Three Japanese companies, Eden Group given green light to build gas power plant at Thilawa

by ECONOMY

Myanmar’s government has given written approval to three Japanese trading companies and local conglomerate Eden Group to build a liquefied natural gas power plant at Thilawa in Yangon Region, according to news releases from Nikkei Asian Review and the Ministry of Electricity and Energy. It will be a government-to-government project and a notice to proceed ceremony took place on July 24. 

According to Nikkei Asian Review, the project valued at from US$1.5 billion to 2 billion will generate 1,250 megawatts of electricity. It is one of the largest projects in Southeast Asia. The three Japanese trading companies are Marubeni, Sumitomo Corp., and Mitsui & Co. The notice to proceed had been issued and electricity would be generated in 72 months. The project would create a milestone in strengthening the relationships between the governments of Myanmar and Japan.

Japan’s leading investment in Thilawa Special Economic Zone was also crucial.They expressed thanks to the Japanese companies for their trustful investment as well as to the Japanese government for providing necessary financial assistance. The ministry announced that 50 percent of the whole country had access to electricity in December 2019.

Source: Eleven media

ADB sees progress in resuming aid to Myanmar - Business Recorder

Myanmar approves ADB loan, outstanding debt hits K40.8 trillion in 2018-19

by ECONOMY

ADB sees progress in resuming aid to Myanmar - Business RecorderMyanmar’s outstanding local and foreign debt stood at K40.8 trillion at the end of September 2019, which is close to 40 percent to GDP. Around 63pc of the country’s debt was incurred locally. The largest share of the foreign loans were allocated to the Ministry of Construction and Ministry of Electricity and Energy. Debt levels are expected to rise further this year, with the government borrowing heavily from international institution like the World Bank and IMF to fund national projects as well as its COVID-19 Economic Response Project.

On July 27, Pyidaungsu Hluttaw approved borrowing $171.3 million from Asian Development Bank to fund rural electrification projects in Kayin State as well as Ayeyarwady, Bago and Magwe regions. It is expected to benefit 2815 villages with 400300 hosueholds. The project will generate 160 million-290 million of units of electricity a year. The government will invest $20.5 million in the project from its budget, taking total investments to $191.7 million. The project is expected to be complete by 2027.

When the project is complete, the country will receive between $15 million and $25 million in tariffs from electricity users. The loan is for 32 years, inclusive of eight year grace period during which interest will changed at 1pc. For the remaining 24 years, the interest rate will be 1.5 pc. The economic internal rate of return is estimated to be 15pc, so this can support paying off the loan.

Source: Myanmar Times

Myanmar imports over $890 mln worth iron/steel materials in Oct-May

by ECONOMY

The value of Myanmar’s iron and steel imports for the construction sector is valued over US$893.8 million in eight months of the current fiscal year 2019-2020. Additionally, $386 million worth iron and steel products are also imported during October-May period. At present, Myanmar’s steel demand is estimated about 2.5 million tonnes per year, and 92 per cent of which are imported. The demand is likely to grow up to 5.4 million tonnes per year in 2030. If Myanmar can fulfil the requirements of local steel consumption and focus on import substitution, the steel industry will strategically contribute to the nation’s interest.

Steel consumption includes in calculating economy growth index. 11 executive members of MSA established MSA Public Company Limited and they are making efforts to set up iron and steel industrial zone, to reduce the outflow of US dollar, effectuating the development of steel industry and assisting in the country’s infrastructure building. Studies for implementation of iron and steel industrial zone project are underway in Ayeyawady and Taninthayi regions and Rakhine and Mon states. The project is slated to commence within three to five year after completing studies, he continued. The government needs to support the steel sector by granting tax relief and land rights, controlling illegal import, making anti-dumping law come into the effort and formulating steel policy, according to the MSA.

Steel industry is pivotal in industrial infrastructure building. This project needs to be implemented for prospects of the country’s economy. The MSA will move forward to the development of industry standards which are compatible with the country and the emergence of steel library and steel laboratory. The association will cooperate with the international organizations to grow the steel sector, he added. China is the main supplier for Myanmar’s steel market. Iron and steel are also imported from India and the Republic of Korea. 

Source- The Global New light of Myanmar

Myanmar govt plans to purchase more reserve rice

by ECONOMY

The government is planning to purchase an additional 20,000 tonnes of rice for its reserves. The government first announced that it would be purchasing 50,000 tonnes of rice from local farmers for reserve purposes earlier this year, when COVID-19 was first detected in Myanmar. It has so far successfully stored away 85 percent of that quota.

The rice was procured from 12 export companies and stored at nine warehouses from April 30 to June 12. A total of 40,000 tonnes was purchased from Yangon, more than 30,000 tonnes from Mandalay and 1000 tonnes from Nay Pyi Taw.

Due to the outbreak of COVID-19, Myanmar will export a maximum of 2.5 million tonnes of rice in fiscal 2019-20. It purchased up to K38 billion worth of the remaining volumes of rice from local traders, and expects to buy up to 10pc of total export volumes for reserve purposes.

Source: Myanmar Times