Quarterly Business Magazine

Japanese-Singaporean Company Given Contract for Hanthawaddy International Airport

Posted :
Thursday, October 30, 2014

Yangon – Tender Evaluation Committee for the Hanthawaddy International Airport project, having selecting the Korean-based Incheon Company ten months ago, decided to replace it with a Japanese-Singaporean joint venture company to implement the project.

The selected joint venture, Yongnam-CAPE-JGC Corporation was given the second priority previously. It was chosen to replace the Korean company because the government could not meet the requests by the latter.

In the application stage, the Korean company promised to build Hanthawaddy International Airport to handle 12 million passengers annually. However, during the tender negotiating process, the airport’s capacity was reduced to 10 million per year. As a result, the Japanese-Singapore company was selected.

“The Korean company demanded compensation from the government if the operating profit from the airport doesn’t reach its target. So we went through the tender process again and chose the Japanese company instead,” said U Win Swe Tun, Director General of the Department of Civil Aviation, at a press conference on October 29th.

People close to the Ministry of Transportation believed that a Japanese company was given the tender because the Japanese government had been providing much-needed assistance to Myanmar’s transportation sector and others.

In addition, although Incheon International Airport Corp enjoys good reputation around the world, its representative team in Myanmar consisted of brokers and middlemen only, said a marketing manager from a local airlines, who does not want his name revealed.

According to the Department of Civil Aviation, the Hanthawaddy International Airport project—located 46 miles from Yangon on a 9,000 acre land and initially planned in 1994—is likely to be finished in 2019 and start operation in 2020.

After the news of giving the project tender to Korea’s Incheon had confirmed the project’s certainty, the land price around the proposed airport skyrocketed. However, the land price also fell when the news came out that the project would be paused, says U Soe Myint, owner of Bago-based real estate company Layaung.

“Well, the project is certain again, so it will be good news for those who have bought the land in the area,” he said.

Bago-based real estate agents said that only a few transactions happened during the ten months after the government selected the Incheon International Airport Corp.

The Yongnam-CAPE-JGC that is given the tender for the airport project has constructed many airports in major cities around the world, including Singapore’s Changi International Airport.

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