Weekly Business News from Myanmar

Over the past two years, the Ministry of Hotels and Tourism has closely cooperated with other government agencies and the private sector on tourism development: 2.9 million tourists and 3.44 million tourists visited Myanmar in 2016 and 2017, respectively
Tourism, the smokeless industry, contributes directly towards national economic development by earning foreign exchange, creating job opportunities and flowing cash directly or indirectly to all walks of life. Attraction, accessibility, accommodation and administration are the distinctive characteristics of healthy tourism. For development of Myanmar tourism industry, the Ministry of Hotels and Tourism is closely cooperating with related ministries, international tour agencies, development partners and private tour operators. The number of tourists visiting Myanmar has increased year after year, and according to data jointly collected with the Ministry of Labour, Immigration and Population, 2.9 million tourists chose Myanmar as their destination in 2016 and in 2017 the number hit 3.44 million.
Ministry of Planning and Finance has approved a two year crop insurance project to protect farmers as a result of erratic weather conditions in Myanmar
The implementation of a recently approved crop insurance scheme to protect farmers in Myanmar, while urgently needed, will face challenges as stakeholders grapple with the risks and complexities. In January, the Ministry of Planning and Finance approved a two-year pilot crop insurance project aiming to cover damages to crops as a result of erratic weather conditions in Myanmar. The project, which will first be carried out on an experimental basis, is being offered by Global World Insurance, and will cover only paddy for now. It will commence this paddy season and cover the Yangon, Ayeyawady, Magwe and Mandalay regions. It is also the first time a crop insurance scheme is being implemented in the country. In Myanmar, insurance is mainly offered by state-owned provider Myanma Insurance and a smattering of private insurance companies. However, the existing portfolio of products and services does not include crop insurance. This is the case even though agriculture accounts for one third of Myanmar’s GDP, provides jobs for half the population and represents one fifth of the country’s exports.
Insufficient public funds have been allocated to power generation and supply has consistently lagged behind demand despite the government's promise to fully electrify Myanmar by 2030
The government has promised to fully electrify Myanmar by 2030. Yet, insufficient public funds have been allocated to power generation and there are no immediate plans to restructure loss-making tariffs or charge more for electricity. One of the government’s top promises since it came into power is to supply electricity to the entire country by 2030. Yet, supply has consistently lagged behind demand. At the same time, the government continues to fund tariffs at a loss, and there are no immediate plans to raise electricity prices. Currently, there are around 6.5 million households, or some 40 percent of the population, which has no access to electricity. With more foreign investments needed to boost growthin power-intensive industries such as manufacturing and technology, electricity consumption will only increase in the years to come. Despite mounting pressure to meet growing demand though, public funds allocated towards developing and expanding the power sector has so far been insufficient. In fact, public spending has fallen over the last few years.
Small and Medium Enterprises (SMEs) need more funding, technology, and support systems to generate meaningful economic growth
Efforts to support small and medium enterprises (SMEs) over the past three years have so far not been sufficient to generate meaningful growth for the economy, experts said. While a higher volume of loans were dished out by state-owned and local banks, only a few SMEs have successfully expanded their operations in the past three years. “There were definitely efforts to help local SMEs, but none have been game changers so far,” said U Ngwe Tun, owner of local business Genius Coffee. The problem, he points out, is the lack of a support system that provides SMEs with assistance in gaining access to financing as well as technology, human resources and a framework setting basic standards of book keeping and governance. U Zin Phyo Paing, a trainer and consultant for local SMEs, said the other issue is financial management: “Giving loans alone is not enough. In fact, the hard part is how to manage debt and be able to repay it. Currently though, not many SMEs practice good debt management,” he said.
Exclusive interview with Union Minister of Commerce, Dr. Than Myint on the performance over two years by Ministry of Commerce
Myanmar rice export broke 70 years old record. Trading plays a vital role in the development of a country’s economy. As for the Ministry of Commerce, efforts are being made to transform the process of the implementation of the economic system. The following are some of the excerpts from the interview with Ministry for Commerce Dr. Than Myint. Q : Could you let us know what the aims and objectives of the Ministry of Commerce are? A : During the tenure of the new government, the state has laid down a 12-point-economic-policy which can foster the development of the country’s economy. In accordance with the state’s policy, the Ministry of Commerce has adopted 26 processes including Trade Promotion, Trade Facilitation, Trade Negotiation, Trade Liberalization, Trade Education and Consumer Protection, which can connect to other trading sectors. Q : Could you elaborate more about trading process in Myanmar? The main duty of the Ministry of Commerce is to boost the trading and develop the private sectors as well. It is important to increase the volume of foreign exports.
