Prioritised sectors, new investment opportunities in Yangon laid out
The Yangon Regional Government has announced a slew of new projects and investment opportunities in a bid to further develop the city. Photo: Kang Wan Chern
At the Yangon Investment Forum on Wednesday, Yangon Chief Minister U Phyo Min Thein announced the five sectors his government intends to prioritise and in which Yangon welcomes foreign investments.
U Phyo Min Thein said the trade, logistics, industry, public transport and energy sectors would be prioritised, adding that the Yangon deep sea port, development of a Special Economic Zone, new industrial zones and townships as well as launch of new electricity projects would yield fresh opportunities for foreign direct investment.
The Yangon Region Government is planning to construct an integrated logistics zone and inland water transport (IWT) system west of Yangon city, he said.
When ready, the Ngwe Pin Le Integrated Logistics Zone and IWT project is expected to improve hinterland logistics shortfalls and reduce road congestion and transportation costs between ports in Yangon.
Currently, container trucks are not permitted to enter the city during the day. This prevents the containers from being delivered to the city’s inner ports, such as Thilawa, during the daytime, resulting in higher costs for manufacturers and shipping lines.
As the Thilawa port is located the east of Yangon River, goods from industrial zones on the western size of the city are not able to reach the port easily. The distance between the western industrial zones and Thilawa port is around 40 miles by truck.
As it is just half the distance to connect the west side with Thilawa in the east via river, building a jetty and new IWT system west of Yangon will improve productivity and lower costs at industrial zones in Hlaingtharyar, Ngwe Pin Le, Shwe Lin Ban and Shwe Pyi Thar.
A total of 244 acres of land has been earmarked for the project, which will be carried out under a Public Private Partnership (PPP). International investors will be invited to bid for the project. “Invitations to tender will be announced soon,” U Phyo Min Thein said.
A request for proposal (RFP) is expected to be issued by Q2 2018, according to a report by the Yangon Region Investment Committee.
Meanwhile, some 50,000 acres of land area near Thanlyin, Yangon, has been earmarked for the development of a deep sea port. “We need an international standard deep sea port as 90 percent of national sea trade relies on Yangon’s ports. Currently, river depths are too low to accommodate international ships,” U Phyo Min Thein said.
He added that several international firms have already commenced discussions with Yangon on plans to develop the port, which will be developed on a third of the 50,000-acre plot of land.
A new SEZ, which will include space of an industrial zone, power plants as well as commercial and residential areas, will be developed across the remaining space.
Work on the Yangon Circular Railway will also be prioritised.”Currently, the stations at the Yangon Circular Railway are underdeveloped. For example, as most of the stations are poorly lit, it is easy for crime to take place. We aim to upgrade the stations to include restaurants, recreational parks, malls and other services at the stations,” he said.
U Phyo Min Thein said all upgrading works will be done under PPP arrangements, adding that the necessary studies have already been done with support from the Japan International Cooperation Agency and investment opportunities would emerge for companies interested in the development.
He added that preparations have been made to solve the shortage of power in Yangon. Around 1,000 megawatts of electricity generated at a new 1,300MW capacity power plant operated by French company Total in Mee Laung Gyaing, Ayeyarwady Region, has been slated for use by Yangon.
“The electricity generated will be sufficient to meet all the additional industrial needs in Yangon for the next two years,” U Phyo Min Thein said.
Ministers also discussed a new management system to convert existing farmlands on which to establish the new industrial zones. The Yangon Regional Government said at least 29 new industrial zones are slated for development in the outskirts of the city, which is surrounded mainly by farmlands.
Under the new system, owners of existing farmlands seized by the government for industrial development will retain ownership of 20 percent of the land. Meanwhile, the government will control the remaining 80pc of the area.
“We will no longer issue approvals for the use of such farmlands in the Yangon area. From now on, only the government will use the land for industrial purposes and take control over 80pc of the space. The landlords will retain a 20pc stake in the land,” the Chief Minister said.
He said the Yangon City Development Committee (YCDC) will also be leasing out the land to interested investors. In total, 25 plots of land above 3 acres in size and 120 plots that are below 3 acres will be available for lease. Investors can lease whole plots of the land or co-invest with the YCDC.
Leasing rates have been set between $5 and $39.68 per sq meter of land owned by the government, depending on the location.