Burma is looking to build a large industrial park complex in the Bassein region west of Rangoon for domestic industries, in addition to more electricity power plants around Rangoon and Mandalay, according to the industry minister.
Industry Minister Soe Thane discussed Burma’s energy needs and investment options on the sidelines of the "Future of Asia" conference last week in Tokyo. No date for the construction of the park complex was given.
Soe Thane currently heads an unofficial body that grants concessions and tax holidays to investors, he told The Bangok Post. He said that setting up a formal investment promotion body would help attract more foreign direct investment into the country.
“There is an urgent need to build at least two plants around Yangon, and maybe one around Mandalay,” he told the Post. “All need to be near a river to make it easier to transport the heavy coal.”
“These projects need to be undertaken as soon as possible because only about 25 per cent of the country is currently connected to the grid,” he said. "We had not anticipated many things and the speed of change has been so fast.”
Over the past week, demonstrators in Rangoon, Mandalay and other cities have protested the lack of electricity.
“We are lagging behind most economies in this region, and you can say we're late in this game,” he told the newspaper.
He said “Parliament will vote on new regulations for foreign direct investment, after having voted recently to allow foreign investors in SEZs [special economic zones] to repatriate 100 per cent of profits.”
“The Bassein industrial park would not be an SEZ like Dawei on the coast,” he said. “Dawei is an SEZ and the new area would not in any way be a competitor, although the new zone will also have a deep sea port, but with more than 1,200 kilometres of coastal shoreline, we can have many deep sea ports.”
Also under study, he said, is an SEZ at Thilawa with Japanese investors, with a decision to be made likely by year-end.
Soe Thane said that Dawei was making slow progress. The Thai government had the responsibility to look for investors, he said, and the lead contractor Italian-Thai Development Plc (ITD) seemed to be taking a lot of time.
ITD appears to be struggling to raise financing, say observers, who said some investors believed the new Burmese government is not as committed to the megaproject as the former military junta, which granted the concession.
Soe Thane said the government still believed in Dawei.
“This project is beneficial not only to Thailand and Myanmar but is also a corridor for all of Southeast Asia so it has to go ahead, but how is a different issue,” he was quoted as saying. “If Italian-Thai can do it, they should. If they cannot, then we will have to review it.”
The Burmese government's decision to reject plans for a 4,000-megawatt coal-fired power plant to serve the Dawei complex, in which ITD would own 75 per cent, has also thrown a cloud over the project. The government bowed to pressure from environmental groups and local residents, who said the plant was not environmentally safe.
Soe Thane indicated that authorities may soften their stand, and any new power plant that is approved would have to be more efficient and smaller. He said he was impressed by the clean-burning coal-fired plants he'd seen in Japan.