The majority of housing and residential projects in Yangon, Mandalay and Muse have been dominated by illegitimate Chinese companies.
A local businessperson at the Myanmar Global Investment Forum said: “New Star Light Company, which is currently operating a 300-acre luxury complex in Muse, and the company implementing Mingalar Mandalay housing project in Mandalay are of the same root. They are financially more powerful than Xiao Pan and Xiao San brothers [Chinese tycoons known for trying to undertake a new town plan on prime land in Yangon]. Likewise, Dagon City 1 and Golden City housing projects are also run by Chinese.”
This information was revealed on the second day of the Investment Forum while Cyrus Pun, executive director of Yoma Strategic Holdings, joined the panel discussion.
Cyris Pun said: “Since three years ago, I noticed that foreign investors have withdrawn their hands from the local business environment. It’s not because they weren’t interested, but because of the spike in land prices caused by speculation. Also, they weren’t satisfied with the competitiveness of government tenders, as local companies won most projects.”
Local entrepreneurs’ investment in the housing sector has accelerated and reached Ks 700 billion [US$700 million].
“As the Investment Law gives tax-free privileges to foreign investors, officials aren’t willing to hand [housing] development projects to foreigners in case they sell their possessions and flee from the country. But the Chinese tycoons register their projects under the names of Myanmar citizens, and so their investment is classed as citizens’ investment,” the local businessperson said.
Since the economic reforms kicked off in 2011, Chinese tycoons and Chinese-backed local business people have surged in and monopolised the property market – making it difficult for other foreign investors to enter.
The Muse Central Business District Project – implemented by New Star Light Company – sits on the Ruili river bank along the Myanmar-China border and encompasses 294 acres of land. It has an economic zone and residential buildings.
Putu Kamayana, an adviser for New Star Light Company, said during the forum: “The Muse CBD Project is interesting. Its location covers 60 per cent of the two countries’ border hub and sits near Ruili town – home to 1.5 million people. The project also includes 200 high-rise buildings.”
The local businessperson argued: “The New Star Light Company runs a massive housing project in Mandalay too. I have no doubt the project would raise the living standard of Muse residents. But development is not the main decision factor. For example, the Malaysian government bars Singaporeans from acquiring land in Jaho province – in case real estate is dominated by foreigners.”
After the Chinese government cracked down on corrupt officials in the politburo, Chinese tycoons have reportedly flocked into Myanmar with help of Chinese residents in Muse to run businesses under as local investments.
Some critics believe the Chinese government is responsible and should conduct wide inspections about “malicious” Chinese business owners who have entered the real estate market in Myanmar, because their dealings have the potential to spur conflict which could lead to further geopolitical concerns.
Source: ELEVEN MYANMAR