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January 29, 2020

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ECONOMY

Myanmar, Japan sign Exchange of Notes on 4 projects worth about $ 1.1 bln

Image result for Myanmar Japan sign Exchange of notesMyanmar and Japan signed the four Exchange of Notes for four loan projects, which will be implemented with the loan worth about 120,915 million Yen.The four projects are Yangon Sewerage System Development Project in Yangon, Urban Development Project for the reduction of traffic congestion and the damages affected by the flood in Yangon, the Power Distribution Improvement Project in Yangon and Mandalay and Providing funds to the Regional Infrastructure Improvement Project in Chin, Rakhine, Mon and Kayin states and Taninthayi Region.

Under the Yangon Sewerage System Development Project in Yangon which is estimated to cost about 45,900 million Yen, funds will be provided to expand waste water treatment plants, to construct sewer pipes and to improve the living environment of local residents in the central business district of Yangon, where about 10% of Myanmar’s population reside.The second project namely Urban Development Project for the reduction of traffic congestion and the damages affected by the flood in Yangon is estimated to cost about 24,085 million Yen. This project will provide funds to improve drainage, take measures against traffic congestion at level crossings on main roads and Yangon Circular Railway Road in Yangon, the largest city of Myanmar which has high economic growth.

The third project is the Power Distribution Improvement Project in Yangon and Mandalay to cost about 12,288 million Yen. This will provide funds to repair and expand the electricity distribution network to improve the power supply in Myanmar’s major commercial cities, Yangon and Mandalay.The fourth project is that Providing funds to the Regional Infrastructure Improvement Project in Chin, Rakhine, Mon and Kayin states and Taninthayi Region is expected to get funds amounted to 38,642 million Yen.

Source: The Global New Light of Myanmar

Projects in Rakhine on track to bring development to state: Indian ambassador

Rakhine State chief minister Nyi Pu (L) and Indian Ambassador to Myanmar, Saurabh Kumar (R) talk prior to the ceremony for the handover of relief materials to the government of Rakhine State, in Sittwe. Photo - EPA

India’s ambassador to Myanmar emphasised that all projects being undertaken by India in Rakhine State are aid projects for the welfare of the people of the state. Ambassador Shri Saurabh Kumar said this during a ceremony in Sittwe, Rakhine, to handed over 20,000 kits containing food and tarpaulins worth US$235,000 (K341 million) for people displaced by conflict.

India is currently involved in the Kaladan Multi Modal Transit Transport Project (KMMTTP ) in Rakhine. The ambassador said the strategic project to link the port of Kolkata in India with Sittwe is important for Myanmar and India. The project comprises three stretches that include shipping, inland waterways and road transportation.

The longest among these stretches is the shipping segment from Kolkata to Sittwe. The project is expected to boost connectivity, contribute to job creation and development in the whole region including in Rakhine and Chin State.

Ambassador Shri Saurabh Kumar said that India is looking forward to the early completion of the road and is confident that all concerned will provide assistance towards this objective as the KMMTTP has a huge potential to impact the economy of Rakhine and provide livelihoods to local people. The total cost of the KMMTTP is estimated to US$484 million making it India’s largest grant in aid project abroad.

Source: Myanmar Times

Emergency project proposals greenlighted by MIC

Ko Ko Htay/The Myanmar Times

A number of energy projects, including emergency power plants, have been greenlighted by the Myanmar Investment Commission (MIC).

The MIC in November 2019 approved the application of a joint venture between China National Technical Import and Export Corporation and Hong Kong-listed VPower Group for a 400MW  LNG plant in Yangon Region, involving US$360 million, and a 150MW LNG plant in Rakhine State worth $140 million.

In the first three months of the 2019-20 fiscal year, starting from last October, the MIC has approved four energy investment proposals, according to U Thant Sin Lwin, director general of the Directorate of Investment and Company Administration (DICA) and secretary of the Myanmar Investment Commission (MIC). The four projects will account for more than US$700 million of FDI.

Power generation in Myanmar is way behind demand, which is also growing rapidly every year. The energy ministry issued five emergency tenders last June to add 1040MW of new capacity this summer season. The tender process was heavily criticised by industry players and experts.

