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January 22, 2020

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Myanmar drafting national textile policy

Pic: Shutterstock

Myanmar is drafting a national textile policy for the development of domestic textile sector, according to the ministry of planning, finance and industry. The drafting process was initiated in January 2018 and the first stakeholder meeting was held in January last year involving relevant ministries, private organisations and textile businesses.

The policy is being drafted with the help of German government’s development organisation GIZ.It will include action plans, road maps, laws, rules and procedures, infrastructural development, creation of business environment that encourages local and foreign investment, manufacturing of value-added products, socio-economic development, technological acquirement, market competition, easy external trade and strengthened economic cooperation, according to a report in a Myanmarese newspaper.

Myanmar is also implementing a National Export Strategy (NES), under which there will be measures like transition of cut-make-pack (CMP) garment system into free on-board (FOB) system, adoption of bonded warehouse system and establishment of specialised textile and garment zone for boosting export.

Source:Fibre2Fashion News Desk (DS)

Legislation seeks to control country’s imports

Related imageThe Pyidaungsu Hluttaw announced the passing of the Law to Prevent an Increased Quantity of Imports on December 24,2019. Under to the new law, the Committee for Preventing an Increased Quantity of Imports will be formed and led by the Union Minister of Ministry of Commerce, the lead entity in the enforcement of the law.

The main of the new law is to enable the systematic investigation of serious injury to domestic producers or serious threat to domestic producer due to the increase in quantity of any kind of imports into Myanmar, and to support the competitiveness of domestic manufacturers during a certain period. The passing of legislation to manage the quantity of imports is needed to help the country’s economic development. The new law will be especially helpful for small and medium enterprises.

The law defines an “increased quantity of imports” as “a quantity of any kind of imports into Myanmar significantly higher than the amount of domestically produced goods that are similar or directly competitive”.Remedies under the law include tariffs and restrictions on import quantities.
Total trade volume for the period between October 1, 2018 and September 30, 2019 US$35 billion, with exports valued at $16.9 billion compared to imports of $18 billion. At $1.1 billion, the trade deficit falls short of the government’s target of $500 million. That trade deficit to $1.1 billion in fiscal 2018-19 is the first time in six years that imports grew faster than exports.

Source: Myanmar Times

Officials reassure business over controversial draft trade law

Pigeons fly by a rice warehouse in Yangon. Photo: EPA Myanmar’s heavily criticised draft trade law will not burden companies with another layer of bureaucracy and may be amended before submitting to the cabinet and then parliament, according to senior officials.The legislation was still in the consultation process and would be referred to the Attorney General within four months.Lawyers for the World Bank and Germany’s development agency GIZ were involved in the process.

The law would require many companies to submit to another layer of government approval and enable ministries to further regulate broad areas of the economy.Lawyers also warned the lack of clarity and room for government intervention in the latest version of the law risk introducing more bureaucracy and protectionism.Specifically, the legislation appears to require companies to apply for a trade registration certificate in order to carry out trading activities. Individual ministries will publish the list of businesses that need to apply for the certificate and further regulations for the “trade registration of individual traders”.

The legislation would also authorize the commerce ministry to regulate the e-commerce industry but does not elaborate on the regulations. The authority to issue what items are to be restricted in trade is not an economic move but would allow the ministry to systemically ban the import of items like arms and ammunition and alcohol and cigarettes, among others.Price controls only concern essential goods for the public and will ensure both public interest and business interests are taken into account.The functions of the Commission are broadly to make recommendations to the relevant government ministries on trade development, and to form committees and subcommittees doing the same.

Source: Myanmar Times

New microfinance bill submitted for approval

Related imageA new bill on microfinance has been drafted and proposed in the Pyithu Hluttaw.The bill, which will replace the 2011 Microfinance Institutions Law, was submitted by Daw Khin San Hlaing, an MP from Pale constituency and chair of the Banking and Financial Development Committee on December 10.The bill aims to support people in rural areas, eradicate illegal loan associations and provide financial assistance to local businesses involved in agricultural and livestock activities.It had become necessary to amend the existing legislation in order for it to be compatible with the changing environment and evolving technologies.

