Thursday, July 9, 2015

Mekong-Japan Cooperation: Dawei & Thai high-speed train backed

Thailand & Japan agreed on Saturday to develop Dawei special economic zone (SEZ) in Myanmar & two train lines in Thailand. Japan pledged 205 billion baht to Thailand, Myanmar, Cambodia, Laos & Vietnam over next three years to spur region's development.
Japanese Prime Minister Shinzo Abe (right) smiles with Prime Minister Prayuth Chan-o-cha during a joint news conference on the sidelines of seventh Mekong-Japan Summit at the Akasaka State Guest House in Tokyo on Saturday. (Reuters photo)
Japan backs Dawei, Thai high-speed train

Bangkok Post and Kyodo News

Thailand and Japan agreed on Saturday to develop the Dawei special economic zone (SEZ) in Myanmar and two train lines in Thailand including a high-speed train linkingBangkok and Chiang Mai. The agreement was reached in talks between Japanese Prime Minister Shinzo Abe and Prime Minister Prayut Chan-o-cha on the sidelines of the seventh Japan-Mekong Summit meeting.


The largest of its kind in Southeast Asia, the Dawei project in southeastern Myanmar will include a deep-sea port with the capacity to hold 250 million tonnes of cargo; an economic zone that will cover more than 200 square kilometres; factories; a coal mineand power plant for electricity; and golf courses and five-star hotels for visitingexecutives.

Dawei is projected to become the major gateway for the Mekong region's trade with India, the Middle East and Africa, while linking Myanmar by road to Thailand, Cambodia and southern Vietnam.

"I’m convinced the signing of a memorandum of intent (MoI) on the Dawei Special Economic Zone will create an opportunity to strengthen the economic partnershipbetween Japan and Asean and Japan and Thailand ahead of the launch of the Asean Economic Community (AEC)," Mr Abe said in a joint news conference with Gen Prayut after their meeting.

When completed, the 200-square-kilometre economic zone "will become a newdistribution centre for the world", Gen Prayut said.

Under the Dawei agreement the three countries will hold equal shares in Dawei SEZ Development Co, which will operate the project. Dawei SEZ was established to manage the Dawei project and initially it was an equal partnership between Thailand and Myanmar.

Japanese Prime Minister Shinzo Abe shakes hands with Myanmar President Thein Sein (L) and Thai Prime Minister Prayut Chan-o-cha after the signing ceremony for the Dawei development project in Tokyo on Saturday. (AFP Photo)

Gen Prayut said Thailand and Japan also agreed to embark on a high-speed rail routebetween Bangkok and Chiang Mai and the Red Line mass transit system in Bangkok...

But Tokyo stopped short of making a strong commitment on two more rail lines in which Thailand was hoping it would invest. They are a route from the Thai border with Myanmar in Kanchanaburi to Rayong and Aranyaprathet district in Sa Kaeo, and another line from Mukdahan to Mae Sot district in Tak.

The two countries "plan to develop" the two lines "in the future", the Thai statementsaid.
Thailand has decided 180 km/h is enough to meet its cargo needs between Bangkok and the Northeast. (Photo by Pattarapong Chatpattarasill)

The pledge for the Red Line could clear the way for the State Railway of Thailand (SRT) to receive an additional loan of 38.2 billion yen (10.4 billion baht) from the Japan International Cooperation Agency (Jica).

The Red route will run from Bang Sue to Rangsit. The railway agency needs moreloans from Japan to finance the project with the Jica already being the main financialsource.

Japan on Saturday also pledged a total of 99.85 billion yen (US$812 million) in yen-denominated low-interest loans to Myanmar to help develop infrastructure.

Of the total, 41.12 billion yen ($334 million) will go towards developing a nationalpower transmission network, and 33.87 billion yen ($275 million) toward improving the Myanmar portion of the East-West Economic Corridor that connects the country with Thailand, Laos and Vietnam by road.

The remaining 24.87 billion yen is linked to a project to upgrade the circular railwayline in Yangon.

Japanese Prime Minister Shinzo Abe (second left) delivers an opening speech at a roundtable as leaders of the Mekong countries including Prime Minister Prayuth Chan-o-cha (second right, back-facing camera) listen during the Mekong-Japan Summit Meeting at the state guest house in Tokyo on Saturday. (Reuters photo)


Mr Abe pledged in the summit fresh aid worth 750 billion yen (205 billion baht) inofficial development assistance to Thailand, Myanmar, Cambodia, Laos and Vietnam over the next three years to spur the region's development....
Japanese investment in Thailand has increased recently. The number of Japanese companies investing in Thailand rose to 1,552 in June 2014 from 1,379 two years earlier.

...Under the New Tokyo Strategy 2015 for Mekong-Japan Cooperation, Abe and the Mekong region leaders agreed that the region has potential to be a "global growthcenter" given its strategic location next to major Asian markets such as China and India.

Aside from supporting efforts of the 10-member Asean, which the five Mekong states are part of, to be more integrated economically, Japan's engagement in the resource-rich Mekong region is also seen as countering China's growing political and economicclout there.

...Abe and the five Mekong nations' leaders, in a document unveiling their newstrategy for cooperation, "noted concerns expressed over the recent development in the South China Sea."

...According to the document, both sides said they will continue to uphold freedom ofnavigation and overflight and peaceful resolution of maritime disputes in line withinternational law.

...Japan hopes to distinguish its aid packages for infrastructure development in the Mekong region from that of China by promoting advanced Japanese technology and environmental-friendly know-how and capacity-building schemes....

...The new strategy is in line with Abe's investment initiative announced in May to provide US$110 billion to promote "quality infrastructure" in Asia over the next five years.

Most nations in the Mekong region lag behind in development, making it one of the priority areas ... of 2013, per capita gross domestic product was $2,073 in Vietnam, $1,628 in Laos, $1,103 in Myanmar and $1,018 in Cambodia, compared with $5,390 in Thailand. The average for Asean countries -- also comprising Brunei, Indonesia, Malaysia, the Philippines and Singapore -- is about $3,839...