Weekly Business News from Myanmar

China – Myanmar Trade and Investment Cooperation seminar took place in Yangon in order to boost business cooperation between the two countries
China (Dezhou) Myanmar Trade and investment cooperation seminar took place with the assistance of UMFCCI in Yangon on Monday. The seminar aims to boost business cooperation between Chinese and Myanmar entrepreneurs. The Chinese entrepreneurs are now showing interest to invest in Myanmar’s energy, agriculture, manufacturing and industry sectors. Chairman, CCOIC, Li LianJun said “We came here with our delegation for business matching with Myanmar entrepreneurs and government too. We’re really interested in energy, agriculture and manufacturing sectors. Officials would also explain about the investment laws and environment as well as policies in this seminar.” Myanmar entrepreneurs, in this seminar, answered questions on investment issues raised by Chinese entrepreneurs. Both sides hope for more foreign investment and greater business cooperation between China and Myanmar.
The Government will launch the tenders for the construction of at least two oil refineries to cover expected demand for products like petroleum in the next 20 years
The government will soon launch tenders for the construction of at least two oil refineries, now “urgently required” on the back of rising demand and higher oil prices, which has led to a much higher petrol import bill of late. “We will need one big oil refinery to cover expected demand for products like petroleum in the next 20 years. Myanmar needs to produce value-added oil products. This will involve huge investments,” said Daw Phyu Phyu Aung, Chief Process Engineer from State-owned No.1 Thanlyin Refinery. “As importing petrol when demand and costs are rising is a waste of money we will invite international investors to bid for the work, which will be under a joint venture arrangement with the government. The terms and conditions of the tender rounds are now under review,” she said. The India Oil Company is among the companies in discussion with the government, The Myanmar Times understands.
Mandalay Regional Government has permitted the opening of 14 locals and foreign business and GDP has risen to 7.4 percent in the 2017 - 2018 fiscal year
Mandalay Region, Myanmar’s second largest city, has permitted the opening of 14 local and foreign businesses in the 2017-2018 fiscal year, said Dr Zaw Myint Maung, chair of the Mandalay Regional Investment Committee. Nine foreign companies will contribute foreign direct investments totaling $13.6 million, while the remaining six companies will contribute K23.1 billion in local investments. “By reducing the administrative procedures involved in the approval process, we can now give the companies permission to do business in Mandalay on the spot if the applicant’s documents are complete,” Dr Zaw Myint Maung said. The move is part of a wider push to expedite the approval process for companies seeking to invest in the states and regions of Myanmar under the New Investment Law enacted in October 2016. Under that law, investment committees were formed in each of the states and regions to decentralise decision-making and facilitate investments.
Industry insiders discussed options to plug the gap between demand and supply of electricity by importing Liquefied Natural Gas (LNG)
At a Yangon energy seminar last week, industry insiders agreed that demand for electricity in Myanmar is rising much faster than supply can keep up with it. However, views on how best to solve the country’s chronic shortage of power soon diverged. Currently, electricity consumption in Myanmar stands at 3,300 MW. With demand expected to rise by around 15 percent each year for the next two years, total consumption could rise to as high as 5,000MW by 2020. As of now, the government plans to plug the gap between demand and supply of electricity by importing liquefied natural gas (LNG). It is currently in the process of negotiating the Power Purchase Agreements involved. But importing LNG is ultimately very expensive, so cheaper alternatives to producing power should have been explored before resorting to LNG, said energy analyst U Myo Myint. U Aung Myo Win, deputy director at the Planning Division under the Department of Electric Power and Planning, pointed out that the government opted for LNG due to the long periods involved in harnessing hydro power.
Ryobi Myanmar opened the biggest warehouse in Thilawa Special Economic Zone covering 36,000 square meters
Ryobi Myanmar, fully foreigner owed by a Japanese company, opened a warehouse with the land area of 36,000 square meters making it the largest warehouse in the country, at Zone A of Thilawa Special Economic Zone in Yangon on June 12. The company that founded Ryobi Myanmar is operating a warehouse service and distribution service, and invested $29.7 billion was used for building the warehouse in Thilawa SEZ. “I believe opening the largest warehouse in Myanmar will help the economic development not only of Yangon Region but also of the whole country. To grow the economy, it is not enough only with production. It is also important to have a well-established storage and distribution system to store goods for distribution,’’ U Myint Thaung, Minister of Planning and Finance, said.
