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January 29, 2020

NEWS
ECONOMY

Myanmar sets investment priorities for all states, regions in the country

The Ministry of Investment and Foreign Economic Relations announced tax exemptions for investments in selected sectors in all 14 states and regions in Myanmar and the Nay Pyi Taw Union Territory.

The key investment sectors in Myanmar’s states and regions are mainly agriculture, manufacturing and infrastructure. Now, the government is expanding the areas of investment for businesses to five priority sectors and streamlining the process in the states and regions.

The top five priority investment sectors in Yangon Region are manufacturing, infrastructure, information technology, hotel and tourism, and education services. Any investment in a promoted sector in Yangon Region qualifies for three or five years of tax exemption.

In December 2019, the International Monetary Fund said that foreign direct investment inflows as well as project approvals remain lower than in recent years as large projects have been completed and foreign investors remain cautious ahead of the 2020 elections.

Source: Myanmar Times

Myanmar-China trade volume reaches to US$1.337 B within two months

Trade volume between Myanmar and China is reached to US$1.337 billion within two months of this fiscal year and Myanmar had a trade surplus as it imported US$551 million worth of products from China.

Myanmar exported over US$785 million worth of products to China in that period. Both countries are opened business centers and implemented to boost border trade and investments.

Ministry of Commerce will sign MoUs with the China to establish border economic cooperation zones and will invite tender for Expression of Interest (EOI) for local businessmen to participate to work in the zones in Muse, Kanpiketie, Laukkai and Chinshwehaw.

Myanmar sent a proposal to China to sign the MoU to implement border economic cooperation zones and if the China replies about it, both countries will sign the MoU and formed a free trade zone in Shweli.

Source: Eleven Media, Myanmar

Good prospects in Myanmar for long-term investors: Oxford Business Group report

A file photo of workers in an electronics plant set up by foreign investors in Myanmar. Photo - EPA

Myanmar’s growth and forecasts make an exciting prospect for companies seeking long-term opportunities.

The Report: Myanmar 2020 marks the culmination of 12 months of field research by a team of analysts from Oxford Business Group, is a global research and advisory company.

The publication assesses trends and developments across the economy, including those in macroeconomics, infrastructure, banking and others.

Myanmar’s inherent advantages, which include a dynamic internal market, an abundance of natural resources and a strategic location between China and India, meant it had plenty to offer the international business community.

The transition under way in Myanmar’s financial services sector is gathering pace, with liberalisation continuing to drive formalisation and financial inclusion efforts across the banking industry, international players establishing a presence in the insurance segment and capital markets opening up to both foreign and local investors.

The report said that Myanmar’s efforts to expand the formal economy on the back of strong GDP and trade growth are given wide-ranging coverage.

Oxford Business Group is a global research and advisory company with a presence in over 30 countries, from Asia, the Middle East and Africa to the Americas providing of on-the-ground intelligence on the world’s fastest growing markets for sound investment opportunities and business decisions.

Source: Myanmar Times

Work on large LNG project set to start in July

A file photo of part of a liquified natural gas plant in Europe. Work on a similar project is expected to start in Ayeyarwady Region in July. Photo - EPA

Work on a large liquefied natural gas (LNG) power plant in Mee Lin Gyaing, Ayeyarwady Region is expected to begin this year.

The Ministry of Electricity and Energy (MOEE) originally approved the project, along with one in Kan Pauk in Tanintharyi Region, and another in Ahlone in Yangon Region, in 2018. The projects, once completed, were expected to generate some 3,000 megawatts of power from imported LNG.

During the visit by China’s President Xi Jinping to Myanmar last weekend, the governments of both countries agreed to hasten negotiations on the LNG power plant project in Mee Lin Gyaing.

During the visit, Yunnan Provincial Energy Investment Group, Union Resources and Engineering Co Ltd, Zhefu Holding Group, and Myanmar’s Supreme Trading Co Ltd signed agreements to accelerate the Mee Lin Gyaing project.

The US$2.6 billion LNG power plant in  Mee Lin Gyaing is expected to generate 1390MW of electricity once it is completed and will become one of the largest power projects in Myanmar. The will include a power plant, LNG terminal and distribution channels.

The project is estimated to generate power starting from 2023, and will fulfill the power needs in Ayeyarwaddy as well as other states and regions.

