Posts in category: INVESTMENT

Under the Myanmar Investment Law, transport and communications sector tops the foreign investment line-up over the four years of incumbent government period, bringing in the capital of US$6.135 billion, according to the Directorate of Investment and Company Administration (DICA). The quantum of investment in transport and communications sector is higher than in any other sectors, attracting 29 enterprises. Between the 2016-2017 and 2019-2020 budget years, the manufacturing sector has absorbed FDI of $6.13 billion from 706 projects.

Real estate sector has attracted $3.6 billion from 29 projects. The power sector has drawn 19 foreign investment projects worth $3.17 billion. Twenty-four projects worth $725.9 million has been approved in the hotels and tourism sector, while the existing enterprises increased the investments of $363 million in the oil and gas sector. The livestock and fisheries sector has pulled in an investment of $452.68 million from 36 foreign enterprises. The agricultural sector has also attracted $181.98 million from 18 foreign projects, while industrial estate sector received $390.459 million from five enterprises. The mining sector has received over $11 million from existing enterprises. Over $2.63 billion in FDI has been pumped into the other services sector from 106 businesses.

The Myanmar Investment Commission (MIC) and the respective investment committees granted permits and endorsements to 1,032 foreign enterprises over the past four years, with estimated capitals of $25.18 billion. Of them, Thilawa Special Economic Zone attracted investments worth $1.36 billion from 60 enterprises under the Special Economic Zone Law in the past four years, while FDI of $23.8 billion flowed into the country under the Myanmar Investment Law, the DICA’s data showed. Of 36 foreign countries investing in Myanmar in the past four years, Singapore put the most massive investments under Myanmar Investment Law, followed by China and Hong Kong (SAR).

MIC is prioritizing the labour-intensive businesses. In the incumbent government period, domestic and foreign projects employ over 670,000 residents, according to the DICA. Those enterprises have created over 96,000 jobs in the FY2016-2017, 110,000 jobs in the FY2017-2018, over 53,000 jobs in the 2018 mini-budget period, over 180,000 jobs in the FY2018-2019 and 210,000 jobs in the FY2019-2020 respectively. 

Source: The Global New Light of Myanmar

Foreign investors are still keen to invest in Myanmar despite COVID-19, even though a number are holding back due to the uncertainty surrounding the investment environment in the country, according to U Maung Maung Lay, Vice President of the Union of Myanmar Federation of Chamber of Commerce and Industry (UMFCCI). Many foreign investors want to expand their businesses here but there is no certainty for growth and returns at this point. It is very difficult for growth and returns at this point. It is very difficult for them to invest during the COVID-19 period.

This is because of travel restrictions imposed to control imported cases of the virus, under which international flights have not been allowed to land in Myanmar since March. It has not been possible for potential investors to enter the country to conduct the surveys and negotiations needed to make concrete investment decisions and as a result, the Myanmar economy has halved in the six months since the pandemic was announced. Garment manufacturers, which contributes significantly to Myanmar’s exports to Europe, Korea and Japan, have been affected, while 80 percent of the construction sector is now facing various challenges from pricier imports of construction materials to the inability to continue developing ongoing projects.

Local businesses have also been affected by declining demand and many are also unable to procure raw materials from China to continue operations. Myanmar has so far received 24 foreign investment proposals worth US$3.5 billion for fiscal 2020-21. Most of the proposals were submitted to the Myanmar Investment Commission (MIC) in fiscal 2019-2020, however, due to the large capital amounts involved, the projects require MIC permits before getting the green light to proceed. The MIC has to consider the possible impact on the environment and local communities before giving approval. In any case, the MIC intends to reach its foreign direct investment (FDI) target of US$5.8 billion for the current fiscal year. It will priorities investments in agriculture, healthcare, industrial and digitization. Myanmar fell short of the FDI target of US$5.8 billion in fiscal 2019-2020 due to COVID-19.

Source: Myanmar Times

For the 2020-2021 fiscal year, 24 projects with $ 3.5 billion in foreign investment have been proposed to the Myanmar Investment Commission (MIC), according to the Directorate of Investment and Company Administration (DICA). For the next year, they have 24 proposals that the Investment Commission has to consider and then discuss the need. The value of the 24 proposals is estimated at US $ 3.5 billion. These businesses are huge because they are not available at this time.

There may be issues that may be of interest to the state next time, and there are sections that assess the needs of the state. Relevant ministries have to negotiate. After the relevant ministries, the decision must be made after submitting to the higher committees of the relevant ministries. For some countries, investment will be huge. It could also have an impact on the country. The land area is large. If the amount of investment is large, it should be submitted to the government It has to be decided. Due to such activities, this year’s target has not been achieved. The 24 investment proposals are over $ 3 billion. It is in this pipeline for the first month of the next fiscal year 2020-2021.

