Weekly Business News from Myanmar

The value of petroleum imports surged due to increased domestic consumption and higher oil prices
The value of petroleum imports totaled $3 billion during the 11-month period to end February of the current 2017-18 fiscal year. That’s at least $1 billion more than the same period last year, U Yan Naing Tun, Director General of Directorate of Trade, told The Myanmar Times. This was due to increased domestic consumption and higher oil prices, he said. There was also a higher number of vehicles as well as a higher volume of activities in mining and higher usage of power generators. “Power generators are being used in Myeik, Kawthoung and Dawei for electricity. Moreover, petroleum products are used in manufacturing, mining and transportation, where investments have risen,” U Yan Naing Tun said.
Myanmar Investment Commission has undergone a major transformation since the Myanmar Law 2016 (MIL) and the Myanmar Investment Rules 2017 (MIR)
Laws passed in 2016 and 2017 have brought major reforms to the Myanmar Investment Commission and have been received with cautious optimism by investors. THE Myanmar Investment Commission has recently undergone a major transformation because of changes arising from the Myanmar Investment Law 2016 (MIL) and the Myanmar Investment Rules 2017 (MIR). It is important for both Myanmar and foreign investors to understand the impact of these changes if they are to benefit fully from them. Theoretically, the changes should make it easier for foreign investors to obtain long leases, which is of critical importance for most businesses. However, tax holidays under the MIL are being more restrictively applied. It will become evident over the next year or so whether the changes have brought significant benefits for investors.
Singapore listed company Memories Group makes its first acquisition in Myeik as tourists' interest rises
Mr Serge Pun, executive chairman of Singapore-listed Memories Group, has bought luxury yachting business Burma Boating in Myeik, Tanintharyi Region, for K1.3 billion from Tint Tint Travel and Tours Company and Freepier. It is the first acquisition for Memories Group since the company listed on the Singapore Exchange in January and marks the first step forward under its strategy to build a diversified tourism platform in Myanmar. Burma Boating, which drew revenues or around $1 million last year, is a well-known luxury yachting company established in 2014 in the Myeik Archipelago, which is in southern Myanmar. Following the acquisition, Memories Group will now take ownership of Burma Boating’s flagship 85-foot Meta IV yacht, the ‘Burma Boating” brand as well as existing partnerships, contracts and bookings. “Given its luxury service and tour experience, the acquisition of Burma Boating represents an exciting opportunity for Memories Group to broaden its experiences portfolio and enlarge its footprint in the Myanmar tourism industry,” Mr Pun said in a statement.
Myanmar Strategic Holdings (MSH) is interested to invest in budget hotels and tourism in Myanmar
Enrico Cesenni, CEO of London-listed Myanmar Strategic Holdings (MSH), an investment holding company, is eyeing investments in budget hotels and tourism in Myanmar. “We feel that there is room to grow in the budget category rather than in the more expensive categories,” he told The Myanmar Times during a recent interview. Tourism is also interesting. “The challenge now is that there iare not enough activities available for tourists who visit Yangon and Bagan. Unlike Chiang Mai in Thailand, which offers cheap food and massages as well as beach activities and sports, there is no reason for tourists to come back to Myanmar,” Mr Cesenni said. “If you stay in Yangon, after visiting the Shwedagon Pagoda in the morning, there is little to do in the afternoon due to the heat and traffic. These things need to be better thought out and organised to draw more tourists,” he added.
Italian- Thai Development (ITD)’s scandal in Thailand alarms Dawei communities and raises questions on ITD's credibility
Is the Myanmar government on the side of the ITD or Dawei people? THE developer of Dawei Special Economic Zone (SEZ) has caused further alarm in Dawei communities as its president was mired in a major scandal in Thailand. Despite the unprecedented media outcry, the case is not expected to affect the SEZ project. Premchai Karnasuta, president of Italian-Thai Development (ITD), was arrested on February 4 after being caught with guns and animals carcasses in the Thung Yai Naresuan wildlife sanctuary in Kanchanaburi province, Thailand. Thai media reported that he was charged with nine counts of poaching in the wildlife sanctuary. Forest rangers and police allegedly found remains of a protected black leopard, pheasant and barking deer as well as hunting rifles from his campsite at a prohibited location. He would also face an additional charge for possession of illegal guns after six of the 43 guns seized from his residence in Bangkok were allegedly illegal when the investigation was expanded to his house.
