Chinese Investments in Myanmar A Scoping Study A “China Going Global” series publication Global Environmental Institute Investment Trade and the Environment Program Team 2 Chinese Investments in Myanmar - A Scoping Study AUTHORS: Christopher Dunn, Lin Ji and Kui Peng Copyright © 2016 Global Environmental Institute ADDRESS: Tayuan Diplomatic Office Building, # 14 Liangmahe South Road; Building 1, Suite 32 Chaoyang District Beijing 100600, China TELEPHONE: +86-10-8532-5910 FAX: +86-10-8532-5038 E-MAIL: geigeichina ACKNOWLEDGMENTS This report was commissioned by the Wildlife Conservation Society (WCS) with funding support from Norways International Climate and Forest Initiative (Grant No. RAS-2793 QZA-13/0563). DISCLAIMER The contents of this publication are the sole responsibility of the authors and can in no way be taken to reflect the views of the Wildlife Conservation Society or the Norways International Climate and Forest Initiative. 3 TABLE OF CONTENTS FOREWORDS 5 CHINESE INVESTMENT IN MYANMAR 5 SECTORS AND FORMS OF INVESTMENT 7 Mining 9 Hydropower 20 Agriculture 28 Infrastructure 32 Tourism 42 SUMMARY OF FINDINGS, RECOMMENDATIONS b) by way of a joint venture with a Myanmar citizen or the Myanmar Government. Both forms exist for Chinese investments, with most SOEs establishing joint venture projects with large Myanmar 63% 25% 11% 1% Power SectorOil and GasMiningManufacturing8 companies, while private companies usually tend to invest alone or collaborate with Myanmar local companies, often related to Chinese decedents. FIGURE 2 NUMBER AND TYPOLOGY OF CHINESE INVESTMENTS IN MYANMAR 9 MINING Following analysis of the data summarized in Table 3, a total of 7 mining projects with 13 Chinese parent and subsidiary companies are identified with interests in Myanmars mining sector. These companies can be classified into three distinct groups, as follows: 1) SOEs with investments in large-scale mining projects; 2) Specialized SOE subsidiaries providing engineering and other contracting services; 3) Private companies with investments in small-scale projects and conducting exploration. Most identified mining projects are medium to large in scale1 and have Chinese SOEs involved, therefore their information is comparatively easier to acquire; while upon conversations with the Chinese Chamber of Commerce (CoC) in Myanmar, there are much more small enterprises or even individual investors from China, mostly Yunnan and Sichuan provinces, investing in small-scale mining projects in central, north and north-eastern parts of Myanmar, whose detailed information are hard to collect. 1 Defined by investment amount projects between US$30 million and US$200 million are considered as medium scale projects, while those over US$200 million are large scale projects. 10 TABLE 3 CHINESE COMPANIES IDENTIFIED WITH INTERESTS IN MYANMAR'S MINING SECTOR Company Name Company Type Company Role Local Partner Project Name Project Location Project Status China Nonferrous Metal Mining (Group) Co., Ltd. (CNMC) Central SOE (CSOE) Investor Myanmar No. 3 Mining Enterprise (50% share in the project) Tagaung Taung Nickel Mine Thabeikkyin Township, Mandalay Region Operational Taiyuan Iron and Steel (Group) Co. Ltd. (TISCO) SOE Investor China Metallurgical Group Corporation SOE N/A China ENFI (China ENFI Engineering Co., Ltd. and China ENFI Engineering Corporation) Subsidiary company Contractor (design, equipment supply, construction support and commissioning) China North Industries Corporation (NORINCO) SOE Parent company N/A N/A N/A N/A Wanbao Mining Co., Ltd. Subsidiary company Investor N/A N/A N/A N/A Myanmar Wanbao Mining Copper Limited Overseas subsidiary Local operating company Myanmar No. 1 Mining Enterprise (51% share in the project) Monywa Letpadaung Copper Deposits Sagaing Region Under construction Myanmar Yang Tse Copper Limited Unknown Local operating company Unknown Monywa Sabetaung and Kyisintaung Copper Deposits Sagaing Region Operational China North Industries Corporation (NORINCO) SOE Parent company Myanmar government (20% share in the project) Mwetaung Nickel Mine Tiddin Township, Chin State Advanced stages of exploration (feasibility study completed) China North Industries Corporation (NORINCO) SOE Parent company N/A N/A N/A N/A 11 Wanbao Mining Co., Ltd. Subsidiary company Investor N/A N/A N/A N/A Myanmar Wanbao Mining Copper Limited Overseas subsidiary Local operating company Myanmar No. 1 Mining Enterprise (51% share in the project) Monywa Letpadaung Copper Deposits Sagaing Region Under construction Myanmar Yang Tse Copper Limited Unknown Local operating company Unknown Monywa Sabetaung and Kyisintaung Copper Deposits Sagaing Region Operational China North Industries Corporation (NORINCO) SOE Parent company Myanmar government (20% share in the project) Mwetaung Nickel Mine Tiddin Township, Chin State Advanced stages of exploration (feasibility study completed) Wanbao Mining Co., Ltd. Subsidiary company Investor Zijin Mining Group SOE Parent company Jinshan (Hong Kong) International Mining Company Subsidiary company Investor China Metallurgical Group Corporation SOE Investor Unknown China ENFI Engineering Co., Ltd. Subsidiary company Conducted feasibility study China National Heavy Machinery Corporation SOE Contractor (design, equipment supply, technical instruction for erection, commissioning, technical training) Project owned by Shan Yoma Nagar Co. Ltd Tigyit coal mine Pinlaung township, Southern Shan State Operational China Minghua Group LTD Private Investor Unknown Kalonta tin mine 24km NNE of Dawei, Tanintharyi region Operational North Mining Investment Company SOE Investor Unknown Mway Taung Phar Ttaung copper mining project Chin State Feasibility study proposal submitted