There is some confusion over whether Thailand or China is the biggest source of foreign investment in Burma. But it’s clear that Thai interest is gathering pace: the Saha Group is the latest Thai cash-rich business to enter the hermetic south-east Asian country, announcing a plan to open 25 stores there by 2012.
And Burma offers more than just a untapped market. For Thai businesses, the country also offers respite from the environmental and other corporate standards that exist at home.
The Thai prime minister, Abhisit Vejjajiva, heard as much last month, when he visited the Map Ta Phut industrial estate (pictured), in south Thailand. Seventy-six projects on the estate remain closed, after a court ruling regarding residents’ complaints about leukemia and cancer rates in the area. A business lobby group is unhappy – and handed Abhisit a letter, outlining its grievances over the government’s handling of the case.
Compare that to Burma. where there’s little chance of a court intervening so forcefully. And it’s seemingly with that disparity in mind that Abhisit has hailed a landmark agreement to develop a massive port and road transportation facility in Burma. The deal – at Dawei, beside the Andaman Sea – is between a Burmese company, the state-run Myanmar Port and Development Co., and the Italian-Thai Development Co..
Worth $8.6bn, the project is the single largest foreign investment into Burma to date. It will cover 250 square kilometres, and involve the building of a deep-sea port to be linked to Kanchanaburi in central Thailand by a new highway. The attraction for investors is an overland shortcut to China and east Asia – bypassing the Straits of Malacca, and linking to an as-yet-unrealised labyrinth of Chinese-backed road and rail links in the Mekong region.
Domestic behemoths Siam Cement and PTT Chemicals – which have both been hit by the Map Ta Phut moratorium – have expressed their interest. Burmese businessman Zaw Zaw, who is under US sanctions for his links with Burma’s rulers, is also reportedly involved in the venture, which the country’s dictator, Than Shwe, sees a domestic equivalent
to the China’s Shenzhen economic zone.
The construction deal was signed five days before Burma’s election last month, and it’s noteworthy that Thai politicians have becoming friendlier towards the Burmese ruling junta in recent years. When in opposition, Abhisit’s party was hostile to the military rulers next door – and critical of the then Thai prime minister, Thaksin Shinawatra, for cosying up to them. Such antipathy has now been forgotten.
Under Abhisit, Thailand welcomed the election, despite allegations of ballot stuffing and voter intimidation. According to leaks first published in Chinese state media, the junta’s party has swept 76 per cent of the vote.Show