Popular concern that the projects could undermine nearby Shwedagon or block the view of the famous landmark was driven by the monk-led Save Shwedagon Campaign. Yet the companies themselves had put considerable time, money and effort into the project, and as far as they knew were following the law.
With the developments now finished, experts say the next step is to decide adequate compensation for the affected companies.
Five projects have been affected – two by Shwe Taung, one by Adventure Myanmar Tours and Incentives, Dagon City 1 by Marga Landmark and Dagon City 2 by Thu Kha Yadanar. However, Dagon City 1 and 2 were the furthest along and the most prominent in the public eye when all were initially paused in January.
While one Yangon lawyer said the companies are likely now looking at what protections they have under the law, others say that Myanmar can still emerge with its reputation as an investment destination intact.
“The key to this is if the original investors are adequately compensated,” said Tony Picon, managing director of Colliers International Myanmar. Colliers was the property manager of Dagon City 1.
Myanmar is a frontier market, and this sort of situation will arise from time to time, he said.
Crucial will be how the next step is managed – and if there is adequate compensation, then Myanmar’s brand as an investment destination may emerge from the situation unscathed.
“If in 10 years the developers are doing their 10th project in Myanmar … [and] if the investors who were affected carry on, we’ll say it’s just one of those things,” he said.
Still, Mr Picon said it is too early to see how the compensation issue will be resolved, though one possibility is compensation with another piece of land.
The government has not yet publicly announced the compensation package the affected companies are to receive, and company officials say they are currently negotiating an agreement.
Marga Landmark said in a statement yesterday that everything it had done was proper, legal, and in the best interests of its customers and the public. Still, it said it respects the public sentiment, particularly that of Sangha members, and is working with the Union government toward an arrangement that upholds the international contract between Myanmar and the foreign investors.
“Marga Landmark is presently cooperating closely with the Myanmar government on a mutually agreed scheme that will satisfactorily resolve all matters pertaining to our customers and our investors,” the statement said.
The company also sought to dispel misconceptions with the project.
The plans for Dagon City 1 were within the area’s height restrictions, while the project had received the necessary approvals, and was using the most modern construction techniques, including advanced diaphragm walls used in many developed countries and cities that would not affect any building beyond 3 feet. “Shwedagon Pagoda, which is 3000 feet away from the project, [would] certainly not be affected,” it said. “Also, Dagon City 1 never intended to and would never use underground water.
“Although the project will not continue, we want to clarify these misconceptions about our previous plans. We are passionate and professional about our projects, and we are absolutely certain our plans do not present any negative impacts to our surroundings.”
Some commentators applauded the July 7 move by the President.
Yangon Heritage Trust, led by well-known historian U Thant Myint-U, said it welcomed the decision to cancel the projects in the compound of what used to be the National Defense College and No (1) Motor Transport Battalion.
There is now an excellent opportunity to step back and think about the future not only of the compound but also the entire city, U Thant Myint-U said in a press release.
“We welcome international and local investment in Yangon’s regeneration and modernisation within a proper framework, one that will stand the test of time and conserve the city’s uniqueness,” he said.
Others said that practical steps could be taken for the future. Daw Si Than, a professional engineer and vice president of the Myanmar Engineering Society, said the area may not be suitable for high-rises.
U Soe Tun, an elected member of Yangon City Development Committee and also a prominent local businessperson, said the Myanmar Investment Commission and other government ministries should be transparent when inviting tenders or giving permits.
“This can be an example, and both investors and people in authority should think deeply before the project starts,” he said.
“We appreciate that with the project now stopped there will be no damage to Shwedagon Pagoda. But for the side of investors, it may affect foreign direct investment, which needs to be pointed out.”
Source: Myanmar Times