The Yunnan-based company has been criticised as secretive as some question whether it is equipped to run such a project
One day in late 2018, residents of Namjin, Kachin state, noticed drones fixed with cameras buzzing above their usually quiet village. Then word spread that some people from China were visiting an area nearby.
The outsiders, they learned, were surveying the land on behalf of a Chinese company, which has secured a deal to build a 4,700-acre industrial zone in Myitkyina district that will encompass their village.
None of the residents, not even village administrators, had been told about the $400m project, which will be led by the Yunnan Tengchong Heng Yong Investment Company (YTHIC) as part of China’s Belt and Road Initiative.
Locals and campaigners say the lack of transparency has raised fears that some may lose their homes to land grabbing or that the area will suffer environmental damage.
The villagers make their livelihoods from farming and shifting agriculture, and by felling trees to make charcoal.
Fifty-year-old Kaing Pu, another Namjin resident, says she is fearful she will be kicked off of her 30-acre plot of land to make way for the industrial zone. “I am not hopeful. I am just afraid,” she told Myanmar Now.
Villagers are also worried that factory waste might pollute local water supplies.
“The wells in the village fill up when the stream swells,” said 71-year-old Than Maung, one of Namjin’s 2,000 residents. “If harmful factory waste fell into the creek it would poison the wells where we get our drinking water.”
“We want development,” he added. “But we are concerned... they will only bring in workers from outside and won’t employ locals. I am worried locals will be left out and there will be social problems.”
The project site, much of which is still covered with rubber trees and surrounded by small forests, will be home to about 500 factories and 5,000 other buildings, according to research by the Institute for Strategy and Policy (ISP).
Locals are particularly vulnerable to losing their land to large business since a 2018 amendment to the Vacant, Fallow and Virgin Land Management Law, a recent report by the Sandhi Governance Institute warned.
Critics say the law enables land grabbing by requiring people who have no official documents to prove their ownership to go through a difficult legal process to register their land. Many in Myanmar have had land in their families for generations but do not have official titles.
Tin Oo Yu, chairman of the Kachin parliament’s planning, finance and public accounts committee, says he has not been informed of the details of the project and is worried locals will lose their land.
“China always monopolizes these ventures,” he added.
A May 2018 memorandum of understanding between the local government and YTHIC suggests the company will enjoy highly favourable terms at the expense of the public.
The agreement gives YTHIC the exclusive right to form a joint venture with the government in Myitkyina for 15 years, meaning no other international investment would be allowed in.
Other investment companies would not be able to operate even if the project was delayed or not implemented, said Khine Win, Sandhi Governance Institute’s executive director. “These terms are concerning.”
The project may lead to an increase in the illegal cross-border trade of jade and timber, the Institute’s report warns.
Lack of transparency
The only thing the Kachin state government has made public about the project is the 2018 memorandum. It is not mentioned in YTHIC’s annual report, financial statements, or reports on project expenditures and procedures.
YTHIC is owned by the Yunnan Baoshan Hengyi Industry Group, which is headquartered across the border from Muse in Mangshi, Yunnan, according to research by the ISP.
The parent company’s chairperson, Duan Zhiku, met former finance minister Kyaw Win in Naypyitaw in April 2018 to discuss the Myitkyina project, the ISP says.
The company officials also met commerce minister Than Myint and the officials from the Directorate of Investment and Company Administration in 2017.
The company’s reliability and expertise in developing economic zones are questionable, the Sandhi Governance Institute said in a report published June 10.
Sandhi Governance Institute is a local organization that monitors the joint ventures between the government and private groups. The institute wrote the ‘Myitkyina Economic Development Zone’ monitoring report with help from The Center for International Private Enterprise (CIPE).
Wai Lin, Kachin state’s planning and finance minister, told Myanmar Now that officials are still drafting the contract terms, which will be submitted to the state parliament. The details will be publicly announced before the contract is signed.
“We will disclose everything when the time is right,” he said. He could not say when the final contact would be signed, he added.
The Kachin government spent about $60,000 to hire lawyers from Singapore to ensure the contract terms did not infringe on state sovereignty or economic interests, said Wai Lin.
The project still needs the green light from the Myanmar Investment Commission and Economic Committee.
Chinese companies usually have the upper hand in joint ventures and the government has to give in to their demands, said Dr M Kawn La, chairman of the Kachin National Congress party.
That, he added, is why the contract terms have not been made public.
The government is keeping the project secret because they fear public opposition, he said, meaning the public cannot decide if the project will be beneficial or harmful to them.
“We have to protect our land and our interests,” he said.
Translated by Swe Zin Moe
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