Hotel zones in Myanmar’s tourism destinations
are being built to increase the supply of rooms and, at the same time,
solve the problem of expensive land for investors.
However, the challenge is obtaining agreement from local villagers
who have to move out, and ensuring they receive appropriate prices for
their land.
The country’s rapid opening to the outside world has led to a surge
in tourism that has exposed the severe shortage of quality
accommodation. The government has moved aggressively by announcing plans
for purpose-built hotel zones with roads and infrastructure in many
areas, including Yangon, Mandalay, Bagan, Taunggyi, Chaungtha, Inle
Lake, Rakhine, Mawlamyine, the Golden Triangle, Bago, Ngwe Saung and Nay
Pyi Taw.
However, local residents in some areas are wary. Some fear the
development will result in land grabs by the rich and connected, a
common occurrence across Asia.
Recently, seven local residents of Nyaungshwe township near Inle Lake
were charged as they protested against land acquisition by the
government for a 600-acre hotel zone near the famous lake. In some other
areas to be built as hotel zones, villagers are resisting relocation
and use of their land for the tourism.
Myanmar Tourism Development Co, the investment arm of the Myanmar
Tourism Federation (MTF), is proceeding with the Tada-U hotel zone near
Mandalay. It has acquired land on which eight villages are currently
located. The company has started negotiating the compensation paid to
the villagers, and five or six have already agreed, said Kyaw Htun,
joint secretary-general of the MTF.
“We earlier thought that getting approval from the government (to
invest in the project) would be the most difficult part of our project
development, but actually it was very easy. This is because the
government also has the same goal: that is to develop the tourism
industry and create jobs,” he said.
“Rather, the most difficult task is to get the local villagers’
agreement and make them understand that the project will eventually
benefit them, not us.”
Mr Kyaw Htun said the company believed it would take about eight
months to negotiate compensation with all the villagers in the planned
zone.
Myanmar Tourism Development is also in the process of becoming a
public company and will sell shares, which are currently valued at US$12
apiece.
The Tada-U hotel zone covers around 2,000 hectares of land. Myanmar
Tourism Development needs to invest $560 million in building the
necessary infrastructure and facilities, including electricity,
utilities and roads.
The project, which Mr Kyaw Htun said would be a new township, focuses
on positioning Mandalay as the main tourism destination of Myanmar. It
will comprise hotels, commercial and financial areas, and a residential
zone, with both local and foreign investors.
He said the company had received around 2,000 proposals from
investors around the world who want to take part in the project. The
company has divided the development into three phases; each will take
three years for development.
As many as 300 hotels are planned in the zone, and proposals are
being screened to ensure that investors have genuine experience in hotel
development or management. The company does not want amateurs or
investors interested only in profiting from land speculation.
“After the project is completed in the next decade, we will add
10,000 hotel rooms to the market and create at least 50,000 jobs for
local people employed by both local and foreign hoteliers,” said Mr Kyaw
Htun.
Kyi Thein Ko, secretary-general of the MTF, said Myanmar urgently
needed to add more hotel rooms, but land prices, particularly in Yangon,
are very high and infrastructure lacking. As a result, foreign hotel
investors have yet to arrive.
He said the hotel zones were intended to help solve the land price
problem. One of the zones is located between Yangon International
Airport and the new Hanthawady International Airport, which is around 80
kilometres from the existing international airport and in Bago
province. The government has to negotiate with farmers living in the
area to move and accept compensation.
Around 1,000 hotel rooms are now being added in Yangon, which by the
end of this year will have around 9,000 rooms, Mr Kyi Thein Ko added.
In the capital Nay Pyi Taw, rooms are in high demand for a World
Economic Forum event in June and the SEA Games in December. It has 4,000
rooms now and is expected to have 10,000 b y year-end.
“We’re not worried about the hotel rooms in Nay Pyi Taw. Only those in Yangon are our concern,” Mr Kyi Thein Ko said.
He said that the government and the MTF were also in talks with
Thailand’s Dusit Thani College and Singapore’s Shatec Institute to set
up international hotel training schools in Myanmar to meet demand for
qualified staff in the fast-growing business.
source: Bangkok Post
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