Weekly Business News from Myanmar

• 

  Increased connectivity and trade promoted at forum to discuss 70 years of India-Myanmar relations

  At a forum held in Yangon to celebrate and discuss 70 years of India-Myanmar relations, a key message to come out being the need to substantially increase connectivity, trade and diplomatic relations between the two neighbours. Parami Roundtable and Mizzima Media Group organised the first India-Myanmar Dialogue ‘Act East Policy and India-Myanmar Relations’ at Park Royal Hotel on 2 September 2017 to commemorate the 70 years of India-Myanmar relations. The roundtable was attended by high level speakers from India and Myanmar. Mr Ken Tun, Chairman, Parami Energy Group, the main organiser and sponsor, extended the opening remarks. H.E. Mr. Vikram Misri, Indian Ambassador to Myanmar extended the special remarks. U Nay Oke, Professor of English gave the keynote address. The Book entitled “Myanmar's Integration with the World: Challenges and Policy Options”, jointly edited by Prabir De and Ajitava Raychaudhuri with contributions from several Myanmar scholars and published by Palgrave Macmillan, Singapore was also released at the roundtable.
• 

  Former UN Secretary-General Kofi Annan’s Commission on Rakhine has recommended that the Myanmar government conducts a a strategic environmental assessment( SEA) and labour market assessment on Kyaukphyu SEZ

  The Commission cautions that large-scale projects in Rakhine State have bred local resentment towards the central government and stresses that local communities should have a greater say in the state’s development. AN advisory commission tasked with finding solutions to the ethnic conflict in Rakhine State has recommended that the government conducts a strategic environmental assessment and labour market assessment for Kyaukphyu Special Economic Zone (SEZ). It also questioned the land acquisition activities in the area. The final report of former UN Secretary-General Kofi Annan’s commission on Rakhine issue was submitted to President U Htin Kyaw on August 23 and subsequently released.
• 

  Yangon SMEs will receive smart cards to facilitate access to loans

  Smart cards to help small and medium-sized enterprises (SMEs) apply for bank loans will be issued after the relevant data is collected, Yangon Chief Minister U Phyo Min Thein said at a meeting with local businesses at the Republic of the Union of Myanmar Federation of Chamber of Commerce and Industry (UMFCCI) office on August 28. THE program will cover 45 townships in Yangon Region including Cocokyun. "So far, we have collected the relevant data for SMEs in Yangon Region. After we have made the necessary ground checks, SME smart cards will be issued to those businesses. Every SME will have a smart card with its loan data uploaded," the Chief Minister said. The lack of loan data is one of the factors delaying the processing of loans and the rate at which money is extended to SMEs.
• 

  Maungdaw in Rakhine State is set to become another Special Economic Zone to boost economic development and border trade,

  Rakhine State government has set in motion plans for the state’s third economic zone to boost economic development and border trade. U Kyaw Aye Thein, Rakhine State Minister for Planning and Finance, told Myanmar Business Today that the government has selected a parcel of land in Maungdaw Township, northern Ra¬khine State, as the pro¬posed location for a bor¬der economic zone. This is the state’s third planned economic zone after the Kyaukphyu Special Economic Zone and deep sea port which is still being dredged and the Ponnagyun Economic Zone near Sittwe on which bulldozers have yet to break ground.
• 

  Myanmar’s economy is projected by the World Bank to grow by an average of 7 percent between 2017 and 2019

  Major structural overhauls have to be carried out so the country can maximise its potential for growth. Myanmar’s economy is projected by the World Bank to grow by an average of 7 percent between 2017 and 2019. Last year, GDP rose by 6.5pc. That’s among the fastest growing economies in Asia, alongside the likes of India, China and Vietnam. On the ground in Myanmar though, things appear to be slowing down. Government spending on infrastructure and development has fallen over the past three years, while the fiscal deficit has ballooned to 4.5pc of GDP in fiscal year 2016-17 from 3.2pc in 2015-16, and 1.2pc in 2014-15. Meanwhile, foreign direct investments (FDI) have thinned, toUS$7 billion in 2016-17 from more than US$9 billion in the previous year, while the trade deficit has widened on the back of fluctuations in commodity prices, illegal trade and a weaker currency.
• 

