Myanmar Govt to Probe Contentious Chinese Development on Thai Border

By Nan Lwin 16 June 2020

YANGON—The Myanmar government has formed a tribunal to investigate irregularities surrounding a controversial China-backed city development project near the Thai border in Karen State.

The planned mega resort and city expansion project is controlled by the Karen State Border Guard Force, a Myanmar military-backed armed group led by Colonel Chit Thu and formerly known as the Democratic Karen Buddhist Army (DKBA). The project is a collaboration between a Hong Kong-based company called Yatai International Holding Group (IHG) and Col. Chit Thu, officially dubbed the “Myanmar Yatai Shwe Kokko Special Economic Zone.”

The project has sparked criticisms due to a lack of transparency, land confiscations, confusion over the scale of construction and the growing influx of Chinese money as well as suspected illicit activity and local concerns about the social impacts of casino businesses.

At a press conference in Naypyitaw on Monday, Union government office Deputy Minister U Tin Myint said he has been selected as chair of an investigative tribunal for the Shwe Kokko project.

U Tin Myint said that the team has yet to make a site visit due to COVID-19, but he has instructed officials from the Karen State government, the General Administration Department and the Settlement and Land Records Department to inspect conditions of the project on the ground.

In September 2017, Col. Chit Thu and Myanmar Yatai Company signed a partnership agreement, initiated by the China Federation of Overseas Chinese Entrepreneurs. In 2018, the Myanmar Investment Commission (MIC) approved US$22.5 million in investments for the Shwe Kokko urban development project, including for the construction of 59 villas within three years on 10.3 hectares of land in Myawaddy Township.

In 2019, local media reported that the construction activities in Myawaddy have far exceeded the approved scale for the project. Later, the project was temporarily suspended for breaching investment regulations following on-site investigations by Karen State authorities.

A report titled “Gambling Away Our Lands” by the Karen Peace Support Network (KPSN) in March said that despite the announced suspension, locals report that full-scale construction is continuing and thousands of Chinese workers remain on site.

Yatai International Holding Group also revealed on its website that the entire planned development would cover nearly 30,000 acres (12,140 hectares), stretching 19 km along the border and costing US$15 billion. The development involves luxury housing, condominiums, hotels, shopping centers, a golf courses, casinos, gambling and entertainment, tourism, culture and agriculture. Yatai said that the first phase of the project, covering 214 acres, was underway with US$500 million already invested.

A promotional video from Yatai International advertised the project as the “only area in Shwekoko that is authorized to operate casinos,” and its business plan identifies casinos as the top source of revenue, which is expected to reach US$11.4 billion within ten years. The company website also claimed that the project is a part of China’s ambitious Belt and Road Initiative (BRI).

U Tin Myint said the Myanmar government has so far not given official permission for casinos businesses to operate in the city project.

Myanmar enacted a new Gambling Law in May 2019 that legalized casino operations. However, only foreigners are allowed to gamble.

“Casinos business are not allowed so far in Shwe Kokko. Let me be clear about this: we have not allowed any gambling activities in that area officially,” U Tin Myint said.

He said State Counselor Daw Aung San Suu Kyi also instructed the Karen State government to follow the law when it comes to handling the project.

The KPSN report said several casinos had already begun operation in the newly-constructed area since mid-2019, including online gambling casinos. KPSN said that locals are raising concerns that the area will become a money laundering hub and about the social impacts of the casino industry, including human trafficking.

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