Business

Rangoon’s Future: Orderly Singapore or Disorderly Bangkok?

By William Boot 30 January 2013

Rangoon should be rebuilt in the image of Singapore, said President Thein Sein, with the best bits of Bangkok like the famous “skytrain” railway and stilted roads added on.

This was the ambition of Thein Sein after he took office in 2011. The reality is rather different. Nearly two years on and Burma’s business city still lacks a comprehensive development plan and infrastructure remains primitive—while piecemeal private construction contracts are being approved in secret.

Foreign entrepreneurs, tourists and dirt poor farm laborers are spilling into the city looking for opportunities, album snapshots, or better-paid work. What they often find is bureaucracy, blackouts and trouble finding somewhere to sleep.

Electricity and water are in short supply, the sewage system is decrepit, and traffic congestion is worsening.

“Yangon [Rangoon] is unprepared  in many ways for rapid growth, but one of the most important shortcomings is that the city lacks a comprehensive land use and infrastructure plan that sets out where new development should be located and how it will be serviced,” a study of the city warns.

“Developing a plan is critical because it will help Yangon respond sensibly to the many unsolicited development proposals that it is bound to receive. Without a plan it will be much more difficult to decide which of these proposals, if any, advance important public interests in the development of the city and which advance only private interests at the expense of the public,” said the study by a team of urban planning specialists linked with Harvard University’s Graduate School of Design.

The Japan International Cooperation Agency (JICA) has been commissioned to compile proposals for a long-term city development plan for the Yangon City Development Committee, due to be completed this year. But without waiting for the plan various powers-that-be have already given approval to a number of construction projects.

Just last week a major homes-for-sale development was approved for Rangoon’s eastern Dagon Seikan Township, according to Deputy Construction Minister Soe Tint. Work is earmarked to begin in April, he told a real estate forum in the city. Construction companies from Singapore, Thailand and South Korea are supposedly involved, though no details have been disclosed.

In December, the Ministry of Hotels and Tourism reportedly signed an agreement with a Vietnamese private property developer for a US $300 million hotel and shopping mall complex in central Rangoon. The firm, Hoang Anh Gia Lai Group—known as HAG—will lease 8 hectares of land, but it’s unclear under what terms the foreign firm acquired the leasehold or when work will begin.

Last November a Burmese firm, Mandalay Golden Wings Construction, emerged from a secret government auction with a licence to build a 34-storey condominium to tower over Rangoon’s Inya Lake. Six of the storeys will be for car parking and the rest will consist of 400 apartments for the financially well heeled.

The current legal environment favors the construction buccaneer willing to take risks and pay commission sweeteners, while providing few safeguards for reputable builders.

Burma’s rule of law status has marginally improved over the past year, but it remains in the “extreme risk” top ten category for would-be foreign investors, according to the 2013 Global Legal and Regulatory Atlas compiled by business risk assessors Maplecroft.

“[Burma] is no longer classed as the country with the world’s most challenging legal and regulatory environment, as was the case in last year’s Atlas. This is primarily a result of the government’s commitment to democratic reform and strengthening of the business environment, following decades of authoritarian rule and isolation,” says Maplecroft.

The annual assessment still ranks Burma as third-worst country in the world, however.

“Neither the rule of law, nor a consistently applied regulatory framework, exists in the country, and corruption remains rife,” Maplecroft’s survey said.

American economist Lex Rieffel, in a study of Burma for the Washington think-tank Brookings Institution, thinks many government officials are distracted by too many official visitors arriving in the country with offers of advice and aid.

“The list of problematic visitors is led by diplomats, aid agency representatives, international NGO representatives and business executives,” said Rieffel.

“The worst impact of the tidal wave of visitors is on the small number of Myanmar policy officials, ministers and director generals. These officials are spending large chunks of every work day meeting with foreign visitors, leaving insufficient time for good policy decisions and even less time for effective policy implementation. This kind of adverse impact has been seen in a number of other countries,” he said, citing Cambodia as an example of a country that has faced similar problems.

Burma’s decades-long isolation saved Rangoon from the destructive redevelopment which has afflicted virtually every other major city in East Asia, with the possible exception of the Cambodian capital Phnom Penh.

But without a cohesive development plan Rangoon faces the same fate as Bangkok, Manila, Ho Chi Minh City and Jakarta, planners and conservationists warn. The surviving colonial-era architecture of Rangoon which is a lure to dollar-spending foreign tourists risks being pulled down to make way for shopping malls, skyscraper apartment blocks and characterless office towers.

Existing laws on planning restrictions are proving ineffectual in the face of pressure from big-buck developers, says Sarah Rooney author of “30 Heritage Buildings of Yangon.”

Rooney lives in Bangkok where often thoughtless office and condominium development has paid no heed to need or surrounding infrastructure, such as transport, and has swept away almost all traces of traditional Thai architecture apart from some historically sensitive temples. In Bangkok, tens of thousands of office workers must spend up to three hours per days struggling to and from their jobs on clogged roads.

Unless a publicly accountable plan is adopted and adhered to, say observers, Rangoon risks turning into a Bangkok-like concrete monster rather than a neat and orderly Singapore.

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