Three Firms Win Retendering of Rangoon ‘New City’

By Kyaw Phyo Tha 14 January 2016

RANGOON — Three local companies have been awarded a multi-billion dollar contract for a city expansion project southwest of the former capital Rangoon that was shelved more than a year ago after prompting outcry over a lack of transparency in its tendering.

According to a source close to the matter who spoke on condition of anonymity, one of the winners, Yangon South West Development Public Company, is run by the same owners of Myanmar Say Ta Nar Myothit, the firm that was originally awarded the tender to implement the project in August 2014. The latter is run by two low-profile Chinese businessmen, Xiao Feng and Xiao Sen, who are said to have a close relationship with Rangoon Chief Minister Myint Swe.

The source told The Irrawaddy that Myint Swe had a meeting with representatives from the three companies recently and told them to “collaborate with each other to develop the project” and “report back with detailed plans.”

As originally envisioned, the Rangoon expansion plan would see the city’s official limits expanded by some 30,000 acres, into Kyimyindaing, Seikgyikanaungto and Twante townships, west across the Rangoon River. The expansion would include the construction of apartments, a school for 1,000 students, a home for the aged and five six-lane bridges.

The plan was first mooted in August 2014 by Myint Swe and Rangoon Mayor Hla Myint. It was shelved the following month, in anticipation of a new public tender, after allegations that developer Myanmar Say Ta Nar Myothit was given the project based on its leadership’s close ties to Myint Swe.

Soe Kyi, a local representative from Yangon South West Development for Kha Lauk Gaint village, part of the project area, confirmed on Wednesday that his company was among the winners, along with Business Capital City Development Ltd., owned by Maung Weik, a prominent businessman in the construction and development sectors. The third company, according to Soe Kyi, is Shwe Popa International Construction Company, a branch of Shwe Thanlwin, a large domestic conglomerate.

“As far as I’m concerned, we have been told to work together but still haven’t gotten any greenlight to start our work,” he added.

In July 2015, when a new tender for the project was announced, only these three companies were able to meet the deadline to declare bids, according to Soe Kyi. The tender announcement last year said the required, refundable deposit for each company was 5 billion kyats (US$3.8 million).

Soe Kyi denied, however, that his company had any connection to Myanmar Say Ta Nar Myothit.

“We have nothing to do with it,” he said. “Our company is made up of 150 people, mostly residents of the project area.”

According to Nyo Nyo Thin, a lawmaker in the Rangoon divisional legislature who attended a preliminary tender evaluation at the divisional government office in September, said Yangon South West Development had proposed investing a whopping US$15 billion in the project.

“All three companies made presentations about their proposals but they didn’t mention who their directors are,” she said.

Khin Maung Thant, community secretary for Yangon South West Development, told The Irrawaddy that due to the size of the project, the company had asked the government to find a private partner to help carry out its $15 billion ambitions. He added, however, that the government had remained silent on the matter to date.

“Whoever they pick up, we will work with them as long as it is good for the local people,” he said, when asked by The Irrawaddy if the company would be open to bringing Myanmar Say Ta Nar Myothit back on board for the project.