Myanmar has scaled back plans worth USD $7.3 billion to build a Chinese-backed port on its western shore after concerns emerged that the cost of the project could leave the nation in debt.
The initial cost of the Kyuak Pyu deepwater port has now been revised to around $1.3 billion, according to Reuters.
State-run Chinese firm CITIC Group, the main developer of the project, has stated that negotiations are ongoing between Myanmar and China’s government, and added that the revised $1.3 billion was actually to be spent on the first of four construction phases.
In response to Reuters, Geng Shuang, a Chinese foreign ministry spokesman, confirmed CITIC Group’s statement: “According to what I understand … both sides are having commercial negotiations. The talks are progressing.”
Original plans for the 25-metre deep sea port were to build 10 berths, although this number has now been reduced to just two.
In addition to this, Kyuak Pyu would have had a similar container capacity to Manila and Valencia, as well as being connected to a special economic zone for businesses in textiles and oil refining industries.
The port is a component of China’s Belt and Road Initiative (BRI).
Commenting to Reuters on the scaled back plans, Set Aung, Deputy Finance Minister of Myanmar, said: “The new deal ensures that any loans financing this project will not lead back to the Myanmar government but rather they will all be private.
“At the moment, my priority is to ensure there is no debt burden for the Myanmar government and these concerns are now quite limited.”