The document discusses the Kyaukphyu Special Economic Zone (KPSEZ) in Myanmar. It notes that the KPSEZ is located on Ramree Island and includes an oil and gas terminal, pipeline, container port, and power plant. Concerns raised include a lack of transparency in the bidding process, inadequate consultation and compensation for the 20,000 people displaced, and potential environmental and social impacts including damage to coral reefs and increased tensions between local communities and foreign workers. Advocacy groups like Oxfam and the Special Rapporteur on Human Rights in Myanmar have urged for more strategic planning, assessments, and benefits for local communities from the KPSEZ's development.

1. Kyaukphyu
Special economic zone
KPSEZ
Pham Van Dung
25 June 2018

2. Overview SEZs
• Chinese SEZs is viewed as
successful overall
• Most SEZs in Africa are
unceccessful, dedicated to
mining
• SEZs in the ‘CLMV’ countries:
unclear rationale,
‘agglomeration economy’
approach based on industrial
clusters
• Most SEZs in Cambodia are
stand-alone areas aimed at
manufacturing

3. Kyauk Phyu SEZ location

4. Background
• KPSEZ is in central western coast of Myanmar on
Ramree Island, Rakhine State
• An oil and gas terminal
– Financed by the China National Petroleum
Corporation
• A pipeline linking Myanmar and China
• A container port and gas-turbine power plant
• Attractive to Chinese investors
– Strategic location - quickest trade route by sea
between India and China

6. Background
• Announced in September 2013
• The 12 competing companies were interviewed, discussed
in February 2015
• Local firms complained of a lack of domestic competitors,
with most bid finalists from China or Singapore
• Government awarded tenders to the Chinese conglomerate
CITIC
• SEZ construction started in 2015; seaport started in 2017
• For industrial, logistics, and service industries, processing
local resources (agricultural goods, minerals)
• To rival Singapore as the regions petrochemical hub

8. Project area occupation

9. Project time frame

10. Planning and challenges
• Textile and clothing industries – not near big cities
• Food and processing industries – road linking other
regions
• Tourism vs. industry, question of local involvement
• Incentives to investors – local benefits?
– Max 75 years land lease
– Income tax exempt for the first 8 years of operations
– 50% income tax relief for the following 5 years
– customs duty exemptions for importing construction
materials, vehicles, and other items
– Government invests in the surrounding infrastructure

11. Consultation?
• Rakhine State Parliament had not been
adequately informed about the SEZ plans
• People have received very little information
about the SEZ and its potential impacts
• Affected people and the public lack access to
information of land acquisition
• Stakeholders showed insufficient
transparency

12. Consultation?

13. Impacts
• 20,000 people are facing involuntary resettlement in
Kyauk Phyu
• Compensation remains a flawed process, it does not
reflect true value of land
• Communities don’t understand the process of
compensation
• Meeting with CITIC representatives, locals were
informed that they would not be compensated if they
did not hold an official “Form 7” land title
• Many villagers tried to register their farmland, but
their applications were not accepted by local officials

14. Available land? from whom?

15. Whom will local ancestral endowment
serve?

16. Impacts
• Local people faced severe difficulties as fishing and
transportating boats are prohibited
• Before: a man could feed his family and sell the surplus.
After confiscation, he could take sporadic work
• Land speculation; rise prices for land and basic
commodities
• Discourage responsible investors and encourage
unscrupulous investors
• Influx of foreign workers, locals get casual labour during
construction

17. Impacts
• Locals are fearful of and hostile to foreign investors due
to the negative impacts of oil and gas terminal and
pipeline
• Concern about the cultural impact and safety of women
and girls
• South-East Asia oil and gas pipeline and terminal facilities
caused land grabbing and displacement
• Plus harmful social impacts and great tension between local
communities, investors and workers
• Illegal transfers of land and access right
• Destruction of coral reef (due to dynamiting) and other
habitat, and depleted fish stocks

18. Research & Advocacy
• Oxfam
– Assess impacts of SEZs
– Suggest undertake mechanisms to ensure benefit
everyone in Kyauk Phyu – and beyond
– To carrying out a Strategic Environmental Assessment
(SEA) -> strategic planning
– To conform to the World Bank Policy on Involuntary
Resettlement and FPIC
– Urge to establish operational complaints and
grievance mechanisms to prevent disputes
– Skills training to enable people to access jobs or other
benefits

19. Advocacy
• Special Rapporteur on the Situation of Human
Rights in Myanmar
– All SEZs had affected communities negatively
– Projects have not been implemented in
transparency and not in accordance with the law
– Locals received few benefits from the port and
pipeline
– Land acquisition activities took place before
related proper assessments

20. Urges halt to SEZ expansion
• Involvement of the International Commission of Jurists
(ICJ), Oxfam and other CSOs
• Reasons to halt SEZ:
– SEZ Law undermines the protection of human rights
– Critical legal procedures are poorly implemented
– Thilawa and Dawei SEZs prioritise profit over the welfare
of the local population and workforce
– Not yet job guarantee for resettled people, while
minimum wage cannot protect livelihood
– Defend human rights in order to prevent from ethnic and
religious conflicts (Kaman, Rohingya ethnic groups; Muslim
& Bhudism)

21. References
• Aung, N.L. 2015. Winner postponed for Kyaukphyu. Retrieved:
https://www.mmtimes.com/business/property-news/12840-winner-postponed-
for-kyaukphyu.html
• Baffa, C. 2013. Special Economic Zones in Myanmar. Retrieved:
https://www.aseanbriefing.com/news/2013/06/28/special-economic-zones-in-
myanmar.html
• Chau, T. 2017. SEZ impact on communities must be addressed: Yanghee Lee.
Retrieved:
https://www.mmtimes.com/news/sez-impact-communities-must-be-addressed-
yanghee-lee.html
• ICJ. 2017. Special Economic Zones in Myanmar and the State Duty to Protect
Human Rights. Retrieved:
https://www.icj.org/wp-content/uploads/2017/02/Myanmar-SEZ-assessment-
Publications-Reports-Thematic-reports-2017-ENG.pdf
• Mcivor, N, & Scharinger. 2017. Responsible investment in Kyauk Phyu Special
Economic Zone. Retrieved:
https://www.mmtimes.com/opinion/25067-responsible-investment-in-kyauk-
phyu-special-economic-zone.html

22. References
• Oxfam. 2017. Responsible Investment in Myanmar: Lessons from experiences of
SEZ developments. Retrieved:
https://myanmar.oxfam.org/sites/myanmar.oxfam.org/files/file_attachments/dp-
responsible-investment-myanmar-sez-250117-en.pdf
• Phillips, K. 2017. Legal advocacy group urges halt to SEZ expansion.
Retrieved:
http://www.dvb.no/news/legal-advocacy-group-urges-halt-to-sez-expansion/
74409
• Road Show. 2014. Effective and meaningful multi-stakeholder engagement.
Retrieved:
http://kpsez.org/wp-content/uploads/2014/07/Multi-stakeholder-Engagement-sg-
roadshow.pdf
• Road Show. 2014. Kyauk Phyu Special Economic Zone development.
Retrieved:http://kpsez.org/wp-content/uploads/2014/07/KPSEZ-Road-Show1.pdf
• So Phyo Win. 2017. MoU on Kyaukphyu SEZ likely in August. Retrieved:
https://www.mmtimes.com/business/27137-mou-on-kyauk-phyu-sez-likely-in-
august.html

23. Thanks for your attention!