Water wizards

What’s your opinion of the situation in Myanmar since the reforms began?

I’m not the Minister of Foreign Affairs. If trade sanctions are lifted against any country we’ll go there and bring Dutch companies with us. Doing business in Myanmar is fine. In my official meetings this week I didn’t discuss the transition or democracy, although in informal conversations I touched on the subject. I’m here mainly because our embassy in Bangkok signalled in 2012 that Myanmar was opening up and that there were many opportunities in the field of water management. My first visit in early 2013 was about getting to know each other and explaining what the Dutch can do. This led to the signing of a Memorandum of Understanding in May 2013 between the Dutch government and the government of the Republic of the Union of Myanmar. We became the partner with which Myanmar wants to develop integrated water resources management policies.

What is the scope of the MoU?

The first pillar is a national, integrated water resources management study that a group of Dutch experts will undertake. The result will be a report comprising several building blocks. These will form the basis for a national master plan, which the Myanmar government should write itself.

The Japanese have no qualms about telling Myanmar how to plan for the future. In fact the Japanese International Cooperation Agency has written several master plans. What is holding you back?

Our style is different. Paramount to us is that Myanmar grows and develops the capacity to deal with water issues itself. That’s the second pillar of our MoU: capacity building. We designed a program to educate civil servants and several Dutch companies and the Delft University of Technology and Shell offer scholarships. Royal HaskoningDHV and Damen Shipyards [a Dutch company that operates about 50 shipyards around the world] both provide education opportunities for Myanmar graduates.

And the third pillar is?

No-regret [relatively risk free] projects we can start right now. Our first no-regret project will be a pilot on the Irrawaddy River, near Bagan. The Irrawaddy is the life artery of the country. But the river needs work. There’s so much to do: dredging, controlling the flow of the river, port development and environmental issues to be resolved. We said: ‘Let us take on 70 kilometres of the river and do five things very well’. We will build groynes that interrupt water flow and limit the movement of sediment, for instance. We can also use them to generate electricty on a small scale, with the local communities taking responsibility. We will also beautify the river banks, which will benefit tourism and get hotel chains interested.

It seems relatively small scale.

The pilot enables us to show how the Dutch operate and what the benefits for the community and private companies are, for example in terms of jobs. Currently we’re arranging the funding. The pilot will cost about $20 million [about K19.4 billion]. Private investors as well as the World Bank are going to provide the necessary funding. The project will serve as a best practice for other projects to come. I hope we get approval fairly soon.

What does the green light for the pilot project depend on?

Funding, of course, but also permits and guarantees regarding energy prices. The authorities still have some work to do.

How have your talks with Myanmar government ministers been?

Very positive, although the elections are looming. Cabinet ministers want to have something tangible to show to their electorate. The short-term is to some ministers more interesting than planning ahead. Civil servants on the other hand are focusing mainly on the master plan. They take the long view. The question I was repeatedly asked by Myanmar ministers was: When is it going to happen? My answer is: We are ready to go, but we need you to deliver first.

Did you meet members of opposition parties during your visit?

I mainly focused on my contacts with the government. My colleague Lilianne Ploumen, the Dutch Minister for Foreign Trade and Development Cooperation, spoke with Daw Aung San Suu Kyi earlier this year. Our ambassador Joan Boer is also regularly in touch with her.

Many foreign companies have adopted a wait and see attitude and will not decide whether to invest in Myanmar until after the general election in 2015.

I think it’s better to be here now. It shows we are serious, even though for companies there are certain risks involved. We can’t be 100 percent sure what the political developments next year will bring. I think the water resources developments in Vietnam are indicative of things to come in Myanmar. I spoke to the managing director who is responsible for inland shipping. He said: I have to replace the entire fleet, but there are no qualified shipyards in Myanmar. Can you help us out? Well, in Vietnam the Dutch firm Damen Shipyards started a modest operation years ago. It now employs 5,000 locally trained workers in Vietnam.

The World Bank, the Asian Development Bank and organisations such JICA are the main providers of development funds. Are big loans the way forward for Myanmar?

