Thailand and Myanmar have agreed to revise all development projects in Dawei to make them more realistic and attractive for foreign investment.
New studies on the Myanmar megaproject will cover infrastructure including roads, a deep-sea port, water, power and industrial estates and must be completed this month.
The third meeting of the Dawei joint steering committee last Wednesday and Thursday decided all development projects need a review and additional analysis so as to ensure an accurate picture of revenue and expenditures for investors.
Analysis will cover demand for utilities, the structure for calculating utility prices, project investment and period, and technical information for the construction of utilities.
A source with knowledge of the committee meeting said previous projections by Italian-Thai Development Plc (ITD) for returns on investment for each project were quite high, while there remain discrepancies over project information.
Last week's meeting also agreed a holding firm or special-purpose vehicle (SPV) should be set up and based in Thailand to manage the huge deep-sea port and special economic zone, with subsidiaries in Myanmar to acquire concessions from the local government.
Investment will be handled by six joint ventures based in Myanmar to take charge of investment in infrastructure.
The joint ventures will be set up and registered in Myanmar to make them eligible for special investment privileges.
PM's Office Minister Niwatthamrong Bunsongphaisan said four countries including Thailand and Myanmar are interested in taking part in the SPV. One of the other two is outside Asia.
Arkhom Termpittayapaisith, secretary-general of the National Economic and Social Development Board (NESDB), said Myanmar's government seems to favour Japan.
Japan already has massive investment in Thailand, which has become a base for Japanese industry, he said.
Mr Arkhom said Myanmar's government is in the process of designating special economic zones that offer more flexible investment incentives and related infrastructure development such as motorways and telecommunications networks.
Earlier this year, an NESDB study commissioned by the House Standing Committee for Industry reported the investment cost for the Dawei megaproject is estimated to have increased to 325 billion baht from higher construction costs.
That figure is 62.5% higher than the 200 billion baht projected by ITD two years ago.
The first phase of the massive project will require 205 billion baht and the second phase 120 billion. This covers eight projects including the first phase of the deep-sea port costing 45 billion baht.
A road link from Dawei to Ban Phu Nam Ron in Kanchanaburi will cost 35 billion baht, while 5 billion baht will be needed for telecommunications.
Reservoirs will cost 14.2 billion baht, while 65 billion will be spent on double-track railways. Some 20 billion baht will be spent on industrial estates and 32 billion on power plants.
The investment in Thailand includes 45.5 billion baht for a motorway from Nonthaburi's Bang Yai district to Kanchanaburi province and 9.87 billion for a motorway from Kanchanaburi to the Ban Phu Nam Ron border checkpoint.
Another 20 billion baht will be spent on double-track railways.