Weekly Business News from Myanmar

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  E-commerce companies take initiatives for safer online shopping as social distancing grows

  As fear of the COVID-19 pandemic spreads, businesses are struggling with economic uncertainty. Following recommendations of the World Health Organisation (WHO), people, in general, have disconnected from their daily routines to practice social distancing, leaving businesses with no way to reach consumers. But where do e-commerce platforms stand? Globally, countries have witnessed reduced visits to offline retail stores with consumers only venturing out if absolutely necessary. In countries like France, Italy or Spain, where strict quarantine has already been enforced, people are not able to leave their houses without official certificates and are turning toward e-commerce to meet their basic needs. In Myanmar, similar consumer behaviors toward online shopping have been observed for the past few days.
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  Thailand suspended 3 port borders through bilateral trading between Kawthoung in Myanmar and Ranong in Thailand

  Thailand has suspended 3 port borders, through which bilateral trades are going on, between Kawthoung in Myanmar and Ranong in Thailand starting from the early morning of 20 March, Thai Ministry of Public Health announced. According to the announcement of the Ministry of Public Health (Thailand) (MoPH), Covid-19 is a very dangerous pandemic and it is quickly spreading in Thailand. So, Thailand will suspend the crossing of the goods and the vehicles carrying the persons via border checkpoints until the situation turns back to normal. The temporary closure is aimed to control the spreading of Covid-19 in the Ranong province of the southern part of Thailand.
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  Myanmar – China border trade zone to be developed in Kachin’s Kan Paik Ti township in Waingmaw, Kachin State

  The Kachin State government this month signed an MOU with Myanmar Hein Investment Development Co to develop a border trade zone at Kan Paik Ti township in Waingmaw, Kachin State, which is near the Myanmar- China border. Myanmar Hein Investment is a 30:70 joint venture established by ethnic Kachin-owned Kan Paik Ti Development Company Limited and Yunnan Htein Yin Trade Company Limited. The project is now under regional parliamentary-level approval. The aim is to create job opportunities for local residents, promote bilateral trade and combat illegal trade, said U Wai Lin, Regional Minister for Finance, Revenue, Planning and Economics. When complete, the Kan Paik Ti border trade area will become a major part of the China-Myanmar Economic Corridor (CMEC).
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  Directorate of Investment and Company Administration (DICA) announced on the eased the rules for in-country – foreign employees

  Myanmar has eased visa extension rules for foreigners based in the country in response to growing travel restrictions and flight cancellations. The Directorate of Investment and Company Administration (DICA) announced that foreigners can now apply for new visas and stay permits until up to five days of expiry of their existing visas. This change will remain in effect until further notice. The move is to alleviate travel uncertainty caused by the coronavirus pandemic, DICA said. “DICA’s announcement should make it a bit easier for expats to apply for new visas and stay permits in Myanmar, reducing the risk to be quarantined upon return to Myanmar if a foreigner leaves the country to apply for a visa abroad,” commented Fabian Lorenz, a lawyer with Luther Law Firm in Yangon who expects the new rules to ease uncertainty among the expatriate community.
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  The National Export Strategy 2020 – 2025 (NES) will prioritize rubber, fishery and foods from Mon State

  The Union government, in an attempt to encourage exports from Mon State, will include rubber, fishery and food produced in the state in the National Export Strategy 2020-2025. This follows a March 6 workshop on the matter involving stakeholders from the government and private sectors. “We will try to include tactics addressing difficulties and hindrances faced by the local companies when trying to sell locally produced products in the international markets,” Permanent Secretary for Commerce U Aung Soe said. The results of the workshop will be included in the final National Export Strategy report. Mon State’s rubber production accounts for most of the rubber production in Myanmar and 90 percent is exported. The state also depends on fishery products and food manufacturing as major sources of income. “The workshop generated a plan that will enhance the competitiveness of Mon State’s export products,” said U Min Kyan Yit, president of Mon State Rubber Planters and Producers Association.
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  CMP business import raw materials increased USD $ 39 million as of 13 March 2020 when compared to the same period of last fiscal year

  Imports of raw materials by CMP businesses have been valued at US$1.028 billion between 1 October and 13 March in the 2019-2020 fiscal year, an increase of $39 million compared with the year-ago period, according to the Ministry of Commerce. The majority of the CMP enterprises import raw materials, mainly from China. These businesses have faced shortages of raw materials starting from February-end, owing to the current negative impact of the corona virus. At present, some CMP garment factories have shut down on the reason for the lack of raw materials due to the COVID-19 negative impacts, leaving thousands of workers unemployed. Even worse, some foreign entrepreneurs are also running away from their businesses. Those factories without official notification of closure will be inspected by a ground field inspection team. And, the factory operators can face legal actions under the Myanmar Investment Law (MIL) if they fail to comply with notification requirements for the closure of factories, said U Thant Sin Lwin, director-general of the Directorate of Investment and Company Administration (DICA).
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  Insurance Business Regulatory Board approved a raft of new insurance products

  The Insurance Business Regulatory Board under the Ministry of Planning, Finance and Industry announced in the first week of March its decision to approve a raft of new insurance products. Insurers need approval from the Board before they can market new insurance products or redesign existing ones. New products must be in the scope of life or general insurance, according to an official from the Board. Insurance companies can propose one insurance product at a time; they must secure approval for their proposed product before proceeding with another proposal. There are now 14 insurance products in the market provided by 11 local firms.
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  Myanmar tourism industry seeks financial assist from Myanmar Government in order to help overcome the impact of the coronavirus pandemic

  The Myanmar Tourism Entrepreneurs Association says it is seeking a K50 billion loan from the government in order to help overcome the impact of the coronavirus pandemic on the tourism sector in Myanmar. Tourism companies have seen their revenues severely hit since the virus was first reported in late December, the association says. U Naung Naung Han, chair of the Myanmar Tourism Entrepreneurs Association, said that he estimates the severe drop in visitor numbers due to the pandemic could last as long as six months up to a year. Such a prolonged loss of business would have severe impacts on the associations’ members ability to pay their employees, he added. U Naung Naung Han said that there are some 1100 companies involved in local tourism and the loan would be used to help the companies pay salaries and keep workers employed during the slowdown.
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  Myanmar temporarily suspended all land borders to foreigners as a preventive measure against the coronavirus

  Myanmar’s Ministry of Foreign Affairs announced on Wednesday the closure of all border checkpoints to foreign tourists as a preventative measure against the coronavirus. It said it had “temporarily suspended the entry of foreign nationals through any border checkpoint” until further notice. The Indian border at Moreh-Tamu and Zokhawtar-Rikhawdar was already closed earlier this month. The border checkpoints with China in Kachin State and northern Shan State and those with Thailand and Laos will now close.
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  Central Bank of Myanmar (CBM) reduced its interest rate which is a move to spur economic growth

  The Central Bank of Myanmar has announced a 0.5 percent reduction to interest rates, in what the bank says is a move to spur economic growth. But bankers and businesses have said that the move doesn’t go far enough to help the country’s declining economy. The bank announced on Thursday that it will reduce its interest rate from 10 percent to 9.5 percent, effective April 1. According to the directive, the minimum bank deposit rate will be lowered from 8 percent to 7.5 percent, while the maximum lending rate will be lowered from 13 to 12.5 percent for collateralized loans and from 16 to 15.5 percent for non-collateralized loans. Bankers and economists have generally welcomed the move but said the adjustment is unlikely to help improve the declining economy.