Due to COVID-19, some businesses were allowed to enter due to traffic restrictions, but were not allowed to do so, leading to a decline in Myanmar’s foreign investment target for the 2019-2020 fiscal year. In the 2019-2020 fiscal year, foreign investment in Burma was projected at $ 5.8 billion, but only $ 5.68 billion came in. However, in the context of COVID-19, investors have limited access; Some businesses are planning to enter but have not yet done so due to traffic congestion, as most of the government offices are located in Rangoon and Naypyidaw. According to Myanmar’s investment promotion plan, foreign investment is expected to reach $ 8.5 billion from the 2021-2022 fiscal year, but these targets will be reconsidered due to the COVID-19 outbreak.

Source: Daily Eleven

HONG KONG business and those already present in Myanmar expressed a keen interest in Myanmar’s significant investment potential including areas as diverse as energy, transport, banking and finance, retail and services during a recent webinar organized by the Myanmar-Hong Kong Chamber of Commerce and Industry. As a guest of honour delivering a keynote address, U Thaung Tun, Union Minister for Investment and Foreign Economic Relations, highlighted Myanmar’s enviable geographic position as: “…a strategic land bridge, connecting two of the world’s largest regional economies, those of South and South East Asia, we also wish to play a greater connecting role – connecting East and West – from the Mid-East to the Mekong!” The Union Minister also referred to ongoing challenges posed by COVID-19 noting that: “…today the IMF forecasts Myanmar’s growth at closer to 2 per cent – still placing us amongst a small handful of nations who will post positive growth this year. Thankfully, most forecasts suggest our rapid return to pre-crisis growth of 6 per cent plus in 2021.”

The Union Minister together with panellists, including Memories Group CEO Mr Cyrus Pun, Cycle & Carriage Hong Kong investors eye new opportunities in Myanmar Myanmar General Manager Mr Adrian Short, and Mr Edgar C P Kwan, Marga Group Chief Development Officer were in firm agreement that such growth could be achieved via increased and diversified investment in maritime infrastructure, roads, rail, urban housing, border cooperation zones, agriculture, technology, cyber and clean energy projects amongst many others. Despite current sluggish global growth and general uncertainty, Mr Edgar C P Kwan expressed optimism that the coming year will bring forth further opportunities for Myanmar, highlighting in particular, investment opportunities in Myanmar’s energy, real estate and manufacturing services sector, while noting that the continued expansion of a world-class services industry will also help to further facilitate Myanmar’s broad-based and inclusive development, Memories Group CEO Mr Cyrus Pun enquired as to what steps had been taken to cut through red tape and to lower administrative hurdles faced by investors, to which the Minister replied noting the launch of the Myanmar Companies Online (MyCo) company registration platform, the recent launch of an online tax payment system in Yangon, as well as the continued development of Standard Operating Procedures across all administrative units within the Ministry of Investment and Foreign Economic Relations as clear signs of progress being made.

With examples on offer such as the recent successful West Yangon Industrial Park competitive tender launch, the successful conclusion of international tendering for 30 solar power projects, and the recent approval of a new Thilawa LNG-to-Power project – amongst Myanmar’s largest and equal to one-fifth of the country’s current power generation capacity – the Minister noted how continued investment in Myanmar’s energy sector will unlock further flown investment in other sectors, generating new jobs for a young population while ensuring the government keeps its commitment to electrifying the nation by 2030. The Union Minister also drew attention to the upcoming launch of the Myanmar Economic Recovery and Reform Plan (MERRP), clarifying its role as an interim reform-oriented measure, a natural successor to the shorter-term COVID-19 Economic Reform Plan (CERP), that will be used to ensure remains on track toward achieving the MSDP once the COVID-19 pandemic subsides. Noting the reputation Hong Kong investment has garnered as responsible and of high quality, the Minister emphasized that Myanmar welcomes responsible, quality investment from wherever it may come and remains committed to providing a level playing field for all responsible investors seeking to do business, or to explore greener pastures in Myanmar.

Source: The Global New Light of Myanmar

Yangon Region Investment Committee endorsed 137 enterprises in the past financial year 2019-2020, bringing in estimated capital of US$308.768 million, according to the Directorate of Investment and Company Administration (DICA). Between 1 October and 30 September of the FY2019-2020, Yangon Region stood at the first place with 137 foreign enterprises (with a capital of $308.768 million), followed by Bago Region with 18 foreign projects ($72.645 million) at the second place and Ayeyawady, with nine at the third place ($19.614 million). Additionally, foreign direct investments also flow into Taninthayi Region from two projects worth $1.397 million, Magway Region from two worth $0.991 million, Mon State from two worth $1.664 million, Mandalay Region from one business valued $4.6 million, Sagaing Region from one worth $3 million, Kachin State from one worth $1 million, Shan State from one worth $4.13 million and Nay Pyi Taw Council from one valued $5.862 million.

