Weekly Business News from Myanmar

• 

  Foreign investors are still expressing their interest to invest in Rakhine State despite sanctions and international pressure applied due to the political unrest

  Foreign investors are still showing interest in Rakhine State despite sanctions and international pressure applied due to the political unrest. And now that the state has better access to electricity, conditions are looking better for businesses to enter the state or expand. Projects related to China’s Belt and Road initiative remain a focus, with the Kyaukphyu special economic zone (SEZ), which comprises a deep-sea port, industrial park and housing, being a major pull of foreign direct investment (FDI) into the state. The industrial park will support businesses involved in aquaculture, livestock and garment industries while the deep-sea port and its facilities will connect Myanmar with a regional network of economies including China, India and Asean.
• 

  Tanintharyi Region Government will hold Tanintharyi Region Investment Forum in this October

  The Tanintharyi Regional Government is planning to organize an investment forum this October. The goal will be to boost investments in the region. According to the Directorate of Investment and Company Administration (DICA), it is considering showcasing the Hotel and Tourism industry, the real estate industry, and the extractive industry. U Thant Sin Lwin, the Director General of DICA, said: “This kind of event is organized by the state and regional governments in accordance with their policies. We are simply supporting them by inviting international organizations and facilitating with other related agencies.”
• 

  The average inflation rate increased by 1.53 percent to 3.27 percent for nine consecutive months of this fiscal year

  From April 2018 to June, 2019, the average inflation rate increased by 1.53 per cent to 3.27 per cent, for nine consecutive months of this fiscal year, according to the figures released by the Ministry of Planning and Finance. The year-on-year inflation is expected to hit 4.10 per cent and the average inflation rate, 4.81 per cent in 2018-2019 FY. From April 2018 to June, 2019, the average inflation rate hit 6.34 per cent in October, 6.66 per cent in November, 6.86 per cent in December, 6.94 per cent in January, 7.07 per cent in February, 7.28 per cent in March, 7.51 per cent in April, 7.82 per cent in May and 8.08 per cent in June. Since April, 2018 till June, 2019, the inflation rate saw an increase for 15 consecutive months. The average inflation rate calculated using 2012 as a base year was 8.08 per cent and the year-on-year inflation rate, 9.51 per cent.
• 

  The civil society groups urged to halt dam projects on Tanintharyi River which would affect about 32,000 people in communities

  YANGON — Plans to build dams on the Tanintharyi River would affect about 32,000 people in communities that have never been adequately consulted, according to a report by three Karen civil society groups that calls for a halt to the projects. The report says there are 18 memorandums of understanding to build dams on the river, but “local communities have received no information on their location, size or status”. It calls on the Tanintharyi regional government to provide full information to affected communities and civil society about the planned dams, which it says could also have a catastrophic impact on aquatic ecosystems and vast pristine forests, and pose a threat to the peace process. The report, Blocking a bloodline: Indigenous communities along the Tanintharyi River fear the impact of large scale dams, compiled by the Candle Light Youth Group, Southern Youth and Tarkapaw Youth Group, was released in Yangon on August 9 to mark the International Day of the World’s Indigenous Peoples.
• 

  Japanese insurance firms are pushed the growth of insurance market in Myanmar

  With Myanmar’s Ministry of Planning and Finance giving the green light to six joint ventures between local and foreign insurance companies at the end of July, Japanese insurance firms are poised to dominate the country’s insurance market. Five of the six foreign insurance companies now permitted to provide life and general insurance services together with local companies are from Japan; the sixth is from Thailand. Japan’s Taiyo Life and Nippon Life and Thailand’s Thai Life will partner with local companies Capital Insurance, Grand Guardian Insurance and Citizen Business to provide life insurance. In general insurance services, Japan’s Sompo Japan Nipponkoa, Tokia Marine and Nichida Fire, and Mitsui Sumitomo will partner with Aya Myanmar Insurance, IKBZ and Grand Guardian Insurance.
• 

  Htikhee border trade surged USD $ 2 billion from gas exports for the current fiscal year

  Natural gas has incrementally boosted Tanintharyi Region’s exports to Thailand via the overland border route to US$1.9 billion from a mere US$3.5 million between October 2018 and July this year. Ministry of Commerce assistant secretary U Khin Maung Lwin said the jump in exports came from including the region’s natural gas exports into the trade data from the Na Bu Lel (Htikhee) border trade route. Tanintharyi Region’s natural gas exports used to be counted as overseas exports. “The border trade has sharply increased after we included it in the border trade list following discussions with customs and the Central Statistical Organisation,” he said.
• 

  Myanmar Rice Federation (MRF) invited investors to submit the proposal for building rice drying machines and storage facilities

  The Myanmar Rice Federation (MRF) has invited investors, especially local farmers, to submit proposals for building rice drying machines and storage facilities. The overall project will require about K170 million in investments. The project will be implemented as a joint project between small and medium enterprises and local farmers in the areas where the rice is mainly grown. The MRF said the rice drying machines and small-scale rice storage facilities will dry harvested rice and help reduce losses from quality degradation during the post-harvest season. There needs to be five farmers investing per project. They will only be required to invest one-third of the cost, and the federation will help acquire other financial assistance with low interest from the government and other partner organizations.
• 

  Ministry of Construction, Korea Land and Housing Corporation and Global Sar-A Co Ltd is setting up a joint venture company to develop an industrial zone in Hlegu Township, Yangon

  Myanmar’s Ministry of Construction, Korea Land and Housing Corporation and Global Sae-A Co Ltd is setting up a joint venture company to develop an industrial zone in Hlegu township north of Yangon. An agreement was signed on August 7 for the industrial zone, to be known as the Korea Myanmar Industrial Complex (KMIC), which would be built on 555 acres of land belonging to NyaungHna Pin training school. Minister of Construction U Han Zaw said the KMIC would not only create between 50,000 and 100,000 jobs but also enhance the country’s manufacturing base, exports, training of talent and support socio-economic development.
• 

  Myanmar has a total debt of Ks 38,117 billion including an external debt of $ 9.89 billion till 31 March of this year

  Till March 31 of this year, Myanmar has a total debt of Ks 38,117 billion including an external debt of 9.89 billion US dollars, said Deputy Minister for Planning and Finance Maung Maung Win. Myanmar had Ks9,938 billion in domestic debt and Ks6,335 billion in external debt, in 2011-2012 fiscal year, Ks 10,824 billion in domestic debt and Ks 7,301 billion in external debt in 2012-2013 FY, Ks 12,014 billion in domestic debt and Ks9,561 billion in external debt in 2013-2014 FY, Ks 12,487 billion in domestic debt and Ks 9,545 billion in external debt in 2014-2015 FY and Ks 15,724 billion in domestic debt and Ks 12,246 billion in external debt in 2015-2016 FY.
• 

  Local insurance industry’s change of plans could be a setback for insurance market

  The local insurance industry may have been dealt a setback after negotiations between several local and foreign insurers were reported to have broken down. According to a report by Nikkei, which cited insiders, local insurers decided to pull out of talks with Thailand’s Muang Thai Insurance and Muang Thai Life Assurance, and South Korea’s DB Insurance, after learning that they were only allowed to set up the joint ventures by buying newly issued shares of local insurers instead of existing shares, as previously communicated. The Nikkei cited an unnamed industry insider who said that the local insurers were more reluctant about setting up the partnerships after learning about the new ruling, which was made known at the last minute by the government. According to the Nikkei, up until April, the understanding was that local insurers could sell existing shares to form these partnerships.