MNA Business Desk: China has agreed to take a 70 percent stake in a strategically important sea port in Myanmar, at the lower end of a proposed range amid local concerns about Beijing’s growing economic clout in the country, a senior government official said.
Oo Maung, vice chairman of a government-led committee overseeing the project, said Myanmar had pushed for a bigger slice of the roughly $7.2 billion deep sea port, in western Rakhine state, in negotiations with a consortium led by China’s CITIC Group. Agreement was reached in September, he said.
“Locals from Rakhine and communities across Myanmar think that the previous 85/15 percent agreement is unfair to Myanmar. People disagree with the plan and the government is now trying to make a better deal,” he said.
The new proposal has been sent to the office of Myanmar’s Vice President Henry Van Thio for approval, Oo Maung said. But the two sides have not yet reached an agreement on financing details, he added, saying further negotiations were needed to move the project forward.
Beijing-based CITIC, China’s biggest and oldest financial conglomerate, did not immediately respond to requests for comment.
Yuan Shaobin, executive president of CITIC Myanmar, told the Myanmar Times in an interview published on Monday that the company had agreed to a 30 percent stake, but also said more negotiations were needed to iron out the financing details.
Reuters in May reported that state-owned CITIC had proposed taking a 70-85 percent stake in the Kyauk Pyu port, a part of China’s ambitious “Belt and Road” infrastructure investment plan to deepen its links with economies throughout Asia and beyond.
China has been pushing for preferential access to the deep sea port of Kyauk Pyu on the Bay of Bengal, an entry point for a Chinese oil and gas pipeline that gives it an alternative route for energy imports from the Middle East that avoids the Malacca Strait, a shipping chokepoint.
The port is part of two projects, which also include an industrial park, to develop a special economic zone in Rakhine. CITIC was awarded the tenders in both initiatives in 2015, reported news agency.