Dawei Awaits Its Destiny

By Paul Vrieze & Htet Naing Zaw 22 February 2014

MAUNGMAGAN, Tanintharyi Region — U Aung Myint, a community leader from Mudu village, stands next to a meter-long, gold-colored footprint with 108 Buddhist signs that was carved on a large boulder many centuries ago. “We believe that the Buddha visited here and that this is his left footprint,” he said.

The relic, around which a pagoda has been constructed, is part of the heritage of the ethnic Dawei people, who have lived in southern Myanmar’s Tanintharyi Region since the 8th century. The ancient artifact gave the cluster of villages on this remote coastal plain its local name: Nabule. “The Pali word for left foot is Nabule,” U Aung Myint explained.

The area is known on most maps as northern Maungmagan, located some 20 km northwest of Dawei city, and it is here that Southeast Asia’s biggest industrial estate is being developed: the Dawei Special Economic Zone (SEZ).

The creation of a multi-billion dollar “new global gateway of Indochina” at the site of secluded, ancient villages underscores the dramatic changes that this long-isolated coastal region will experience if the project is realized.

The Myanmar government considers the Dawei SEZ a great economic engine for the impoverished country and officials boast of the region’s future as an industrial hub.

Many Dawei residents and activists, however, fear that they will bear the costs, rather than the benefits, of the sweeping changes that the massive project will bring. They complain of the project’s heavy environmental impact, forced eviction from the SEZ without adequate compensation, and a region-wide surge in land grabs.

Although their pagodas will not be knocked down, many in Nabule oppose leaving their ancestral villages for fear of losing their Dawei heritage. “Our forefathers lived here for more than 1,000 years,” said U Aung Myint. “I am certain that the more the project will be developed, the more our culture will decline.”

Losing Ground to a Stalled ‘Regional Hub’

In 2008, Myanmar’s former military government and Thailand signed a deal to develop the Dawei SEZ, a project that includes a huge industrial estate, a deep-sea port for supertankers, and highway, railroad and oil pipeline routes to Bangkok, located some 350 km to the east.

Billed as Myanmar’s largest export industry zone and a regional trade hub, its strategic location would allow companies from Thailand, Vietnam, Cambodia and China to send goods overland to the Bay of Bengal and bypass the busy Strait of Malacca shipping lane.

Government officials, such as U Aung Tun Thet of the Myanmar Investment Commission, presented glowing plans to “transform Dawei into a newly opened investment destination and logistic hub of the region” valued at US$50 billion, which would “generate a very large amount of employment.”

Italian-Thai Development Public Company Ltd (ITD) won the project concession and sought to attract $8 billion in investment to develop the zone’s infrastructure, after which international firms were expected to build heavy industries, such a massive coal-fired plant, a steel plant, oil refineries and a chemical fertilizer plant.

However, ITD failed to attract investors and the project faced numerous delays. In November 2013, Myanmar and Thailand took the firm off the project and called for the involvement of Japan’s government and Japanese firms. Tokyo has since shown an interest in reviving the project and on Nov. 21 Mitsubishi announced it would work with ITD and the Thai government to develop a 7,000-megawatt coal plant at Dawei.

In 2010, ITD had already begun construction of the SEZ, a water reservoir and a two-lane access road to Thailand. The plans will ultimately force the resettlement of 12,000 people from six ethnic Dawei villages in Maungmagan, while thousands of ethnic Kayin (Karen) villagers in the Tanintharyi Yoma mountain range will lose farmland.

In Nabule, a coastal plain dotted with villages growing rubber, betel nut and cashew nut, hundreds of farmers have already seen their land confiscated for the SEZ, which will cover 200 square kilometers of untouched beaches and farmland.

Villagers and the Dawei Development Association (DDA), a local NGO monitoring the SEZ, said authorities and ITD had pressured farmers to give up land without proper consultation, while compensation procedures have been inconsistent. Future resettlement sites, they claim, lack arable farmland.

In Mudu village about 70 farmers have lost 198 acres (80 hectares) of land. “Sometimes [ITD] offers [compensation] money and then they occupy the land. Other times they first occupy the land and then they offer money,” said U Aung Myint, adding that about 30 farmers received no compensation as they refused to give up their land ownership.