A record-breaking over 740 million kyat dropped in Yangon Stock Exchange (YSX) trading in February
Trading at the Yangon Stock Exchange (YSX) experienced a record-breaking drop of over 740 million kyat in February – the lowest since the exchange launched in March, 2016. There are now five listed companies in the stock market after TMH Telecom Public Company was listed on January 26. In January, stock trading among the five listed companies reached over 1.2 billion kyat, down more than 1.6 billion kyat from the same period last year. In 2016, the total stock trading exceeded 70.74 billion kyat – over 24 billion kyat in March, 5 billion in April, 16 billion in May, 6 billion in June, 3.7 billion in July, 2.9 billion in August, 2.4 billion in September, 4 billion in October, 2.2 billion in November and 1.6 billion in December. Block trading amounted to 2.25 billion kyat.
Myanmar government, South Korea’s Posco Daewoo Steel Co., Ltd and Millcon Steel Co., Ltd of Thailand will co-invest in a joint venture to operate state own steel factory in Myingyan, Mandalay
South Korea’s Posco Daewoo Steel Co Ltd and Millcon Steel Co Ltd of Thailand will co-invest with the government in a joint venture to operate a state-owned steel factory in Myingyan, Mandalay, according to a statement released by the Ministry of Industry. Posco Daewoo and Millcon Steel have already met with U Khin Maung Cho, Minister of the Ministry of Industry in January to discuss the various possibilities of cooperation. These included Build – Operate – Transfer (BOT) schemes as well as profit sharing arrangements under a joint venture, the statement said. There are currently two state-owned steel factories in Myanmar. The second factory is in Pang Pet, Taunggyi township in Shan State. However, the factories have been loss-making and operations have been suspended since April 2017.
Thailand’s Kasikorn Bank (Kbank) and Myanmar’s biggest lender, Kanbawza Bank (KBZ bank) cooperated to offer a staff exchange program at the border cities of Mae Sot and Myawaddy to boost border trade between the two counties
Thailand’s Kasikorn Bank (KBank) is joining with Myanmar’s biggest lender, Kanbawza Bank (KBZ Bank) to offer a staff exchange programme at the border cities of Mae Sot in Thailand and Myawaddy, Myanmar. The aim is to boost border trade between the two countries. The programme will focus on bank-based import-export settlements and boost the cross-border transfer of funds via Mae Sot Border Trade Business Center by about THB200 million, according to a statement released by the two banks on Tuesday. To date, the center has granted credits of more than THB150 million to businesses in Mae Sot for investment in Myanmar. Mr. Kittichart Potithat, First Vice President for World Business Strategy and Marketing Management Department of KBank, said the bank has always placed importance on Myanmar market, given its large volume of border trade with Thailand.
About 40 factories had been approved for commercial operations in Thilawa Special Economic Zone (SEZ) (U Set Aung, Chair of Thilawa Special Economic Zone Management Committee)
Some 40 factories can carry out commercial operations in Thilawa Special Economic Zone, said Set Aung, chair of the Thilawa Special Economic Zone Management Committee. “No country in the world can conduct impact analysis on exports in two years,” he said, explaining the slow pace. “We will have to take another two years to carry out impact analysis.” The zone’s export figures would soon be released on their website, he added. The Thilawa SEZ project was initiated about two years ago. Building a factory takes at least one year, often 18 months, and an environmental impact assessment must be completed, Set Aung said.
The Myeik Public Company and Korea’s KMPI Company joined hands to build 610 megawatts power plant in Myeik Archipelago
The Myeik Public Company and Korea’s KMPI Company joined hands to build a second LNG power plant near Kape Village, Kyun Su Township, in the Myeik District in the Tanintharyi Region. The power plant will be able to generate 610 megawatts, according to the Ministry of Electricity and Energy. The goal is to provide electricity at an affordable price to local people, and then supplying any excess power into national grid. The power plant is finished it is hoped that it will help entice electricity based factories to the area, which would create more job opportunities, according to the Ministry’s press release.