George Soros (Photo credit: Wikipedia)
Myanmar's transition to democracy has drawn fulsome praise from Western powers who recognise a pivot when they see one. Conversely, the biggest external loser is China, which backed the former junta and was rewarded with sweetheart deals for natural resources. So when Myanmar announced last year that it was opening up its telecoms sector to foreign investment, the bidding process took on a geopolitical flavour. Dozens of companies from around the world expressed interest in entering one of Asia's last untapped telecoms markets. Twelve consortia submitted final bids for two available wireless licenses. One of the strongest pairings, at least in terms of size, was between China Mobile China Mobile and Vodafone Vodafone Group, but they then pulled out, saying the returns didn't justify the outlay. That left a crowded field of operators that spanned the globe, from Jamaica to Singapore and Japan to South Africa. At a time of cheap money and slow growth in developed markets, Myanmar (Burma) is a golden opportunity.
On Jun 27, Myanmar revealed the winners: Norway's Telenor Telenor and Qatar Telecom, which has rebranded as Ooredoo. The latter was a dark horse in the race. On a recent trip to Yangon, I heard repeated claims that Telenor was a strong contender on the basis of Norway's support for democracy in Myanmar, as well as Telenor's regional footprint in Thailand and Malaysia. As to the other license, the smart money seemed to be on Digicel Group, the Jamaica-based operator, which had been on the ground well in advance of other bidders and had promoted its brand with splashy events. Not only did Digicel have a strong local partner in Serge Pun, a real-estate tycoon, it also had a deep-pocketed ally, George Soros's Quantum Quantum Strategic Partners. In the end, this alliance came to nothing. Indeed, all of the bidders with local partners fell short, and the two winning bidders submitted solo bids. This bodes well for Myanmar's promise to create a level playing field for foreign investors. U.S. multinationals are trying to press home their advantage, as I found when I wrote about General Electric's adventures in Myanmar in this magazine piece.
Now comes news that Myanmar has narrowed the field of bidders for the construction of a new international airport outside Yangon. Chinese state media reported Monday that four consortia have been selected to submit detailed bids for Hanthawaddy International Airport, which is due for completion by 2017 at a cost of $1 billion. The Ministry of Transport's civil aviation department said the winner would be announced in July and expected to start work in September, though it's unclear how the deal would be structured. The four pre-qualified bidders include France's Vinci, which has built airports in Cambodia, South Korea's Incheon International Airport Corp. and Korean engineering firms, a Japanese consortium led by Taisei Corp, and a Singapore-Japan pairing. All have local partners.
A noteworthy omission from the shortlist of bidders is an American consortium led by ACO Investment Group, a private-equity fund focused on emerging markets. ACO had its own ace in the pack: Kurt Campbell, the former State Department official who was the Obama administration's point man on normalising relations with Myanmar. In March, ACO announced that Campbell's newly formed consultancy, Asia Group was joining their consortium. Campbell, who quit at the end of Obama's first term, then made a high-profile lobbying trip to Myanmar on behalf of his new paymasters. As revolving doors go, this took some beating. He even had the gall to write a breathless account of flying into Yangon on a commercial flight, instead of Air Force One, and being a participant in Myanmar's economic takeoff.
While Campbell's dash to the private sector is distasteful, he has made a break with public service. Now he wants to cash in on his expertise and contacts. But the role of Soros in the telecoms auction is even more troubling. For over a decade, Soros generously funded the Open Society Foundation's covert programs for human rights in Myanmar, helping refugees and dissidents, and getting under the nose of the former junta. You could argue that such initiatives helped laid the groundwork for democracy and the pivot to the West. After consolidating power, reformist President Thein Sein even invited Soros to set up shop in Myanmar. So for international human-rights activists, it came as a shock to learn that Soros was mixing business with democracy and justice. Yet his financial clout and connections failed to secure a telecoms license. Similarly Campbell's airport consortium is out of the running, whether by choice or not is unclear. Myanmar's political elite seems to be resisting the temptation to reward American carpetbaggers.
Source: http://www.news.myanmaronlinecentre.com/2013/07/02/myanmars-pivot-to-west-is-no-shoo-in-for-u-s-carpetbaggers/
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