YANGON – Japan is going to have to
rethink its strategy for opening business opportunities in Myanmar, one
of the last untapped markets in Asia, as Japanese consortia have failed
to win international tenders to develop the country’s infrastructure.
Airport construction and expansion projects as well as telecom
operator licenses are among key deals that Japan has lost to other
foreign consortia that have included South Korean and Chinese bidders,
dealing a blow to Japan’s all-out efforts at the government and
private-sector levels to win contracts.
“There is a need to revise (our) game plan,” a high-ranking
government official said in the face of Japan’s poor record in securing
contracts despite its promise of official development assistance and
debt waivers for Myanmar.
In the tender for a project to upgrade Yangon International Airport,
the country’s major gateway for international visitors, Japanese
government officials were confident until the last minute that the
contract was a done deal.
But when the Myanmar government announced the winner for the
expansion project last Saturday, it was a consortium including Chinese
and local corporations.
The government also announced that a project to build the new
Hanthawaddy International Airport had been awarded to a consortium led
by South Korea’s Incheon Airport, beating a consortium that included New
Kansai International Airport Co.
Hanthawaddy International Airport is to be built near Bago, about 70 km north of Yangon, Myanmar’s largest city.
It hasn’t been all bad news for Japan. A consortium of Mitsubishi
Corp. and a Japan Airlines Co. affiliate, JALUX Inc., won a contract to
repair and operate Mandalay International Airport serving Myanmar’s
second-largest city for the next 30 years for around ¥6 billion.
But the scale of the contract is significantly smaller compared with
the project to build the new airport, which is estimated at several
hundred billion yen.
After opening up to the world following decades of military rule, Myanmar wants to draw more than 7 million tourists by 2020.
The Myanmar government has not disclosed its criteria for selecting
tender winners, but an official at a trading house surmised that the
deciding factor is connections with influential figures close to Myanmar
President Thein Sein.
The official added that Myanmar, in choosing tender winners, is trying to strike a balance among participating countries.
Japan also failed in its pursuit to enter the largely untapped mobile
phone market in Myanmar, which would have given it access to 60 million
potential customers.
In June, the Myanmar government announced that Norway’s Telenor and
Qatar’s Ooredoo won telecom operator licenses out of 12 qualified
bidders, which included KDDI Corp. and Sumitomo Corp.
Speculation was rife in Myanmar that the surprising inclusion of
oil-rich Qatar was because the Middle Eastern country offered an
extraordinary amount of investment.
Reflecting Japan’s eagerness to support growth in Myanmar, Prime
Minister Shinzo Abe visited the country in May with around 100
representatives of the corporate sector.
In a meeting with Thein Sein, Abe pledged ¥91 billion in fresh ODA
while waiving ¥190 billion in debt. The prime minister also said Japan’s
public and private sectors would together support Myanmar’s
nation-building efforts.
Japan has until now focused on the United States and Europe as rivals
in international bidding, but competition has been heating up with
other Asian bidders.
A senior official of the Myanmar government said South Korea and
China are in no way inferior to Japan as bidders and the debt waiver and
ODA from Japan was only one of the factors considered during bidding.
source: Japan Times
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