A holding firm or special purpose vehicle (SPV) will be set up and based in Thailand to manage Myanmar's massive Dawei deep-sea port and special economic zone, says PM's Office Minister Niwatthamrong Bunsongphaisan.
But he said the focus of the holding firm or SPV will be on management, not investment.
The third meeting of the joint steering committee for the Dawei project chaired by Mr Niwatthamrong in Chon Buri yesterday agreed the holding firm or SPV will be set up in Thailand, with subsidiaries in Myanmar to acquire concessions from the local government.
Investment will be handled by six joint venture firms based in Myanmar to take charge of investment in infrastructure such as roads, the deep-sea port, water, power and industrial estates.
The joint ventures will be set up and registered in Myanmar to make them eligible for special investment privileges in that country.
"We now have four countries including Thailand and Myanmar that are interested in taking part in the SPV," said Mr Niwatthamrong. "Another two countries both inside and outside Asia are pending selection."
He said four is a suitable number for the Dawei project, as too many countries would hinder administration.
But Myanmar itself has yet to finish amending its investment laws to a global standard and make them attractive enough for foreign investors.
A source with knowledge of the committee meeting said an industrial port should be established in the first phase and a container port developed later as cargo volume rises.
The source said the first focus should be on small or light industries, with heavy industry to be set up later.
The meeting also agreed that just a two-lane road from the Thai border to Dawei port should be built before the road is expanded to four and eight lanes once demand for transport surges.
The road links from Dawei to other economic areas need reconsideration, as they come with a high risk to recover investment return.
The Thai government recently shelved the planned expansion of a motorway linking Thailand to the proposed Dawei deep-sea port.
The Office of Transport and Traffic Policy and Planning said expanding the motorway from four lanes to eight on the Thai side of the border is unnecessary for the time being.
The 110-kilometre road would link Dawei in Myanmar to Kanchanaburi in Thailand.
The office had analysed estimates of cargo volume expected at Dawei and found the figure not too high.
About the author
- Writer: Chatrudee Theparat
Position: Business Reporter