Italian-Thai to ink B20bn Dawei deal

A Thai construction giant will enter into a concession agreement with the Myanmar government to develop the first phase of the Dawei Special Economic Zone (SEZ) in southeastern Myanmar next month.

Somchet Thinaphong, managing director of Italian-Thai Development Plc (ITD), yesterday said the Dawei Development Co, an affiliated firm of the ITD, will sign the concession contract with the Myanmar government by July 24 to develop the industrial estate.

It will cover 20,000 rai and be worth about 20 billion baht. The concession period will cover 70 years. Mr Somchet said the company project in Dawei could cost around 30 billion baht in total as it might include another 10,000 rai if the project expands.

However, the ITD is still negotiating that portion with the Myanmar government.

As part of the arrangement, Thailand will offer loans at 0.10% interest to the Myanmar government to build a 137km road between Dawei and the Thai border which will also support the government’s special economic zones, the source said.

Mr Somchet said construction of the estate will begin soon after the contract is completed as the company is well-prepared for the project.

According to the project’s plan, public utility infrastructure, a liquefied natural gas receiving terminal, a power plant and small ports also have to be built.

Mr Somchet said some previously-built infrastructure such as roads and wells will allow swift progress of the construction work.

Under the memorandum of intent on cooperation over the Dawei SEZ signed by Thailand, Myanmar and Japan last week, Japan will also play a key role in creating the zone’s engineering design and in its financing.

Thailand, Myanmar and Japan will hold equal partnership in the Dawei SEZ Development Co, a special-purpose vehicle, to run the project.

The project’s total costs, design details and other aspects will be pinned down within the next three years, Mr Somchet added.

A source at the Transport Ministry said the so-called Myanmar-Thailand Joint Coordinating Committee for the Comprehensive Development in the Dawei SEZ and its Related Project Areas will meet to give updates on the project’s progress in Naypyidaw on Wednesday.