of total) and GDP in each country, with an average value of 0.981. Additionally, there are no significant differences in the *R* values among the countries. Furthermore, the functions of the linear regression model indicate that UP grows with the increase of GDP, demonstrating the most direct influence on UP growth by economic

**variable (***x***)**

(billion USD)

Thailand 0.983 *y* = 0.05*x* + 27.67 Vietnam 0.986 *y* = 0.05*x* + 24.23 Laos 0.970 *y* = 1.42*x* + 22.67 Cambodia 0.985 *y* = 0.13*x* + 18.3

The functions were valid because they all passed the *F*‐test, and all of the regression coefficients passed the *t*‐test (at the

**Table 11.** Relationship between urbanization in the countries of the Indochinese Peninsula and GDP during the period

*R* **Functiona**

0.982 *y* = 0.09*x* + 27.23

*3.2.3. Economic growth elements*

26 Sustainable Urbanization

growth in the cities.

a

level of 0.05).

from 2001 to 2014 (*n* = 14).

**Country Dependent variable (***y***) Independent**

Myanmar UP (% of total) GDP

**Table 12** shows the summary statistical results from the linear regression model examining the relationship between UP (% of total) and FDI in the five countries. High *R* values appear in the five countries, thus indicating that the two items are highly correlated. The functions also illustrate that increased FDI could drive urban development in the countries of the Indochinese Peninsula. Much like the situation in the previous model, high *R* values between UP (% of total) and TME are obtained in all countries (**Table 13**), denoting that there is a positive correlation between them. From the results of the functions, we further find that boosting the export value can promote urban development in the five countries. Moreover, from the summary statistical results for both scenarios, we learn that the influences from FDI and TME on UP growth are at almost the same level because there is little difference in the values of the Pearson correlation coefficient. FDI and foreign trade have played an almost equally important role in the urban development of the five countries for the period from 2000 to 2015. Further‐ more, there is little difference among the various nations in the *R* values in both scenarios, which indicates that the continued outward orientation towards the global market and the absorption of foreign investment are considered key contributing factors to the rapid urbani‐ zation of each country of the Indochinese Peninsula during the studied period.


a The functions were valid because they all passed the *F*‐test, and all of the regression coefficients passed the *t*‐test (at the level of 0.05).

**Table 12.** Relationship between urbanization in the countries of the Indochinese Peninsula and FDI during the period from 2001 to 2013 (*n* = 13).


a The functions were valid because they all passed the *F*‐test, and all of the regression coefficients passed the *t*‐test (at the level of 0.05).

**Table 13.** Relationship between urbanization in the countries of the Indochinese Peninsula and TME during the period from 2001 to 2014 (*n* = 14).

#### *3.2.5. Trade and investment linkage with China*

**Tables 14** and **15** show both the results of the linear regression model examining the relation‐ ship between urbanization and FDI from China during the period from 2003 to 2013 and the results examining the relationship between urbanization and GIE with China during the period from 2000 to 2010 in the countries of the Indochinese Peninsula. As shown in **Ta‐ ble 14**, the UP is highly correlated with FDI from China in the five countries, and the high *R* values indicate that urbanization is sensitive to increased investment from China. In addition, the functions derived from the analytical models demonstrate that investment from China is a key driving force for UP growth in the region. According to the analytical results of the relationship between UP (% of total) and GIE with China, we can obtain a similar situation with the aforementioned scenario, and the two items are highly correlated with each other in each country of the Indochinese Peninsula. Moreover, the derived functions show both that trade with China has positive effects on UP growth in the five countries and that increasing bilateral trade will be beneficial to facilitate urbanization in the region. Briefly, trade and investment with China have a substantial effect on the urbanization process in the countries of the Indochinese Peninsula during the study period, and improving the economic coopera‐ tion between China and the five countries will contribute to the region's urbanization.


a The functions were valid because they all passed the *F*‐test, and all of the regression coefficients passed the *t*‐test (at the level of 0.05).

**Table 14.** Relationship between urbanization in the countries of the Indochinese Peninsula and FDI from China during the period from 2003 to 2013 (*n* = 11).


a The functions were valid because they all passed the *F*‐test, and all of the regression coefficients passed the *t*‐test (at the level of 0.05).

**Table 15.** Relationship between urbanization in the countries of the Indochinese Peninsula and GIE with China during the period from 2000 to 2010 (*n* = 11).

## **3.3. Sustainable urbanization in the China‐Indochinese Peninsula Economic Corridor**

The coordinated development between urban area expansion and UP growth is one important aspect of sustainable urbanization [83]. In this chapter, we use Spearman rank correlation to test the association between the annual change rate of urban expansion and population growth in the Indochinese Peninsula for the period from 2000 to 2015. According to the result of the Spearman model, we determine that the correlation coefficient between the two items is 0.807 (Sig.=0.015) for the period from 2000 to 2010 and 0.536 (Sig.=0.215) for the period from 2010 to 2015. It is obvious that the annual change rates for urban expansion and population growth are highly correlated with each other for the period from 2000 to 2010 among the cities in the Indochinese Peninsula; however, for the period from 2010 to 2015, the statistical analysis result does not pass significance testing, which indicates that there has been disequilibrium devel‐ oping between urban expansion and population growth in the region since 2010. Thus, in the future, more attention should be paid to sustainable urbanization in the Indochinese Peninsula.

Based on the analysis of driving forces for urban expansion, we conclude that, in addition to socioeconomic factors, FDI and international trade have a noticeable correlation with urban development in the countries of the Indochinese Peninsula. As we have discussed above, railway infrastructure construction is significant to urbanization in countries of the Indochi‐ nese Peninsula. However, some previous studies reported that the lack of financial resources was a serious obstacle to infrastructure development in Southeast Asia, and transportation infrastructure in the region could not meet the need for urban development because of fiscal pressures [84]. With assistance from the ADB and the WB, Asian countries receive approxi‐ mately 20 billion USD in annual fiscal support but still cannot maintain basic transport infrastructure investments in the railways, airports, seaports, roads, and communication facilities needed for urban development [85]. Therefore, new investment has become a key factor, especially in Cambodia and Laos. The Asian Infrastructure Investment Bank (AIIB), proposed by President Jinping Xi of China on October 2, 2013, primarily aims to provide financing for infrastructure projects in the Asia Pacific region [86]. Increased investment by the AIIB will be very helpful for the construction of urban infrastructure and the promotion of urban development. Furthermore, the trade cooperation between the five countries and China is an important contributing factor to the forces driving urbanization at least according to the statistical analysis. With the benefit of the investment and trade opportunity provided by B&R, the China‐Indochinese Peninsula Economic Corridor will embrace new and increased opportunities for urban development.
