Myanmar, China agree on new deep sea-port on cheaper terms

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Myanmar and China have signed an agreement on November 8 on a controversial deep sea port project in the Bay of Bengal, allowing Beijing to press forward with its strategic plan to access the Indian Ocean. The agreement with China’s state-run Citic Group comes after negotiations that saw the initial phase of the project scaled back over fears of a “debt trap”.

The first phase of the project in Kyaukphyu in Rakhine State – which will encompass the construction of two deep water berths – will now cost $1.3 billion, after earlier proposals for a $7.3-billion facility as Myanmar officials raised concerns in response to reports that Chinese-backed projects in Sri Lanka and Pakistan had entangled those countries in debt.

Set Aung, deputy minister of Myanmar’s Ministry of Planning and Finance, called the agreement a “win-win deal” after enduring many tough negotiations to bring it up to international standards, to reduce Myanmar’s burden both in the short and long term and to ensure the project’s sustainability. He noted that international experts would be involved in environmental and social impact assessments.

Set Aung said the two parties agreed on a phased roll-out so that the feasibility of the project’s different stages could be assessed.

“We will implement the project phase by phase, step by step,” he said.

Myanmar so far does not have a deep sea port to allow big ocean liners to anchor, a condition causing the country to suffer high transaction costs for requiring trading via foreign ports in the region such as Singapore.

“The new port will not only bring more job opportunities for Myanmar nationals but also create more business opportunities,” Set Aung said.

However, the Kyaukphyu project is also expected to give China substantial control over the region’s trading routes as per the country’s current Belt and Road Initiative.

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Reading Time: 2 minutes

Myanmar and China have signed an agreement on November 8 on a controversial deep sea port project in the Bay of Bengal, allowing Beijing to press forward with its strategic plan to access the Indian Ocean. The agreement with China’s state-run Citic Group comes after negotiations that saw the initial phase of the project scaled back over fears of a “debt trap”.

Reading Time: 2 minutes

Myanmar and China have signed an agreement on November 8 on a controversial deep sea port project in the Bay of Bengal, allowing Beijing to press forward with its strategic plan to access the Indian Ocean. The agreement with China’s state-run Citic Group comes after negotiations that saw the initial phase of the project scaled back over fears of a “debt trap”.

The first phase of the project in Kyaukphyu in Rakhine State – which will encompass the construction of two deep water berths – will now cost $1.3 billion, after earlier proposals for a $7.3-billion facility as Myanmar officials raised concerns in response to reports that Chinese-backed projects in Sri Lanka and Pakistan had entangled those countries in debt.

Set Aung, deputy minister of Myanmar’s Ministry of Planning and Finance, called the agreement a “win-win deal” after enduring many tough negotiations to bring it up to international standards, to reduce Myanmar’s burden both in the short and long term and to ensure the project’s sustainability. He noted that international experts would be involved in environmental and social impact assessments.

Set Aung said the two parties agreed on a phased roll-out so that the feasibility of the project’s different stages could be assessed.

“We will implement the project phase by phase, step by step,” he said.

Myanmar so far does not have a deep sea port to allow big ocean liners to anchor, a condition causing the country to suffer high transaction costs for requiring trading via foreign ports in the region such as Singapore.

“The new port will not only bring more job opportunities for Myanmar nationals but also create more business opportunities,” Set Aung said.

However, the Kyaukphyu project is also expected to give China substantial control over the region’s trading routes as per the country’s current Belt and Road Initiative.

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