Yangon – In order to help both foreign and local investors avoid steep land prices in industrial zones, the Ministry of Industry is planning to build factories for rent.
According to Deputy Minister of Ministry U Thein Aung, due to prohibitive land prices in industrial zones, his ministry is working together with respective regional governments to build and rent factories to both foreign and local investors.
“The land price issue here couldn’t be solved by simply building and renting factories,” said U Myat Thin Aung, Chairman of the Management Committee for Hlaing Tharyar Industrial Zone.
According to local businesspeople, the cost of building a factory is higher than renting a plot; therefore, to reduce land price, the government should refund plots that are not operating and rent them to genuine businesses at the government price instead.
According to U Myat Aung, the high land prices in industrial zones are due to the existence of plots that do not have any functioning factory on them.
Throughout Myanmar including Yangon, there is an abundance of this kind of plots in industrial zones. Out of 10,000 acres of industrial land in Yangon region, about 2,400 acres are such plots.
A committee was once organized under the leadership of the vice president to refund and reclaim these plots at the original purchased prices.
Moreover, Deputy Minister for Industry U Thein Aung also stated that a fine would be imposed on industrial zone lands that cannot implement the proposed projects within the timeframe.
“Most of the owners won’t care about fines since the land price is rising year by year,” said a factory owner in Hlaing Tharyar Industrial Zone (4).
Currently, real investors in manufacturing, both local and foreign, are facing the issue of high land prices since they have to buy industrial plots from the price-gouging owners.