Aung San Suu Kyi's party mulling over rethink of China-backed dam in Myanmar: Adviser

Aung San Suu Kyi's (centre) incoming government is rethinking a controversial Chinese-backed dam in Myanmar.
Aung San Suu Kyi's (centre) incoming government is rethinking a controversial Chinese-backed dam in Myanmar.PHOTO: REUTERS

YANGON (AFP) - Ms Aung San Suu Kyi's incoming government is considering a rethink of a controversial Chinese-backed dam in Myanmar and looking for ways to end a military conglomerate's "privileges", according to her party's economic adviser.

Her new government, which is expected to take office in early April, faces a raft of economic challenges, not least the continued financial clout of Myanmar's military, while needing to manage delicate relations with China, its biggest trading partner.

Critics of the former junta long argued that Myanmar's military elite grew wealthy off a cosy relationship with Beijing that granted the giant northern neighbour lucrative concessions with little trickle-down benefit.

Ms Suu Kyi and her National League for Democracy (NLD) have offered few policy details, beyond a broad manifesto, in the lengthy transition period since winning last November's elections with a thumping mandate.

But Mr Hantha Myint, the head of the NLD's economics committee, said voters were expecting tangible change.

"The people have very, very high hopes and then if we misbehave in some way... the people's expectations will be crushed," he told AFP during an interview at the party's headquarters in Yangon.

While underlining that Ms Suu Kyi would make the ultimate decision on policy, he said a potential redesign of the multi-billion dollar Myitsone hydropower project in northern Kachin State was on the cards - comments likely to reverberate in Beijing.

The trained engineer raised fears over its proximity to an active earthquake fault line, but said a compromise could be made to reduce risk.

"If we refuse to build a dam at Myitsone we can build other dams upstream," he added.

Hantha Myint also said it was time for Myanmar Economic Holdings Limited (MEHL) - a military conglomerate that runs business interests as diverse as construction, transport and brewing - to "compete at a level playing field".

"The privileges given to MEHL by the previous government, we will not be able to give them those privileges," he said, adding however that other military financial ventures would remain outside of civilian control.

Ms Suu Kyi has shown a pragmatic streak in dealing with both Myanmar's powerful military and controversial Chinese-backed projects.

She led an inquiry into the Letpadaung copper mine in central Monywa - a joint venture between MEHL and China's Wanbao - following a violent police crackdown on protesters including monks in 2012.

The probe attracted the ire of activists after it recommended construction be allowed to continue in the interest of the economy.

But it also made a host of other recommendations for reducing the impact of local communities that Mr Hantha Myint said the new government would revisit.

Wanbao plans to start production in May, in a move likely to pose an early challenge for the NLD government, which the firm expects to handle continued protests by angry local farmers.

Ms Suu Kyi is banned from becoming president but she has vowed to rule through a presidential proxy, with the NLD expected to announce their candidate for the job on Thursday.