Business

Quick Buck Land Boom Stalls Mon State Resort Developments

By Yen Saning 8 May 2015

YE, Mon State — Were it not for its beautiful beaches, Kabyar Wa would be indistinguishable from any one of hundreds of Mon State’s farming villages. Home to about 300 households, most of the area’s inhabitants stake their livelihood on fishing, betel orchards and small-plot subsistence farming.

Despite being only 27 kilometers (17 miles) away from Ye, the journey into Kabyar Wa takes an hour by motorbike. Communications infrastructure is nonexistent and the area falls under the aegis of the Mon National Liberation Army.

Yet life is beginning to change in the village. Last year, after the Ministry of Border Affairs funded the replacement of the rickety wooden bridge into the Kabyar Wa with a new concrete structure, the site has become host to an increasing number of local travelers seeking a weekend’s rest and respite by the Andaman Sea.

Not long after the announcement, Aung Moe, who lives by the beach, decided to capitalize on the village’s new profile by setting up a restaurant. There were barely any customers when he started five months ago, he told The Irrawaddy. In the time since, two new restaurants have opened up to compete for the small daily trickle of local tourist traffic.

The Mon State government designated the village’s 13-kilometer (8-mile) stretch of beach as a hotel and recreation zone in Sept. 2014. Facilities will be developed under the management of local firm Aurun Co, primarily known for its mining operations, with the construction of an assortment of resorts, bungalows and midrange hotels.

The increasing profile of the Kabyar Wa beach has now jeopardized the government’s hope to realize its expansive hotel and resort plans by the planned 2017 completion date. News of the proposal has led to a speculative frenzy in beachfront land prices, with a 100-fold increase in value over the past year.

“It’s difficult to develop it now due to land issues,” said Nai Lawi Aung, the state electricity and industry minister. “The project hasn’t been developed yet because of land brokers manipulating prices.”

Before the government’s announcement a beachfront plot, usually 40 by 60 meters, cost only US$100-200. Some of the plots were used as makeshift toilets by villagers and many others were neglected completely. After Aurun stalled on its land acquisition plans, the same plots are now selling for $1,000-$20,000, depending on their location and size, with prospective buyers coming from as far away as Rangoon and Myawaddy.

Almost all land along beach now has new owners, collectively hoping to sell the titles back to the company for a quick windfall.

Kabyar Wa’s development has been further stalled by bureaucratic hurdles. The company has so far acquired only 17 hectares (43 acres) of wild land around the village, with promises to provide tarmac roads, medical clinics, a market, a monastery and fire engines to the local community. Work cannot begin on many of these proposals until they are approved by the state Department of Lands, an arm of the Ministry of Agriculture and Irrigation. Nai Lawi Aung said that the state government did not have the authority to grant the company permission, and was limited to granting assistance in the company’s application to the department.

Htay Thwin, Aurun’s managing director, told The Irrawaddy earlier this year that his firm expects to spend $12 million on infrastructure and preliminary hotel developments, before seeking partnerships with international companies to build further resort facilities.

With the surge in land prices and construction delays, it is unclear whether the project’s budget will exceed its initial projections. Meanwhile, in one of the few areas of Mon State to welcome a development proposal with open arms in recent years, villagers have become frustrated that the expected boom in tourist arrivals has yet to occur.

“[Aurun] are waiting for hotel zone to develop,” said Aung Yin Oo, an orchard owner in Kabyar Wa. “They said that a hotel project would start this year but it has yet to begin. Locals want them to start as soon as possible.”

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