VIENTIANE, June 27 (Bernama) -- Asean Union Inc, one of the leading commercial ambassadors for Asean, plans to develop macro and micro projects at the Savan-Seno Savannakhet Special Economic Zone, said Chairman Faidzan Hassan.
Located ideally on the border with Thailand and linked by road and rail to Cambodia, Myanmar, China and Vietnam, the economic zone is positioned to become the trading, industrial and financial hub of Asean.
"Looking from a micro perspective, Savannakhet has a potential for development, in that area itself, as the east to west highway is already there, and that is where Savan-Seno city, Site A, is located," he told a media conference after the launch and signing ceremony for Savan-Seno Special Economic Zone between Asean Union and Savan City Co Ltd.
Spearheaded by the Savan City Co Ltd, a Laotian government-linked company, the economic zone will be divided into five sites, A, B, C, D and E, which will cater for different sectors namely services, commercial and financial, tourism and hospitality, manufacturing and heavy industries.
Faidzan said out of the five sites, Asean Union and Savan City Co Ltd have both agreed to jointly invest in site A and D, to build services, financial centre and other services related industries (for site A) and residential areas, handicraft centre and a logistic hub on site D.
Among the joint investments are the development of three-star and five-star hotels, Malaysia-Lao International Bank and the Aderans Handicraft Centre.
Earlier in his speech, Faidzan said the private equity fund for sites A and D had been structured to have the initial size of US$2.5 billion and this was expected to increase as development progresses.
"For such a huge development, a US$2.5 billion is not enough. However it could be used as a starting point to bring about interest in the development of, at least, the infrastructure.
"By using that amount of money, it could be used to develop the gateway such as petrol station and a rest and relax area," he said, adding that both sites would involve up to US$40 billion investment value.
He also said that about two million vehicles were expected to use the road where site A is located, and this would automatically create job employment and bringing economic wealth to the locals.
Meanwhile, Laos Vice Governor in its Government Cabinet Office, Thongsay Sayavongkhamdy said the development would help boost Laos' preparation to become fully integrated into the Asean economic community next year.
"If there is no such economic activities here, Savannakhet Special Economic Zone will just be a transportation corridor," he said.
While site B and C have already received investors' interest, site E is still available.
Over the past decade, Laos' economy has maintained consistently high in terms of gross domestic product due to strong growth among its main trading partners in the region, particularly China.
Nurul Hanis Izmir
Business & Investment Opportunities
Saigon Business Corporation Pte Ltd (SBC) is incorporated in Singapore since 1994.