Source: Myanmar Times

Agreement to implement Yangon Amata Smart and Eco City signed

Image result for Agreement to implement Yangon Amata Smart and Eco City signedA signing ceremony for implementation of Yangon Amata Smart and Eco City was held at the Kempinski Hotel in Nay Pyi Taw yesterday.The Urban and Housing Development (UHDD) and Amata Asia(Myanmar) Limited also signed a land lease agreement on the occasion.

The project aims to attract more foreign investments, to boost the industrial, foreign export and human resources sectors of the nation, in addition to being a major source of assistance to socio-economic development.Yangon Amata Smart and Eco City Limited will implement a Smart and Eco City project with an investment of US$ 1 billion on 2,000 acres of land near Laydaunkkan Village between East Dagon and South Dagon Townships in Yangon Region and it will create up to 33,000 jobs.

33,000 job opportunities will be created through the establishment of the industrial zone. Moreover, the government can earn tax yearly as well as promote foreign exports and human resources sectors and socio-economic development. Yangon Region Minister for Electricity, Industry and Transportation,said that the Yangon Region Government would provide the needs concerning Yangon Amata Smart and Eco City project.

Source: Eleven Media

Insurance association to introduce CII qualifications

Image result for dai-ichi life insurance myanmarThe Myanmar Insurance Association (MIA) is set to introduce qualification programmes of the UK’s Chartered Insurance Institute (CII) to Myanmar.The two industry bodies inked a deal late last year for MIA to hold exams for CII qualifications from April onwards. Candidates in Myanmar no longer need to travel abroad for the CII examinations and can now enrol and sit for the assessment within the country.A key challenge for Myanmar’s insurance sector since November 2019 liberalisation is the lack of qualified professionals to support the fast-expanding operations of the multinational insurers and joint ventures.

The capacity of insurance professionals is severely limited because insurance in Myanmar is still in its early stages of development. Until two months ago, no foreign insurers can operate in Myanmar, except the three Japanese providers who were given licences in Thilawa Special Economic Zone.For the industry to grow, companies need insurance agents across the country, in major cities as well as in rural areas, to promote and reach out to communities. Myanmar’s insurance penetration is among the lowest in the world.Last year the government awarded licences to five foreign insurers and half a dozen joint ventures to operate in the domestic market, marking Myanmar’s first-ever licencing to foreign fully-owned life insurers.

British Prudential, Japanese Dai-ichi Life, Hong Kong AIA, US Chubb and Canadian Manulife can now issue life insurance policies with their fully-owned subsidiaries. Sompo Japan Nipponkoa Insurance, Tokio Marine & Nichido Fire Insurance and Mitsui Sumitomo Insurance have set up JVs with local partners to offer general policies while Taiyo Life Insurance; Thai Life Insurance and Nippon Life Insurance have also joined the market via local JVs.London-headquartered CII is a professional body dedicated to building public trust in the insurance and financial planning profession. It also has offices in Hong Kong, Dubai and Mumbai, and provides membership services and professional development.

Source: Myanmar Times

 

Agro exports up $153.98 mln in current FY

Myanmar’s exports of agricultural products between 1 October and 10 January in the 2019-2020 financial year rose to US$998.728 million from $844.747 million in the corresponding period of the 2018-2019 FY, which reflects an increase of $153.98 million.
In the export sector, the agriculture industry performed the best, along with the natural gas sector. The chief items of export in the agriculture sector are rice and broken rice, pulses, corn, and rubber. Fruits and vegetables, sesame, dried tea leaves, sugar, and other agro products are also exported to other countries.
Myanmar agro products are primarily exported to China, Singapore, Malaysia, the Philippines, Bangladesh, India, Indonesia, and Sri Lanka. However, the export market remains uncertain due to unsteady global demand.
According to the Myanmar Rice Federation, quality control and food safety are key to the promotion of exports. Therefore, improved agricultural practices need to be developed.
Additionally, the country requires specific export plans for each agro product, as they are currently exported to external markets based upon supply and demand. Contract farming systems, involvement of regional and state agriculture departments, exporters, traders, and some grower groups are required in order to meet production targets.
The Commerce Ministry is working to help farmers deal with challenges, such as high input costs, procurement of pedigree seeds, high cultivation costs, and erratic weather conditions.

