Myanmar developers let workers go as Yangon high-rise review continues

Construction News Myanmar
Yangon City Development Committee officials inspect a high-rise project in Yangon.
Yangon City Development Committee officials inspect a high-rise project in Yangon.

Two months into a city-wide suspension on high-rise construction, some Yangon developers faced with frozen projects are telling their workers to seek employment elsewhere.

Yangon authorities halted hundreds of high-rise projects in May, over 60 of which had received a construction permit from the previous Yangon Region government.

The subsequent review to make sure the projects comply with draft zoning plans has dragged on, and the first round of results – on the first 12 of the 64 projects to have received a permit before being frozen – only appeared last week.

Many developers, meanwhile, are still paying staff – including foreign experts required for complex high-rise construction – despite work having stopped.

One developer whose firm had started work on a 27-storey project in Ahlone township, which is now under review, said his monthly expenses for workers – foreign and domestic – runs to around K100 million.

This is on top of the interest on bank loans his firm took out to fund the project, he added.

“We have around 300 workers digging foundations,” he said. “Even when the work stopped we paid their salaries.”

The construction firm also provides dormitories for labourers, and with the ban on construction still in effect the situation has become untenable.

“We’ve told them to look for new work,” he said. “But as other construction sites have also been stopped they’ll find it hard.”

U Myo Myint, managing director at MKT Construction, which has over 30 construction projects around Myanmar, said his firm is still paying workers’ salaries on projects where construction had been stopped.

“We’re paying salaries to staff, workers and foreign experts as much as we can,” he said.

Workers hired on longer-term contracts have been allowed to leave if they want, or to work on other MKT construction projects, he added.

The company has enough funds from its wider operations to keep paying salaries on frozen projects for around six months, U Myo Myint said.

He said MKT Construction is also still paying sub-contractors that were hired to work on a range of tasks from water and electric systems to porcelain finishing and stair railings.

U Kyaw Kyaw Naing from i-Green Construction said his company could keep paying its workers’ salaries for another three months, but no longer. The company had already told the workers that salaries would not continue past 12 weeks, but it would be hard for workers to find new work during the rainy reason amid the city-wide suspension, he said.

i-Green is building a 12.5-storey project called Sein Lae Aung Condominium on Sein Lae May Yeikthar Road – one of the 12 buildings already reviewed.

Developers have criticised the review, which they say has left workers without wages, damaged businesses and put the construction industry under great pressure.

They also complain the review lacks transparency, because the criteria for the review have not been made public.

U Khin Shwe, chair of Zaykabar Company and a patron of the Myanmar Construction Entrepreneurs Association, told The Myanmar Times that a list of construction industry grievances – from workers and developers alike – would be drawn up and submitted to the Yangon Region and Union governments.

After the judgement was handed down on the first 12 buildings, U Khin Shwe thinks the other 52 so will face similar instructions.

“Everyone has suffered, but the main issue is that workers will soon be jobless,” he said, adding that he has told the developers of buildings under review to submit reports on their losses to him at a meeting, which he would then take to the government.