South Korean enterprises make inroads into Myanmar
- November 27, 2019
- Global New Light of Myanmar
- By Kyaw Htike Soe
THE URBAN and Housing Development Department-UHDD of Ministry of Construction and the Korea Land and Housing Corporation-LH Corporation signed an Memorandum of Understanding-MOU on building KMIC Industrial Complex in Hlegu Township, Yangon Region. Photo: MNA
The Republic of Korea has injected around US$ 150 million worth investment into Myanmar for construction of two industrial projects in Yangon and Bago Regions this fiscal year, according to a source from the Directorate of Investment and Company Administration (DICA) under the Ministry of Investment and Foreign Economic Relations. The Myanmar Investment Commission (MIC) had already given the green light for the establishment of the two industrial zones in Yangon and Bago Regions.
An industrial zone is being set up on 203.6 acres of land in Nyaung Inn Village-tract in Bago Region with an investment volume valued at US$ 28 million from the Republic of Korea and construction of the project is expected to take three years, according to a senior official from the Ministry of Investment and Foreign Economic Relations. The Urban and Housing Development Department (UHDD) under the Ministry of Construction of Myanmar and the Korea Land and Housing Corporation from the Republic of Korea sealed a deal to jointly establish an industrial complex in Hlegu Township, Yangon Region on 7 August this year. Under the agreement, an industrial zone named “the Korea-Myanmar Industrial Complex†will be established on 556 acres of land in NyaungHna Bin Village, Hlegu Township at an estimated cost of about US$ 120 million.
The MIC approved the project early this year as a 60/40 partnership between Myanmar and South Korea and the industrial park will be developed in two phases with the first starting from 2019 to 2021 and the second phase from 2022 to 2024, said U Aung Naing Oo, Permanent Secretary of the ministry. The industrial complex is designed to include SMEs, heavy industry and a vocational training school and will support the development of industrial, export and human resource sectors in Myanmar.
Many South Korean companies are expected to make investments in the industrial complex which will create 50,000 to 100,000 job opportunities for local people and generate US$ 10 million in taxes annually.
In addition, the Yangon regional government signed a Memorandum of Understanding (MoU) with a consortium from Hong Kong and Taiwan to build a US$ 500-million industrial zone on 2,200 acres of land in Htantabin Township.
Construction of the project started in September this year and is expected to create around 100,000 job prospects. Another South Korean company, GS Engineering and Construction has started building a 4.3-kilometre river crossing bridge connecting downtown Yangon and Dala Township. The estimated cost of the project is more than US$ 150 million.
The bridge is slated for completion by 2022, and will significantly reduce the travel time for residents of Dala to Yangon.
In addition, HUBS MK Co Ltd from the Republic of Korea and the Myanmar Trade Promotion Organization inked a deal for construction of a US$ 98 million international-standard logistics hub at Shwe Lin Ban Industrial Zone in Hlinethayar Township, Yangon Region in 2018. The two governments also sealed a deal to conduct feasibility study for the development of the Dala Satellite City Project.
Myanmar and South Korea inked the number of deals on economic and infrastructure development during President Moon Jae-in’s visit to Myanmar in September this year, including an agreement for a US$ 1 billion loan to Myanmar.
The two countries also agreed to promote cooperation on trade, technology, infrastructure and rural development. Currently, over 200 South Korean companies including multinational conglomerate Lotte Group are operating in Myanmar. South Korea was the sixth largest foreign investor in Myanmar with most investment from the East Asian country came to oil and gas, infrastructure, retail, and real estate sectors. South Korea has pumped US$ 3.9 billion worth of investments into 177 projects in the real estate, agriculture, manufacturing, infrastructure, logistics, and construction sectors in Myanmar, accounting for 4.86 per cent of total foreign direct investments in the Southeast Asian country.
Bilateral trade between Myanmar and South Korea amounted to nearly US$ 800 million in the financial year 2018-2019.
Bilateral trade between Myanmar and the East Asian country reached 2017- US$866 million in the fiscal year2016-17, US$ 657 million in 2015-2016 FY, US$ 862 million in 2014-2015 FY, US$ 1.57 billion in 2013-2014 FY, US$ 623 million in 2012-2013 FY, and US$ 667 million in 2011-2012 FY, according to the statistics from the DICA.