now loading...
Wealth Asia Connect Middle East Treasury & Capital Markets Europe ESG Forum TechTalk
Asia Connect
Green light for China to develop port complex in Myanmar
Chinese expertise and finance will develop port infrastructure in Kyaukpyu and comes after several years squabbling over the ownership and financing structure of the deal
Michael Marray 13 Nov 2018

China and Myanmar have signed an agreement to press ahead with a multi-billion dollar deep sea port project in Kyaukpyu, on the coast of the Bay of Bengal.

At a ceremony in the Myanmar capital of Nay Pyi Taw on 8 November, the Chinese consortium led by state-owned conglomerate Citic Group signed the framework agreement with the Kyaukpyu Special Economic Zone Management Committee.

Myanmar's Minister of Commerce Than Myint, the Chinese Ambassador to Myanmar Hong Liang, Myanmar's Deputy Minister of Planning and Finance and Chairperson of the Management Committee of the Kyaukphyu SEZ U Set Aung, and President of CITIC Group Chang Zhenming all attended the signing ceremony.

Under the framework agreement, China will fund 70% of the investment for the project, and Myanmar the other 30%. The initial phase of the project will include two berths with a total investment of US$1.3 billion, according to the agreement. A joint venture will be set up to construct and operate the port.

The signing of the framework agreement marks a significant step forward, after several years of delay as talks have dragged on.

A Chinese consortium won the bidding to build the port in December 2015, but the two sides subsequently failed to reach agreement on funding and ownership structure. Such mega projects under the Belt & Road Initiative have become increasingly controversial, with accusations that China pushes host countries into a debt trap, and is thus in a strong position to control vital infrastructure such as ports.

China is already developing the deep water Gwadar port in Pakistan, and Sri Lanka's Hambantota port, which it took control of in a debt swap, in the Indian Ocean.

Conversation
Nor Masliza Sulaiman
Nor Masliza Sulaiman
group head investment banking, deputy chief executive officer
CIMB Investment Bank
- JOINED THE EVENT -
6th Global Islamic Finance Issuers and Investors Leadership Dialogue
Marking time as new opportunities emerge
View Highlights
Conversation
Alex Escucha (moderator)
Alex Escucha (moderator)
president
Institute for Economic Development and Econometric Analysis (IDEA)
- JOINED THE EVENT -
18th Philippine Summit
Bouncing back better
View Highlights