Myanmar authorities are hoping to secure an Overseas Development Assistance (ODA) loan from Tokyo in order to resuscitate the failed Hanthawadddy airport project

23 กรกฎาคม 2561

The transport ministry is hoping to secure an Overseas Development Assistance (ODA) loan from Tokyo to resuscitate the failed Hanthawaddy airport project, according to the Department of Civil Aviation (DCA). However,  the facts show that an airport 80km away from Yangon is unnecessary and that the focus should be on strengthening the infrastructure for the existing airport and attracting more passengers instead. More alarmingly, officials said that the tender process for the project will begin once the Japanese aid is approved, but failed to mention any plan to undertake environmental assessment, which is required by law.

DCA’s deputy secretary general U Ye Htut Aung said that the government is keen to revive the failed project by securing an ODA loan from Japan because the National League for Democracy-led government regards it as a priority for the nation. 

“Hanthawaddy airport must be developed due to the limited capacity of Yangon International Airport [YIA]”, he said, referring to both the terminal as well as runway capacity. Authorities have claimed in the past that the YIA is already at full capacity with 3 million passengers annually. This claim however does not match with the facts. 

The Yangon airport managed a total of 5.92 million passengers in 2017. According to Yangon Aerodrome Co Ltd (YACL), the operator of YIA, the airport was built to handle up to 20 million passengers a year. With only around one quarter of the airport’s terminal capacity utilised, Yangon hardly needs another international airport.

In terms of runway capacity, the figures, too, deviate from the government’s position. The authorities repeatedly argued that YIA cannot accommodate the increasing number of aircrafts and hence the Hanthawaddy project is imperative. But YACL spokesperson told The Myanmar Times that the YIA’s handling capacity for aircrafts is not expected to saturate in “the next decade and beyond”.

“The YIA is currently undergoing upgrades to maximise its capacity handling to cater to future demand. Several ongoing expansions on the YIA airside include taxiway widening, a new apron, construction of Rapid Exit Taxiways as well as a new VIP/ CIP terminal,” the spokesperson commented. The airport recently opened a connector from Terminal 1 (T1) to T2 with plans to eventually upgrade the latter and combine the two as one international terminal. 

“We expect these upgrades to take our handling capacity [of YIA] well into the next decade and beyond,” the spokesperson continued.

‘Hanthawaddy airport must be developed due to the limited capacity of Yangon International Airport.’ - U Ye Htut Aung, Department of Civil Aviation

“Squatters” are cleared

Tokyo wants to hire Japanese firms to construct and operate the new airport, according to the DCA. Similarly, Mandalay Airport is currently operated by a joint venture set up by Japan-based Mitsubishi, Jalux and Singapore-listed Yoma Strategic Holdings. 

The DCA is waiting for the Japanese legislature to greenlight the ODA. Once approval is given, the tender process will begin. Japanese and local officials have met to explore the options earlier this year. 

Bago regional finance minister U Nyunt Shwe said that Nay Pyi Taw and the regional government are working together to resuscitate the failed project. “Squatters” in the site have already been relocated and compensated and fences have been put up, he claimed.

In addition, the officials have not mentioned any Environmental Impact Assessment (EIA) being undertaken for the project, nor have they mentioned any Environmental Compliance Certificate (ECC) issued. 

The Hanthawaddy project with the proposed 3,600m runway is categorised as a project which requires a site-wide EIA. Article 83 of the 2015 Environmental Impact Assessment (EIA) Procedure under the Environmental Conservation Law states that any permit regarding implementation of the project can only be granted to a developer after the issuance of an ECC by the environment ministry. It is unclear how the resettlement of “squatters” is lawful without the legally-required assessment and certificate.

Endless delays

The proposed US$1.5 billion airport, with an annual capacity of 12 million passengers, is slated to be built 80 kilometres north of Yangon, in Kyauk Taing Kan village near Bago city. It will be constructed on an old WWII Japanese airfield covering 9,690 acres (3,921 hectares). Previous plans have fallen through: it was initially slated for completion by 2018, which was then postponed to 2020. The government had also sought to move all international airlines to the new airport from the existing one by 2020. Obviously, that is not going to happen. 

A framework agreement was signed in January 2016 between a consortium, including Japan-based JGC Corp and Singapore’s Yongnam Holdings Ltd, and the DCA, aiming to complete the project by 2022. The consortium in February announced that the agreement to design, build and manage the project has expired and did not seek an extension. 

This is not the first time when investors walked out of the deal: earlier, in 2013, a consortium led by South Korea’s Incheon International Airport Corporation (IIAC) was selected to spearhead the project, but the $1.1 billion contract was later terminated.

 

(The Myanmar Times: https://www.mmtimes.com/news/facts-show-myanmar-doesnt-need-hanthawaddy-despite-govts-obsession.html )