Myingyan Steel millThe Myingyan Steelworks
Burma is looking for FDI to help the steel industry grow
av _abdm = _abdm |||| ;_abdm.push(["1512023572", "InPage", "1512024292", "InPage_1512024292"]); var _abdm = _abdm |||| ;_abdm. push (["1512023572", "InPage", "1512024269", "InPage_1512024269"]); South Korea's Posco Daewoo Steel Co Ltd and Millcon Steel Co Ltd of Thailand are in split talks with the Thai authorities to run a state steel plant in Myingyan, Mandalay, according to a declaration by the Ministry of Industry.
In January and December, Posco Daewoo and Millcon Steel already held meetings with U Khin Maung Cho, Minister of the Ministry of Industry, to explore the various ways of working together. Currently there are two state steel mills in Myanmar. Its second plant is located in Pang Pet, Taunggyi, Shan State.
Since April 2017, however, the plants have been loss-making and operation has ceased. Governments are now exploring ways to re-open these plants with the help of privately owned enterprises in order to further the development of the industry as well. The Ministry also needs to make sure that the local steel production needs to be sustained in order to warrant the long-term investment, said the Ministry of Industry.
The Myingyan plant, called No.1 Steel Mill, has already completed Stage One. Steei Mill No. 2 in Pang Pet was under building with the help of Russia before it was abandoned. As soon as further plan detail is finalized and made available, the federal administration will make the necessary notifications, said U Kan Chun, CEO of No.1 Large Industries Enterprise, which manufactures lightweight and heavier automobiles, under the Ministry of Industry.
The Union Minister for Industry is committed to the Myingyan steelworks promoting the parliamentary support for the annual output of 400,000 tonnes of steel.
After the Myingyan No-1 steel mill is completed, it will be able to produce 400,000 tonnes of steel annually, a resource that Myanmar's industries are desperate for, U Khin Maung Cho, the Union's Minister of Trade and Commerce, said to Parliament. Underlining the importance of the upcoming steelworks, the Union Minister underlined the importance of completing the construction as soon as possible.
"A local manufacturer has great untapped opportunity in the aftermath of a nationwide upturn in steel infrastructures and trade development," said U Khin Maung Cho. Currently, output is restricted to 100 small private companies producing 70-100,000 tonnes of steel per year and a small number of publicly owned companies such as Myanmar Steel.
State enterprise supervision departments are under EU governments' scrutiny as ongoing reporting shows the inefficiency of state-sponsored projects. "We are ahead of schedule and cannot allow ourselves to postpone building, we need the other 39.5 million euros for construction," U Khin Maung Cho asked Parliament.
As soon as the mill is operational, it will be extremely lucrative and the credit can be paid back within 8 to 14 years, the Union Minister estimates. Steel exports are increasing every year, according to the Minister of Trade. This year, 1.56 million tonnes of steel have already been brought in, 60 per cent of it from China.