Who will the new $70M USD hospital in Rangoon serve?

Monday’s groundbreaking of a new private hospital, to be built in Downtown Rangoon–at a cost of $70 million USD–has generated visceral outcry among Burma’s medical community.

The hospital has been characterized as a venue to improve healthcare in Burma. However, in Burma, the overriding concern is access to care. Most ordinary citizens don’t have the means to even pay for primary care at local clinics. The World Health Organization’s most recent “Overall health system performance” ranking put Burma second to last among 191 nations, only ahead of Sierra Leone.

And this new project has fueled growing concerns among clinicians that Burma’s healthcare system is rapidly moving toward a two-tiered system, one for the have-alls and one for the have-nots. Just who is the target market for Parkway Yangon Hospital?

Key players

According to press releases, the project is being spearheaded by a Malaysian-Burmese joint consortium that was selected by the Myanmar Investment Commission:

The project would be developed and operated by a joint venture consortium – Andaman Alliance Healthcare Ltd (AAHL), comprising Parkway Healthcare Indo-China Pte Ltd (52.0%), Singapore-incorporated Macondray Holdings Pte Ltd (10.5%), Myanmar-incorporated AMMK Medicare Company Lt (21.5%) and Myanmar-incorporated Global Star Company Ltd (16%).

The consortium’s origins have raised eyebrows among the Burmese speaking community, because of the involvement of Win Aung’s Dagon Group, which has been involved in other key investment projects including the Thilawa SEZ and was not removed from US’s sanctions list until April 2015. Conflicts of interest remain a huge problem. According to Eleven Media:

Andaman Alliance is run by Dagon Group Co Ltd, which is jointly established by Win Aung, president of the Union of Myanmar Federation of Chambers of Commerce and Industry, and International Beverages Trading Company chairman Aung Moe Kyaw.

Lease terms

The favorable terms of this lease have also garnered significant suspicion. The 4.3 acre plot is being leased for a 50 year term (extendable to 70 years), at a monthly rate of 3.389 million kyats (approximately $26,191 USD or a mere $314,292 USD per annum), less than $0.14 USD per square foot, significantly below market value for prime real estate in the middle of Downtown Rangoon. Land prices have risen tremendously, even in the outskirts of Rangoon. With few details to come by, it’s unclear whether the rental prices are fixed throughout the lease–or a profit-sharing arrangement with the Government.

The hospital will be built on the a site owned by the Ministry of Health, on the corner of Pyay and Bogyoke Roads, opposite the New General Hospital, nicknamed the “Japan Hospital” because it was constructed using Japanese development grants.

The bottom line

The Myanmar Investment Commission’s lack of public involvement and ability to scrutinize its vetting and selection process for joint ventures has engendered significant distrust among constituents. Its poor track record of pursuing and negotiating politically unpopular deals in the past doesn’t help–just look at the $300 million USD Dagon City 1 deal that was dismantled only in July 2015 only after significant outcry and lobbying.

One of the greatest challenges for the incoming NLD government will be to rein in and revisit and handle these opaque deals. NLD would do well to enact a national sunshine law requiring government proceedings and documents to be be made available to the public.

One thought on “Who will the new $70M USD hospital in Rangoon serve?

  1. Wagaung says:

    The answer lies in the way people are seated in the video clip – the front row in ostentatious ornately carved chairs then the rest…a two tier healthcare system based on the size of your wallet. Still won’t stop some from flying post-haste to Singapore I guess, a good example set by our dear reformist generals.

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