Japanese aid package gets started with 3 projects
Work has begun on three initiatives – a bridge and two water supply projects – that will be financed by the $7.7 billion package recently announced by Japan’s Prime Minister Shinzo Abe.
THREE projects funded by part of a recently announced US$7.7 billion Japanese aid package are under way, according to the Japanese International Cooperation Institute (JICA).
Japanese Prime Minister Shinzo Abe announced earlier this month that his country would provide 800 billion yen in aid, loans and investment to promote development and reconciliation in Myanmar.
It is not clear how much of the $7.7 billion, to be spread over five years, will consist of ODA loans, but JICA will manage the majority of the ODA component, said Keiichiro Nakazawa, the agency’s chief representative in Myanmar.
JICA has not yet decided on all the projects it will fund through the ODA section, but so far this year work has begun on three projects – a bridge and two water supply projects – that will financed by the $7.7billion package, he said.
The bridge will connect Yangon and Thanlyin over the Bago River. JICA will manage the project, which will have a budget of $280 million, said Mr Nakazawa during a media tour last week.
The interest on the loan for that project equates to 0.01 percent for 40 years, he said, although the loan must be paid back after 11 years.
The existing Thanlyin Bridge has only single lanes in either direction, which leads to traffic problems for vehicles trying to cross to Thanlyin township or Thilawa special economic zone, Mr Nakazawa said. Yangon Region Minister for Transportation Daw Nilar Kyaw said in July that the government planned to build a new bridge to resolve traffic problems on the existing route.
JICA has finished a detailed design plan for the new bridge and hopes to start construction in the 2017-18 financial year, according to JICA. The agency is in the process of calling a tender for the project in order to select a company.
“JICA will call a tender to select a private company for construction then we will contract with the selected company,” said Mr Nakazawa, adding that JICA would pay 15pc of the contract fee upfront for construction materials. The rest of the funds will be paid out in instalments as construction proceeds, he said.
The $280 million budget is a hard limit, but the tender process could end with a lower cost, he added.
JICA also has two water supply projects: the Lagunpyin water supply project in South Dagon township will distribute water across Yangon, and construction is scheduled to start in June next year, according to JICA.
Another water supply project in Kokkowa on the far side of the Hlaing River will also provide water for the commercial capital, with a loan agreement expected this financial year, according to JICA.