Amata halts Yangon estate after coup

Amata halts Yangon estate after coup

Firm fears foreign economic penalties

Supporters of Aung San Suu Kyi at a protest against the military coup in Myanmar on Monday mass in front of the Myanmar embassy in Bangkok. (Photo by Varuth Hirunyatheb)
Supporters of Aung San Suu Kyi at a protest against the military coup in Myanmar on Monday mass in front of the Myanmar embassy in Bangkok. (Photo by Varuth Hirunyatheb)

The political turbulence in Myanmar has caused SET-listed Amata Corporation to stop its 140-million-baht first-phase investment in Yangon Amata Smart and Eco City (YASEC) indefinitely until a new election is called in the military-controlled country.

The Thai industrial estate developer made the decision after the political conflict between the military regime, which claimed election fraud, and civilian leader Aung San Suu Kyi because this dispute may lead to the international community imposing economic sanctions on Myanmar.

The military declared a state of emergency for a year.

The conflict was described as the "worst-case scenario" for Amata's new industrial estate in Yangon, which has been developed since December last year, Amata chief executive Viboon Kromadit said on Tuesday.

His company is building infrastructure on 500 rai of land, part of a block of 5,000 rai granted by the Myanmar government for YASEC development under a 50-year land lease contract.

The project has attracted many foreign investors and Amata plans to initially allocate 300 rai to its customers this year, said Mr Viboon.

"We have around 20 foreign companies, mostly from Japan, showing interest in the project," he said.

They want to invest in Myanmar because labour costs are cheaper than in Thailand, and Myanmar is allowed tariff reductions on its exports, said Mr Viboon.

Myanmar also does not face any anti-dumping penalties from its trading partners, he said.

Japanese companies in particular are attracted to Myanmar because they are expanding investment in Asean, said Mr Viboon.

"YASEC is the first industrial estate in Myanmar expected to contribute revenue as well as support investment and trade in Asean," he said.

Yet the ongoing political conflict will cause foreign businesses to delay their investment, said Mr Viboon.

Myanmar, similar to many countries, is struggling to deal with the Covid-19 outbreak.

Amata hopes the military regime will carefully consider its next move as the coup may draw economic punishments from giant economies such as the US and the euro zone.

"International financial institutions will stop granting loans to foreign companies investing in Myanmar," said Mr Viboon.

Amata operates many industrial estate projects in Thailand, including Amata City in Chon Buri and Rayong spanning 10,000 rai.

The company also has estates in Vietnam and is seeking an opportunity for expansion in Laos.

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