Weekly Business Roundup (November 28, 2009)

Rats Undermine Regime’s Rice Export Hopes

An infestation of rats caused by Cyclone Nargis is threatening to devastate rice crops in the Irrawaddy delta—in contradiction of government claims that Burma is set to produce a one million tons surplus for export.

The rat plague—affecting over 700,000 hectares—has developed because the cyclone killed off natural predators such as snakes, dogs and cats, according to the UN Food and Agricultural Organization (FAO).

The FAO estimates that although 2.5 million rats have been exterminated in the past few months, their fast breeding rate means there could be as many as 10 million of them still in the delta.

There are no estimates on the extent of rice crop damage, but an FAO official told the United Nations-sponsored news service IRIN that more funding is needed to ward off “further damage and a possible spread of the rodents to crops not currently affected.”

“If we are to prevent further damage to the monsoon rice crop and damage to the following dry season crops, we must continue the current preventative measures and emphasize an integrated pest-management approach for the coming winter season,” FAO representative Shin Imai is quoted by IRIN as saying.

The regime-linked Myanmar Rice and Paddy Association claimed earlier this month that Burma’s rice exports could reach one million tons for the 2009-2010 fiscal year. That figure would be about 300,000 tons more than Burma claims to have exported in 2008-2009—the year Nargis struck.

Thailand Slump Offers Glimmer of Hope for Salween Dam Opponents

A slump in demand for electricity in Thailand could shelve or slow down plans to build a controversial large hydro dam on Burma’s Salween River.

The global economic slump has hit Thailand’s economy hard and power demand has consequently dropped—by more than 2,000 megawatts over the last 12 months.

That’s more than the entire generating capacity of Burma.

The Electricity Generating Authority of Thailand (Egat) is the leading license holder to build the 1,200 megawatt Hatgyi dam on the Salween in Karen State near the border with Thailand.

Much of the power generated is earmarked to be pumped into Thailand, despite acute electricity shortages in Burma itself.

But Thailand’s energy ministry last week announced that due to the slide in electricity demand it was canceling plans to issue a new round of power plant development licenses in the country.

The cancellation will affect power development plans for the next ten years.

Thailand already has 20 times more electricity generating capacity than neighbor Burma, even though they have similar sized populations.

Many Burmese have little or no access to electricity.

Thailand’s energy oversupply problem emerged as human rights campaigners staged a protest gathering outside the Thai government headquarters this week, urging it to abandon the Hatgyi project.

Many Burmese would be forced to move from the dam’s area and there are concerns about its effects on fishing livelihoods and the environment. 

Singapore Firm gets Burma Gas Pipeline Contract

Singapore’s marine oil and gas engineering firm Swiber has won a contract to build a 150 kilometer pipeline which the Myanmar Oil and Gas Enterprise says will carry gas to Rangoon.

The US $77 million pipeline will be linked to the offshore Yadana field operated by Total of France.

Most of the 780 million cubic feet per day (mcfd) of gas produced by Yadana goes to Thailand, but MOGE says it intends to have 200 mcfd delivered to Rangoon for domestic use by mid 2010.

Work on the mostly onshore pipeline is expected to begin in early 2010, according to the industry newspaper Upstream. It will come ashore at Daw Nyein.

Vietnam Presses its Business Ambitions in Burma

More than 50 Vietnamese businesses have showcased their goods at a trade fair in Rangoon as Vietnam bids to raise its economic presence in Burma.

The fair, featuring producers of goods ranging from cosmetics to fertilizers, follows trade delegation exchanges between the two countries.

Vietnam has been increasing imports of wood, furniture, and seafood from Burma in the last two years, and is seeking to find Burmese markets for its steel, medicines and chemicals.

Two-way trade between the countries grew 11 percent in 2008 over the previous year, but was still only worth about US $110 million.

Burma and Vietnam are members of the Association of Southeast Asian Nations and would benefit from a planned drop in tariff barriers within the association from 2010.