SINGAPORE, 28 May 2021: A leading hotel group, Banyan Tree, has pressed the pause button on a joint venture project with Myanmar’s Htoo Group that would have established its luxury brands in the country.
In response to email questions from TTR Weekly, Banyan Tree stated: “Due to the present situation, the JV’s operations are not active, and there are no executives from Banyan Tree Group currently in Myanmar.
“We will be closely monitoring every development whilst taking the lead from international organizations to ensure that we uphold our position as a responsible global citizen. Our business mission is to be stewards of natural and cultural heritage in the communities we operate in.”
Commenting on the joint venture project with Htoo Group through its hotel and resort subsidiary, Htoo Hospitality, Banyan Tree added: ” We strongly believe in the long term potential of Myanmar’s tourism and as such signed a joint venture in 2020 with Htoo Hospitality — Myanmar’s largest hotel and resort network and operator of the hospitality school — for the purpose of providing our hotel management expertise to enhance their existing portfolio and capabilities.”
Banyan Tree Holdings Limited inked the 50-50 joint venture with Htoo Hospitality at the height of the Covid-19 crisis, in March 2020, to develop a hotel management business in Myanmar, starting with 17 resorts owned by Htoo Hospitality.
At the time, it was viewed as a major breakthrough for Banyan Tree’s expansion in Southeast Asia. Htoo Hospitality’s properties would gradually rebrand into a new jointly-developed brand for the Myanmar market or one of the prestigious brands from Banyan Tree Holding’s portfolio.
Banyan Tree Holdings executive chairman Ho Kwon Ping personally signed the joint venture agreement with Htoo Group chairman U Tay Za on 16 March 2020. The joint venture, Myanmar Hotel Management Company, incorporated in Singapore, has a paid-up share capital of SGD100,000.
But the link with Htoo Group, a company that comprises more than 40 subsidiaries and a workforce of 40,000, has the potential to become a source of embarrassment for Banyan Tree. Social media channels in Myanmar frequently target the Htoo Group and its founder U Tay Za for allegedly cosying up to the military junta, accusations the group denies.
Last week social media criticism focused on reports from Reuters and the Moscow Times that claimed a military delegation led by Commander-in-Chief of the Myanmar Air Force Maung Maung Kyaw visited Moscow on 20 May. The visit coincided with the hosting of Russia’s largest helicopter trade fair that showcased the latest combat hardware in drones and helicopters at the Crocus Centre in the capital, according to the Moscow Times.
Maung Maung Kyaw is under US sanctions over his involvement in the 1 February coup that seized power from Aung San Suu Kyi’s elected government.
Reuters and the Moscow Times both quoted Myanmar’s Irrawaddy online news service describing the Htoo Group chairman U Tay Za as a “prominent businessman and arms broker,” who may have or may not have visited Moscow around the same time as the delegation.
Irrawaddy claimed that one of the 41 subsidiary companies under the Htoo Group identified as Myanmar Avia Export was “Myanmar’s sole representative for Russia’s Export Military-Industrial Group, known as MAPO, and the Russian helicopter company Rostvertol.”
It was not possible to independently confirm the Irrawaddy news service assertions on Myanmar Avia Export’s commercial role or the travel itinerary of the Htoo Group’s founder.
Banyan Tree’s joint venture partner, Htoo Hospitality, on its website describes its corporate commitment to “drive sustainable, environmentally responsible tourism growth.”
Htoo Group of Companies is a Myanmar holding company established in 1990 as a timber and rice exporter. Today its portfolio has diversified to include construction, aviation brokerage and services, airlines (Air Bagan, Asia Wings Airways), hospitality, agriculture, banking, insurance and financial services, lifestyle and entertainment.
Htoo Hospitality operates 17 hotels and resorts (15 existing properties and two in the pipeline). They include brands like Aureum Palace Hotels & Resorts, Myanmar Treasure Resorts and Malikha Lodge. Projects under development include Kandawgyi Palace Hotel in Yangon and a new resort in the Mergui Archipelago.
The founder’ son, Htoo Htet Tay Za, is managing director of Myanmar’s AGD Bank and holds a BSc in International Hospitality Management from Switzerland’s École hôteliér de Lausanne, one of the world’s top hospitality schools. He is also the main person representing Htoo Group’s interests in the joint venture with Banyan Tree that has a pending mission to establish a new line of Myanmar specific hotel brands as well as Banyan Tree’s up-market brands in the country.