China and Myanmar Sign Deal to Complete Kyaukphyu Deep Sea Port

The Chinese state-owned enterprise CITIC and the Myanmar Junta have officially signed an agreement to expedite the completion of the Kyaukphyu Special Economic Zone and a deep-sea port in Rakhine State. The project, which has been floundering in the Myanmar Foreign Ministry for at least a year was finally approved, much to the delight of the Chinese Foreign Ministry which has now gained access to an Indian Ocean deep water port. The completion was being held up by a number of environmental studies and bureaucratic red tape, exacerbated by the escalating civil war and loss of junta control, especially in the Northern states, but also in the Rakhine state where the agreement is.

The announcement from the Myanmar Commerce Ministry reads below:

In order to implement the Kyauk Phyu Special Economic Zone Deep Sea Port Project, the Concession Agreement between the Kyauk Phyu Special Economic Zone Management Committee and the Myanmar-China joint venture Kyauk Phyu Special Economic Zone Deep Sea Port Company Limited (the project company) was signed in 2020. Signed in November. In order to promptly implement the Kyauk Phyu Special Economic Zone deep sea port project, some of the information in the contract is necessary to define the powers and responsibilities of both Myanmar and China more clearly. With the need for a more clear and accurate understanding of the previous Concession Agreement, and Both parties have held consultations. According to the negotiations, the chairman of the Kyauk Phyu Special Economic Zone Management Committee and the official representative of the Kyauk Phyu Special Economic Zone Deep Sea Port Co., Ltd. signed an addendum, which will encourage the Kyauk Phyu Special Economic Zone project to start promptly. This project will not only improve the living standards of the people of Rakhine State, including the Kyauk Phyu region, and create employment opportunities, but will also promote the development of Myanmar’s socio-economic life and economic and trade cooperation between Myanmar and China.

The Kyauk Phyu Special Economic Zone Deep Sea Port Project is a large-scale infrastructure development project that Myanmar-China has jointly invested in. The project includes 30 percent shares from the Myanmar side and 70 percent shares from the Chinese side. The Kyauk Phyu Deep Sea Port project will be implemented in four phases, with a total of 10 jetties, and is designed to receive an annual cargo capacity of 7,000,000 TEU containers. It is Asia, It can become a trade hub that will connect with Africa and Europe, and it will be able to promote the socio-economic development of Myanmar and the region as a gateway to the world.

Both Myanmar and China have been actively cooperating in the initial work of the project. Starting from 2022, not only did the initial geo-topographic survey (PGTS) and environmental and social impact assessment (ESIA) for the deep sea port project, but the world-renowned Canada-based project management company HATCH was appointed as a project consultant and with its help in selecting contractors and managing the project area. Activities are being carried out. As the initial geo topographic survey work (PGTS) has now been completed, the relevant geo topographic technical reports will lay a solid foundation for the subsequent design and construction of the project. An Environmental and Social Impact Assessment (ESIA) is intended to analyze and assess the potential environmental impacts of a project’s future construction and operation, and to develop measures to prevent or mitigate adverse impacts. The project company has also appointed an Environmental and Social Impact Assessment (ESIA) consulting firm with local experience and international perspectives through international open tendering in strict compliance with Myanmar’s existing laws.

Since April 2022, the Environmental and Social Impact Assessment (ESIA) consulting company has conducted a series of analysis and public participation activities to understand the basic environmental conditions surrounding the deep sea port project, and recorded the concerns of local residents regarding environmental protection issues. Currently, the Environmental and Social Impact Assessment (ESIA) has also completed the scoping phase of the project, so the Scoping Report has been approved by the Myanmar Ministry of Natural Resources and Environment. ESIA follow-up activities will be carried out strictly in accordance with Myanmar’s environmental protection laws and international best practices. We aim to encourage Kyauk Phyu Deep Sea Port to become a green and modern port.

”PPP” (“People, Prosperity, Planet”) in the development of the Kyauk Phyu Deep Sea Port project, promoting the interests of the public; It will be implemented based on 3 basic principles of wealth and environmental protection. While the project activities are actively being carried out, both Myanmar and China are paying special attention to improving the lives of Kyauk Phyu residents. Rural fund project in Kyauk Phyu region; vocational skills training; mobile clinic project; More than 10 social benefit projects such as mangrove plantation projects have been consistently carried out, and thousands of local residents have benefited from these projects. In the future construction and operational stages of the project, we will continue to invite local and foreign social benefit partner organizations to work together. Health Education environmental protection Efforts will be made in areas that people need, such as creating employment opportunities. As the project company, USD 1,000,000 every year for the first 5 years of the project construction phase; We will contribute US$500,000 annually to the operational level and strive for CSR and social welfare activities. In order to meet the needs of local people in carrying out socially beneficial CSR activities, we would like to invite the balanced participation of the local community, and we will carefully listen to the opinions and suggestions of stakeholders.

Along with the construction of the Kyauk Phyu Special Economic Zone deep sea port project, the industrial park project will continue to be implemented. If the Kyauk Phyu Special Economic Zone Deep Sea Port Project and the Industrial Park Project are implemented, tens of thousands of job opportunities will be available for the local people, and most of the management positions will be employed by Myanmar nationals. It will be able to attract millions of US dollars in investment to Myanmar, generate a lot of tax revenue for the state, and promote the surrounding upstream and downstream industries, thus increasing the economic development of the entire country and the individual GDP of the people.

In the implementation of the project, including local Rakhine ethnic businessmen, ethnic businessmen who have business experience from Myanmar and can actually work will be invited to cooperate with the project company.”

However, it is worth noting that local Burmese fishermen in the area have protested the move, saying that such a project will wipe out their livelihoods as industrialization with pollute the waters and drive the fisheries further off-shore.

This announcement also comes as the Arabian Army, one of the 50 ethnic groups currently fighting the Junta, seized a police station and attacked a junta military base in Mrauk-U in Rakhine State. This battle is ongoing as of this publication. The group claimed that junta forces seized nine civilians to use as human shields.

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Ethan Alun
Ethan Alun
A United States Naval Academy and American Military University Alumni, Ethan covers flash military, intelligence, and geo-political updates.
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