More Chinese investors are interested to invest in Myanmar due to the threat of U.S. tariffs on Chinese goods
Due to the threat of U.S. tariffs on Chinese goods, Chinese exporters are looking for potential places to make investments, U Aung Kyaw Than, Deputy Director of Directorate of Investment and Company Administration, said at Korea-Myanmar Investment Forum held at Lotte Hotel, Yangon, on June 20. “Some investors are looking for other places to invest — especially in SEZs which already have infrastructure in place,’’ he said. Myanmar is given Generalized System of Preferences (GSP) on exports to the United States. The U.S. GSP program promotes economic growth in the developing world by providing duty-free entry to the U.S. market for goods imported from designated beneficiary developing countries. As a least developed beneficiary country of GSP, Myanmar may export almost 5,000 different products to the United States duty-free. Myanmar became a beneficiary of the GSP program on November 13, 2016.
Rice industry is urging parliament to advocate the legislation of a draft new rice law in order to regulate the supply chain
The country’s leading business group for rice is pushing the parliament to legislate a new law to regulate the sector. The Myanmar Rice Federation (MRF) is advocating the legislation of a draft rice law, U Ye Min Aung, secretary of MRF, said. In March, the MRF organised a stakeholder forum for the rice sector in Nay Pyi Taw, which was attended by State Counsellor Daw Aung San Suu Kyi. The event tackled two areas - the base price for paddy during the harvest period as well as to draft a rice bill. The Federation has drafted the rice bill, which is intended to support the development of the rice sector, and has consulted farmers and agriculture development committees from both houses of parliament this month. They have planned to talk to the Union Attorney General Office’s about the proposed legislation.
Myanmar government has granted permission for seven new registered express delivery providers to start their operations in the country
The government has officially granted permission to a total of seven new registered express delivery providers to carry out operations in the country. The registered service providers will provide postal and parcel express delivery services both domestically and internationally and will be managed by the Ministry of Transportation and Communication, according to a government notification. These include RG Express Services Co, Myanmar Zarla Distribution Co, First Courier Service Co, Hercules Logistics Co and UMG Logistics Co, which will provide delivery services domestically. Meanwhile, RG Express Services, together with Door Asia Cargo Services, will extend their offerings overseas. That private companies are taking an interest in the Myanmar postal service is positive for the sector, said U Thaung Naing Soe, regional manager of Myanmar Post in Yangon Region.
Myanmar's major tax reforms set for analysis in the report: Myanmar 2019 by global research and consultancy firm Oxford Business Group (OBG)
Myanmar’s plans to overhaul its tax regime, as part of broader efforts to boost revenue on the back of slower growth, will be mapped out in a forthcoming report by the global research and consultancy firm Oxford Business Group (OBG). The Report; Myanmar 2019 will shine a spotlight on the 2018 Union Taxation Bill, while also considering what’s next for the government’s tax amnesty proposals, which are now subject to review, following criticism that they could encourage tax evasion and inflows from dangerous groups. Key initiatives also set for analysis include the government’s decision to move away from the current method of tax collection to a self-assessment system. In addition, the publication will look in detail at the broader structural reform programme, which is driving Myanmar’s efforts to attract foreign investment for its pipeline of mega-projects, such as the phased Yangon New City initiative.
Myanmar Investment Commission (MIC) will remove unnecessary steps and procedures in order to promote smooth operations of business in the future
Myanmar Investment Commission (MIC) will remove unnecessary steps that may hinder smooth operations of businesses in the future, said Aung Naing Oo, secretary of Myanmar Investment Commission at a press conference at the Directorate of Investment and Companies Administration’s (DICA) office in Yangon on June 25. “The MIC will relax restrictions and make procedures clearer for investors within legal boundaries,” he added. Thaung Tun, Union Minister for the Office of Union Government becomes the new chairman and Set Aung, Deputy Minister for Planning and Finance, a new member.