YANGON, 15 January 2015: Myanmar’s Department of Civil Aviation says a government proposal to upgrade and privatise 30 domestic airports has been postponed until late this year or possible 2016.
The DCA general director, Win Swe Tun, told the Irrawaddy media that the delay is due to ongoing efforts to transfer three international airports to private management.
The department announced in November 2013 that it would ask for bids to manage 30 out of the country’s 69 domestic airports, but companies would need to upgrade the airports and invest in expensive expansion.
“We are going to transfer Mandalay International Airport to a Japanese firm this March… there are still two airports to finalise before looking at domestic airport tenders, so it will be delayed until the end of this year.”
Last year, the government announced that Japan’s Jalux Inc and Mitsubishi Corp and a subsidiary of local firm Yoma Strategic Holdings, would manage and upgrade Mandalay International Airport requiring an investment of USD100 million.
“So after transferring Mandalay Airport, we need to discuss the takeover of two airports, Yangon and Hanthawaddy. It will take time, we expect that it will all be done this year,” he said.
Singapore’s Yongnam Holdings has been awarded the contract to construct the Hanthawaddy International Airport, at a site about 50 miles north of Yangon. it will cost USD1.5 billion. A subsidiary of the country conglomerate Asia World was awarded a USD150 million contract to upgrade the current Yangon International Airport.
“We want to encourage the private sector to prepare precise master plans for the proposed airports before submitting the applications to us. They still have time, it should include details on the investment and how they plan to operate the airports,” he explained.
According to the DCA, Nyaung U (Bagan), Heho (Inle Lake), Thandwe, Sittwe and Dawei are Myanmar’s busiest domestic airports. They received the most interest from bidders.
At the other end of the spectrum, some airports are not even currently operational due to low passenger demand.
“So we will have to reconsider whether we still need to spend government funds to operate these airports in future,” he said.
According to the DCA, the government currently spends about USD12 million annually on running 69 domestic airports.