“In a scenario wherein Myanmar is classified as a sanctioned country under OFAC, or if OFAC opines that the project violates the current sanctions, Adani Ports plans to abandon the project and write down the investment,” the port firm stated in an investor presentation on Tuesday, referring to the U.S. Department of the Treasury’s Office of Foreign Assets Control.
OFAC administers and enforces financial and commerce sanctions primarily based on U.S. international coverage and nationwide safety objectives.
Touted a decade in the past as one in all Asia’s most promising frontier markets, Myanmar has seen many buyers shun the nation as a violent crackdown leaves greater than 750 protesters useless and hundreds of others locked up. Telenor ASA, Norway’s largest telecom firm introduced on Tuesday it’s writing down its 6.5 billion kroner ($780 million) funding within the nation.
S&P Dow Jones Indices final month stated it’ll take away Adani Ports from the Dow Jones Sustainability Indexes due to hyperlinks to Myanmar’s army, which is alleged to have dedicated severe human rights abuses beneath worldwide regulation.
In May 2019, Adani Ports introduced its intent to arrange a container terminal at Yangon by way of a lease settlement with the democratically-elected authorities of Myanmar. The venture entailed a complete funding of $127 million, together with $90 million as upfront cost for the leased land.
The latest violence in Myanmar and the army coup have resulted in uncertainty, the port firm stated within the presentation. “The write down will not materially impact Adani Ports as it is equivalent to about 1.3% of total assets,” it stated.
The venture gives, instantly or by way of sub-contractors, employment to about 300-350 individuals.
The funding write off in Myanmar will come at a time when Gautam Adani’s wealth has ballooned on the second-fastest tempo among the many world’s billionaires year-to-date.
–With help from Unni Krishnan.