Affected farmers said they were offered compensation amounts ranging from $500 to $3,000 per acre. Although the latter amount is fairly high, residents often demand more, as land prices around the SEZ have surged to between $5,000 and $10,000 per acre.

U Aung Myint lost 10 acres (4 hectares) of betel nut trees and like many farmers he is anxious about his future livelihood at one of three planned relocation sites. “I have no idea what I’m going to do, I have no land left,” he said, adding that only migrant workers had been offered jobs at the SEZ project.

DDA said ITD’s project implementation methods had violated villagers’ human rights. “Most people rely on plantation farming, but the government cannot move them and guarantee their future livelihoods,” said DDA coordinator U Thant Zin.

U Zaw Thura, a local activist and Dawei University scholar, expressed concern over the industrial zone’s expected environmental pollution. “We are worried about the northwest monsoon, it will blow all the exhaust fumes of the coal plant and other industries inland and over Dawei city,” he said, adding that ITD had refused to release the project’s environmental impact assessment (EIA).

Although work started in 2010, little has been achieved at the SEZ, which remains a largely empty area, with a small port, dirt roads, a few simple office buildings and barren living quarters for ITD’s 1,200 local workers.

Managers at ITD’s project support office were reluctant to talk to Irrawaddy reporters and EIA reports by Bangkok’s Chulanglokorn University on display in a glass showcase could not be made available because staff had “no key.”

A high-ranking official involved in the planning of the SEZ said in a phone call that the government was “trying very hard to mitigate” the project’s local impacts, adding that farmers directly affected by the SEZ “are being properly compensated.”

The official, who spoke on condition of anonymity, said Naypyitaw was confident that a Japanese consortium would help to resume project work in mid-2014.

However, some economists question whether the SEZ will ever attract industrial investment, or offer any benefits to Myanmar.

“Successful SEZs have an underlying economic need and rationality first, and proceed from there. Here we seem to have an idea akin to ‘build it and they will come,’” said Sean Turnell, a professor at Macquarie University in Sydney, Australia, who advises opposition leader Daw Aung San Suu Kyi.

Any economic benefits of the project, he said, “will accrue to Thailand rather than Burma. Dawei in no way opens up the Burma hinterland to trade.”

Unlocking a Region: Land Grabs and the Economics of Peace

For decades, Dawei was an isolated region, located in Myanmar’s deep south and cut off from nearby Thailand by a Karen National Union (KNU) insurgency in the forested Tanintharyi Yoma mountain range that runs along the border.

The planned Dawei SEZ, a 2012 government-KNU ceasefire and economic reforms by President U Thein Sein’s quasi-civilian government have changed all that and Dawei’s days as an inaccessible backwater now seem over.

In October, ITD completed a 132-km gravel access road running from the SEZ through the KNU-controlled mountain range to the Thai border. Some 30 minibuses from Thailand, carrying tourists and business visitors, now reportedly arrive in Dawei every day.

Land prices have surged throughout Dawei District, as local and Thai businessmen move to buy up land for investment in tourism projects, real estate, plantation farming and mining in the newly unlocked region.

Among local communities, however, concerns are growing over the projects’ impacts. Near Dawei city and around the SEZ numerous investment projects have sprung up, as have controversies over land ownership.

One of the biggest local investors is Dawei Development Public Company Ltd (DDPC), which was set up by a group of Dawei businessmen in 2011 with a view of gaining a stake in the region’s expected, rapid economic development, managing director U Ye Htut Naing said in an interview.

DDPC is chaired by local tycoon U Khin Soe, whose Anawar Hlwam Company controls much of southern Myanmar’s highly productive coastal fishing industry. The firm’s website boasts of $50 million in registered capital and 47 fishing vessels. U Khin Soe also owns Apex gas stations, the 55-room Apex Hotel in Naypyitaw and has announced plans to launch Apex Airline.

DDPC plans to build a cement factory and a mine, and has begun constructing a $3 million shopping mall near Dawei city and a tourist resort on a 475-acre (190-hectare) pristine beach front just south of the SEZ. The resort includes a $14-million luxury hotel, bungalows and apartments, a golf course and an “ethnic races village” supposedly representing Dawei’s peoples.

“We already collected the [investment] money for the project,” said U Ye Htut Naing. “We expect an increase in business and tourist visitors. There are no sleeping facilities at the SEZ; we want businessmen to sleep in our bungalows.”

