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NEWS Last modified on August 12, 2013

Korean consortium to build new Myanmar gateway as country upgrades airport system

The newly opened Naypyitaw International Airport serves capital Naypyitaw.

The government of Myanmar has awarded the contract to construct a new airport for commercial capital, Yangon, to a group of South Korean companies, in a deal worth an estimated $1.1 billion.

In the state-owned New Light of Myanmar newspaper on Saturday, the Myanmar Ministry of Transport announced that a consortium comprising Incheon International Airport was the successful tenderer in a competitive bidding process to build a new airport handling 12 million passengers a year.

The paper also announced that a consortium led by local firm Pioneer Aerodrome Services won the concession to operate the Yangon International Airport and Japan's Mitsubishi-Jalux Inc consortium won a concession to run the Mandalay International Airport.

As part of a series of tenders put up last year in hopes of bringing investment into country's aviation sector, the government invited bids for the Hanthawaddy International Airport, to be built about 80 kilometres away from Yangon in Bago region.

"The Tender Selection Committee duly considered the financial and technical strengths and other relevant factors of the shortlisted tenderers and has selected the tenderer to implement the Hanthawaddy International Airport Project and one other tenderer as back-up candidate," the announcement said.

The winning consortium is all South Korean, made up of the Incheon Airport, Kumho Kumho Industrial Co, Ltd, Halla Engineering and Construction Co., Ltd, Lotte Engineering and Construction Co, Ltd. and Posco Co Ltd.

According to Reuters, an announcement Sunday by the South Korean Ministry of Land, Infrastructure and Transport in Seoul said the winning companies were scheduled to sign a contract with the Myanmar government by the end of the year.

The firms will build the airport by 2018 and operate it for as long as 50 years, Reuters said.

A group comprising Singapore's Yongnam Holdings Limited, Changi Airport Planners and Engineers and Japan's JGC corporation is the back-up tenderer, according to the New Light of Myanmar.

Japan's Taisei Corporation, which built the Iloilo International Airport in the Philippines, and French infrastructure firm Vinci were shortlisted but lost out.

Pioneer Aerodrome Services, part of the Myanmar and Singapore-based Asia World Group, will continue leading the operation of the Yangon International Airport, which has plans to expand its overstretched 2.7-million capacity terminal.

It won the concession in a consortium with China Harbour Engineering Co, Ltd., Singapore's CPG Consultant Pte, Ltd. and Malaysia Airport Consultancy Services Sdn, Bhd.

Mitsubishi and Jalux of Japan and Myanmar’s SPA Project Management Ltd. will operate the 3-million passenger-per-year Mandalay International Airport.

In comments before the announcement, Win Swe Tun, deputy director general at the Department of Civil Aviation, said involving private operators would help bring in the investment needed to upgrade Myanmar's aviation infrastructure.

"Firstly, [we plan] to develop the international airports by the partnership with foreign firms which are capable to invest, operate, maintain as long term concession basis," he said.

"We expect that the concessionaires have plans to attract the aircraft operators and create more routes."

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