Dawei port agreement: A highlight in Russia – Myanmar strategic partnership

By Tun Mon Thet, Phyo Lin Aung, 02-Mar-2025 | NPnews 

In a significant move toward strengthening bilateral relations, Russia and Myanmar reached an agreement on February 23, 2025, to jointly invest in the Dawei Special Economic Zone (SEZ) featuring a deep-sea port and oil refinery, a landmark moment in the economic cooperation between the two nations.

Dawei Special Economic Zone (SEZ) featuring a deep-sea port and oil refinery, a landmark moment in the economic cooperation between the two nations.

According to various news reports, the signing took place at the fifth Myanmar-Russia Intergove­rnmental Trade and Economic Coope­ration Commission session, which was held in Naypyidaw, Myanmar, among senior government officials of the two countries. Russia’s Economic Devel­opment Minister Maxim Res­hetnikov and Myanmar’s Minister of Investment and Foreign Economic Relations Dr. Kan Zaw signed the agreement.
Dawei Special Economic Zone, which stretches along the eastern seaboard of Myanmar in the Andaman Sea, spans 196 square kilometers. The ambitious project will construct high-tech industrial estates, transport hubs, information technology parks, and export processing zones, turning Dawei into an important driver of regional economic growth. The Dawei port, to be located in Myanmar’s Tanintharyi region, is set to become a big gateway for trade, not only in Myanmar but also for the broader Greater Mekong Subregion, which includes Cambodia, Laos, Thailand, Vietnam, and China. Its proximity to Bangkok, which boasts a well-developed road network linking them, only serves to enhance its strategic importance, especially for Thailand’s containerized trade.
The plans for the Dawei port include ambitious 10 million tonnes capacity, alongside an oil refinery to process 100,000 barrels of oil per day. All such investments are aimed at turning Myanmar into a Southeast Asian hub of energy, commerce, and industry for the common good of Russia and Myanmar.
Russia and Myanmar’s growing partnership
Since Myanmar declared a State of Emergency in 2021, the country has faced international isolation and condemnation. In this context, Russia has emerged as one of Myanmar’s closest allies, providing diplomatic backing. As the State Administrative Council (SAC) government, faces mounting sanctions, Russia has been one of the superpower nations that share with Myanmar thick and thin.
Most notably, Myanmar has been increasingly reliant on Russian imports of oil since 2023. The coll­aboration has even extended into defense, as the two nations have inte­nsified mutual cooperation in the form of naval base visits, maritime security exercises, and increased defense cooperation. The two governments are now looking to expand their energy cooperation, including the construction of a gas pipeline to Yangon and the establishment of a nuclear research center for electricity generation. Mo­reover, Russian nu­clear company ROSA­TOM is also considering suppl­ying Myanmar with Small Modular Reactors (SMRs), with Yangon even opening its first Nuc­lear Technology Information Centre, supported by Mos­cow, in February 2023.
The Russia-Myanmar connection is not purely economic and energy co-operation. It is also geo-political, and Russia also has a role to play in putting Myanmar in the limelight as an influential regional actor. If the project for a Dawei deep-sea port ever goes forward, it would make Russia have an enormous footprint in Southeast Asia. The port would become Russia’s ocean gateway to Southeast Asia, granting not only trading opportunities but strategic and military leverage, as Russia has minimal influence in Southeast Asia compared to the other great world powers. From this project, Russia could also improve its position geopolitically, utilizing the strategic location of Myanmar.

Russia’s broader Southeast Asian agenda
The Dawei project is part of a broader agenda by Russia to increase its footprint in Southeast Asia. Beyond Myanmar, Russia is pursuing other infrastructure projects in the region, including a significant military and development project in Laos. Russia is building an airport and military base in Laos, further increasing its strategic ties with the country. The airport will be employed for civilian as well as military flights, augmenting Russia’s presence in the region and boosting bilateral trade and cooperation.
Russia is expanding its presence in Southeast Asia through infrastructure and military efforts and positioning itself as a new power in the region. The expanding network of Russian projects and investments reflects Moscow’s desire to diversify its influence and secure valuable strategic footholds in the Asia-Pacific.
As Myanmar and Russia increasingly strengthen their economic as well as political ties, the Dawei deep-sea port is a milestone in this new relationship. Successful project development would provide Russia with a crucial sea gateway to Southeast Asia and further strengthen its presence in the region. For Myanmar, Dawei port would be a game-changer that would position the country in the center of Southeast Asia’s future geopolitical and economic picture.
The Russia-Myanmar rel­ationship is the best example of shifting Southeast Asian foreign relations dynamics. Russia boosts its regional presence as Myanmar will become an increasingly valuable strategic asset in the broader scheme of international geopolitics in the region. As a series of new projects are on the cards for the coming near future, both countries are likely to gain significantly from their intensifying relationship, opening the door to a new paradigm of economic cooperation and Southeast Asian geopolitics power play.

The project once posed a threat to Singapore’s transshipment hub
In 2008, Italian-Thai Develo­pment (ITD) was granted a 75-year concession by Myanmar’s State Peace and Development Council to develop the Dawei SEZ, with the ambition of transforming the area into Southeast Asia’s largest business complex.
Following Myanmar’s admin­istrative transition in the 2010s, ITD persisted in its efforts to implement the mega infrastructure project, attracting numerous high-profile investors. Reports suggest that Singaporean investors showed considerable interest in the project.
Myanmar’s political and economic liberalization in 2011 drew a surge of foreign investments. During the 2010s, reports indicated that Singaporean investors acquired significant stakes in ITD, perceiving them as highly valuable in the Singapore Stock Exchange, the SGX. However, this shift in ownership allegedly influenced the project’s trajectory, steering it away from its original vision of becoming Asia’s next major port hub. Consequently, the project faced financial constraints and prolonged delays for over a decade. In late 2020, the Myanmar government terminated seven concession agreements tied to the Dawei SEZ, including those held by ITD, citing non-compliance with financial obligations and contractual failures.
ITD expressed its support and welcomed for potential Russian involvement in the Dawei project in 2024 following the emergence of news of possible Russia’s involvement in the Dawei SEZ, hoping that such collaboration could help salvage its investments and revive the stalled development.