Major criteria included in the new bill include requirements that association members not be heavily indebted, sustainable development of those associations and sharing of financial knowledge among the members. The new law will provide recourse for lenders and borrowers and permit action to be taken against any wrongdoing. So, if the microfinance institutions (MFI) lend correctly and the lenders pay off their loans accordingly, this sector will develop and grow over the long term.

Besides rural farmers, microfinance can also be harnessed to support growth in the education and healthcare sectors.If the microfinance sector develops and is regulated well, people will be able to borrow money at lower interest rates from MFIs and avoid falling into a situation where they are unable to service their debts.Myanmar MFIs also provide borrowers the option of taking smaller loan amounts. Loans of up to a maximum of K10 million are available.

Source: Myanmar Times 

Myanmar reduces stamp duty penalties

Image result for stamp dutyMyanmar’s parliament has approved a proposal by the Ministry of Planning and Finance to significantly reduce existing stamp duty penalties. On November 26, the Law Amending the Myanmar Stamp Act was passed by the Pyidaungsu Hluttaw, Myanmar’s Union Parliament. The law lowers the penalties for late or deficient stamp duty payments to three times the payable stamp duty from 10 times before.

The Myanmar Stamp Act (1899) states that certain instruments, such as lease agreements, should be subject to the payment of stamp duty on or before the date of execution. Late payment or non-compliance could result in a fine equal to 10 times the payable stamp duty. The last grace period for late payments was under Thein Sein’s government in 2015. Businesses should keep in mind that instruments non-properly stamped may not qualify as deductible expenses during tax assessments.

The original bill was submitted to parliament in early November by the Ministry of Planning and Finance. U Maung Maung Win, deputy finance minister at the time, said the amendment was part of the 2017 bill, but was subsequently excluded from the approved law. The bill is intended to prevent huge fines and improve the tax-paying culture. In Thailand, failure to pay stamp duties brings a fine up to six times the unpaid amount, while Singapore charges four times, and Malaysia adds a 20 percent fine to the unpaid amount.

Source: Myanmar Times 

Myanmar reassigns minister of newly merged ministry

Image result for parliament myanmarThe Myanmar government has reassigned U Soe Win as minister of planning, finance and industry, a new ministry merged from two ministries, according to an announcement of Myanmar President’s Office issued on late Thursday. Myanmar’s parliament approved on Tuesday a motion to merge the Ministry of Planning and Finance, and Ministry of Industry into one new ministry, which was submitted by the president in order to speed up the government’s transition works.

U Soe Win was previously minister of planning and finance and minister of industry before the merging of the two ministries. The announcement also said two deputy ministers of the original Ministry of Planning and Finance U Maung Maung Win and U Set Aung, and one deputy minister of the original Ministry of Industry Dr. Min Ye Paing Hein were also reassigned as deputy ministers of the newly emerged ministry.

Source: Infosurhoy

CBM Issues Rules for Cross-Border Money Transfers

Related imageIn a move to counter illegal money transfers, the Central Bank of Myanmar on November 15 issued rules for cross-border remittances. Under the directive, only local companies registered in accordance with the Myanmar Companies Act who have placed a certain amount of deposit can apply for a cross-border remittance license. They have to provide documents of fund deposits to prove they are taxed and legal.

In addition, the applicants need to provide documents proving the experience and skills of the executives of the cross-border remittance business as well as criminal clearance certificates for the owners, executives and shareholders with over 10 percent ownership of the company. Moreover, employees of cross-border money transfer companies are required to attend training provided by the Financial Intelligence Unit, Myanmar Police Force, Special Intelligence Department and the Central Bank of Myanmar in accordance with anti-money laundering and anti-terrorism laws. Certificates of training completion must be submitted along with the license application.

Successful applicants will have to pay K1 million for a three-year cross border remittance license plus a K100,000 annual fee. The maximum amount for a single transaction is $1,000 and the monthly transaction cap is set at $5,000 per person. Penalties for delaying or failing to transfer funds or deceiving clients can include a suspension or withdrawal of license. Most migrant workers from Myanmar go to Thailand in search of work opportunities and their second most popular destination is Malaysia. Allowing authorized cross-border fund transfer services can benefit Myanmar migrant workers and overseas employment agencies. Hundi money transfer services will likely try for a license as well.