Source: The Global New Light of Myanmar

SEZs rake in investments of over $76 mln in current fiscal

Foreign investments of US$76.14 million have flowed into the Special Economic Zones (SEZs), under the Special Economic Zone Law, as of 10 January in the 2019-2020 financial year, according to figures released by the Directorate of Investment and Company Administration (DICA).
A total of 115 enterprises from 18 countries and four local businesses ploughed in $1.92 billion as of end-December, 2019 in the zones, data on investments by permitted enterprises shows.
Japan has topped the list of foreign investors so far, accounting for more than 35 per cent of the overall investment, followed by Singapore and Thailand. FDI also flowed into the SEZs from the Republic of Korea, Hong Kong, the UK, Australia, the UAE, Malaysia, Austria, China (Taipei), Panama, China, Brunei, Viet Nam, France, Switzerland, and the Netherlands.
At present, more than 70 businesses are operating in the Thilawa SEZ, and some businesses are beginning to export goods. The SEZ is employing over 20,000 workers, including permanent and construction workers, according to the management committee.
A company exporting at least 75 per cent of the production in value is registered as a Free Zone investor, and is exempt from paying corporate tax for 7 years from the time it starts commercial operations. Companies such as logistics, which support export-oriented manufacturing, can also be free zone companies. Domestic-oriented manufacturing companies are regarded as promotion zone companies, and they are eligible for a five-year holiday on corporate tax.
There are other tax incentives for free zone and promotion zone investors on importation of capital goods, raw materials, and merchandise, and consigned goods and vehicles. Further details about the tax system are available on http://www.myanmarthilawa.gov.mm.
While the manufacturing sector has absorbed the largest share of foreign investments, FDI has also flowed into the trading, services, transportation and logistics, real estate, and hotel sectors in the past.
Myanmar is currently implementing three Special Economic Zones — Thilawa, Kyaukpyu, and Dawei. Out of the three, Thilawa is leading with better infrastructure and successful businesses.

Source: The Global New Light of Myanmar

Japanese NTT sets up US$5M local subsidiary

Image result for Japanese NTT sets up US$5M local subsidiaryJapanese tech major NTT is diving into Myanmar’s nascent but fast-growing digital economy with its newly-established subsidiary.The company announced that its subsidiary NTT Myanmar was granted a business-to-business wholesale licence from the commerce ministry to offer ICT solutions in the Myanmar market.

The capital investment of NTT Myanmar is US$5 million (K7.2 billion),Today’s digital landscape is changing rapidly. Hence, they are constantly innovating and working to meet their clients’ ongoing needs.Their commitment is to deliver intelligent, end-to-end solutions to their clients in Myanmar as the nation moves forward with its digital transformation road map. The company’s tech expertise will help drive growth in local companies.In addition, NTT Myanmar also plans to support firms in the education and financial sectors in developing ICT-related human resources.

Myanmar’s telecommunications industry is growing at 6-12 percent annually, and represents a strong market potential.NTT has invested US$400 million to build the MIST – a large-capacity submarine communications cable between Singapore, Myanmar and India. The scheme is part of a strategic joint venture for international submarine cables in Southeast Asia. Listed in Tokyo, New York, London and Osaka, the Tokyo-based firm is one of the largest telecommunications companies in the world in terms of revenue.

Source: Myanmar Times

DaNa launches fintech challenge

Image result for DaNa launches fintech challengeUK-funded DaNa Facility is launching a fintech challenge in Myanmar to promote further financial inclusion.The Fintech Challenge Myanmar 2020 (FCM2020), open to local and international fintech firms, is organised in partnership with the United Nations Capital Development Fund (UNCDF) and the Asian Development Bank’s ADB Ventures.

Topics include: digital and financial literacy; microinsurance, MSME finance/alternative lending; digital remittances; and green finance. This is going to be a very good thing for Myanmar’s consumers. In a few years’ time, your phone will be your bank. As rural farmers, micro and small enterprises, and low-income urbanites face difficulty in receiving financial services from financial institutions, fintech aims to fill this gap. FCM2020 will focus on fintech solutions that can improve the quality and quantity of financial services to the underserved and unbanked.

“In the payment space, we definitely need financial innovation to drive interoperability and promote greater access to financial services,” said U Bo Bo Nge, deputy governor, Central Bank of Myanmar.Successful applicants will take part in a two-month period of collaboration and mentoring with a financial institution. Fintechs will participate in a competitive “Initial Pitch Session”, where they will present their capabilities to a panel of financial industry players, financial experts, and investors. The best fintech solutions providers will have the opportunity to demonstrate their products and services at the Myanmar Fintech Day scheduled for June 2020.

Source: Myanmar Times

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