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Weekly Business News from Myanmar
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Union Government seeks Union Parliament approval to establish Yangon Special Economic Zone project on about 20,000 acres of land covering Dala, Kawhmu and Kungyangon townships in Yangon
The union government will seek approval from union parliament to establish Yangon Special Economic Zone on about 20,000 acres of land covering Dala, Kawhmu and Kungyangon townships in Yangon Region, according to a development proposal plan of the region. Currently, the Yangon region government is holding a series of work coordination meetings on the implementation of Yangon SEZ project that will include deep-sea port construction. Over 20 development projects have been proposed for the region with the aim of improving industrial sector, creating job opportunities, improving trade sector and ensuring easy flow of foreign exchange. The projects include housing improvement, new town plans, industrial zones, dry pots, Nyaunghnapin industrial zone, elevated road project and 11 industrial zones outside the municipal area. However, a new Yangon city project has less potential for implementation following a remark made by President Win Myint. Meanwhile, some of those proposed development projects are also facing opposition. -
Ministry of Electricity and Energy signed power purchase agreement with Great Hor Kham Public Co.,Ltd for the Nam Paw hydropower project in northern Shan State in order to meet Myanmar’s growing energy needs
After announcing high-profile gas-fired power projects earlier this year, the Ministry of Electricity and Energy is now focusing on a string of hydropower dams – most with Western developers – to meet Myanmar’s growing energy needs. AT A CEREMONY in Nay Pyi Taw on July 5, the Ministry of Electricity and Energy signed a power purchase agreement with Great Hor Kham Public Co, Ltd for the Nam Paw hydropower project in northern Shan State. The signing didn’t get much media attention. The project is only 20 megawatts; Myanmar needs to add something like 300 megawatts a year of installed capacity just to keep up with rising demand. Although it may power up to 40,000 homes in Muse Township, Nam Paw is the proverbial drop in the ocean. But the agreement is symbolically important, not least because it appears to be the first PPA for a new power project signed since the National League for Democracy government took office in late March 2016. -
Myanmar rubber industry will benefit from better development of technology, access to rubber species and better market penetration from Natural Rubber Producing Countries (ANRPC) membership
Myanmar rubber businesses will benefit from more growth opportunities if the country joins the Association of Natural Rubber Producing Countries (ANRPC), said U Hla Kyaw, deputy minister of the Ministry of Agriculture, Livestock and Irrigation (MOALI). “The rubber industry will enjoy better development of technology, access to rubber species, better market penetration and more job opportunities if Myanmar joins the ANRPC,” U Hla Kyaw said. The ANRPC has also advised and urged MOALI to join their association. The yearly membership fee to join the association is US$5,000, with an initial payment of $1,666 required for the four months between September and December. -
Retail market in Myanmar yields better opportunities for growth compared to the neighbouring countries and demand for retail space is still on the rise
Demand for retail space has been on the rise in Yangon, where the population has swelled and living standards are improving. Earlier this year, the government also permitted foreign ownership of local wholesalers and retailers and last month allowed businesses in the sector to trade in a total of 24 products. Ko Nay Min Thu, managing director of imyanmarhouse.com, told The Myanmar Times that the retail market in Myanmar yields better opportunities for growth compared to neighbouring countries. This is because there are still few shopping malls in relation to the number of people. “Shopping malls with recreational areas have become popular in Singapore, Thailand and Malaysia. When Myanmar people visit these countries, they have fun in these shopping malls so there is potential to develop similar retail offerings in Myanmar,” he said. The retail sector can be broken down into shopping malls, hypermarkets, supermarkets, department stores and supporting retail outlets such as standalone stores or shops in condominium buildings, for example. -
Insurance providers including state-owned Myanma Insurance and 12 private insurance companies will provide short term endowment life insurance policies in Myanmar
Insurance providers in Myanmar including state-owned Myanma Insurance and 12 private insurance companies will provide short term endowment life insurance policies as part of their product portfolios, said Daw Sandar Oo, chair of Myanmar Insurance Association (MIA) and managing director of state-owned Myanma Insurance. Currently, Myanma Insurance provides 26 types of insurance and private insurance companies provide 13 types of insurance, including general, fire and vehicle insurance policies. On August 3, Grand Guardian Insurance (GGI) became the first insurance provider to offer short term endowment life insurance in Myanmar. -
