SINGAPORE'S INFRASTRUCTURE ASIA, MYANMAR INK DEAL ON INFRASTRUCTURE COLLABORATION
Singapore's Infrastructure Asia will identify suitable investors for infrastructure projects in Myanmar, following an agreement inked with Myanmar's Ministry of Planning, Finance and Industry (MoPFI) on Wednesday (May 27). The agreement will help implement projects in the Myanmar Project Bank, an online database of priority infrastructure investments that are aligned with the country's sustainable development plan. Under the agreement, Infrastructure Asia (IA), together with MoPFI, will identify projects that the private sector can participate in.
(Source: The Straits Times, May 27, 2020)
Hpone Myint Thu (Assistant Research Manager):
Formed under the joint initiative by Enterprise Singapore and the Monetary Authority of Singapore, Infrastructure Asia (IA) is known as a Singaporean government agency working with major infrastructure players and stakeholders in the region in strengthening the project implementation capabilities of governments. Ministry of Planning, Finance and Industry’s (MoPFI) decision to collaborate with IA in identifying suitable investors for infrastructure projects reaffirms Myanmar’s unwavering commitment to the Project Bank and her goal to entice foreign investment into the much-needed development of growth-inducing and business-enabling infrastructure. Looking closely, Myanmar is no stranger to working with her Singaporean counterparts. In Myingyan Independent Power Plant project, Myanmar’s first competitively tendered Public-Private-Partnership scheme, the Singapore-based companies, professional service providers as well as financial institutions such as Sembcorp, Jurong Engineering, Mayer Brown JSM, Clifford Capital, DBS and OCBC have taken pivotal roles. Meanwhile, IA has also worked with New Yangon Development Company Limited (NYDC) in scoping the evaluation criteria for New Yangon infrastructure projects stretching from distribution and supply of power and natural gas to cyber connectivity. With IA’s headquarter in Singapore, MoPFI is anticipated to be able to open the door wide open and beckon a broader investor base to Myanmar Project Bank. Despite the Covid-19 outbreak, the government remains focused on reaching its sustainable development goals. Colliers urges investors and developers to follow suit.
THE IMPORTANCE OF PUBLIC-PRIVATE PARTNERSHIP (PPP) TO FIGHT AGAINST COVID-19
The World Health Organization (WHO) announced COVID-19 can be characterized as pandemic on 11th March, 2020. We have already been through the impact of this pandemic before the outbreak hit our own lands. When it does happen, the government is the first to respond in any country. As the virus is new, we still have a lot yet to learn over time. This is a long-term battle for the human being and the sector of PPP plays a key role to fight against COVID-19. As the State Counsellor, Daw Aung San Suu Kyi said, “People are the Key”. We would like to mention that we all need to know the 5As to fight against COVID-19: Asymptomatic Carrier, Avoid Crowded Places, Activate Immunity, Active Community Participation and Attitude towards using Masks, Handgel, Handwashing and Physical Distancing.
(Source: The Global New Light of Myanmar, May 25, 2020)
Paul Ryan Cuevas (Senior Research Analyst):
Public-private partnership (PPP) projects across the world, particularly in Myanmar, are now facing a downtime, owing to the uncertainty prompted by the ongoing health crisis. It has led all these projects to incur additional costs, particularly those that are operational, mostly due to disinfection of equipment and facilities, and labour shortages. As for the user-funded PPP projects, the revenues are negatively impacted, specifically the transportation and energy projects, due to the much-reduced demand. Furthermore, it has and continues to pose specific challenges to projects that are in the construction phase, such as construction delays and supply chain disruption. Overall, the influence of the crisis will hinge on the longevity of disruption and will be felt differently by each PPP project, depending on its extant circumstances. As Colliers views it, the role of the Myanmar government in executing a series of pro-active measures will be crucial. In response to the current state of affairs, the government has initially provided support (e.g. loans, guarantees, tax relief, subsidies, etc.) to address liquidity or solvency needs of PPP projects and other private firms alike.
DEVELOPER ISSUES TENDER FOR AYEYARWADY LNG POWER PLANT
The Myanmar-Chinese developers of a major liquefied natural gas (LNG) power plant for Ayeyarwady Region have issued a tender with a one-week deadline for companies to enter the prequalification stage. The proposed 1390MW LNG power plant is to be built in Shwethaungyan township’s Mee Lin Gyaing area, a greenfield site about 250 kilometres from Yangon. If approved, it will be among the largest energy investments costing about US$2.5 billion, according to state media. The tender notice was issued by the state newspaper on May 22, with a deadline of May 28.
(Source: Myanmar Times, May 21, 2020)
Nida Soe (Research Analyst):
During the visit by China’s President Xi Jinping to Myanmar in January 2020, the governments of both countries agreed to hasten negotiations on the LNG power plant project in Mee Lin Gyaing. The Ministry of Electricity and Energy (MOEE) originally approved the project, along with one in Kan Pauk in Tanintharyi Region, and another in Ahlone in Yangon Region, in 2018. The three projects, once completed, are expected to generate some 3,000 megawatts of power from imported LNG. Myanmar faces an uphill battle to achieve universal electrification. With the lowest GDP per capita in the region, the need to unleash the transformative power of reliable and sufficient energy for all becomes all the more urgent. While interested investors have expressed concerns over the short time frame of the tender process, the Myanmar government is showing full commitment in striving to achieve its goal of electrifying 100% of its nation by 2030. Colliers sees this as a positive sign for investors, especially for those involved in manufacturing and industrial activities, since unreliable electricity is one of the biggest bottlenecks hindering the industrial sector. So far, the roadmap for Myanmar’s journey towards full electrification is robust. The country has been committed to implementing mixed-electricity generation methods in order to create a strong power grid, such as the Smart Power Initiative by the Rockefeller Foundation and the Yoma Micro Grid to name a few. Colliers views the move to resume China’s Belt-and-Road Initiative in a swift manner after COVID-19 as the promising signs of Myanmar’s dedication to improve its national infrastructure, providing investors with some hope for economic revival in a post-pandemic world.