Italian-Thai, Rojana expected to ink Dawei SEZ deal by end-May

Arkhom is also secretary-general of the Office of the National Economic and Social Development Board.

The initial phase of the Dawei project will consist of a 27-square-kilometre industrial estate and a 138km two-lane road between the SEZ in Myanmar’s Tanintharyi region and Phunumron checkpoint in Thailand’s Kanchanaburi province, an initial township for the workers, a liquefied-natural-gas terminal for gas transport over long distances, a telecom landline, a power plant, a small port, and a water reservoir.

“There are two Thai companies [Italian-Thai and Rojana] that have entered the bidding process for the construction of the first 27-square-kilometre industrial estate in Dawei and the contract agreement is expected to be finalised around the end of May, or at the beginning of June,” he said. 

Deputy Prime Minister MR Pridiyathorn Devakula revealed in January that the projects in the initial stage of Dawei development were expected to be worth around US$1.7 billion (Bt55 billion), and said he believed the construction phase would commence this year.

The Myanmar government is planning to ask for an official-development-assistance loan from Thailand to fund the two-lane road, Arkhom said yesterday. The amount of the loan is expected to be around Bt4.5 billion.

Japan is also looking to provide assistance in the drafting of the new comprehensive plan for Dawei, and to enter the project fully once the comprehensive plan is completed and the full phase begins, he added.

Japan currently holds an equal partnership in the Dawei SEZ via a special-purpose vehicle to run the project after a trilateral agreement reached at the meeting of the Joint High-Level Committee on Dawei development in January.

“The reason Japan was reluctant to join earlier is the lack of a master plan from the two governments [Thailand and Myanmar], but the new comprehensive plan is expected to be completed by the end of this year,” Arkhom explained.

The Dawei SEZ replaced Italian-Thai Development, which had been granted the original concession from the Myanmar government in November 2010. 

Thailand and Myanmar agreed in June 2013 to set up the special economic zone with an equal shareholding and initial investment of Bt12 million, far below the Bt100 million that was proposed and planned by Italian-Thai Development earlier.

“This is a large project and a new plan must be drawn up. A private company alone cannot afford to build the whole project, because it is hard to secure lending for long-term investment in infrastructure. Therefore the government has to be the one that lays down the infrastructures first, and the commitment shown from Thailand and Myanmar has persuaded Japan to follow suit,” said the deputy minister.

Meanwhile, construction of a second Thai-Myanmar Friendship Bridge and a road connecting the bridge to the main highway in Thailand’s Mae Sot province is expected to commence in October, he said.

Moreover, Sa Kaew is likely to host the second Thai special economic zone to be launched, following the launch of the Mae Sot SEZ, which is expected before the end of this year, he added.