Weekly Business News from Myanmar

Microsoft launched the Highway to 100 Unicorns initiatives to strengthen startup ecosystem in Myanmar
Microsoft for Startups launches the Highway to a 100 Unicorns initiative in the Asia Pacific to strengthen the region’s startup ecosystem. This follows the initiative’s success in India, where only 56 startups were selected to the Emerge X program from six states, which have over 15000+ startups. The Emerge X winners have greatly benefited with global market access support, a 3-day founder Bootcamp with world-class mentors, access to funding, ongoing mentorship, and guidance on Azure, artificial intelligence, machine learning, and more. Innovation is critical to unlocking inclusive economic growth in the Asia Pacific; high-income economies in the region invest three times more in research and development as compared to their peers. To spur innovative entrepreneurship, Microsoft will work closely with governments and industry partners to discover and nurture technology startups with a high potential to become truly global enterprises in the future.
Myanmar’s annual inflation rate fell 6.43 percent in August 2020
The annual rate of inflation in Myanmar, based on the Consumer Price Index, fell to 6.43 per cent in August 2020, according to a report released by the Central Statistical Organization, under the Ministry of Planning, Finance and Industry. The US dollar against Kyat is relatively weak in August, with a fall of about five Kyats than the previous month and a sharp drop of K141 against a-year ago period. However, the gold price significantly rose in August on the back of global cues. Similarly, the imported oil price went up against July’s rate, causing truck fares and food price to rise. Nevertheless, there was a remarkable increase in CPI for the food group, household goods and maintenance, other commodities, clothing, education services, recreation, culture and non-food. The price of the education group is stable due to the closure of schools amid the COVID-19. The cost of telecommunications and tobacco and beverages dropped, the report stated. Starting from August 2019, the consumer price index rose, and the inflation rate has remained above 8 per cent since June 2019. It reached a peak of 8.61 per cent in September and dipped in November. It touched the highest level at 8.81 per cent in December 2019 because of the high season.
The CMP raw materials imports plunged to USD $ 2.17 billion in the 2019 – 2020 financial year
CMP raw materials import has registered at US$2.17 billion in the past financial year 2019-2020, which plunged from $2.37 billion recorded in the 2018-2019FY, according to the Ministry of Commerce. Myanmar manufacturing sector has mostly concentrated in garment and textiles produced on the Cutting, Making, and Packing basis, and it contributes to the country’s GDP to a certain extent. 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. The COVID-19 badly batters the labour-intensive enterprises, said an official of the Directorate of Investment and Company Administration.
Traders requested China for temporary stay to sell watermelon and muskmelon
Fruits and Vegetable Wholesale at Muse (105) mile in its statement on October 13 have requested a temporary stay for some Myanmar fruits and vegetable traders at Wanding City, China when watermelon and muskmelon export volume is at large. The statement also implored the Shan State Government to address the difficulties of transportation and trading due to restrictions and COVID-19 preventive measures while the watermelon and muskmelon export season has begun. At present, due to the travel restriction into/ out of China, only goods can enter China while traders cannot go into the country, and thus the transaction is carried out by the phone when the goods arrive at Wanding Fruit Market. This method can become troublesome when the watermelon and muskmelon supply massively flows into the country. It can lead to a situation where farmers don’t get the remunerative price and thus the body requests Yunnan Province Government to grant a temporary stay for five Myanmar traders at Wanding City.
Microfinance Supervisory Committee (MSC) will be forced collection of loans by microfinance firms to face legal action
Microfinance Supervisory Committee (MSC) will take legal action against the microfinance institutions if they forcibly collect loans in the pandemic period, according to the committee’s announcement released on 13 October. The committee also announced that the microfinance businesses should not forcibly collect the loans plus interests when the members’ businesses and income are lower in the pandemic period, and they should only negotiate the date of repayment of the loans and interests. The committee has also announced that if the members are forcibly asked to return the loans and interest, they are entitled to complain to the committee in detail mentioning the contact phone number or address. The committee will take legal action against the microfinance institutions under the Microfinance Law.