  More than 150 foreign companies have invested over 1.8 billion USD in Thilawa Special Economic Zone and infrastructure for Zone B is expected to be completed by mid 2018

  Investment into Thilawa Special Economic Zone has toppled $1.8 billion from over 150 foreign companies, announced the Myanmar Investment Commission. Zone A, which was launched at the start of the 2014-2015 fiscal year, is 400 hectares and at 98 percent occupied. It is also the only functioning area of Thilawa Special Economic Zone’s planned 2,400-hectare facility. Japanese companies have invested $468 mil¬lion in the Thilawa SEZ making Japan the nation leading investment at 43.5 percent of total foreign investment, followed by Thailand at $134 million.
• 

  SEZs in Myanmar should encourage policy experimentation and focus on tech spillovers (an Economist)

  SPECIAL Economic Zones (SEZs) in Myanmar should encourage policy experimentation and focus on tech spillovers, an economist told The Myanmar Times. By early June, 95 percent of the land plots in Thilawa SEZ zone A had been sold and the building of manufacturing plants is ongoing, while zone B is already under construction. At the same time, Dawei SEZ has been further delayed, whereas a Memorandum of Understanding (MoU) for Kyaukphyu SEZ is expected to take place very soon. A central component of the government’s strategy, under U Thein Sein, to bolster the manufacturing sector is through the establishment of SEZs. However, so far the three SEZs have differed drastically in their progress, and in the level of controversies they have attracted. SEZs may have promising effects in theory, but their success as an engine of economic growth, import facilitation and as a hub for FDIs is not guaranteed. The Myanmar Times sat down with economists from the International Growth Centre (IGC) on June 19 to talk about their research on SEZs.
• 

  To boost Myanmar's economy, private banks plan to extend more credit to SMEs

  SMALL and medium enterprises in Myanmar will soon get greater access to finance as private banks plan to extend more credit to boost the economy, according to speakers at the Amcham Financial Services Forum held last week. Zaw Lin Aung, managing director of KBZ Bank, the largest private bank in Myanmar with the largest retail network, said the bank had changed its lending policy to help the growth of SMEs across the nation. “Our lending to SMEs is not based on collateral any more. We have changed to subjective- or objective-based lending. It is now based on their capacity to repay,” he said. He said less reliance on collateral led the bank to knowing more about customers, understanding their business plans, knowing their financial conditions, and identifying sources of repayment.
• 

  Agriculture and livestock industry leaders discuss new insurance items for their sectors with related agencies to prevent losses

  Members of the agriculture and livestock in industry met with officials from the Ministry of Agriculture, Livestock, and Irrigation and Myanmar Insurance Enterprise to discuss the prospect of offering new insurance items for their sectors, according to a UMFCCI press release. Insurance for agriculture and livestock businesses would prevent against significant losses caused by crop destruction, uncommonly low yields, animal disease, and a host of other occasional speed humps. Dr. Aung Thu, Union Minister of Agriculture, Livestock and Irrigation was enthusiastic about the idea stating, "insurance will be a win-win for both insurance companies looking to expand and agricultural or livestock businesses who need protection against losses."
• 

  In partnership with mFino, a global fintech solution provider, AYA Bank will introduce mobile fintech products and advanced payments for the market by the end of this year

  AYA BANK, one of the top three private banks in Myanmar, recently signed a pact with mFino, a global fintech solution provider, to deliver new products and advanced payments for the market, said Myint Zaw, the bank’s managing director. He said the partnership would lead the bank to introducing mobile fintech products by the end of this year. He seemed proud to play a role in Myanmar’s bid to ensure financial inclusion. “We target all the people who do not have even a bank account. We hope to bring Myanmar’s large underbanked and unbanked segments under the umbrella of financial inclusion with our new offerings,” he said. According to surveys done by different organisations, more than 90 per cent of Myanmar’s 53 million population do not have access to banks and financial institutions. The bank considers it as a room for improvement in the near future.