DESCRIPTION The Second Greater Mekong Subregion (GMS) Corridor Towns Development Project (the project) represents the second phase of the ongoing GMS Corridor Towns Development Project in Cambodia, Lao PDR and Viet Nam. It supports the first four strategic thrusts of the GMS Strategic Framework 2012_2022 namely (i) strengthening infrastructure linkages; (ii) facilitating cross-border trade, investment, and tourism; (iii) enhancing private sector participation and competitiveness; and (iv) developing human resources. The focus on corridor town development follows an approach that will maximize the economic benefits of increased trade and traffic flows along the major transport corridors in the GMS with the expected positive impacts resulting from accelerated investments in strategically located towns and cities, and added value on economic growth through development oriented on green growth and climate resilience. The objective is to strengthen competitiveness of the GMS economic corridors through environmental infrastructure. PROJECT RATIONALE AND LINKAGE TO COUNTRY/REGIONAL STRATEGY Towns along the North-South Economic Corridor (NSEC) which links Lao PDR with People's Republic of China (PRC), Thailand and Myanmar are well positioned to serve as dynamic centers of investment and economic growth. The strategic location of the corridor towns provides the stimulus for increased trade and investment. Access to markets will provide many incentives for local economies in the hinterlands of the corridor towns. Given these development opportunities, and with the rapid growth of the urban population and expansion of these areas, several corridor towns are now facing demands for urban infrastructure and essential support services. Two project towns in Lao PDR along the NSEC, which traverses the region from the city of Kunming in Yunnan Province of the PRC to Bangkok, Thailand, were selected as project areas on the basis of their economic potential, environmental infrastructure constraints and expressed commitments. Houayxay is a medium-sized town and the administrative capital of Bokeo Province in the north-western part of Lao PDR and lies in proximate distance to the country's border with Myanmar and Thailand. Luang Namtha Town is the administrative capital of the Luang Namtha Province in the north-western part of Lao PDR bordering PRC and Myanmar. Luang Namtha Town is strategically located in proximate distance to the Lao PDR-PRC border. The project is in line with the ADB Country Partnership Strategy for Lao PDR; ADB's Urban Operational Plan which encourages economic competiveness of cities, green development, and inclusive growth; the GrEEEn Cities Approach, which has been piloted in several cities in Viet Nam, Thailand, Myanmar, Malaysia, and Indonesia; ADB's Water Operational Plan; the GMS Strategic Framework; and the GMS Regional Investment Framework Implementation Plan (2014-2018). The towns under this project were selected and prioritized under the GMS Regional Investment Framework, as towns that are both localized within the GMS economic corridors and directly contribute to economic and urban development. IMPACT Maintain economic growth, achieve poverty reduction targets, ensure sustainable development, and support regional integration in the towns of Houayxay and Luang Namtha (Seventh Five-Year National Socio-Economic Development Plan, 2011_2015) CONSULTING SERVICES ADB-funded consultants will be recruited in accordance with ADB's Guidelines on the Use of Consultants (2013, as amended from time to time). PROCUREMENT All procurement under the ADB loan will be in accordance with ADB's Procurement Guidelines (2015, as amended from time to time)

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