At the sprawling project site a dozen bungalows have already been built on the white sandy beaches overlooking the azure waters of the Andaman Sea. A billboard shows an artistic rendition of the future resort extending far inland, into an area currently covered with mangrove forest and cashew nut trees.

About half a kilometer away, at the edge of the forest, lies Kavee Hnit Pin village. Here, some 130 impoverished families reside in rickety huts built along a litters-strewn dirt road. They live hand-to-mouth, working as day laborers and collecting food from the forest.

In October, however, the DDPC obtained the mangrove area from the Forest Department, and workers began cutting down trees and erecting fencing. The villagers have since grown desperate and complain that they have been deprived of a crucial food and income source that they have used for decades.

“Before the company came we found everything we need there: fish, crabs, fruit, and firewood. Now we struggle to get food,” said Daw Hla, a 43-year-old mother of nine. “We heard that they will take our village land too!” fumed Daw Eimal, a mother of five children.

Emotions ran high among the roughly 100 villagers who gathered to speak with Irrawaddy reporters, and when several Special Branch officers in plain clothes showed up to take photographs some confronted the thuggish-looking men.

“We want this area back, we received no money in compensation!” shouted Daw Hla. “Our future generation is lost, we planted many fruit trees in this area but the company took it all.”

U Ye Htut Naing dismissed the complaints and said his firm had received the forest land “for free” because DDPC Chairman “U Khin Soe is close to the [Tanintharyi Region] chief minister” and had convinced him of the project’s positive economic impacts. The poor villagers, he said, would simply have to be patient because “after the local economy develops there will be new job opportunities for them.”

In the Tanintharyi Mountains, meanwhile, several thousand Kayin villagers have lost land to ITD’s construction of a 2,970-acre (1,200-hectare) water reservoir and the new road to Thailand, which will eventually become a four-lane highway.

The angered villagers have complained of poor compensation and appealed to the KNU for help. In September, they blocked the road for three weeks at a site some 50 km west of the Dawei SEZ. All along the road, meanwhile, businessmen are buying up land and complaints of land-grabbing have surged, according to DDA, which warns that tens of thousands of Kayin villagers will be directly and indirectly affected by ITD’s projects.

During a visit to Thapyu Chaung, a small village of thatched-roofed and wooden huts located in a lush mountain valley some 30 km east of Dawei city, impoverished Kayin villagers complained that road construction waste had polluted their local stream.

“This river is now destroyed, the fish and crabs are all gone,” Pi Naw Pa Lay Zar, 74, said in perfect English. “We only have one clean stream that we can use for drinking water in the [dry season]. It doesn’t flow very well and we have to go very far to the upper part of the river to get water.”

During the interview, two pick-up trucks, including a gleaming new Toyota Hilux SUV with a Myanmar license plate, pulled up carrying a dozen fighters of Karen National Liberation Army Brigade 4. A KNLA captain inquired about the Irrawaddy reporters’ visit, but discussions quickly turned to the surge in land disputes.

“The buying and selling of land is a very big problem here,” said the officer, who declined to be identified. “Many businessmen come here now that the roads are becoming better. They came with licenses obtained in Naypyitaw, showing that they can buy the land.”

“The KNU never approved these sales, and some people sell land when they don’t own it—this creates a lot of problems. That’s why the KNU banned land sales,” he said, referring to a KNU notification placed along roads in the area that reads: “No selling, buying of land in this territory.”

U Thant Zin of DDA said the sudden influx of businessmen looking to buy—or grab—land was having a disruptive effect on the long-suffering Kayin communities and causing tensions in the area, which is still awash with weapons after decades of conflict.

“In some villages, the bulldozers are parked [to begin work] and the people are so worried that they wait with guns to guard their land,” he said, adding that the KNU had also cut business deals that affected communities, such as in southern Dawei District, where it has allowed Thailand’s East Star Company and local firm Mayflower to operate a coal-mining concession.

U Thant Zin warned that the rise in land sales and disputes threatens donor-backed government plans to return Kayin refugees from Thailand in coming years.

“This is also related to the peace process. So many Karen refugees [from Dawei] live across the border in the camp near Kanchanaburi. How can they return when there is no access to land?” he asked.

The cover story first appeared in the February 2014 issue of The Irrawaddy print magazine.