Source: Myanmar Times

Foreign investment inflows to double: govt

Image result for Foreign investment inflows to double: govtForeign direct investment (FDI) into Myanmar is expected to grow this year, the Myanmar Investment Commission (MIC) says. FDI into Myanmar in the first three months of fiscal year 2019-20 is double what it was in the same period in the previous fiscal year.FDI in the country shows obvious growth in the current fiscal year.

MIC has approved investments in projects totalling US$1.5 billion since the start of FY2019-20 on October 1, 2019. The commission has approved a significant number of high-value foreign investment projects, it is also working to ensure the projects are sustainable and beneficial.The commission rejected proposed projects that were judged to have the potential to damage the country’s social and environmental landscape within the 15 days stipulated under the Myanmar Investment Law.

The World Bank’s latest Myanmar Economic Monitor report states that FDI inflows showed signs of recovery in 2019. However, the report added that sustaining FDI inflows depends on continued efforts to improve the business environment to attract capital flows in the context of diminishing global flows and Myanmar-specific country risks. Singapore remained the largest foreign investor in Myanmar, followed by China and Hong Kong. The sectors receiving the most foreign investment were oil and gas, followed by power, and manufacturing.

Source: Myanmar Times

Myanmar, China sign agreements on Kyaukphyu

Image result for Myanmar China agreement Two countries presidentMyanmar and China inked 33 agreements spanning infrastructure, power and trade during a bilateral meeting between State Counsellor Daw Aung San Suu Kyi and Chinese President Xi Jinping in Nay Pyi Taw. The two countries signed a concession agreement and shareholders’ agreement for the deep-sea port in Kyaukphyu Special Economic Zone, an important asset in the China-Myanmar Economic Corridor (CMEC).

Kyaukphyu is already an important oil and gas hub for the Chinese, where pipelines through which oil produced in Myanmar is delivered and exported to China. Industry watchers hailed the visit as a success, saying the meeting helped to advance developments, encourage investments and improve bilateral relations.

China serves as a no-questions-asked ally to Myanmar, giving it diplomatic cover as the country faces widespread condemnation over its human rights record. It is threatened with Western economic sanctions over a brutal counterinsurgency campaign that has driven more than 700,000 members of the country’s Northern Rakhine Muslim minority to flee for safety in neighboring Bangladesh.China for years has defended Myanmar in forums such as the United Nations, and Myanmar has returned the favor by following Beijing’s positions on issue such as China’s claims over territory in the South China Sea.China as a top investor and trade partner with Myanmar offers economic insurance if Western nations do impose sanctions.

Source: Myanmar Times

China invests in aviation, communications and garment sectors

A site of Oil and Natural gas pipeline project (Photo-SEAGP)

Although China had invested in Myanmar businesses such as energy, construction and transport sectors, they’ve also made investments worth USD20.9 billion in aviation, communications and garment industries.

Commercial Attaché Tan Shufu from Chinese Embassy said that business and trade cooperation between Myanmar and China largely stem from mutual interest. China had mostly stood top in the list of Myanmar’s trade partner list and China was the biggest trade market for Myanmar.

In 2018-19 fiscal year, Myanmar-China trade volume was US$11.36 billion. Myanmar had allowed China to invest in Myanmar businesses worth US$20.9 billion until December last year. They were investing in aviation, communications, agriculture, finance, tourism and garment sectors. They had also supported the Myanmar in improving their living standards.While the Chinese investment was the top in Myanmar for a long time, Singapore overtook China as the investment volume went over US$ 22 billion.

 The Chinese President will be visiting to Myanmar on January 17th. During his visit, MoU on border economic cooperation and Kyaukphyu Economic Zone and other projects under BRI may be discussed.“Myanmar and China is now striving to build the Belt and Road Initiative Project and Myanmar-China economic corridor. The incumbent government formed BRI Project Implementation Leading Committee and State Counsellor Daw Aung San Suu Kyi acted as the Committee’s Chairman,” said Tan Shufu.

Source:Eleven Myanmar

 

Myanmar’s Growth Resilient Despite Global Slowdown

Image result for World Bank economic monitor 2019Myanmar’s economy continues to show resilience despite the ongoing global slowdown and domestic uncertainties, according to a new World Bank report. The Myanmar Economic Monitor for December 2019 estimates that Myanmar’s economy grew at 6.3 percent in 2018-19, marginally higher than 6.2 percent in 2017-18. Economic growth is expected to reach 6.4 percent in 2019-20, helped by growing investment in the transport and telecommunications sector and planned infrastructure spending by the government before the 2020 elections.

