YANGON, Myanmar – Myanmar’s government has decided to halt construction of a large coal-fired power plant linked to a major industrial development, local news reports and an environment activist said Monday.
Minister of the Electric Power Ministry 2 Khin Maung Soe told reporters at a briefing Monday that the ministry is halting the $8 billion, 4,000-megawatt plant at the Dawei deep sea port project in southern Myanmar because it could have a negative environmental impact.
The Dawei project, undertaken by Thailand’s Italian-Thai Development construction company, is to be a massive heavy industry zone with a total investment of more than $50 billion, and the cancellation of the power plant may hinder its development. Surplus electricity was to have been exported to Thailand.
The minister said the government will also take another look at plans to build a smaller 400-megawatt coal-fired plant.
The decision, if confirmed, would have both economic and political significance. It follows by four months the cancellation of another major foreign investment power project, the Myitsone hydroelectric dam project on the Irrawaddy River in northern Myanmar undertaken by a Chinese company to export electricity to China.
In both cases, the government apparently has been willing to risk antagonizing important foreign investors while currying support domestically. The decision to stop the Myitsone dam project, said to have been in response to domestic concern over adverse social and environmental consequences, was seen as an important indicator of the new military-backed but elected government’s progress toward democratic reforms.
Khin Maung Soe’s comments were reported by the Eleven Media Group and confirmed by several reporters who attended the briefing, but have not otherwise been announced. Members of the Thai business community in Myanmar, speaking on condition of anonymity because they were not authorized to release information, said they have not been informed of the decision, and the news circulated in Thailand after business hours.
Combined with other measures such as the legalization of labor unions and the freeing of some political prisoners, the government hopes to convince Western nations to drop political and economic sanctions imposed on Myanmar due to repression by the previous military regime. Australia on Monday announced a minor easing of sanctions, while the U.S. and Britain have said they are encouraged but more needs to be done.
“This is the second major decision made by the new government in favor of people’s aspirations. We welcome and support the president for the bold decision,” said Lay Lwin, a member of the Dawei Development Association, an environmental group seeking to raise awareness of the ecological impact of the mega-project.
Environmentalists in both Myanmar and Thailand expressed strong concern over the Dawei power plant, which was planned to be built near the country’s pristine Maungmagan beach on the Indian Ocean. Lay Lwin’s group sent an open letter to President Thein Sein in December calling for the government to stop the project because it could have disastrous environmental consequences.
Myanmar is also known as Burma.
