Singapore-based Credera has announced that it will invest US$20m in a stake in a new 5000tpd cement plant in Myanmar, Deal Street Asia reports.
Credera's Myanmar Frontier Opportunities Fund will partner with a foreign cement firm – as yet unnamed – that will bring another US$30m to the deal. The remainder of the estimated US$200m required to build the plant will be raised as debt.
According to Credera, Myanmar currently produces and demands around 4Mt of cement, but the firm expects consumption to rise to 10Mt in the next five years.
"Due to the need of the infrastructure, we believe the demand for cement will be very large in Myanmar," said Gaurav Manghnani, senior portfolio manager at Credera Group.
Changes to Myanmar law means that foreign direct investment now attracts tax incentives, with investment in the least-developed areas of the country eligible for tax holidays of up to seven years. However, Manghnani stressed that the final decision on where to site the plant would be dictated by the availability of resources and infrastructure, particularly in regards to energy supplies.
