BANGKOK Ministers from Myanmar and Thailand met on Wednesday to show their support for the struggling multibillion-dollar Dawei economic zone in Myanmar and to look for ways to drum up more private sector interest.
"Collaboration on Dawei is of the utmost importance to both our countries. The next step is to invite investment from the state and private sectors," Thai Finance Minister Kittirat Na Ranong said during a break in the meetings in Bangkok.
The $50 billion, 250 sq km (100 sq mile) complex was planned to include a deep-sea port, steel mills, refineries, a petrochemical complex and power plants.
However, Italian-Thai Development Pcl, Thailand's largest construction firm and the parent of Dawei Development Co, has struggled to find the $8.5 billion needed to finance infrastructure and utilities under the first phase.
On Wednesday, Thailand and Myanmar agreed to set up joint committees overseeing infrastructure projects, including a 132-km (83-mile) road stretching from Dawei to the Thai border, plus water and energy needs. Another committee will advise businesses on Myanmar's new foreign investment law.
A follow-up meeting will be held in Myanmar's capital, Naypyitaw, in December.
Funding for Dawei's first phase will be decided in the next three or four months, with Myanmar keen for construction to begin no later than April 2013, said Somchai Sajjapong, chief of the Thai Finance Ministry's fiscal policy office.
In September, sources said Thai banks, led by Bangkok Bank and Siam Commercial Bank, would provide short-term loans to keep the first phase afloat before an expected Japanese loan of up to $3.2 billion was secured.
"There is strong interest from international banking organizations keen to provide investment loans for Dawei," Finance Minister Kittirat said, adding Myanmar and Thailand had not discussed the involvement of a third country.
Thailand is keen to see Dawei get off the ground as it is ideally placed to provide its companies with a low-cost base for heavy industry.
Bangkok approved a $1.1 billion budget in May for Dawei-related infrastructure in Thailand. It included a four-lane highway linking towns in Thailand to Myamar plus government offices at the border and housing for Thais who will work in the zone.
Dawei Development Co said last month it planned to invest more than 1 billion baht ($32 million) on infrastructure in the economic zone to promote light industry.
(Additional reporting by Kittipong Thaicharoen; Editing by Alan Raybould and Ron Popeski)