Japan Interest in Dawei Industrial Zone Seen as Unlikely

Myanmar information search service

Efforts by the Thai government to attract Japanese investment in a port-industrial complex at Dawei on Burma’s southeast coast are doomed, a prominent regional economist said.

“I don’t think the Japanese are at all interested in Dawei. To the extent their name keeps cropping up, I expect it reflects the desire of the zone’s promoters, now essentially the Thai government, to have them involved,” Sean Turnell a professor in economics and co-editor of the Burma Economic Watch bulletin told The Irrawaddy this week.

Turnell was commenting after a fresh round of promotional talks instigated by Thai Prime Minister Yingluck Shinawatra was held in Rangoon last week.

Japanese government representatives participated in the meeting, which also included Set Aung, deputy minister for Burma’s National Planning and Economic Development agency, and the secretary-general of Thailand’s National Economic and Social Development Board, Arkhom Termpitthayapaisith.

The Japanese have made no public statements on Dawei and reports from Burmese and Thai media conflict on what Japan said at the September 27 Rangoon meeting.

Tokyo intends to make more studies of the Dawei plan before making any commitments, the Bangkok Post reported, and these could take up to one year.

“Japan needs more information before making the decision on whether the country will join the project,’’ the newspaper quoted Arkhom saying.

However, the Myanmar Times quoted Set Aung saying that Japan is expected to announce a decision on the Dawei special economic zone (SEZ) as early as November.

This lack of clarity on the possible involvement of Japan underlines the continuing stall on any serious development at Dawei, five years after the former military regime of Than Shwe signed an agreement permitting Bangkok construction company Italian-Thai Development (ITD) and Burmese business partner Max Myanmar Group to go ahead.

Max Myanmar Group has since bowed out of the project.

For more than a year, Thailand’s Yingluck government has been publicly pressing Japan to join the Dawei project, which would cost billions of dollars. Bangkok’s interest has grown since ITD admitted it did not have the capital to deliver the project.

“The Japanese pay lip-service to the idea the [Dawei] zone is viable, and may attract some of their corporates, but I expect that this is with an eye to their real interests, such as the Thilawa SEZ [in Rangoon], rather than anything to do with Dawei really,” Turnell said.

Yingluck last year held one-to-one talks with President TheinSein to promote a Dawei SEZ, and as recently as last month raised the issue yet again during a visit to Bangkok by Shwe Mann, Naypyidaw’s parliamentary speaker and a senior government official.

But the main beneficiary of any development at Dawei is seen as Thailand, which wants to establish an oil transhipment terminal to pump imported crude to the greater Bangkok region, and to build a petrochemicals production estate, primarily to serve Thai industry.

“Dawei really seems to be struggling. Always really a Thai story in its fundamentals, with Burma’s old regime playing along for the cash, it is hard to imagine now that progress can be made without fiscal commitments from the Thai state,” Turnell said.

Renewed efforts by Thailand to rekindle Burmese and Japanese interest coincides with protests by a community group in the Dawei area, alleging that an ITD subsidiary, Dawei Development Company, is carrying out ground clearing work and disrupting homes and livelihoods.

The complaints by the Tavoyan Women’s Union have prompted calls by the international rights group Burma Campaign UK for respect for human and land rights at Dawei.

“Japanese companies thinking of investing in the zone should be using their influence to persuade developers to respect the rights of local communities, or they will be storing up trouble for the future,” Mark Farmaner the director of Burma Campaign UK told The Irrawaddy this week.

“If the rights of local people continue to be literally bulldozed, the project will face costly delays and probably even more costly legal action in the future,” he said.

The NGO last week highlighted a video produced by the Tavoy group, which it said “exposes how the Thai and Burmese developers of the Dawei deep sea port project are abusing local villagers’ rights”.

Dawei is also known as Tavoy.

Although there is no funding for port and industrial development, the ITD subsidiary is carrying out basic land clearance and some road construction.

“Company construction vehicles are ruining local roads, blocking transport and preventing children from going to school. Pleas to mend the roads have fallen on deaf ears, and villagers have had to repair them themselves. At the same time, new roads for the project are blocking existing waterways, causing flooding and destruction of rice fields,” said Burma Campaign UK citing the Tavoy group.

The women’s group said it fears that 12,000 people in six villages could be evicted once the rainy season ends. It said there had been no proper consultation or adequate compensation offered.


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