Into the Zone: SEZs in the Mekong Region, Income…or Instability? (Part 1)

The Mekong region is abuzz with news about special economic zones (SEZs). From Thailand’s prime minister telling US business leaders that the Kingdom’s SEZs are a cornerstone to his economic reforms, to Ho Chi Minh City’s mayor wanting 890 km2 designated as an SEZ to revive his city’s economic leadership, to Myanmar’s newly elected government facing increasing pressure to review the outgoing-junta-approved SEZs now underway there—these foreign-investment magnets are picking up steam as ASEAN integration progresses within the Greater Mekong Subregion.

But what’s so special about these zones? Can they unlock new pathways to region’s economic potential, or as the Bangkok Post warned recently, should policy-makers proceed with caution given the immense complexities to securing SEZs’ desired benefits?

River Network Objects To Hydropower Group

Concerned about a series of dams planned along the Salween River, the Save the Salween Network has raised objections to the formation of the Hydropower Developer’s Working Group (HDWG) in Burma by the International Finance Cooperation (IFC), claiming it will assist investors while sidestepping potential negative outcomes of the dams for thousands of ethnic minority groups.

The Salween River is one of the largest free flowing rivers in the world with many largely isolated groups living alongside it.

IFC and Private Sector Launch Working Group to Drive Change in Myanmar Hydropower Sector

IFC, a member of the World Bank Group, and the private sector launched the first working group for Myanmar’s hydropower sector. The Hydropower Developers’ Working Group (HDWG), first established in Lao PDR in late-2013, is the only platform exclusively for hydropower companies and industry-related professionals to influence policy and identify solutions to improve upon sustainability and business operations in Myanmar.

Over 100 stakeholders from Myanmar’s hydropower sector including companies, civil society organizations, financial institutions and government officials attended the working group’s first General Forum today in Yangon. The interim executive committee presented the working group’s agenda focusing on strengthening private sector relations with the government and highlighting the best practices and policies needed to develop projects sustainably. The committee comprises local and international hydropower companies and consultants operating in Myanmar.

Myanmar green energy sector faces hurdles

Myanmar’s goal of achieving a 100 per cent electrification rate by 2030, with 20 per cent of energy from renewable sources, is achievable but several hurdles need to be tackled first, energy experts have said.

At the Myanmar Green Energy Summit 2016 last week, panellists agreed that hydroelectricity, plus wind and solar energy, were good choices given available resources.

Into the Zone: SEZs in the Mekong Region, Income…or Instability? (Part 2)

While neighboring Thailand’s Special Economic Zones are now progressing without much public consultation or review, Myanmar may be moving in the opposite direction. Its three SEZs which were launched in the waning years of the junta, are now under the direction of the civilian government fully aware of concerns raised by communities and independent researchers, and inclined to take stock of what their predecessors set in motion. At issue are a whole range of social and environmental grievances, as well as the viability of the projects themselves and to what extent they reflect the new leadership’s priorities.

China Gezhouba Group signs deal to construct 35-MW Xelanong 2 hydropower project in Laos

The China Gezhouba Group Corp. has signed an agreement with the Laotian government to develop a 35 MW hydroelectric plant in Laos’ southern Salavan province, according to reports from state news sources.
China Gezhouba will develop what is being called the Xelanong 2 project using a build-operate-transfer model, with construction of the US$72 million facility expected to take about 40 months.
Xelanong 2 and its 55-meter-high dam will be located on an unspecified tributary of the Mekong River and is part of the Laotian government’s effort to dramatically increase the availability of electricity to its population by 2020.
Other significant hydroelectric plants being developed in Laos include the 1,285-MW Xayaburi, 1,156-MW Nam Ou and 410-MW Xe-Pian Xe-Namnoy, amongst others.

Thilawa Zone B to start in November

Development of the second stage of the country’s first economic zone will begin with infrastructure including roads, electricity and water, said U Myint Zaw, general manager of Myanmar Japan Thilawa Development Limited.

“We will implement Zone B in phases. Once one phase is complete, we will start on the next one,” he said.

Meanwhile the smaller Zone A is around 90 percent complete, with US$760 million in foreign investment committed to the project across 400 hectares of land. The project is located to the south of Yangon.

Govt to survey dams nationwide

The government is planning on reviewing the status of dams throughout the country to see if they are worth keeping. U Htun Win, deputy minister for agriculture, livestock and irrigation, told parliament on August 2 that the review would take into account the efficiency, cost-effectiveness and long-term benefit of the dams.

A shift in policy, away from building dams and toward running irrigation channels to farmland, has already led to a 50 percent cut in the request for irrigation funding next year. The ministry’s assistant secretary, U Myo Tint Tun, told The Myanmar Times on July 18 that expenditure in 2017-18 would be less than half of this year’s level, falling from K253 billion (US$216 million) to K120 billion. The funds would be used primarily to provide irrigation drainage to existing dams that lacked it.

SEZ polluting Bavet canal, villagers say

Villagers living along a canal in Svay Rieng province’s Bavet town say its water has been polluted by untreated discharge from the nearby Manhattan Special Economic Zone (SEZ), rendering it unusable.

Three communes live along the Tapov canal – Bati, Prasat and Bavet – with villagers from the first two saying that they have complained about the pollution since 2015 and that the quality of the water has continued to decline and the smell is unbearable.