Myanmar Chamber of Commerce Wants More Chinese Hydropower Investment

YANGON — Despite environmental and sustained public opposition, Myanmar’s main business federation has called for more Chinese investment in hydropower projects on the country’s rivers.

Numerous plans have been announced to build major dams Myanmar’s two biggest rivers, the Irrawaddy and the Salween, and harness the huge amounts of potential energy on offer to address the country’s energy shortage.

One such project on the Irrawaddy River, backed by China, is the proposed Myitsone dam in Kachin State. But President Thein Sein has suspended the project indefinitely amid concerns that millions of Burmese downstream would be affected by a dam that would largely be providing power to China.

This week, the Union of Myanmar Federation Chamber of Commerce and Industry (UMFCCI) signed a trade cooperation deal with its counterpart in Guangdong province, China’s most economically productive region and industrial hub.

At a signing ceremony for the memorandum of understanding Monday, Cho Thiri Maung, a member of the UMFCCI’s central executive committee, told the Chinese delegation that Myanmar would prefer investment that adds value to goods inside Myanmar, rather than in extractive industries such as jade, coal and copper mining, where China is already the main investor in the country.

However, she said, investment in Myanmar’s power sector, in particular hydropower, was still welcome.

“The government allows independent power producers (IPP), and welcomes foreign investors. Most of the investments should go to the power sector,” she said, before pointing potential investors specifically to the opportunities in hydropower generation.

“We have so many rivers that can produce electricity through hydropower, and this can be considered a high-potential sector to invest in.”

The pitch was well-received by the Chinese, with Zhao Yufang, vice governor of Guangdong Province, professing interest in both adding value for exports, and helping to get at the country’s vast natural resources.

“We are interested in Myanmar [Myanmar] because of its good geographic position between India and China,” she said. “Also, Myanmar is very rich in natural resources like rivers, natural gas, jade and mineral resources.”

According to UMFCCI Vice President Zaw Min Win, China’s total investment in Myanmar is worth more than US$14.195 billion across 52 projects—the highest of any country.

“Both normal investment and border trade investment from China is increasing every year and China also stands first in terms of the value of cross-border trade, when compared with other neighboring countries,” he said.

The value of trade between China and Myanmar is estimated at more than $6 billion for 2013, an increase of 26.6 percent compared with 2012.

China’s role in Myanmar’s economy is a contentious subject. It is thought increasing reliance on China in the later days of Myanmar’s military regime was a key factor in the generals ceding power to a nominally civilian government in 2011 and embarking on reforms.

Environmentalists are critical of using the country’s rivers to fill the energy gap.

At a separate NGO-organized event in Yangon on Tuesday, Tin Aye, the retired director of the Ministry of Forestry who takes a keen interest in environmental issues, warned of the damage damming the country’s rivers could do.

“Rivers should flow freely. The social impacts to downstream communities are caused by the environmental impact on upstream, all because this is the wrong policy for producing electricity,” he said, adding that unwise damming was also occurring for agricultural irrigation projects.

A coalition of environmental groups—including the Thailand-based Mekong Energy and Ecology Network, the Renewable Energy Association of Myanmar (REAM)and the Myanmar Green Network—has surveyed riverine communities on the Irrawaddy, and found widespread concerns about dams and the impact of fisheries downstream.

The groups also found worries over other negative impacts of increasing industrialization on the river. Tin Thit, chairman of Mandalay-based environmental group Seing Yaing So, said factories on the river, seepage of fertilizer into the water, mining projects and dredging were all causes for concern.

He also warned that while hydropower projects on the upper reaches of the Irrawaddy received a lot of attention, plans were being made to build large-scale dams on the Salween River, also known as the Thanlwin River.

Four Chinese hydropower projects on the Salween have been agreed by the government’s department of hydropower implementation since 2005, according to an official at the Ministry of Electric Power, who asked not to be named because he was not authorized to speak to the media. Two more Salween dams are reportedly backed by Thai firms and will export power to Thailand.

“There will be in total six dams on the Thanlwin River with a very high combined megawatt capacity,” the official said.

One UMFCCI member, who spoke on condition of anonymity, insisted that the organization, as a non-government body, was not responsible for investment decisions. The member also argued that support for increasing Chinese investment was not unanimous in the UMFCCI.

“Actually, I don’t like Chinese investment,” the member said. “They take less corporate social responsibility compared with Japan and other Western countries.

“But they can take risks more than other countries, that’s why Chinese leads in natural resources investment of Myanmar.”

Source: THE IRRAWADDY Myanmar

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