In cooperation with the Economic Development Cooperation Fund from the Republic of Korea, Ministry of Transport and Communications plans to construct an e-government integrated data centre to boost the government's e-services
The Ministry of Transportation and Communications is set to construct an e-government Integrated Data Centre in cooperation with the Economic Development Cooperation Fund from the Republic of Korea to boost government e-services. Daw Nwe Ni Soe Yin, director of e-Government Department of the Ministry of Transport and Communications, told The Myanmar Times that the South Korean government has sent a draft agreement on the funding of the project. “In order to sign a mutual agreement, discussions are being carried out,” she said. After the discussions are completed, the cost of the project will be set.” The objectives of building the data centre are to upgrade and combine e-government services that are now being conducted separately by each department. This will ultimately lead to better online services.
Asia AVA Gas Company formed a joint venture with Myanmar Petrochemical Enterprise (MPE) to build LPG facilities in Myanmar
Asia AVA Gas Company has entered into a joint venture with Myanma Petrochemical Enterprise (MPE), which falls under the remit of the Ministry of Electricity and Energy (MOEE) to undertake a project enabling the import, storage and distribution of liquefied petroleum gas (LPG) in Myanmar, Daw Yin Yin Aung, deputy director of MPE, told The Myanmar Times. Asia AVA Gas Company, in turn, is a JV between Singapore’s AVA Kahyasis Investment and domestic firmsSky Construction Company Ltd and Guiding Star Group Ltd. The project will include construction of a jetty, storage tanks, loading and unloading facilities and a gas-filing plant. It will involve an initial investment of $60 million and be developed across 32 acres of privately-owned land near Bogyoke Village, which is in Thalyin township, Yangon. The permitted duration of investment is 50 years. The project, which received Myanmar Investment Commission approvalin 2016, has already completed the necessary topographic surveys and soil tests.
Shwe Taung Groups is involved in a Public Private Partnership (PPP) to develop the Yuzana low cost housing project in Dagon Seikkan
Infrastructure developers at Dagon Seikkan township, Yangon Region, have experimented successfully with modern construction techniques aimed at saving time and costs as well as building sustainable living conditions. Last week, local real estate developer Shwe Taung Group, which is involved in a Public-Private Partnership (PPP) to develop the Yuzana low cost housing project in Dagon Seikkan, announced the completion of seven five-storey residential blocks using construction technologies developed in Singapore. Six of out of the seven completed apartment blocks were built using Singapore-listed construction firm Tiong Seng Holdings’ semi-precast methods, while the seventh utilised the company’s Prefabricated Pre-finished Volumetric Construction (PPVC) technologies.
Myanmar's reform program and infrastructure plan to improve its investment environment and stimulate growth are explored in "The Report: Myanmar 2018" by the global research and consultancy firm Oxford Business Group (OBG)
Myanmar’s efforts to enhance its investment environment and stimulate growth through a series of wide-ranging reforms are explored in a new report from the global research and consultancy firm Oxford Business Group (OBG). As the country approaches the two-year anniversary of its first civilian-led government, The Report: Myanmar 2018 charts the impact of efforts to create regulatory certainty for investors through landmark legal developments such as the Investment Law, Companies Law and Condominium Law. The report also charts the country’s progress in plugging its vast infrastructure gaps in order to improve nationwide productivity and galvanize the construction, logistics, trade, and tourism sectors. Key issues examined include the steps being taken to tap a broader range of financing mechanisms, such as public-private partnerships, concessional loans from development partners, and treasury bond issuances, for the country’s planned port, rail and road works. In addition, OBG’s publication tracks the latest developments in the property market, which is poised for a period of heightened activity once remaining ambiguities on foreign ownership of residential apartments are clarified.
The Indian government signed an agreement on the construction of the India- Myanmar- Thailand trilateral highway to boost trade and cultural exchange between the three countries
The India–Myanmar–Thailand Trilateral Highway is that will connect India with the ASEAN region. The highway will link Moreh in Manipur state (India), via Mandalay city (Myanmar) and to Mae Sot district (Thailand). India Government has signed agreement on construction of the highway according to Business Standard news agency. The 1,400-kilometre-long highway that will link India with Southeast Asia by land for the first time in decades, giving a boost to trade and cultural exchanges between the three countries. National Highway Authority of India (NHAI) has checked companies that won tender for construction the project for four months. Among these companies, Punj Lloyd and Varaha Infra companies were chosen and the two companies will cooperate in construction the highway.It is estimated that Rupees 771 billion will be invested in the project.