Thailand reaffirms Dawei plans, but does Myanmar?


The Dawei Special Economic Zone is still in its very early stages, burdened by delays. Photo: Theingi Tun/Mizzima

The Dawei Special Economic Zone is still in its very early stages, burdened by delays. Photo: Theingi Tun/Mizzima

“The governments of Thailand and Myanmar reaffirmed that the Dawei megaproject will create thousands of jobs and improve the livelihoods of people along the border,” according to Thailand’s caretaker Prime Minister Gen Prayuth Chan-ocha.

Prayuth was speaking at a joint press conference in Bangkok on Friday. Myanmar leader Aung San Suu Kyi also addressed reporters, but made no mention of her administration’s commitment to the Dawei Special Economic Zone (SEZ) or other mutual business or trade interests. The pair also declined to take questions after the press briefing.

Perhaps Suu Kyi’s silence speaks louder than the Thai leader’s enthusiasm for the beleaguered industrial zone, which is slated to be built on Myanmar’s western coast. While the Thai business sector is anxiously looking for signals from the new Myanmar government that it backs the project, Suu Kyi may be taking her time to assess the deal, as well as several other controversial contracts granted to foreign investors by her predecessors in power.   

Uncertainty surrounds the Dawei SEZ. A key foreign economic advisor to Suu Kyi’s government has expressed skepticism over the controversial project.

Suu Kyi concluded a three-day trip to Thailand on Saturday, her first official visit to Myanmar’s eastern neighbour since she swept to power in November’s general election.

Much of the focus on this visit has been Burmese refugees and the migrants who work in Thailand – of whom there are between two and three million. The National League for Democracy-led government harbours hopes that many of these workers will ultimately return home to work in Myanmar’s emerging industrial sectors. Prayuth earlier in the week alluded to the 120,000 Burmese refugees straddling the common border, and indicated that he believed the conditions were right for them to return home.

"Myanmar is ready for their return, but we must give them time to make arrangements, including providing land for living,” the Thai general said.

Combing these two policies to create an influx of new labour in the country leads many to believe that such a ready-made workforce is being tailored for factories in Dawei and Myanmar’s other two special economic zones (SEZs), Thilawa and Kyaukphyu.

Developers of the multi-billion-dollar industrial project in Dawei, situated on the Andaman coast of Tanintharyi Region, claim they can create up to 100,000 jobs when the SEZ is finally up and running.

But therein lies the problem: the mega-project has stalled, been suspended, and marginalised several times since Thailand and Myanmar first signed a memorandum of understanding to initiate the venture back in 2008 when military dictator Senior General Than Shwe was in power.

Originally granted a 75-year lease to front the economic zone, Ital-Thai PLC was unceremoniously relieved of its position in 2013, after failing to attract other investors and dragging its heels on commitments. A year earlier, Max Myanmar Conglomerate had pulled out, abandoning a 25 percent stake in the SEZ. Ital-Thai resumed a smaller part in the project once it was resurrected in 2014 as both governments tried to convince each other that each was fully committed to the investment. But offers to Tokyo to bring Japanese investors into Dawei fell on deaf ears; Japan has already carved out its own stake in the Thilawa project, further north on the coast, close to Yangon. 

Independent analysts say that the Dawei project remains high on Thailand’s agenda.

“Dawei is a vital project for our mutual economic development,” said Nopporn Wong-anan, deputy editor for the Bangkok Post. “Thailand and Myanmar will greatly benefit from the long delayed special economic zone and soon-to-be developed deep-sea port that will also boost trade among other Southeast Asian economies.”

Anselm Feldmann, an academic studying international development with a focus on Dawei, agreed. “From a Thai perspective, the Dawei SEZ offers quite a few economic opportunities. One of the major ones is its location at the sea and its favourable location, just 350 kilometres west of Bangkok. The highway links Dawei with Bangkok and the Southern Economic Corridor of the Greater Mekong Subregion, while the deep-sea port will link Thailand, Cambodia and Vietnam with India, the Middle East, Europe and Africa, significantly shortening the time of transportation, eliminating the need to ship around Singapore through the Malacca Straits. The already growing economic relations between Thailand and Myanmar will most likely experience another boost.”

Thailand is Myanmar’s second largest trading partner after China, with trade last year reaching US$8.1 billion.

But while Thailand may be gung-ho, signs are evident that the new Myanmar government will take time to reassess not only Dawei but several other projects inked during the era of the former ruling military junta.

Speaking to Mizzima ahead of Suu Kyi’s visit, Sean Turnell, an Australian economist who is currently working as an informal economic advisor to the NLD, said, “My assessment is that Dawei has little to offer Myanmar one way or the other. I guess we will see what Thailand has in mind, but it is a non-core issue for Myanmar, I think.”

Perhaps the strongest opposition to the project comes from the local people of Dawei themselves. Few are convinced that the SEZ will bring about a boom to the town, which has until now been little more than a quaint fishing port. Many activists claim the industrial zone will spell ecological disaster for fishing, tourism and the sea, not to mention the livelihoods of an estimated 22,000 to 43,000 people who will be displaced to make way for the mega-project.

Researcher Feldmann said that the Thai industrial zone at Map Ta Phut is often cited as Dawei’s role model. “Thirty years ago, the Thai government transformed this fishing town on Thailand’s eastern seaboard into a hub for the petro-chemical industry. It has since become infamous for its pollution.”

Saw Frankie Abreu, the director of TRIP NET, a Dawei-based civil society organisation, said, “Aung San Suu Kyi needs to learn the history of the Dawei SEZ since it was initiated during the time when the military regime was in power. There are several irregularities such as corruption, disrespect to the environment, and the local indigenous people's rights on land tenure. These are human rights issues. The project needs to be redesigned from the beginning, and must include the Free Prior Informed Consent of the locals, an Environmental Impact Assessment, and a Social Impact Assessment. This project shouldn't be implemented until all the citizens of Myanmar can be assured of their rights to land tenure and land titles.”

According to a report by the International Commission of Jurists, the firms involved in planning and building the industrial zone in Dawei are refusing to disclose impact assessments and other relevant information.

Abreu added that the Suu Kyi administration should also consider “the sensitivity of the armed conflict”, referring to the fact that the Dawei-to-Thailand highway will pass through Karen National Union (KNU) territory. Though the KNU was among eight armed groups that signed a ceasefire with the government last year, peace in the area remains fragile, while fighting continues further north in Shan State.

In recent months, local residents in Dawei have taken to the streets to protest the latest deal signed in Dawei – a US$3-billion oil refinery to be undertaken by China’s Guangdong Zhenrong firm.

Despite a petition signed by 2,000 local Daweians calling for the NLD government to reconsider the Chinese contract, Guangdong Zhenrong Vice CEO Li Hui confirmed to Mizzima that the oil refinery project would go ahead.

“We have not yet set the exact day for construction to begin,” said Li. “It depends on the new [NLD] government. We understand that Myanmar’s new government may have its own policies that are different from the previous government. But I hope we can work together. For me, the earlier construction can begin, the better.”

Construction of the entire project – deep-sea port, petro-chemical plants, factories, power plants, workers’ accommodations – is expected to take three years. The first phase of that construction was due to have begun in March.

Colin Hinshelwood - CPA Media

More Articles