Japan sees opportunity in Myanmar's emerging economy

YANGON Fri Jan 4, 2013 1:42pm EST

1 of 2. Japan's Deputy Prime Minister and Finance Minister Taro Aso shakes hands with Myanmar's President Thein Sein (L) as they meet in the capital Naypyitaw January 3, 2013. Aso is in Myanmar for talks with Thein Sein to boost relations with the rapidly transforming country and support Japanese business interests in the region.

Credit: Reuters/Antoni Slodkowski

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YANGON (Reuters) - Japan's deputy prime minister confirmed fresh financial aid for Myanmar on Friday during a visit to an industrial zone that underlined the long-isolated nation's growing importance as an economic partner.

With a land mass as large as Britain and France combined, Myanmar shares borders with 40 percent of the world's population in India, China, Bangladesh and Thailand.

President Thein Sein's quasi-civilian government has enacted reforms since it took over from a long-ruling military junta nearly two years ago.

Taro Aso, who is also Japan's finance minister, chose the country for his first official visit abroad just a week after taking up his job.

His visit sets the stage for Japanese firms to gain privileged access to Myanmar as Western competitors move in slowly after years of economic sanctions.

"I can feel Myanmar has very big potential. It is our intention to support its development by private-public partnership," Aso said as he visited Thilawa, a $12.6 billion, 2,400 hectare special economic zone and centerpiece of Japan-Myanmar relations.

Mitsubishi Corp., Marubeni Corp. and Sumitomo Corp. form the Japanese side of the joint venture developing the industrial park. The plan is to build the first 400 hectares by 2015 and start luring Japanese and global manufacturers.

Aso confirmed during the visit that Tokyo would waive part of Myanmar's 500 billion yen ($5.74 billion) debt and make a fresh loan of 50 billion yen, partly to kick-start construction of Thilawa.

"The Myanmar side has thanked us for waiving their debts many times," Aso told reporters in Yangon. "I hope this will serve as a first step in boosting Myanmar's economic development."

Aso, a senior member of the Japan-Myanmar Association, had arranged the visit before he was appointed, but took many by surprise with his decision to go despite a busy domestic agenda.

Aiming to offset the economic impact of Tokyo's frayed relations with Beijing, Shinzo Abe's new administration has been reaching out to other Asian neighbors, pledging to send special envoys to improve ties with both South Korea and Russia.

Myanmar is still re-working its laws governing special economic zones after passing new foreign direct investment laws last year. Officials there hope Thilawa will bring employment opportunities to the job-starved country, helping stabilize a country undergoing social and economic upheaval.

"With the help of Japan and its technology, we will be able to create jobs for the people and enter a new age of economic development," said Win Aung, who heads the Myanmar side of the consortium.

Japan is also investing in an economic zone in Dawei on Myanmar's southern peninsula, where the largest industrial complex in Southeast Asia is on the drawing board.

($1 = 88.0400 Japanese yen)

(This story is refiled to fix dateline to YANGON, instead of LONDON, and adds byline)

(Editing by Tom Pfeiffer)

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Comments (3)
Janeallen wrote:
Human Rights Watch estimated that 75,000 Kachin were displaced from their homes in the fighting, recording the razing of homes, stealing of property, torture of Kachin civilians, use of civilians as slave labor, and the rape of Kachin women, all by Myanmar soldiers.

That’s why the 2 are smiling.

Jan 04, 2013 10:20pm EST  --  Report as abuse
Free_Pacific wrote:
Yes Janeallen, many rights abuses. With Chinese weapons to make room for Chinese construction companies.

You are just upset that China might lose some influence and have a harder time working out one sided bsuiness deals. So transparent.

Jan 05, 2013 9:35pm EST  --  Report as abuse
Janeallen wrote:
@fr, the paid Japanese neo-Nazi spy, is out defaming human rights defender again.

I have absolutely nothing to do with the PRC.

Abe’s tail stuck out when he declared the real Japanese intention of everything about his foreign policy — follow the footsteps of the mass murderers he worship, and whitewash Japanese war crimes so that Japan can execute their predatory agenda diplomatically, economically, militarily, and spread the over a century old, highly developed, culture of Japanese defamation.

Yawn. Go tell the Japan spy agency that the world is going to find out about the Japanese mental boot-camp that indoctrinates young Japanese as accessories-after-the-fact for Class I Japanese Nazi-teacher-war- criminals — your deception is busted.

Soon and very soon, our American Government, under Obama, will start chastising Japan for its continual harassment of, and death threats to the Asian Wiesenthals, for documenting history facts of Japanese war crimes for the pure purpose of stopping the continual molestation Japanese propaganda, self-serving fear-mongering, warmongering, does to mislead the conscience of the United States.

I know that the international victims of the Hitler-Japanese axis, numbering hundreds of millions of lost souls, in heaven, are watching you as your practice your malicious defamation culture on Reuters.

Jan 07, 2013 8:53am EST  --  Report as abuse
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