U Han Zaw, Minister of Construction: Interview

U Han Zaw, Minister of Construction

Interview: U Han Zaw

Which infrastructure development projects are being prioritised between 2018 and 2020?

U HAN ZAW: It is the responsibility of the Ministry of Construction (MoC) to develop key socio-economic enablers, such as the highway network and the social housing programme. Between 2018 and 2020 we will prioritise roads, bridges and urban development. Key projects include Yangon’s inner and outer ring roads, the Korea-Myanmar Friendship Bridge, the third Bago River Bridge, the New Mandalay Resort City Project, the Yangon-Mandalay Expressway, and other relevant planned highways connecting major cities. Most of the priority projects are around Yangon because of its commercial relevance; business in the region generates over 25% of our national GDP.

Taking into consideration budget constraints, what is the government’s plan for funding these projects, and what financing options are available?

HAN ZAW: The MoC does not solely depend on the national budget to implement all high-priority projects. The government has created the Policy Framework for Investment, which includes three types of investment models. First, if the project is financially viable and bankable, it can be funded by the private sector. Second, if the project is financially viable but not bankable, the government will provide a guarantee so the project becomes bankable and can be undertaken by a public-private partnership. The last model applies to projects that are not financially viable, but which help the nation advance socio-economically.

Such projects will be funded by the government through public funds and international grants and loans. The MoC has evaluated all the ways to develop transport infrastructure in our country and we will accept all international cooperation that aims to benefit the people of Myanmar. This is the purpose of the Belt and Road Initiative, which aims to develop regional infrastructure through economic corridors.

With only 57% of the infrastructure projects approved in 2017-18 completed as of August 2018, what are the main reasons behind the delays?

HAN ZAW: Some of these projects were not completed on time due to an increase in costs after surveying, soil testing and other procedures.

Bureaucracy is another factor that has slowed down financial and technical projects. We plan first to obtain technical approvals one year prior to the start of projects. Second, we will rely on the various pending laws, which will enforce good practices for company registration and monitoring systems, manpower training, material standards, and digital platforms for both procurement and tendering.

How is the MoC working to attract the investment needed for infrastructure through to 2030?

HAN ZAW: There are two ministries responsible for transport infrastructure in Myanmar. Air, rail and inland water transport are under the remit of the Ministry of Transport and Communication and road and bridge infrastructure are under the MoC. Myanmar needs to invest $45-60bn in transport infrastructure until 2030. Based on our own calculations, we have two master plans with different approaches. The first of these is the Arterial Road Networks Master Plan (2030) that we developed in 2015 in cooperation with the Korea International Cooperation Agency. According to this plan, the MoC will oversee new construction projects, including the widening, upgrading and maintaining of highway networks to a total value of $41.5bn. Second, the MoC plans to upgrade existing roads and bridges to meet ASEAN Class III standards, an undertaking that was estimated to cost $32bn.

According to the above analysis, $41.5bn is based on a demand and supply analysis, and $32bn is based on a standardisation analysis. To meet the estimated investment, we are seeking funds from the national budget, grant and loans, and private sector investment.


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The Report: Myanmar 2019

Construction & Real Estate chapter from The Report: Myanmar 2019

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