China to hold 70% in port

MYAN­MAR IN­SISTS DEAL WILL BE ‘WIN-WIN SIT­U­A­TION’

Bangkok Post - - ASIA -

>> NAY PYI TAW: Myan­mar will hold a 30% stake in its strate­gic deep-wa­ter sea­port project led by cash-rich China, giv­ing Bei­jing a 70% in­ter­est, un­der their fi­nal agree­ment reached dur­ing re­cent talks be­tween the two coun­tries, ac­cord­ing to a vis­it­ing se­nior Myan­mar of­fi­cial.

That is an im­prove­ment for the emerg­ing South­east Asian econ­omy from the ini­tially pro­posed ra­tio of 15% for Myan­mar ver­sus 85% for China, as re­ported by some news me­dia.

In an in­ter­view with NNA on Wed­nes­day, Myan­mar’s Union Min­is­ter Thaung Tun also said his coun­try plans to grad­u­ally scale up the size of the port in line with trans­port de­mand.

He said the Kyaukpyu spe­cial eco­nomic zone project, in­clud­ing the port, in a coastal town along the Bay of Ben­gal in the western state of Rakhine will “soon go for­ward”.

Thaung Tun, who is also chair­man of the Myan­mar In­vest­ment Com­mis­sion and na­tional se­cu­rity ad­viser, stressed that the SEZ project must be “a win-win sit­u­a­tion” for both Myan­mar and China and ben­e­fi­cial to res­i­dents in Kyaukpyu.

The two coun­tries have also agreed to de­velop the port un­der the prin­ci­ple of a “de­mand-based” and “step-by-step” ap­proach in its ini­tial phase, in­stead of launch­ing it as a mega project.

“We would like to make sure that it is man­age­able,” he said in Tokyo on the side­lines of the 10th Mekong-Ja­pan sum­mit this week, which brought to­gether the lead­ers of Cam­bo­dia, Laos, Myan­mar, Thai­land and Viet­nam.

As for the KyauKpyu SEZ, a con­sor­tium led by the CITIC group, China’s largest state-backed con­glom­er­ate, has won the right to de­velop an in­dus­trial park as well as the deep-wa­ter port.

Myan­mar de­pends on China for over 40% of its for­eign debt, ac­cord­ing to the In­ter­na­tional Mone­tary Fund.

The coun­try has man­aged to re­duce the cost of de­vel­op­ment and China’s stake in the port project from ini­tial plans in a bid to cap its debt owed to Asia’s pow­er­house, which is ex­pand­ing its stakes in strate­gic in­fra­struc­ture sys­tems and nat­u­ral re­sources in de­vel­op­ing economies around the world in what many see as check­book diplo­macy.

For its part, Myan­mar, with an over­whelm­ing Bud­dhist pop­u­la­tion, has been crit­i­cised by the in­ter­na­tional com­mu­nity for its atroc­i­ties against the Ro­hingya Mus­lim mi­nor­ity, fac­ing slow­downs in for­eign di­rect in­vest­ment for the se­cond straight fis­cal year to March 2018.

The World Bank has re­vised down­ward its eco­nomic growth fore­cast for Myan­mar to 6.2% for 2018 from its pre­vi­ous pro­jec­tion of 6.7%, and to 6.5% for 2019 from 6.9% pre­vi­ously.

The Euro­pean Union said last week that it was con­sid­er­ing sus­pend­ing pref­er­en­tial du­ties on im­ports from Myan­mar due to the Ro­hingya is­sue.

Thaung Tun said his coun­try’s “democ­racy is in a tran­si­tion phase” and that it has stressed the rule of law and pro­moted hu­man rights pro­tec­tion.

“If the EU de­cides to with­draw GSP [gen­er­alised sys­tem of pref­er­ences], it will hurt or­di­nary peo­ple [in Myan­mar],” he said, adding it would be “not fair” for the EU to “take away em­ploy­ment” in the gar­ment and other in­dus­tries as a re­sult of the mea­sure.

The Myan­mar gov­ern­ment “is work­ing to en­sure that there are other al­ter­na­tives” to pro­vid­ing in­vest­ment op­por­tu­ni­ties “so that there will be a cre­ation of jobs” in spe­cial eco­nomic zones, in­clud­ing Thi­lawa on the out­skirts of com­mer­cial cap­i­tal Yan­gon which was jointly de­vel­oped by the pri­vate and pub­lic sec­tors of Ja­pan and Myan­mar.

“We are also try­ing to en­sure that friends and neigh­bour­ing coun­tries — Ja­pan, South Korea, Tai­wan, Thai­land and Sin­ga­pore — all in­vest in Myan­mar to sup­port the coun­try’s high eco­nomic growth,” the min­is­ter said.

Myan­mar an­nounced on Sept 25 that it has con­firmed com­mer­cial vi­a­bil­ity in the de­vel­op­ment of re­serves in a gas field called the A-6 block in the south­ern Rakhine Basin off­shore area.

The stake in the block is owned 40% each by Wood­side Petroleum Ltd, Aus­tralia’s largest in­de­pen­dent oil and gas firm, and France’s To­tal SA, and the re­main­ing 20% by Myan­mar’s MPRL E&P. Thaung Tun said that ex­plo­ration will “start soon”.

THAUNG TUN: Has big plans for port

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