Over 250 Cutting, Manufacturing and Packaging (CMP) factories at Hlintharyar and Shwe Linban Industrial Zones are reopened and started its operation regularly
Officials from Hlinetharyar and Shwe Linban industrial zones administrative committee said that over 250 ‘Cutting, Manufacturing, Packaging’ (CMP) factories had been reopened in their zones. The government allowed reopening of CMP factories which had passed Grade A and B criteria and regulations imposed by the Ministry of Health for containment and control of COVID-19 and then these factories were reopened on October 12.
Yangon Region Investment Committee (YRIC) approved the USD $ 6.904 million worth foreign investments from Vietnam, South Korea and China
The Yangon Region Investment Committee (YRIC), at a videoconference held on 14 October, has endorsed three foreign projects from Viet Nam, Republic of Korea and China. Those projects are to be brought in an estimated capital of US$6.904 million. Those enterprises will create 2,279 jobs. They will execute manufacturing of bags and garments on a Cutting, Making, and Packing (CMP) basis, and production and distribution of iron, steel and galvanised iron and building materials, according to the Directorate of Investment and Company Administration (Yangon Region), YRIC stated. The Yangon Region Investment Committee (YRIC) has endorsed over 130 foreign investment projects with an estimated value of over $280 million in the last financial year 2019-2020, according to the Directorate of Investment and Company Administration.
The transportation cost for commodities from Shan – Yangon increased double amidst COVID – 19 resurgence
The transport cost for commodities from Shan State to Yangon Region has increased more than double amid the coronavirus crisis, said U Kyaw Thu, secretary of the Myanmar Fruit, Flower and Vegetable Producer and Exporter Association (MFVP). At present, the truck fare rates remarkably soar to K1.6 million from the previous rate of K600,000-650,000, he continued. “We can steadily transport the goods at the previous rate of K600,000-650,000. Now, the truck drivers are price markers,” he stressed. Following the double increase rate, only 20 to 30 trucks are seen entering Thirimingala Market of Yangon in the recent days. “We see the entry of over 20 trucks only these days. Before the coronavirus outbreak and the period before the resurgence of coronavirus, hundreds of trucks are flowing into the region,” he stated. The vegetables such as tomato, cabbage, cauliflower, broccoli, bell pepper, eggplant, potato and onion are abundant in Shan State. However, the local products cannot easily be transported to the other regions owing to high truck fares and other transport difficulties. As a result, the commodity prices are so high for consumers, according to MFVP.
The feasibility test for oil refinery in Dawei SEZ delayed due to the COVID – 19 pandemics
Feasibility test for an oil refinery, which can produce eight million tons of oil in a year, in Dawei SEZ is delayed due to COVID-19 pandemic, said Dr Tin Htoo Nanig, Secretary of Dawei SEZ Management Committee on October 13. “A Chinese company is conducting a feasibility test and it was expected to finish in the middle of this month but they cannot come. So they made contact with some organizations to conduct feasibility tests for them. After that, they will ask permission from us. They will analyze whether the project is beneficial or not and whether they can meet the market demand and labour availability or not. They will think of environmental and social impacts. We will make negotiations after that,” he said.
The Individual trades through land border exceeded J 43 billion in the last 2019 – 2020 financial year
Trade conducted by Individual Trading Card (ITC) holders touched a low of K43 billion through the land border in the last financial year 2019-2020, according to the data released by the Ministry of Commerce. The trade value plunged from K59 billion registered in the FY2018-2019 as both export and import sharply fell in the last FY2019-2020. The Trade Department issued 88 cards in the October-September period of the FY2019-2020, and the cardholders conducted trade worth K43 billion. While imports exceeded K40 billion, exports were valued at just K3.25 billion. The Myawady border recorded the highest trade value at K28 billion in the last FY, according to the Commerce Ministry. But, the figure only reflected imports as individual trading cardholders did not export goods through the Myawady gate.