In the last FY, the respective investment committees of Kayah, Kayin, Rakhine and Chin states did not endorse foreign enterprise at all, the DICA stated. The region and state investment committees endorsed a total of 175 foreign enterprises with an estimated capital of $423.671 million last financial year.  The endorsed enterprises are to be engaged in the manufacturing, hotels and tourism, other services, power and agricultural sector. Of them, the majority of the investment goes into the manufacturing sector, followed by other service sector and hotels and tourism sector.

The manufacturing sector has also attracted the most foreign investments in Yangon Region, with enterprises engaging in the production of pharmaceuticals, vehicles, container boxes, and garments on a Cutting, Making, and Packing (CMP) basis. To date, foreign investments from China, Singapore, Japan, Hong Kong, the Republic of Korea, Viet Nam, India, China (Taipei), Malaysia, the British Virgin Islands and Seychelles are arriving in the region. To simplify the verification of investment projects, the Myanmar Investment Law allows the region and state Investment Committees to grant permissions for local and foreign proposals, where the initial investment does not exceed K6 billion, or $5 million.

Source: The Global New Light of Myanmar

The Yangon Region Investment Committee (YRIC), at a videoconference held on 14 October, has endorsed three foreign projects from Viet Nam, Republic of Korea and China. Those projects are to be brought in an estimated capital of US$6.904 million. Those enterprises will create 2,279 jobs. They will execute manufacturing of bags and garments on a Cutting, Making, and Packing (CMP) basis, and production and distribution of iron, steel and galvanised iron and building materials, according to the Directorate of Investment and Company Administration (Yangon Region), YRIC stated.

The Yangon Region Investment Committee (YRIC) has endorsed over 130 foreign investment projects with an estimated value of over $280 million in the last financial year 2019-2020, according to the Directorate of Investment and Company Administration. Manufacturing, hotels and tourism, other services, electricity and agricultural sectors pulled in the foreign investments. Majority of the investments went into the manufacturing industry, followed by other service and hotels and tourism industries.

To date, foreign investments from China, Singapore, Japan, Hong Kong, the Republic of Korea, Viet Nam, India, China (Taipei), Malaysia, the British Virgin Islands and Seychelles are arriving in Yangon Region. To simplify the verification of investment projects, the Myanmar Investment Law allows the region and state Investment Committees to grant permissions for local and foreign proposals, where the initial investment does not exceed K6 billion, or $5 million.

Source: The Global New Light of Myanmar

Myanmar has attracted more than US$25 billion of foreign direct investments over the past four and half years under the incumbent government, according to the Directorate of Investment and Company Administration (DICA). The Myanmar Investment Commission (MIC) and the respective investment committees granted permits and endorsements to 1,032 foreign enterprises between the 2016-2017FY and 2019-2020FY, with estimated capitals of US$25.186 billion.

The FDIs stood at $6.9 million from 158 enterprises in the FY2016-2017, $6.119 billion from 234 businesses in the FY2017-2018, $1.94 billion from 89 projects in the 2018 mini-budget year, $4.5 billion from 298 enterprises in the FY2018-2019 and $5.689 billion from 253 businesses in the FY2019-2020 respectively, the DICA’s data indicated. The FDIs flow into the 12 sectors; oil and gas, power, transport and communications, real estate, hotels and tourism, mining, livestock and fisheries, industrial estate, agriculture, construction, manufacturing and other service sectors.

Transport and communications sector topped the investment line-up, followed by the manufacturing industry in the second place and real estate sector in the third place. Of 51 foreign countries and regions investing in Myanmar, Singapore put the most massive investments, followed by China and Hong Kong (SAR). MIC is prioritizing the labor-intensive businesses. In the incumbent government period, domestic and foreign projects employ over 670,000 residents, according to the DICA. Those enterprises have created over 96,000 jobs in the FY2016-2017, 110,000 jobs in the FY2017-2018, over 53,000 jobs in the 2018 mini-budget period, over 180,000 jobs in the FY2018-2019 and 210,000 jobs in the FY2019-2020 respectively. 

Source: The Global New Light of Myanmar

India wants to build a US$6 billion oil refinery in Thanlyin, Yangon, to rival China’s investment in Myanmar’s energy sector, according to India’s Foreign Secretary Harsh Shringla and India Army Chief MM Naravane during their joint visit to Myanmar this week, India media have reported. Myanmar has yet to confirm or announce the proposal. Under a Memorandum of Understanding between Myanmar and India signed during President U Win Myint’s trip to India in Februray, the two governments had agreed to advance cooperation in the sector.

