Government Lost Millions of Dollars as Large Firms Paid Rock Bottom Rents for Public Land – Report

Yangon’s govern­ment has lost bil­lions of kyat in po­tential revenue by leasing public space to local firms at rock-bottom rates, a report from the Auditor General’s Office has re­vealed.

The report is based on an analysis of the Yangon City Development Com­mittee’s (YDCD) finances, which are not normally made public.

Looking at the 2015- 2016 fiscal year, before the NLD took power, the report found that YCDC ran up a budget deficit while it was leasing public land to businesses for well below standard market prices.

A contract with the Zaykabar Company that allowed it to lease the land for Kawareik Gar­den for well below market rates cost the public purse K1.6 billion per month, auditors said.

That added up to a loss of K19.91 billion, rough­ly $13.9 million, for the 2015-16 fiscal year, the re­port found.

YCDC made just K2 bil­lion from leasing public land across the entire city for the whole fiscal year.

“When leasing land in People’s Square and Peo­ple’s Park, YCDC charged just K0.8 per square foot. At current market prices, renting a square foot costs K3,000,” U Tin Lwin, the leader of the Bill Commit­tee, told a parliamentarymeeting.

“These companies earn a lot of money from en­trance fees, usually K300 per person,” he added.

In 2015, a separate in­vestigation by the Yangon Regional Auditor Gener­al’s Office into YCDC’s fi­nances found the contract awarding process for sev­eral companies who were leasing public land was opaque and that the land had been leased for well below market value.

One project which raised the ire of MPs for lack of transparency was the lease of the 44.5 acre Mya Kyun Tha Park site at Inya Lake. Eight com­panies were awarded con­tracts to build an amuse­ment park, healthcare clinics, a cinema, a golf driving range and retail stores.

The most recent report found that some com­panies also failed to pay a fine of K100,000 per day after they missed the deadlines set out in their contracts for finishing the projects.

“YCDC has never sub­mitted a report on theiractivities, for which deci­sions were made at inter­nal meetings,” said U Tin Lwin. “The regional cabi­net has to monitor and supervise this.”

Source: Myanmar Business Today