Economy

The Irrawaddy Business Roundup (July 12, 2014)

By William Boot 12 July 2014

Yadana Gas Field Set for Production Boost to Keep Thailand Supplied

South Korean, Chinese and French firms have been shortlisted to build expansion facilities for the Yadana offshore gas field in Burma’s Andaman Sea, industry reports said.

The expansion is planned to boost production and maintain output as the field begins to age, said 2b1st Consulting of France.

Most of the gas from the 5.3 trillion cubic feet field, which has been operating since 1998, goes by undersea pipeline to Thailand, with only a small volume assigned to Burma under the terms of an agreement signed by the former military regime.

Yadana, operated by an international partnership led by Total of France and including Chevron of the US and the state-run Myanmar Oil & Gas Enterprise, will have a new platform and associated facilities added to boost production by 120 million cubic feet per day (cfpd), said 2b1st Consulting.

At its peak the field has been delivering 750 million cfpd.

“The race for the first of two main contracts that French major Total is tendering out for the phase four development of the Yadana field is understood to be down to a tight race between South Korea’s Hyundai Heavy Industries and a joint bid between China’s Offshore Oil Engineering Company (COOEC) and France’s Technip,” said Upstream oil and gas magazine.

Total hopes to have the new facilities installed ready for the production boost in the first quarter of 2015, said 2b1st Consulting.

UK Says It’s Pressing Thailand on Burmese Migrant Labor Rights

The British government is pressing the authorities in Thailand to improve the labor rights of Burmese migrant workers in the country.

The London Foreign Office said it was closely monitoring the case of British citizen Andy Hall in Thailand awaiting trial on criminal libel charges for publishing allegations of Burmese worker abuse at a fruit canning factory near Bangkok in a report for human rights NGO Finnwatch.

“We continue to raise the issue of labour rights in general with the Thai authorities, including those of migrant workers,” said Alexandra McKenzie, deputy head of the Foreign Office Asean Department. “This is an issue to which the UK attaches great importance,” she said in a letter to Hall seen by The Irrawaddy.

However, McKenzie said London is “not able to interfere in an ongoing judicial process, nor attempt to influence the outcome of a trial; nor can we request that the Thai court or authorities drop charges.”

The case against Hall—brought by the Natural Fruit Company—is due to be heard in September and the court has confiscated his passport. If convicted, he faces up to seven years imprisonment.

“The prosecution of Mr. Hall illustrates how Thailand’s criminal defamation laws allow powerful corporations or individuals to criminalize and thereby silence the lawful exercise of freedom of expression guaranteed by the International Covenant on Civil and Political Rights ratified by Thailand in 1996,” said Lawyers’ Rights Watch Canada.

Jade Price Rise Pushes Gems Auction to Record $3.4B Sale

Burma’s annual gems auction broke all records this year with sales income totaling US$3.4 billion, the Gems & Jewellery Entrepreneurs Association said.

Most of the sales were for jade, with more than 6,000 lots going under the auctioneer’s hammer, said DPA news agency this week, quoting the association.

This year’s auction took exactly $1 billion more than in 2013, the association said. Improved access to the country and a 20 percent rise in the value of jade boosted the total sales value.

More than 4,000 buyers attended the auction, mainly from China, Hong Kong, Thailand and Japan.
“This year sale surpassed the target and is the record sale in [Burma’s] emporium history,” association secretary Tun Hla Aung told DPA.

However, an uncut lump of jade weighing about 250 kilograms with a starting price of $82 million failed to find a buyer, he said.

Singapore is Biggest Foreign Investor in Burma So Far This Year

Singaporean companies contributed almost all of Burma’s incoming foreign investment in the first five months of this year, the Directorate of Investment and Companies Administration said.

Singapore accounted for $1.9 billion of the total $2 billion in the January-May period.

Thailand was a distant second, investing $114 million, while third-placed China invested $51 million.

Most of the investment went into commodities, factory production facilities and tourism, said Eleven Media quoting the directorate.

Five other Asian countries collectively invested another $114 million.
The biggest non-Asian investors came from Britain and Sweden, with companies from both countries bringing in a total of $28 million during the five months.

Burma’s giant neighbor India invested a mere $900,000 in the period.

Record Visitor Turnout for Trade Fair will ‘Stretch’ Naypyidaw Hotels

Organizers of a huge regional tourism fair in Burma’s capital Naypyidaw next year say over 200 exhibitor booths have already been booked for the event.

The Asean Tourism Forum, making its debut in Burma for the first time in its 34-year history, is scheduled to be held Jan. 22-29.

The annual event usually attracts about 1,600 participants and the Ministry of Tourism has said there is enough accommodation in Naypyidaw to cope with such an influx.

However, the travel magazine TTR Weekly said growing interest in Burma as a tourism center will make the Naypyidaw fair especially busy.

“Sellers need to secure their booths early and all delegates will need to secure their hotel accommodation through officials channels as room capacity will be stretched to the limit to accommodate up to 2,000 trade visitors,” TTR Weekly said.

Counterfeit Goods Imports Threaten to Dissuade Foreign Investment

A surging black market in illegally imported goods is discouraging some foreign investors from entering Burma, the Minister of Commerce said.

The problem is compounded by the sale of counterfeit goods using internationally noted brand names, said Win Myint.

“Japanese manufacturer Canon Inc. said they are holding off on setting up a Myanmar production facility until intellectual property laws are enacted and enforced, the Myanmar Times reported.

“Analysts generally regard Myanmar’s intellectual property environment as quite weak, with a full set of modern laws on patents, trademarks, industrial designs and copyright still not yet passed by parliament,” it said.

Search teams from the ministry of commerce will target Rangoon’s main sea and airports in July in a bid to seize illegal and counterfeit goods as part of a crackdown, said Myanmar Times quoting the ministry.

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