Dawei construction could be back on track soon

The Nation | 5 January 2015 | Sasithorn Ongdee

CONSTRUCTION on the Dawei project - the weakest link of the East-West Economic Corridor - should revive after being stalled for more than a year, as Thailand is expected to rejoin talks with Myanmar this week.

There have been several meetings between the two countries over the project since July. A source who is close to the project said a meeting of the Myanmar-Thailand Joint Coordinating Committee (JCC) had been set for this Thursday and Friday.

The source added that a deal should be concluded after the meeting.

The Myanmar government completed its tendering for the project - with only Thailand taking part in the bidding - at the end of October.

The JCC, which is chaired by a ministerial officer from each side, is responsible for comprehensive development in the Dawei Special Economic Zone (SEZ) and related project areas.

The committee was set up during the Yingluck Shinawatra administration, as it stepped in to take over the project after Thai private construction firm Italian-Thai Development (ITD) gave up its struggle to finance the mega-project. Originally, ITD was awarded a 75-year concession in 2008 to develop the deep-sea port in Dawei, with an industrial zone, infrastructure and buildings.

Since then, the project has been scaled down to 27 square kilometres for a first phase worth Bt30 billion, compared with 205 sq km originally - 10 times the size of Map Ta Phut in Thailand - worth about Bt240 billion. At the initial stage, ITD is expected to develop some parts of the industrial zone. But the country's largest contractor can still bid for future Dawei work.

The source said ITD president Premchai Karnasuta went to Myanmar two weeks ago and discussed the project with Myanmar government officials.

Aye Myint, Myanmar's minister for labour, employment and social security, said in late October that he was still holding talks with ITD and its partner company to operate some smaller projects such as roads, ports, housing and a mini industrial zone.

He said evaluations of the project's importance to the Mekong-India corridor, the size of the industrial segment of the project, participation of the government and the private sector, and environmental and social impact assessments were being conducted. After that, Japan would join the project.

There have been several meetings between Myanmar and Japanese officials over the project.

Japan has also expressed interest in Thailand's construction of three double-track railway routes. One of these, which includes a Bangkok-Rayong route, could be linked with Dawei.

Thai Transport Minister Air Chief Marshal Prajin Juntong said earlier that the government would hold talks on Dawei with the Japanese government in February.

Market watchers have said that if the Dawei project is able to get off the ground in a serious way, it could be a new trade lane linking the eastern part of the region to the west via Laos, Vietnam, Cambodia, Myanmar and Thailand by rail. Japan would benefit from this, as many of its production bases, especially in the automotive and electrical sectors, are in Thailand and neighbouring countries. The route from Map Ta Phut to Dawei would be the key driver for this.

"Goods transport will be more convenient if there is a link to the Dawei port via the rail network, especially for the 1,304-kilometre Dawei-Laem Chabang-Ho Chi Minh route," Nong Pomlaktong, an expert in the rail transport sector, said.

He added that shipping times between Bangkok and Chennai, the biggest industrial and commercial centre in southern India, would be halved to three days if Dawei Port becomes a reality.

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