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Kyaukpyu Special Economic Zone, Myanmar


Description:

Myanmar has seen a quick economic development since the military junta launched political reforms towards democracy in 2011 after almost 50 years of dictatorship. One of the strategies followed by the government to boost this growth has been the establishment of Special Economic Zones (SEZ) [1].

One of the areas chosen to host one of those Special Economic Zones has been Kyaukphyu, a coastal town in the restive area of Rakhine state, in the Eastern part of the country. The project was first announced in September 2013 and will consist of three projects: a deep-sea port, (see related conflict, below) an industrial park, and a residential area [2]. The deep-sea port, whose framework agreement was made in November 2018 [3], will be the first phase of the project.

When the project was announced, Rakhine state was already submerged in a wave of racial violence after a Buddhist woman was found dead with signs of sexual abuse [4]. Buddhists communities blamed the Rohingyas, a Muslim minority that lives in the area, and clashes between Rakhine Buddhists and Muslims spread. The tensions intensified in August 2017 after the Myanmar army launched a crackdown against a new Rohingya insurgency group that has driven over 700,000 Rohingya refugees across the border into Bangladesh [5].

The project is directly linked to Chinese investment and has been considered key for the Belt and Road Initiative strategy [6]. When finished, the Kyaukphyu SEZ will become an important link in the trade with India and towards the West, and will give China access to the Indian Ocean. One of the main uses of the deep-sea port will be the trade and storage of oil that will be later sent to China through the highly controversial Shwe oil-gas pipeline, recently opened.

The project is expected to be developed by the China state-owned group CITIC, through several of its subsidiaries such as China Harbor Engineering Company Ltd, China Merchants Holdings, TEDA Investment Holding [TTEDA.UL] and Yunnan Construction Engineering Group [YNCEG.UL]. The Thai conglomerate Charoen Pokphand  Group (CP Group) is also involved in the project [7].    

The project has been criticized for being a potential ‘debt trap’ for Myanmar due to the high investment required and the disfavorable conditions given by China [8]. According to Reuters, CITIC would have proposed taking a 51 percent stake in the $2.3 billion industrial park, an offer Myanmar has agreed to.

Also, about 20,000 residents of Kyaukphyu Township may lose their land as a result of the land acquisition for developing a Special Economic Zone (SEZ), according to the International Commission of Jurists [9]. The NGO has also accused the project of breaching Myanmar’s land laws.

Basic Data

Name of conflict:Kyaukpyu Special Economic Zone, Myanmar
Country:Myanmar
State or province:Rakhine state
Location of conflict:Kyaukpyu city
Accuracy of locationHIGH (Local level)

Source of Conflict

Type of conflict. 1st level:Industrial and Utilities conflicts
Type of conflict. 2nd level:Land acquisition conflicts
Manufacturing activities
Specific commodities:Land
Manufactured Products
Industrial services
Fish

Project Details and Actors

Project details

Area: The government reserved more than 1,700 hectares for the project. It is unclear what will be the area when the project is completed. [10]

Port capacity: 4.8 million tons of bulk cargo and 4.9 million TEU containers

Industries in the SEZ: according to the government project, the land will be mainly allocated for garment and fish-related industries. [11]

Project area:1,708
Level of Investment:2,300,000,000
Type of populationSemi-urban
Affected Population:20,000
Start of the conflict:01/09/2013
Company names or state enterprises:CITIC Group from China
China Harbour Engineering Co Ltd (CHEC) from China
China Merchants Port Holdings Company Limited (CMHI) from China
TEDA Investment Holding Co., Ltd. (TEDA) from China
Yunnan Construction Engineering Group Co., Ltd. (Yunnan Jiangong) from China
Charoen Pokphand (CP) Group (CP) from Thailand
Relevant government actors:Government of Myanmar, Myanmar's Ministry of Commerce
Environmental justice organizations (and other supporters) and their websites, if available:International Commission of Jurists (www.icj.org), Kyaukphyu Regional Development Association

Conflict & Mobilization

IntensityLOW (some local organising)
Reaction stagePREVENTIVE resistance (precautionary phase)
Groups mobilizing:International ejos
Local ejos
Neighbours/citizens/communities
Fisher people
Forms of mobilization:Development of a network/collective action
Involvement of national and international NGOs
Media based activism/alternative media
Public campaigns

