Junta banks on private gold mines, gems to boost economy

Yangon, October 30:

Myanmar’s military government wants to keep more than half the gold produced from its largest mine, if a plan to privatise the operation goes through, an official said. The government announced two weeks ago that it would privatise at least part of its biggest Kyaukpahto gold mine in the central division of Sagaing. An official from the number 2 Mining Enterprise, which currently operates the Kyaukpahto mine, said today that the mine could produce an average of 19-kg of gold per month.

“Those who are interested in investing in this gold mine have to pay about 12-kg per month” to the government, the official said. “If an investor can produce more than 19-kg a month, the government would take 10 per cent of the extra amount,” he said. The Kyaukpahto mine is the first gold mine in Myanmar to be privatised. A 2002 study by the US Geological Survey estimated the mine’s production quota at less than 25-kg a month. The current junta has taken steps to liberalise the economy since it took power after crushing a pro-democracy uprising in 1988.

Myanmar said in late June that it would sell a 49 per cent stake in 11 factories in Yangon, Mandalay and Magway, as the government tries to raise much-needed cash. The previous military dictatorship had spent decades following the ‘Burmese way to socialism’, which ruined what had been one of the most promising econ-omies in Southeast Asia. Myanmar, which has been ruled by the military since 1962, is one of the world’s poorest nations and is subject to US and European economic sanctions because of human rights abuses and the house arrest of democracy leader.

Myanmar’s neighbours like China, India and Thailand have been increasing their trade with Myanmar, mainly to tap the country’s natural gas reserves to fuel their own growing economies. Meanwhile, Myanmar has sold nearly 3,000 lots of jade, gems and pearls at a recent auction, local media reported today, possibly earning the cash-strapped junta more than $124.2 million. “We estimate that we can earn more from this sale than the previous biggest sale in July,” an official from the Myanma Gems Enterprise said. The Myanma Gems Enterprise has refused to say how much the government earned at its last auction in July, but local media previously put the total at 98 million euros.