The service sector is the main driver of growth in Myanmar and is expected to grow by 8.4 percent in 2018-19. A slow recovery in tourism related services is offset by robust growth in wholesale and retail trade. The industrial sector is expected to grow by 6.4 percent, on the back of strong manufacturing growth offsetting slower growth in construction. Firms in Myanmar need greater access to inputs such as finance, land, and skills, better connectivity, and an enabling business environment to support a responsible private sector.

The report recommends that polices should be geared towards private-sector led growth by fostering market expansion, improving the allocation of resources and developing the capacity of market participants.The Myanmar Economic Monitor is a biannual analysis of economic developments, economic prospects and policy priorities in Myanmar. The publication draws on available data reported by the Government of Myanmar and additional information collected as part of the World Bank Group’s regular economic monitoring and policy dialogue.

Source: World Bank

State-owned steel mill seeks investors

Image result for StateOwn Steel Mills in myanmarThe Ministry of Planning, Finance, and Industry is seeking expressions of interest from both domestic and foreign investors interested in participating in the recommissioning of the Myingyan Steel Mill.The steel mill, located near Sar Khar village, Myingyan Township in Mandalay Region, is reported to have a production capacity of 1.8 million tonnes a year.

The state-owned entity No. 1 Heavy Industrial Enterprise, which operates the Myingyan mill, is seeking investors to participate in the running of the mill. No. 1 Heavy Industrial Enterprise is under the control of the Ministry of Planning, Finance, and Industry.The government is willing to consider a range of proposals for different types of public-private partnerships including the possibility of limited disposal of certain designated product lines currently located at the mill.

At present, some 90 percent of the country’s steel needs is imported, with the other 10pc coming from local production.The South East Asia Iron and Steel Institute estimates that Myanmar’s steel demand will continue to expand at an average growth rate of 8pc a year, with steel demand in the country could exceeding 3 million tonnes in 2020 and reaching 5 million tonnes in 2025.

Source: Myanmar Times

Financial authorities, Kayin State SMEs discuss loans

Image result for sme loan in myanmarFinancial authorities held a meeting with small- and medium-sized enterprises in Kayin State yesterday to discuss granting loans to enterprises.
Some 150 businesspersons from Kayin State attended the meeting with the committee on providing financial assistance for private sector development, which was led by Deputy Minister for Planning, Finance and Industry U Maung Maung Win.

The local businesspersons requested that authorities relax rules for obtaining SME loans, extend the loan period and coordination from the governmental departments for granting land ownership documents, and decrease interest rates.

The officials from the committee explained the loan process and discussed the issues presented by the businesspersons. Kayin Region Chief Minister Daw Nan Khin Htwe Myint, Kayin State Minister for Planning, Finance and Development Affairs, officials from the Myanma Agricultural Development Bank and from the Central Bank of Myanmar were also present at the meeting.

Source:Global New Light of Myanmar

 

CMP businesses import raw materials worth $608.9 mln

Image result for CMP businesses import raw materials worth $608.9 mlnImports of raw materials by CMP businesses have been valued at US$608.9 million for the three months since October in the 2019-2020 fiscal year, an increase of $49.49 million compared with the year-ago period.Meanwhile, the exports of finished industrial goods touched a high of $2.6 billion between 1 October and 3 January in the current fiscal, an increase of $588.6 million compared with the corresponding period of the 2018-2019 financial year.

Myanmar’s manufacturing sector is largely concentrated in garment and textiles produced on the cutting, making, and packaging (CMP) basis, and it contributes to the country’s GDP to a certain extent.The CMP industry has emerged as a very promising one in the export sector. The value of CMP exports was just $850 million in the 2015-2016 fiscal year, but it tripled within two years to reach $2.5 billion in the 2017-2018FY, as per figures provided. In the first month of the current financial year, exports of clothes produced under the CMP system topped $320 million.

Japan is the largest market for Myanmar apparel, followed by the European Union. The Myanmar Garment Manufacturers Association has more than 500 members, and garment factories in Myanmar employ more than 500,000 workers. Investors prefer to invest in cheap-labor countries like Myanmar.

Source: Global New Light of Myanmar

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