Yangon Regional Government met with Thai industrial estate developer, Amata Corporation PCL, and discussed details of the industrial zone project which is included in the Yangon Amata Smart and Eco city project
On August 7, U Phyo Min Thein, chief minister of Yangon Region Government met with executives of Thai industrial estate developer Amata Corporation PCL at the Yangon Region Office to discuss the Yangon Amata Smart and Eco City Project. Talks revolved around nailing down the construction plan and building a 150 megawatt power plant for the project, which is one of the urban development projects being carried out by the Yangon Region Government. The Yangon Amata Smart and Eco City Project is one of 23 urban development projects proposed by the Yangon Region Government in April. The proposals are still being considered by the regional parliament, said U Nay Phone Latt, representative of the Yangon Hluttaw. According to a report by the Yangon Region Government, the Yangon Amata Smart and Eco City Project will be located at Dagon Myothi, northeast of Yangon. The industrial zone project will span 16,000 acres and be developed in phases between 2018 and 2026. -
Local economist warns of adverse impact of Kyat depreciation on Myanmar's export competitiveness in the manufacturing and agriculture sectors
MYANMAR’S government has been urged to rein in the rise of the kyat and ease the impact of a decline in export competitiveness on the country’s manufacturing and agricultural sectors. The economy could be in deep trouble, if the exchange rate continues to appreciate against the US dollar, said U Myint, who served as the chief presidential economic adviser in the previous government. On Tuesday, the market rate set one US dollar at 1,468 kyats, 126 kyats higher than that of July. “When earnings from exports in local currency are no longer able to cover the costs of production, huge losses are incurred and enterprises have to close down,” U Myint told a public forum. “When enterprises close down, workers lose jobs, farmers and fishermen cannot sell their products. When they cannot sell their products this year, they will not produce them next year. The economic, social and political consequences of this chain of events can be serious.” He foresees a decline in the manufacturing and agricultural sectors if the government cannot exert some control over the volatility in foreign exchange. -
Companies in the promotion zone made 75 percent of overall investments in Thilawa Special Economic Zone (SEZ) since 2014 – 2015 fiscal year
Companies in the promotion zone of Thilawa Special Economic Zone (SEZ) brought US$1.13 billion into the zone since 2014-2015 fiscal year, accounting for over 75 per cent of overall investments. There are 59 companies executing in the promotion zone. Meanwhile, 38 companies are working as free zone investors in Thilawa, with investments of $363 million. In the past four months this year, three companies invested in promotion zone while one went to free zone. A company exporting at least 75% of the production in value is registered as a free zone investor, who will be exempted for corporate tax for 7 years starting from commercial operation. Companies, such as logistics that support export-oriented manufacturers, can also be free zone companies. Domestic- oriented manufacturing companies are regarded promotion zone companies and they are eligible to enjoy five-year tax holidays for corporate tax. -
Ministry of Industry invites foreign and local enterprises to submit Expressions of Interest (EOIs) to invest in the State owned, Economic Industrial Park (Thaton) in Inn Shae village, Thaton Township, Mon State
The Ministry of Industry (MOI) is inviting foreign and local enterprises to invest in the Eco-Industrial Park (Thaton) in Inn Shae Village, Thaton township, which is in Mon State. The park is open to businesses involved in any sector. Investors interested in setting up facilities at the 400-acre park are required to submit Expressions of Interest (EOI) to No.(3) Heavy Industrial Enterprise, which is under the MOI, by the deadline of September 28. -
Yangon Tyre fends off competition for more growth as demands for rubber tyres is rising in tandem with various types of vehicles in Myanmar
Yangon Tyre, a homegrown tyre maker, wants to grow its local market share as demand for rubber tyres rises in tandem with various types of vehicles in Myanmar. “As more infrastructure is developed and existing road conditions improve, there will be less need to replace damaged tyres, but the number of vehicles on the roads will nevertheless increase,” Dr Htin Kyaw Oo, CEO of Yangon Tyre, told The Myanmar Times during an interview. With its second factory in Bilin now up and running, Yangon Tyre is already producing tyres for passenger vehicles and small trucks. This year, the factory began manufacturing tyres for bicycles and capacity is now up to 600 per day from 200 before. The company is also finalising plans to expand its product range to include tyres for tractors and motorcycles. Currently, tractor tyres are mostly imported, but with demand rising from the agriculture sector, it’s time to start producing domestically, Dr Htin Kyaw Oo said.
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