Business

Irrawaddy Business Roundup (September 28)

By William Boot 28 September 2013

World Bank Gives US$140M Loan for Burma Power Station Upgrade

Money to renovate and upgrade a gas-fueled power station in Mon State is being provided in an interest-free loan from the World Bank.

A total of US$140 million will be advanced via the bank’s International Development Association to buy new gas turbines and improve the efficiency of the 106 megawatt plant at Thaton.

The investment will increase electricity generating efficiency by 250 percent using the same volume of natural gas as now, said a World Bank statement announcing the loan. It will also reduce air and noise pollution from the plant, which will then be able to deliver 50 percent of Mon State’s power demand.

Meanwhile, Emerging Markets Energy Limited of Singapore announced that it has signed a preliminary agreement with Burma’s electricity ministry to source for underground geothermal energy in several areas of the country.

A feasibility study will assess whether there is sufficient energy from underground hot rocks and hot springs to build one or more electricity generating projects. The search will be focused in Shan State, Tenasserim Division, Sagaing Division, Magway Division and Mandalay Division, the Singapore firm said.

Farmers Seek Compensation From India Over Abandoned Chindwin Dam

Villagers and farmers forced out of homes and land to make way for a 1,200 megawatts hydroelectric dam at Tamanthi on the River Chindwin are demanding compensation from the Indian government now that the project has been abandoned.

Hundreds of people at the area in Sagaing Division were forcibly moved as the dam site was cleared but received no more than US$5 each in compensation, according to the Burma Rivers Network NGO quoting the Kuki Women’s Human Rights Organisation.

The former residents have filed a petition to the Indian Embassy in Rangoon and the Ministry of Electric Power for proper payment for the loss of land and property and the right to return.

“The families are from two villages, Tazone and Leivomjang, forced in 2007 to move at gunpoint from the Tamanthi dam site to a barren relocation settlement 40 miles downriver,” said the NGO.

Their farms produced rice, tea, bananas and bamboo.

The Tamanthi dam was to have been built by Indian state-owned National Hydroelectric Power Corporation (NHPC), but it recently abandoned the delayed project on the grounds that it was not financially viable.

Most of the electricity from the Tamanthi dam would have been transmitted to India.

Thai PM Renews Bangkok-Naypidaw Talks on Dawei Economic Zone

Thailand’s Prime Minister Yingluck Shinawatra has held talks with Burma’s parliamentary speaker Shwe Mann in Bangkok on plans to push forward the stalled special economic zone proposed for Dawei on the Burmese southeast coast, said Bangkok newspapers.

Yingluck told Shwe Mann that despite the failure of leading developer Italian-Thai Development (ITD) to take the project forward because of a lack of capital, various Thai government departments are “conducting an economic study on infrastructure in Dawei, such as transportation and power and water supply,” the Bangkok Post reported.

Talks were due to be continued in Naypidaw this week between Burmese and Thai officials on ways to attract Japanese investment for Dawei, Eleven Media reported.

The renewed government-level talks coincided with protests from local communities in Dawei alleging that the face eviction without adequate compensation or consultation from areas around the development zone.

The Tavoyan Women’s Union alleged that ITD was engaged in land clearance and road construction which was wrecking farm crops, the Burma Campaign UK reported.

Suu Kyi Urges Foreign Firms to Demand Business Transparency in Burma

Changing Burma’s Constitution and ensuring the rule of law are essential if the country’s economic growth is to benefit all its citizens, opposition leader Aung San Suu Kyi said in Singapore.

Suu Kyi stopped in the city state to attend a regional economic conference in her way back to Burma from visits to several countries in Eastern Europe.

“A lot of our problems in recent months have arisen from the fact that we have been lacking in transparency. Business deals that have turned sour, the demands of the people for their wrongs to be put right so transparency is very important,” she was quoted by Channel News Asia as telling the conference.

“But transparency is linked to confidence. We need a leadership that has enough confidence in themselves to be transparent and enough honesty to accept criticisms.”

She reportedly urged foreign companies seeking to invest in Burma to insist on business transparency—avoiding sweetheart deals which involve old-style crony habits or corruption.

Action Needed on More Business Facilities in Burma, Says Planning Chief

Burma risks frightening away some foreign investors because of a severe shortage of business facilities such as office space, the Ministry of National Planning and Economic Development director-general Aung Naing Oo said.

“To solve the problem of the shortage of hotel and office apartment, we are now encouraging investors in these sectors by approving their proposals very speedily,” he told Reuters.

Some large foreign firms who were unable to secure adequate offices in Rangoon were basing executives in Bangkok and flying them into Burma for meetings, the news agency said.

“The rising tide of foreign investment is fueling a property boom in the commercial capital [Rangoon] with the increasing demand for rental space feeding the highest office rental rates of any Southeast Asian city, according to real-estate firm Colliers International, which opened a branch in Yangon in July,” said Reuters.

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