Weekly Business News from Myanmar

Union of Myanmar Federation of Chamber of Commerce and Industry (UMFCCI) urged government to allow providing exchanges services for the Chinese Yuan and South Korea Won
The Union of Myanmar Federation of Chambers of Commerce and Industry (UMFCCI) made a request to the Private Sector Development Committee chaired by Vice President U Myint Swe to allow providing exchange services for the Chinese Yuan and Korean Won. U Kyaw Min Hlaing, President of Hotel and Tourism Working Committee of MBI under the UMFCCI, argued that, if Myanmar offers a visa free program to other countries with an aim of boosting tourists, we should provide a currency exchange for those countries too. UMFCCI urged the government to allow exchanges for the currencies of the countries, which are enjoying visa free benefit granted by Myanmar, because there are illegal exchanges for those currencies. “The authorities said that they are in talks with counterparts of the other countries and we will know about it soon,’’U Kyaw Min Hlaing added.
Myanmar government authorities are preparing to invite tender from international companies for upgrading of Yangon- Pyay railway in early of 2019
Myanmar is preparing to invite tender from international companies early next year to upgrade Yangon-Pyay railway, one of the most important sections in the country which carries some 75 percent of all rail passengers, the official Global New Light of Myanmar reported on Sunday. The work of upgrading the railway will start in 2020, an official of the state-run Myanma Railways (MR) was quoted as saying. The MR is currently conducting feasibility study to use 200 million U.S. dollars to upgrade the railway and the project will be implemented within three years. The MR will also receive loans from the Asian Development Bank (ADB) and the European Investment Bank (EIB) for the upgradation project.
The operation of Thilawa port will be begun in February 2019
The mixed-use Thilawa Port, with its 400 meter long terminal and necessary container handling equipment, will commence operations in the Thilawa Special Economic Zone in February 2019, according to JICA’s statement on December 14. The Myanmar Port Authority, under the Ministry of Transport and Communications, is implementing the port using ¥23.4 billion loan (yen) from JICA under the contract signed between the Ministry Planning and Finance and JICA in 2013 and 2015. The 40 year loan has an interest rate of 0.01 percent, with 10 years of grace period.
Business communities are “wait and see” as government plans for transformation of the General Administration Department (GAD) to civilian control improvement of bureaucracy and regulatory environment for doing business in outside of major cities
The business community will “wait and see” if the transfer of the General Administration Department (GAD) to civilian control improves the bureaucracy and regulatory environment for those doing business outside major cities. The President Office last week announced that the GAD under the military-controlled Ministry of Home Affairs is set to be shifted to the Ministry of the Union Government Office, which is headed by U Min Thu, who was until recently a deputy minister in the President's Office. U Zaw Htay, the President’s Office spokesperson, told the press on December 22 that “the policy has been set” and the government “will work according to the procedures to implement it.” The military still has control over defence, border affairs and home affairs ministries without the oversight of civilian authorities.
The volume of Foreign Direct Investment (FDI) has doubled from the beginning of this new fiscal year to the second week of December 2018 when compared to the same period of last fiscal year
From the beginning of this new fiscal year, to the second week of December, the amount of Foreign Direct Investment (FDI) has doubled compared to the same period last year, according to Directorate of Investment and Company Administration. Myanmar changed the fiscal year format from April-March to October-September, starting from 2018-2019 fiscal year. During 2017-2018 fiscal year, the volume of foreign direct investment reached over $355 million from October to the second week of December while this fiscal year’s FDI hit $749 million during the same period. “During the last fiscal year, there were only 19 projects in Yangon, this year though received 25 projects. Last year, Kayah State and Tanintharyi Region didn’t receive any FDI compared to this year which Kayah State received one project and Tanintharyi Region has received two projects. There are also new FDI flowing into Mon State and Thialawa SEZ,’’U Aung Naing Oo, General Director of DICA, said.
Taiwan’s top aluminum maker, Abba Aluminum Co., launched its first manufacturing plant in Thilawa Special Economic Zone (SEZ) which cost 13 USD million worth
Taiwan’s top aluminium maker has launched its first manufacturing plant in Myanmar. Abba Aluminium Co, headquartered in Taoyuan, held the opening ceremony for its factory in Thilawa Special Economic Zone (SEZ) on December 24. Initial investment amounted to US$13 million and 300-500 local employees will be hired, according to Abba’s chair Chen Pai-chin. The estimated production value is expected to reach $32.5 million per year. Mr Chen said the presence of a large number of “ethnic Chinese people in Myanmar” gives the country an edge over other CLMV economies (Cambodia, Laos, Myanmar and Vietnam) for manufacturers from Chinese-speaking countries. He added that Myanmar’s young workforce is another attraction.
Ministry of Planning and Finance will increase tax on imports in order to expand the market of local products instead of importing goods
In an effort to reduce imports, the Ministry of Planning and Finance will levy more tax on imports instead of placing tax on locally produced products with high quality that can replace the imported products, according to U Soe Win, Union Minister of the Ministry of Planning and Finance, during the regular meeting between vice president of Myanmar and local businessmen held at UMFCCI on December 14. “With the aim of nurturing the manufacturing sector for import substitution, we will raise tax on the products imported even though the same kind of products produced locally are present in the market,’’he said. However, he did not identify the imported products on which more tax will be placed. For import of raw materials which are necessary for local industry, the ministry has plans to lower the tax for a certain period, he added.
According to a report by the Central Statistical Organization (CSO), average inflation rate based on the Consumer Price Index (CPI) increased from 6.34 percent in October to 6.66 percent in November 2018
The average inflation rate, based on the Consumer Price Index (CPI), increased to 6.66 per cent in November from 6.34 per cent in October, according to a recent report issued by the Central Statistical Organization (CSO), under the Ministry of Planning and Finance, state media reported. China’s suspension on importation of some agro products through the border since October has halted some freight forwarding services, hiking up commodity prices and pushing up the inflation rate.
Mandalay property market still cool with renting despite the fact that the government has changed the property tax rate
Although the government has changed the property tax rate, the property market is still cool in the city and suburban areas in Mandalay Region. However, the rental market for apartments located in Chanayethazan Township and Yadanarbon market is slightly rise as more and more shops and showrooms are being opened these days. Most of the shop owners are renting some apartments, and houses which are located on 73rd Street between 26th and 35th streets as well as on the 78th street between 26th and 38th streets in Chanayethatzan Township to open mobile shops, online stores, motorcycle showrooms and auto accessories shops. The rental for a 20×40 foot room is around K1 million per month while for the whole house it is over K2 million per month, according to real estate agents.
Directorate of Investment and Company Administration (DICA) plans to held Chin State Investment Forum in Yangon on 16 March 2019 in order to bring more investment to Chin State
With the aim of bringing in more investment to Chin State, the Directorate of Investment and Companies Administration will hold Chin State Investment Forum at MCC Hall in Yangon on March 16 next year. Chin State receives least amount of investments in Myanmar, so the forum will showcase investment opportunities in Chin State such as products and potential tourist destinations. “We have plans to showcase Chin State, but we want the forum to be more effective than forms held in the past that were not effective in bringing in investment,’’said U Aung Naing Oo, General Director of DICA.