An infrastructure
development loan for the Dawei deep-sea port in Burma is likely to be secured
from Japan next week, the president of Italian-Thai Development Plc (ITD) told
The Bangkok Post on Monday.
Premchai Karnasuta said he expected to get soft loans
from Japan to finance up to 75 per cent of the US$8.6 billion required for
infrastructure development at its Dawei project in southern Burma.
He said he would visit Japan from July 16-17 to
finalize plans with the Japan Bank for International Cooperation and the Japan
International Cooperation Agency.
Somchet Thinaphone, managing director of Ital-Thai's
Dawei Development Co (DDC), said the company plans to raise 75 per cent of the
total infrastructure cost in yen, with the rest made up of Thailand and U.S.
loans.
The Dawei Special Economic Zone, which is being
developed under a concession from the Burmese government, was in the news
recently after Max Myanmar, the local Burmese partner that owns 25 per cent of
DDC, announced that it would pull out of its partnership gradually.
Somchet told the newspaper that Max Myanmar remains a
DDC partner.
“Max Myanmar does not want to inject more money into
DDC through a capital increase in the future. Consequently, the company will
see its ownership diluted from the current 25 per cent,” said Somchet.
He said DDC has been in talks with four or five potential
local partners.
The first phase of Dawei's deep-sea port is scheduled
to be operational in 2016.
Winston Set Aung, an economic adviser to the Burmese
government, said the problems with fundraising and joint investment partners,
could delay the completion date, but he said the government fully supports the
massive project.
Apart from Dawei, there are two other special economic
zones under development in Burma.
In January, Mizzima reported that Italian-Thai needed
to secure around US$ 8.5 billion to move ahead on the infrastructure phase of
the massive $50-billion project.
Thailand's largest construction company by market
value, ITD will require the backing of Thailand and Burma and a blend of
international partners.
The Thai contractor has said it will maintain at least
a 51 per cent stake in DDC, while other partners are welcome.
The project that will cover 250 square kilometers.
Located on the Andaman shoreline, Dawei is about 350 kilometers west of
Bangkok. The project will supply oil and other goods to Southeast Asia,
bypassing the Strait of Malacca and cutting costs.
The Dawei Special Economic Zone includes an integrated
steel mill, power plants, a petrochemical complex and a fertilizer plant.
Separate entities will be set up to invest in each project, Somchet said.
“China, Japan and South Korea are the key strategic
partners of our projects,” he said. “Finding a balance for each of these groups
is important.”
Somchet said the Thai and Burmese governments would
provide support in four areas for the Dawei project:
– Physical infrastructure such as roads in Thailand to
link with Burma roads.
– Simplifying border procedures between the two
countries under the Asean Economic Community (AEC) in 2015.
– Financial transactions such as money exchange
between the two countries.
– Enhancing competitiveness of Thai and Burmese
businesses in the cross-border investment.
Mizzima News
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