Thi­lawa Zone B to start in Novem­ber

The Myanmar Times - - Business - TIN YADANAR TUN ZAY YAR LIN

CON­STRUC­TION of Thi­lawa spe­cial eco­nomic zone B will be­gin this Novem­ber on 700 hectares of land, an of­fi­cial re­spon­si­ble for the project said in an in­ter­view with The Myan­mar Times.

Devel­op­ment of the sec­ond stage of the coun­try’s first eco­nomic zone will be­gin with in­fra­struc­ture in­clud­ing roads, elec­tric­ity and wa­ter, said U Myint Zaw, gen­eral man­ager of Myan­mar Ja­pan Thi­lawa Devel­op­ment Lim­ited.

“We will im­ple­ment Zone B in phases. Once one phase is complete, we will start on the next one,” he said.

Mean­while the smaller Zone A is around 90 per­cent complete, with US$760 mil­lion in for­eign in­vest­ment com­mit­ted to the project across 400 hectares of land. The project is lo­cated to the south of Yan­gon.

More than 70 in­vestors from 16 coun­tries have signed to build fac­to­ries and cre­ate 15,000 jobs, U Myint Zaw said, while four more com­pa­nies are at the ne­go­ti­at­ing stage.

The rental fee for land in Zone B has been set this year at $80 per square me­tre, he added. Land can be rented for al­most 50 years, with the op­tion to ex­tend the lease by an ex­tra 25 years.

“That is this year’s rate. We can­not say what it will be next year. All land can be leased from now un­til 2064, with the op­tion to rent for 25 more years for an ad­di­tional fee,” he said.

He said 12 fac­to­ries have launched op­er­a­tions, 25 more are due to open soon, and 30 fac­to­ries will be built at the end of the rainy sea­son.

With ex­ist­ing lev­els of in­vest­ment, man­u­fac­tur­ing ca­pac­ity can reach up to $241 mil­lion dol­lars a year, he said. The com­pany ex­pects to­tal in­vest­ment into Thi­lawa to reach $1 bil­lion in a few years and the value of an­nual pro­duc­tion to rise to $350 mil­lion.

The SEZ is a joint ven­ture be­tween Myan­mar and Ja­pan – each gov­ern­ment has a 10pc stake while a con­sor­tium of nine lo­cal com­pa­nies called Myan­mar Thi­lawa SEZ Hold­ings (MTSH) con­trols 41pc and a Ja­panese pri­vate-sec­tor con­sor­tium con­trols the re­main­ing 39pc.

The gov­ern­ment will fo­cus on ap­prov­ing ex­port ori­ented in­dus­tries and im­port sub­sti­tu­tion com­pa­nies to help re­duce the grow­ing trade deficit, U Myint Zaw said.

“Re­duc­ing the trade deficit will help to sup­port the currency and may also bring down in­fla­tion to some ex­tent,” he said. “As we are a coun­try with rapid eco­nomic growth, our trade deficit will in­crease un­less we can de­velop our ex­port in­dus­tries.”

The gov­ern­ment pro­posed a K24 tril­lion bud­get for the 2016-17 fi­nan­cial year, in­clud­ing a K3.9 tril­lion deficit – around K1 tril­lion lower than the pre­vi­ous year.

Myan­mar en­joyed a mod­est re­duc­tion in its trade deficit for the first quar­ter – the deficit was $945.7 mil­lion com­pared to $1.11 bil­lion in the first quar­ter of 2015-16.

U Myint Zaw said the pro­vi­sion of in­ter­na­tional-stan­dard in­fra­struc­ture will be cru­cial to se­cur­ing for­eign in­vest­ment into Thi­lawa.

“We are com­pet­ing with other Asian coun­tries such as Viet­nam, Philip­pines and Thai­land for busi­ness from in­ter­na­tional man­u­fac­tur­ers,” he said.

In­vest­ment into Thi­lawa ac­counted for 12.5 per­cent of to­tal in­vest­ment into Myan­mar in fis­cal year 2014-15 and 3pc of to­tal ex­ports, MJTD pre­vi­ously said.

In the same fi­nan­cial year, for­eign in­vest­ment was worth more than $8 bil­lion and ex­ports came to $12.52 bil­lion, ac­cord­ing to data col­lected by the Min­istry of Plan­ning and Fi­nance.

Photo: Naing Win Htoon

Work­ers ride past a steel fac­tory in Thi­lawa spe­cial eco­nomic zone.

Newspapers in English

Newspapers from Myanmar

© PressReader. All rights reserved.