In the end you want Myanmar to be able to fund its own water projects. In the Netherlands we have a Delta Fund. Until 2020 the government will deposit €1 billion [about K1,312,440,325,000] in it every year. It enables us to finance long-term projects. The stability that government involvement guarantees is attractive to private investors as well. Myanmar is a resource rich country. It should be able to use a model like ours in the future. My advice would be: deposit a percentage of the gas revenues in a fund and use the money to enhance the Irrawaddy River. This way the Myanmar government will have more control, too. There will be no need anymore to wait for plans and money from foreign partners.

Are you expecting the Dutch to get all the water management work?

There is so much to do. We probably won’t take on the whole Irrawaddy River. What is important is an integrated approach, the full picture. In the Netherlands we take into account technical issues as well as sustainability and funding. Can projects become financially self sustaining, for instance? Questions like these should be considered in the planning phase. Myanmar is a greenfield, which gives you the opportunity to do everything right the first time around. Holland is a country beneath sea level. We learned about water the hard way. Noblesse oblige. We want to share our knowledge. The second reason to get involved is trade, of course. There will be tenders, but our pilot project is a nice visiting card. Also, some dams have been halted lately. It might be interesting for Myanmar to show it’s possible to generate electricity without dams.

Integrated policies can be a challenge to implement if many ministries are involved. Will this be a problem?

We’ve visited the most important ministries involved in water issues. A positive sign is that a national level Water Resources Committee was formed, led by Vice President U Nyan Tun. In this committee all the ministries involved are working together. Still, I’m fully aware that the way water issues are spread out in Myanmar is fairly unique. It’s pretty complex. Nonetheless, integrated water resources management is our trademark, the product we sell worldwide. In our Dutch approach we combine technology, sustainability, governance and finance.

Governance might be a sensitive area in which to offer advice.

That’s one of the reasons we’re quite happy the Vice President is enthusiastic about water management. He always says: If there’s anything I can do to help, just say so. Every official I have talked to was very clear about what is wanted. Among them were the Minister of Environmental Conservation and Forestry and the Minister of Livestock, Fisheries and Rural Development. I spoke to the Minister of Agriculture and Irrigation while I was in Singapore, just before my visit to Myanmar. To illustrate how warm relations are, I was told that President Thein Sein will probably visit the Netherlands in September.

Proposals for dams on the Thanlwyin River have angered ethnic minority groups, partly because the Tatmadaw will probably be deployed to secure the project area. Have you discussed this sensitive issue with cabinet ministers?

No, I haven’t. I know there are sensitivities in water management, although I wasn’t aware of the ethnic component. And sure, political risks exist. Nobody knows how the elections will turn out. Not doing anything is not an option, though. For centuries the Dutch have taken to the sea to find out where they could trade. Only when countries are not recognised by the international community or when severe human rights violations…

Like those in Rakhine?

Well, trade sanctions have been lifted against the country as a whole. Indeed, in some regions complex issues remain unresolved. Personally I think it’s better to be present than to wag our finger from the sidelines. Being there is the optimum way to get people acquainted with other ways of thinking.

Is there a risk that after all the work the Netherlands is doing other countries will get the contracts Dutch companies are craving?

There’s always a chance that might happen. But the pilot will demonstrate we are capable and diligent. Sometimes resources-starved countries are prone to accept ‘gifts’, like an offer to buy up a bad harvest in return for big dam projects. This is not the way we do business. Myanmar is potentially one of the richest countries in the region. It is less prone to be seduced this way. I think in the end trustworthiness and knowledge will be decisive for the Myanmar government.

Did your mission yield the results you hoped for?

I’m quite happy. [The Irrawaddy delta] is the only large delta in the world in which the Dutch are not yet active. Since trade sanctions were lifted, Myanmar has virtually been jumped upon by everybody. So we are in a bit of a hurry. I want to transfer our knowledge as quickly as possible and to be taken seriously. I have urged Dutch companies to come up with tangible projects. My aim was to realise a productive follow-up after the initial contact last year. In November we supply the building blocks for a nationwide IWRM strategy. After that it’s up to the Myanmar government to come up with a master plan.

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This Article first appeared in the June 26, 2014 edition of Mizzima Business Weekly.

Mizzima Business Weekly is available in print in Yangon through Innwa Bookstore and through online subscription at www.mzineplus.com

Water wizards