Friday, April 10, 2015

Thai construction co ITD gains more land in Dawei project

Deal street Asia - Posted April 9th, 2015 by Chalida Ekvitthayavechnukul
Representation of Dawei SEZ & deep sea port . visual from website of Dawei Development Company
Thai construction giant Italian-Thai Development Plc (ITD) has received the right to develop the deep-sea port and infrastructure on 45 square kilometres of land, a substantial increase from the 27 square kilometres it was allotted in the initial phrase, for the government-backed mega project, Dawei Special Economic Zone (SEZ), in Myanmar.

ITD’s chief executive Premchai Karnasuta said that the company would sign the contract for the additional land area during the end of this month.

“After we sign the contract, we will start to recognise the revenue from land sales as well as start the construction of small ports, utilities and township system immediately,” he said.

Of total 24,000 rais of land (45 square kilometres), it will develop 18,000 rais to be an industrial estate and set up the infrastructure on the remaining 6,000 rais. So far, it has already sold 10,000 rais of land in the industrial estate area to one investor.

ITD has offered to share 7 per cent of the profit with the Burmese government, he added. On the other hand, the government will repay the cost that ITD has invested in advance, which was booked for 6.03 billion baht ($186.69 million) in 2014.

The $50-billion Dawei SEZ aims to help Myanmar capitalise on its strategic location between India and China and attract foreign direct investment to Myanmar after years of being deprived under military rule.

The project will help stimulate the local economy by creating up to 100,000 jobs when the project is completed this year.

At the same time, this project is not going as smoothly as expected since the NGO has recently stepped out and said that tens of thousands of people in the area have been forced to relocate and are loosing their livelihood due to the project’s development.
Against this accusation, he said that the company gave the importance to local people as it gave to its shareholders, and it planned to build up a new community near the project’s zone for the relocated villagers.

Today ITD stock increased 1.27 per cent to 8 baht per share at 1120 local time with the trading value of 209.86 million baht.

Maybank Kim Eng Securities (Thailand) cited that ITD stock should surge again after the long public holiday next week, mainly due to the contract signing ceremony for Dawei SEZ in April-May and the negotiation for the co-railway project between Thailand and China in May.