International Finance Corporation (IFC) – the private lending arm of the World Bank – is advising the implementation of Yangon’s first elevated expressway under a public-private partnerships scheme.
The Ministry of Construction and IFC signed an advisory services agreement on January 11 to implement the 20.5-km-long four-lane elevated expressway spanning north and south of Yangon.
The expressway will require an estimated private investment of $350 to $400 million.
The tender winner will be chosen by early 2019 followed by the construction, which is expected to take up to three years. A qualified private sector developer experienced in handling efficient construction, management, operation and maintenance will be chosen through a tender.
The emergence of the new expressway is expected to improve connectivity in Yangon and to pose further benefits across the flow of goods and services connecting the Yangon Region.
“Large-scale investment in infrastructure, especially in key transport areas, is critical for Myanmar’s sustainable economic growth as it improves the country’s access to markets and social services,” said Kyi Zaw Myint, Deputy Director General Planning, Ministry of Construction.
The project will improve connectivity between the Yangon Port and Thilawa Special Economic Zone in the South, and the Yangon International Airport, Yangon Industrial Park and to Mandalay expressway in the North.
Myanmar needs investments up to $48 billion in transportation infrastructure until 2030 and IFC has been encouraging the government to pursue PPP projects.
“With IFC’s PPP transaction advice, the project will be structured in line with international best practices to create a competition-enabling market for qualified investors to come in,” said Vikram Kumar, IFC country manager for Myanmar.
“As the first greenfield road PPP project adopting best international practices in Myanmar, it will set a precedent for developing transport PPP transactions to attract private sector investments. In addition, while improving connectivity and mobility for people and businesses across sectors, it will enhance the country’s competitiveness and productivity.”
The recent PPP project that IFC had advised is the 225 MW combined cycle gas turbine power plant in Myingyan, estimated at $300 million and to be developed by Sembcorp Utilities Pte Ltd and MMID Utilities Pte Ltd. The project was implemented as an example for the government to follow-suit the template, hoping to see more PPPs in Myanmar.
The Myingyan power plant is set to come into operation later this year.