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INTERNATIONAL > East Asia & Pacific

Japan readies 100bn yen in lending for Myanmar

  • August 26, 2016
  • , Nikkei Asian Review , 2:00 a.m.
  • English sites

MOTOKAZU MATSUI, Nikkei staff writer

 

YANGON — Japan plans to extend about 100 billion yen ($994 million) in low-interest lending to Myanmar for such projects as railways and water treatment plants, the latest step in Tokyo’s push to bolster ties with the Southeast Asian country.

 

This would mark Japan’s first development financing initiative for Myanmar since Aung San Suu Kyi’s pro-democracy party formed a government in March. Japanese Prime Minister Shinzo Abe will announce the plans during the Sep. 6-8 Association of Southeast Asian Nations summit in Laos.

 

The financing is to fund five projects including repairs to railways connecting Myanmar’s biggest city, Yangon, with the second-largest, Mandalay, in the north. It will also cover water treatment facilities in Yangon, as well as road development in rural areas and other poverty relief measures.

 

Hiroto Izumi, special adviser to Abe, communicated the prime minister’s intentions to Suu Kyi, the country’s de facto leader, on Thursday in Myanmar.

Other countries are eager to get on friendly terms with the new government in Myanmar, which sits at the crossroads of China, India, and Southeast Asia.

 

Chinese President Xi Jinping welcomed Suu Kyi to China last week, offering aid for infrastructure. Indian External Affairs Minister Sushma Swaraj discussed trade and other matters with Suu Kyi during a visit to Myanmar on Monday.

 

Japan has been trying to strengthen ties with Myanmar since the country began a transition to democracy in 2011 after decades of military rule. Tokyo forgave about 500 billion yen in overdue debt in 2012 in a deal with the government of then-President Thein Sein. In July 2015, Japan announced 100 billion yen in loans to develop electricity infrastructure, among other projects.

 

The latest financing is meant to support infrastructure and ease economic disparity between cities and rural areas in line with the aims of Suu Kyi’s government. Japan seeks to distinguish itself from China, whose economic aid is often criticized as irrelevant to local people’s needs. Abe also hopes to welcome Suu Kyi to Japan soon.

 

Often described as Asia’s last frontier, Myanmar is a burgeoning economy expected to grow 8.4% in fiscal 2016 — the most in ASEAN.

 

Japanese companies have been involved in a broad range of activities here since 2011, including industrial park development, mobile phone services and the establishment of a securities exchange.

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