Military suspends major Bahan township project

The military has suspended Zaykabar’s lease for a major Bahan township mixed-use project, claiming it has breached the memorandum of understanding.
 
The land is military-owned, but was leased to Zaykabar for the Mya Yeik Nyo project (more recently called Yangon New World in Zaykabar literature).
 
Although there have been several criticisms publicly levelled at the project from different directions, it appears the military decided to freeze the project for two main reasons:
  • Zaykabar has made only two of the promised five land lease payments (totalling $42m) it was to make
  • It is improperty cooperating with a foreign developer
 
Zaykabar had announced it was cooperating with China State Construction Engineering Corporation, specifically from Hunan province in China. It said that due to the lease it could not share equity with the Chinese firm, so instead appears to have drawn up a kind of joint operatorship deal. However, it appears the military claims the project contravened the terms of the lease.
 
Military officials said at a 3 October press conference that it had informed the developer since May that it could not carry out any work. 
 
Myanmar Real Estate and Construction Monitor notes that different media has used different phrasing to discuss the military’s orders. The Irrawaddy claimed in a 4 October article that the project was “terminated”, which implies a full halt, while Democracy Today used the word “halt”. The terminology is important to determine whether the stoppage is temporary or permanent, but according to press accounts that cannot be said conclusively.
 
Zaykabar had also taken criticism from some civil society organisations over its demolition of the former mayor’s house and guest house, both of which were on the plot. Others have been concerned about potential damage to a reservoir, which is crucial for the water supply in Bahan and surrounding townships.
 
The military reportedly claimed it had not given permission to Zaykabar to demolish the buildings, adding that was only to be allowed after a certain number of contracted payments to the military.
 
The military’s public statement comes shortly after Hunan province deputy governor He Baoxiang led a delegation to visit the project, a very public attempt to shore up support for a clearly troubled development.
 
Yangon City Development Committee has also been involved, reportedly not allowing the project to move forward due to the water supply issues.
 
Democracy Today reported that Zaykabar official U Zay Thiha declined to discuss the situation when contacted.
 
The Yangon New World (Mya Yeik Nyo) project is reportedly worth $500m, with 12 high-rise projects. It is separate from the similarly-named Yangon World Trade Centre project, also to be built by Zaykabar and a Chinese partner.
 
The Irrawaddy also noted that Zaykabar head U Khin Shwe’s daughter is married to Thura U Shwe Mann’s son. Thura U Shwe Mann was formerly the parliamentary speaker under the USDP government, but is now close to Daw Aung San Suu Kyi.
 
 
Site as of March 2018. FMR