Impacts

Environmental ImpactsPotential: Biodiversity loss (wildlife, agro-diversity), Noise pollution, Soil contamination, Soil erosion, Waste overflow
Health ImpactsPotential: Accidents, Occupational disease and accidents
Socio-economical ImpactsVisible: Other socio-economic impacts
Potential: Displacement, Loss of livelihood, Loss of traditional knowledge/practices/cultures, Militarization and increased police presence, Land dispossession
Other socio-economic impactsIncreasing debt

Outcome

Project StatusPlanned (decision to go ahead eg EIA undertaken, etc)
Conflict outcome / response:The port was downsized
Development of alternatives:The ICJ has recommended a moratorium on all the Special Economic Zones and to suspend the land acquisition process in Kyaukpyu.
Do you consider this an environmental justice success? Was environmental justice served?:No
Briefly explain:The project is still ongoing

Sources & Materials

Related laws and legislations - Juridical texts related to the conflict

2014 Myanmar Special Economic Zone Law
https://www.dica.gov.mm/sites/dica.gov.mm/files/document-files/sez_law.pdf

2015 Environmental Impact Assessment Procedure
http://www.myanmar-responsiblebusiness.org/pdf/2015-06-Myanmar-EIA-Procedures.pdf

Links to general newspaper articles, blogs or other websites

[2] Winner postponed for Kyaukphyu, The Myanmar Times, January 19, 2015
https://www.mmtimes.com/business/property-news/12840-winner-postponed-for-kyaukphyu.html

[6] The economic stakes for China in Myanmar’s restive Rakhine, South China Morning Post, September 22, 2017
https://www.scmp.com/news/china/diplomacy-defence/article/2112366/economic-stakes-china-myanmars-restive-rakhine

[5] Rohingya Refugee Crisis, United Nations Office for the Coordination of Humanitarian Affairs
https://www.unocha.org/rohingya-refugee-crisis

[3] Kyaukphyu port: What happens next?, Myanmar Times, November 9, 2018
https://www.mmtimes.com/news/kyaukphyu-port-what-happens-next.html

[4] Why is there communal violence in Myanmar? BBC, July 3, 2014
https://www.bbc.com/news/world-asia-18395788

[1] General Information on Myanmar Special Economic Zones , Thai Embassy in Yangon
http://www.thaiembassy.org/yangon/contents/files/business-20180228-130154-066034.pdf

[7] Exclusive: China seeks up to 85 percent stake in strategic port in Myanmar, Reuters, May 5, 2017
https://www.reuters.com/article/us-china-silkroad-myanmar-port-exclusive/exclusive-china-seeks-up-to-85-percent-stake-in-strategic-port-in-myanmar-idUSKBN1811DF

[8] Analysis: ‘Debt Trap’ Alert Rises in Myanmar as More Belt and Road Projects Scrapped, The Irrawaddy, September 18, 2018
https://www.irrawaddy.com/news/burma/analysis-debt-trap-alert-rises-myanmar-belt-road-projects-scrapped.html

[10] Govt reserves land for Rakhine state SEZ, Myanmar Times, Dec 7 2015
https://www.mmtimes.com/business/17995-govt-reserves-land-for-rakhine-state-sez.html

[11] New Chair of Kyaukphyu SEZ Wary of Chinese Loans, The Irrawaddy, July 17 2018
https://www.irrawaddy.com/business/new-chair-of-kyaukphyu-sez-wary-of-chinese-loans.html

[9] Myanmar: amend Special Economic Zones Law to protect human rights – new ICJ report, February 2017
https://www.icj.org/myanmar-amend-special-economic-zones-law-to-protect-human-rights-new-icj-report/

Other documents

Demo of the Kyaukphyu Deep Sea Port Demo of the Kyaukphyu Deep Sea Port. Myanmar Government (http://www.moi.gov.mm/moi:eng/?q=news/13/11/2018/id-6191)
https://file.ejatlas.org/docs/kp3.jpg

View of the Kyaukpyu port from the above View of the Kyaukpyu port in January 2018 from the above, Asia Maritime Transparency Initiative ((https://amti.csis.org/kyaukpyu-china-indian-ocean/)
https://file.ejatlas.org/docs/Screenshot_5.png

Meta information

Contributor:Laura Villadiego, Carro de Combate, [email protected]
Last update24/01/2019

Images

 

Demo of the Kyaukphyu Deep Sea Port

Demo of the Kyaukphyu Deep Sea Port. Myanmar Government (http://www.moi.gov.mm/moi:eng/?q=news/13/11/2018/id-6191)

View of the Kyaukpyu port from the above

View of the Kyaukpyu port in January 2018 from the above, Asia Maritime Transparency Initiative ((https://amti.csis.org/kyaukpyu-china-indian-ocean/)