Source: Myanmar Business Today

Myanmar Govt to Combine Two Key Economic Ministries

Related imageThe Myanmar government plans to combine the positions of Minister of Industry and Minister of Planning and Finance into a single position, according to the Union Parliament agenda for Friday. According to the agenda, a Union-level representative from the government will explain the plan to parliamentary lawmakers in order to seek their approval. According to a proposal by President U Win Myint, the two ministries will be merged entirely and named the Planning, Finance and Industry Ministry, if lawmakers endorse the plan.

The Ministry of Planning and Finance is responsible for monetary services, bank services, public finance management, revenue systems, economic plans, investment, human resource development and coordination and communication with local and foreign organizations in the country. The Ministry of Industry is responsible for state-owned enterprises and ensuring that they are commercially viable. The ministry promotes the involvement of the private sector in state-owned enterprises and works to enhance private sector development to uplift the socioeconomic standards of citizens by developing SMEs.

In a bid to reduce government expenditure, the NLD began its tenure in power in 2016 with 19 ministers heading 21 ministries. However, the cabinet has expanded significantly since then: the most recent addition came last year, when the NLD created the Ministry of Investment and Foreign Economic Relations. The government now has 25 ministries led by 24 Union ministers and 20 deputy ministers.

Source: The Irrawaddy 

GAP certificate validity to be extended to two years

Image result for fruits and vegetablesThe validity of Good Agricultural Practices (GAP) certificates will be extended to two years, according to the Agriculture Department.

Good Agricultural Practices ensure food safety, and GAP growers can get more market access, locally and internationally. Additionally, GAP also ensures worker safety, health and welfare, and conservation of the environment. Therefore, the Agriculture Department is planning to extend the validity of certificates to two years. “Fruits and vegetables produced under GAP can fetch good prices. They ensure food safety and traceability. So, the department is raising awareness of GAP among growers by providing courses.

Next, the department is planning to introduce digital touch for seeking GAP certificates soon. Online applications can reduce red tape, and help bring smooth and quick service to growers. The Ministry of Agriculture, Livestock and Irrigation has encouraged farmers to use its GAP protocol in a bid to boost productivity, profitability, market access, and competitiveness in the agricultural sector. The GAP protocol and guidelines include the most consumed and major export items — mango, pomelo, honeydew, watermelon, avocado, chili, tomato, onion, cabbage, corn, sesame, various beans, rice, and coffee.

Source: Global New Light of Myanmar

Importers now need to register business for trading agri inputs, medical equipment

Related imageImporters will not be allowed to trade six items – fertilizers, seeds, pesticides, medical equipment, construction materials and equipment, and agricultural machinery and equipment without a wholesale or retail business registration, according to the Trade Department under the Ministry of Construction.

Foreign companies and joint venture companies between foreigners and Myanmar citizens, which are importing the six items using their import-export registration certificate, were given a 90-day deadline from 21 May to apply and register their business. The registration period has expired, but businesses are being allowed to proceed with the registration process, in accordance with the rules and regulations. However, businesses that have not registered will no longer be able to trade the six items using their import-export license alone. MOC recently announced it has issued registration cards to 11 retail and wholesale trading services.

To register their business with the MOC, companies will require their company registration papers; a copy of approval or endorsement from the Myanmar Investment Commission (only for foreign companies and joint ventures which need them); recommendations of the city development committee concerned; a list of commodity classification of goods to be distributed retail or wholesale; and a detailed business plan, including the initial investment amount, the location of distribution, and the dimensions of the facility. A company can execute retail, or wholesale, or both the trading services. They can apply for registration at the Trade Department of the Ministry of Commerce in Nay Pyi Taw and the export-import licence office of the trade departments in Nay Pyi Taw, Yangon, and Mandalay, depending on the type of company.

Source: Global New Light of Myanmar 

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