By Somluck Srimalee
Kingdom to maintain role despite reports of ITalian-Thai pulling out, source says
Thailand will maintain its role in the development of the Dawei Special Economic Zone despite substantiated reports that Italian-Thai Development will pull out of the mega-project.
According to a source who asked for anonymity, ITD – which won the contract in 2008 to develop and operate the zone for 75 years – has given up after years of fruitless efforts to find financing. The company will cease operating in the zone tomorrow, he said.
“ITD is now negotiating with the Myanmar government to terminate the concession as the company cannot find financial support for the project,” said the source, who is close to the deal.
“This will pave the way for the government to reopen bidding for all projects, and ITD would love to get involved with the deep-sea port.”
The company’s executives could not be reached for comment yesterday.
ITD had estimated it would need about US$9 billion (Bt284 billion) to develop 128,171 rai (20,507 hectares). The zone is designed to accommodate a deep-sea port, a green industrial estate that would house a large refining complex, a gas-fired power plant and a logistics network that would link Myanmar with the west of Thailand.
Since clinching the concession in 2011, ITD has shown little headway in developing the site. The Thai government in the past two years has adopted the role of an intermediary to draw foreign investment, particularly from Japan, for the project, which is envisaged as a key component of the East-West Corridor, which will complete Thailand’s vision to become the Asean logistics hub.
Dawei, in Tanintharyi region of southern Myanmar, would be connected to Bangkok some 350 kilometres away by road, providing the Thai capital with an outlet to the Andaman Sea. Under the dream to be the logistics hub in Asean, Dawei would also be linked up with Thailand’s Laem Chabang deep-sea port.
According to a source in the construction industry, Thailand’s role in the project will remain intact despite ITD’s departure.
Project to be split into 7 phases
Under an agreement reached by the Thai-Myanmar Joint Coordination Committee (JCC), a 50:50 special purpose vehicle (SPV) will be established to carry out the development. The project would be split into seven phases, with the first phase consisting of a highway to Thailand being constructed by ITD.
“This will leave the other six phases for bidding, including the port that ITD wants to do,” he said.
The JCC will convene on Thursday to sign the deal to establish the SPV. The source said the bidding for the industrial estate should be opened by the end of January.
ITD and Rojana Industrial Estate will reportedly team up to bid for the project. ITD will require additional investment besides the $1.3 billion required for the port.
A Japanese official recently told The Nation that Japan was keen to join the project.
Eleven Media Group, a member of Asia News Network, quoted a worker there as saying that all Thai workers from other sites would return home after the project was officially dropped. Only Myanmar workers will be left behind to attend to a stone quarry.