Commerce Minister Niwatthumrong Boonsongpaisan said yesterday that ITD would be fully compensated for its investment in the project since 2010.
ITD has not yet confirmed or denied The Nation's report on Tuesday that it would withdraw from the project because of financial difficulties. Sources in the industry told The Nation that ITD would relinquish its 75-year concession to use the land granted by the Myanmar Port Authority.
Though it will likely want to play a role in the development of some phases, the exclusive right over the 128,171-rai (20,507-hectare) area would be transferred to a special purpose vehicle (SPV) to be jointly controlled by the Thai and Myanmar governments, the sources said.
"I haven't had a discussion with ITD for months about whether it will pull out of the project. However, at the meeting, ITD's executives should be there and we should discuss it," Niwatthumrong said.
Niwatthumrong, who represents the Thai government in the Thai-Myanmar Joint Coordination Committee, said one agreement would give the exclusive development right to the SPV. The second will be signed with ITD to guarantee that it would be compensated for its investment.
Myanmar would pay ITD with the funds to be raised by the special purpose companies that will be involved in the development of the remaining seven phases, he said.
That is the only way that ITD would be compensated and it is natural that the new investor must pay the compensation. However, the development must be inspected before finalising the amount, he said.
After the changes, ITD would cease all operations in Dawei, he said, while insisting that the project would be completed on schedule. The Myanmar government will call bids for the remaining phases, believing that the bidding will ensure transparency of the project. ITD has the right to join the bidding and he believes that ITD will do so, as well as other Thai companies and state enterprises.
ITD registered Dawei Development Co in September 2011 as the unit responsible for the development of the deep-sea port, industrial estates, trans-border corridor link and infrastructure. As of Monday, brokerages maintained a positive outlook on the company in their research notes.
Maybank Kim Eng Securities (Thailand) said that although ITD would no longer hold the Dawei concession, it was still eligible to compete for construction contracts.
Asia Plus Securities expects ITD to sign construction contracts in Myanmar next year. KKTrade Securities also expects ITD to sign a Bt40 billion coal-mine project next year. ITD showed a net profit of Bt32.9 billion in the first nine months of this year against Bt46.98 billion for all of last year. Its stock price yesterday gave up 1.79 per cent to Bt5.50.
Dawei development plan
The special purpose vehicle (SPV) will have seven special purpose companies carry out the development in seven phases.
They are:
1. Project infrastructure such as roads, water systems, etc
2. Deep sea port
3. Industrial estate for steel, fertiliser, auto assembly, and an oil refinery
4.Industrial estate for the petrochemical industry
5. Power plant
6.Industrial estate for light industry such as computer assembly, garments etc
7. Community development
source: Eleven Myanmar
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