Investors Lining Up for Mergui Archipelago Hotel Permits

By Kyaw Hsu Mon 8 May 2015

RANGOON — Nearly 30 local companies and joint ventures are awaiting government approval for hotel projects in Burma’s Mergui Archipelago or have already been given the greenlight to start implementing plans, according to Aung Zaw Win, director general of the Ministry of Hotels and Tourism.

The Myanmar Investment Commission is currently vetting 20 local firms and six joint ventures seeking to break ground on hotel and resort projects across 26 of the archipelago’s largely unspoiled islands. Two other joint ventures with foreign partners, Moe Kant & Kyaw Win Phyo and United Resorts, have already been granted approval for plans on the islands of Kyun Phila and Ngakhin Nyogyi, respectively.

“Many companies have applied to set up hotels in the Myeik [Mergui] islands since 2011, when the new government took office,” Aung Zaw Win told The Irrawaddy.

“Our ministry has recommended that these companies receive approval from the MIC through the Tanintharyi [Tenasserim] Division government. We have checked their environmental protection plans in their proposals, then recommended them. After that, MIC is checking them and if it is OK, will approve them,” he said.

He added that because the Mergui Archipelago had remained unexposed to mass tourism, in contrast to neighboring Thailand, a growing contingent of foreigners were making their way to its islands from the Thai beach town Phuket and elsewhere.

“Recently, Dawei and Thailand’s Kachanaburi district are connecting to develop tourism around the southern part of Myanmar, so at the same time, the Kawthaung region will also keep developing. That’s what we are expecting,” Aung Zaw Win said.

The Mergui Archipelago spans 800 islands across an area of 10,000 square miles in Burma’s far south. While currently difficult and expensive to visit, the area, also known as the Myeik Archipelago, is tipped to become a major tourist destination as Burma welcomes more foreign tourist arrivals. The archipelago is listed as a priority area for development under a Tourism Master Plan released by the government in 2013, with the coral-rich area seen as likely to draw intrepid ecotourists, divers and holiday-goers from southern Thailand.

Hlawan Moe, assistant director of the Kawthaung department of the Ministry of Hotels and Tourism, said foreign and local investors in recent years had expressed strong interest in the Mergui islands.

“The United resort is now preparing to start work on Ngakhin Nyogyi island. They plan to invest 500 million kyats [US$450,000] for an initial project,” Hlawan Moe said.

“All the islands are beautiful and untouched, we’ve been making field checks of these islands since last year to approve applicants working with MIC,” he said.

Attempts by The Irrawaddy to contact the Myanmar Investment Commission’s secretary Aung Naing Oo to discuss the commission’s approval process were not successful.

At least one other project is already moving forward.

Last year, the Myeik Public Corporation announced plans to invest $4 million in a resort on Kadan Island, the archipelago’s largest, beginning this year. Kadan lies some 15 miles west of Myeik, a coastal town on the Burmese mainland that serves as the region’s commercial hub.

Aung Myat Kyaw, the chairman of the Union of Myanmar Travel Association and an adviser to Burma’s Tourism Marketing Committee, welcomed the new hotel projects in the archipelago, saying the development would spur regional tourism as well as improve local livelihoods in southern Burma by creating jobs.

“In the past, there was very little infrastructure in the Myeik islands. Even though tourists wanted to enjoy snorkeling and scuba diving there, a lack of infrastructure made it difficult to go there. That will soon improve,” he said.

“For residents in that area who are fishing with dynamite, damaging the environment, if these investors create job opportunities for them, they will have an alternative income rather than fishing, so it will benefit both,” he said.

Win Myo Thu, an environmentalist with the Burmese NGO EcoDev, acknowledged the region’s inherent tourism potential, but warned that environmental pressures were already being felt, and could be exacerbated by a sudden, inadequately regulated expansion of the industry.

“I wonder how these local companies will manage the environmental issues in this area,” he said. “How can the government control this issue credibly?”

Virginia Henderson, a researcher and writer who visited the archipelago last month, called the experience “magnificent.”

“I had the privilege to visit the Mergui Archipelago during Thingyan last month with Moby Dick Tours. It was a magnificent experience boating around the pristine deserted white sand beaches, peaceful and delightful nature at its best,” she said.

“There is obviously enormous potential for development in this area, but I’d hope that rather than rushing in and building resorts, developers would plan carefully to protect and maintain this extraordinary environment,” Henderson added.

According to figures from the Ministry of Hotels and Tourism, there were about 1,150 hotels in Burma as of March 31, most of them being concentrated in Rangoon (298 hotels) and Mandalay (148 hotels).