Weekly Business Roundup (December 08, 2008)

By WILLIAM BOOT

Chinese Begin Dam Construction in Kachin State

Thousands of people are set to lose their homes and a fragile ecosystem is now under threat due to construction under way of river dams in Burma’s northern Kachin State.

Burma's military government, in collaboration with China Power Investment Corporation (CPI) and Burma’s junta-friendly Asia World Company Ltd (AWC), is to construct at least seven dams on the rivers Mali Hka and Nmai Hka, with the electricity generated from the dams sent via China’s Yunnan power network to feed the western region and the eastern coastal areas of China.

The electricity revenue to the Burmese junta from China could run to about US $500 million per annum—but is not expected to improve Burma’s power grid.

According to the Thailand-based Kachin Development Network Group (KDNG), the Burmese junta’s Ministry of Electric Power No1 and CPI have agreed to generate at least 3,600 megawatts of electricity from the hydroelectric projects.

Work is already underway—eyewitness reports from the area say that roads are being constructed using bulldozers and excavators and the AWC has sent in geologists to begin inspections at three different locations along the Nmai Hka watercourse between Chibwe and Sawlaw towns.

Under the watchful eye of the Burmese army’s No 121 Infantry Battalion, more than 1,000 AWC construction workers have set up temporary camps at the project site and dynamite explosions underneath the riverbed have been heard with increasing frequency over the past two months, according to local villagers.

It is estimated by the KDNG that up to 47 villages will disappear while the dams will have a dramatic impact on fluvial biodiversity and plant life while flooding vast areas of pristine forest.

Burma-Bangladesh Border Reopens after Sea Dispute

Border trade between Burma and Bangladesh has resumed after a row between the two countries over their maritime boundary saw tensions rise in a naval standoff and increased border troop deployments.

However, over the last few days heavily laden Burmese cargo boats from the coastal region have once again been entering the Bangladeshi port of Teknaf.

Burma exports an array of everyday goods into Bangladesh including umbrellas, rope, Chinese-made batteries and ersatz cosmetics, all of which enter the port of Teknaf.

The tensions also disrupted a lot of other, illegal cross-border trade.

Timber and teak are smuggled across the border from Arakan, their journey made possible by substantial bribes paid to local army chiefs who turn a blind eye to the destruction of Burma’s natural resources. Officially, Burma does not allow the export of teak and timber into Bangladesh but endemic corruption and desperation render the law virtually meaningless. In the past, arrests have been made and contraband seized but the trade continues unabated.

Large quantities of medicines are imported into Burma illegally through Teknaf, the majority ending up in Burmese markets throughout the impoverished country.

But some aid agencies have noted that some of the drugs imported into Burma through Teknaf are fake and dangerous.

Thailand Draws Blank in Gas Search

In a rarely admitted failure, Thailand’s PTTEP oil and gas explorer has abandoned exploratory drilling in an offshore well in the M-7 Block in Burma’s Gulf of Martaban.

PTTEP, majority owned by the Thai government, admitted that the nearly US $25 million venture had failed to find commercial quantities of gas, despite drilling to a depth of more than 3,000 meters.

The M-7 Block is adjacent to M-9, a block which PTTEP also holds, in a new partnership with Chinese state firms, and which has been found to hold large reserves of gas.

Burma’s junta controlled Myanmar Oil and Gas Enterprise is a silent partner in both blocks.