The two governments are discussing possibilities to cooperate in the downstream oil and gas sector in Myanmar. The MOEE is now also negotiating terms to purchase power to purchase power from India via cross border transmission following a bilateral meeting held on September 3 between the relevant ministries and officials, including Indian Ambassador to Myanmar Mr. Saurabh Kumar. India is raising efforts to promote its presence in Myanmar energy under its Look East and Neighbors First policies even as China expands investments in the downstream sector.

Several Chinese companies have shown interest to invest in building large oil refinery projects at the Dawei Special Economic Zone in Thanintharyi Region. China-based Yunnan Indo-Pacific Group Zhongan and CNPC East China Design Institute have purposed field surveys for a large-scale oil refinery project in the SEZ which can refine 8 million tonnes of oil a year. Meanwhile, Hong Kong New Energy Investment Holdings Limited, China Huanqiun Contracting and Engineering Co., Ltd, China Petroleun Pipeline Engineering Co., Ltd and China Energy Engineering Corporation are also interesting in building an oil refinery in Myanmar and have submitted proposals to the MOEE.

Source: Myanmar Times

According to the Myanmar Investment Promotion Plan, foreign investment is expected to reach $ 8.5 billion from the 2021-2022 fiscal year, but due to the COVID-19 outbreak, those targets will be reconsidered, according to the Directorate of Investment and Company Administration. Starting from the 2021-2022 financial year, they have set a target of $ 8.5 billion. This is also being prepared for consideration by the Myanmar Investment Promotion and Facilitation Committee, which is mentioned above, in advance of the coming 2021-2022 financial year.

Due to COVID-19, some businesses were allowed to enter due to traffic restrictions, but were not allowed to do so, which reduced Myanmar’s foreign investment target for the 2019-2020 fiscal year. In the 2019-2020 fiscal year, foreign investment in Burma was projected at $ 5.8 billion, but only $ 5.68 billion came in. However, in the context of COVID-19, investors have limited access; There are also restrictions on what can be done after the visit. Similarly, Rangoon and Nay Pyi Taw, most of which have government offices in Naypyidaw, are difficult to access due to traffic congestion.

In the 2018-2019 fiscal year, $ 4.52 billion in foreign investment flowed into Myanmar. Myanmar is implementing a 20-year Myanmar Investment Promotion Plan aimed at becoming a middle-income country by 2030. It also aims to attract more than $ 220 billion in investment in Myanmar over the next 20 years and attract more responsible investment. Aiming to increase foreign investment in Myanmar, the Myanmar Investment Commission, in collaboration with the Japan International Cooperation Agency, drafted a long-term foreign direct investment promotion plan in 2013 and implemented it in 2014.

Source: Daily Eleven

Domestic investments by Myanmar citizens approved by the region and state investment committees have reached K184.9 billion and US$32.195 million over the past 11 months of the 2019-2020 financial year since October, according to the statistics released by the Directorate of Investment and Company Administration (DICA). Between 1 October and 4 September in the current FY, the relevant region and state investment committees gave the green light to 67 local enterprises to invest in various sectors.

As of 4 September, Ayeyawady Region Investment Committee cleared 13 businesses, allowing an estimated capital of US$3.428 million and K41.26 billion, while Yangon Region Investment Committee gave the go-ahead to 12 enterprises with $5.886 million and K26 billion, Taninthayi to 10 projects with $10.5 million and K40.48 billion, Sagaing to eight enterprises with $2.344 million and K12 billion, Mon to five businesses with $4.328 million and K13.6 billion, Kayah to four enterprises with K8.2 billion, Mandalay to three enterprises with $2.957 million and K12.14 billion, Nay Pyi Taw Council to two businesses with $1.634 million and K6.147 billion, Chin to two enterprises with $0.17 million and K2.535 billion, Bago to two enterprises with K5.265 billion, Shan to two projects with K5.67 billion, Kayin to one enterprise with $0.7 million and K5.6 billion, Magway Region to one with $0.042 million and K2.5 billion, Rakhine to one with $0.192 million and K2.499 billion, Kachin to one with K965 million respectively.

The domestic investments are flowing into the executing manufacturing, hotels and tourism, other services, electricity, agriculture, real estate development and mining sectors. Of them, manufacturing sector pulls the most massive investments, followed by hotel and tourism and other service sectors. To simplify the verification of investment projects, the Myanmar Investment Law allows the region and state Investment Committees to endorse local and foreign proposals, where the initial investment does not exceed K6 billion, or $5 million.

While some projects no longer need MIC approval, businesses that are strategic to the government require the permit from the commission. Besides, those businesses that have large capital investments exceeding $5 million and that may have a possible impact on the environment and the local community need to be approved by the DICA’s proposal assessment team and the relevant ministries. With a fast-track way to set up a business in Myanmar having been introduced, investors can apply to the MIC or the state and regional Investment Committees to get their investment proposals endorsed, depending on the business type.

Source: The Global New Light of Myanmar