Weekly Business News from Myanmar

Myanmar is seeing its transit trade improves, USD $ 4 billion earned from Kyaukphyu – Kunming gas pipeline
Myanmar is seeing its transit trade improve, and nearly US$4 billion has been earned from the Kyaukphyu-Kunming gas pipeline alone, said Deputy Minister for Commerce Aung Htoo. He made the remark during a news conference on the ministry’s activities in the fourth year of the government’s term held in Nay Pyi Taw on June 24. “Depending on our geographical conditions, we need to engage in transit trade. We have seen our transit trade improve greatly. When it comes to the Kyaukphyu-Kunming gas pipeline, we have earned US$3.9 billion,” the deputy minister said. In the Myanmar-China oil and gas pipeline project, the pipeline connection starts from Yanbye Island in Kyaukphyu Township, Rakhine State. The crude oil pipeline connection starts from Made Island.
Myanmar’s trade deficit up in eight and half months of the current fiscal year
Myanmar’s trade gap has significantly widened in eight and half months of the current financial year 2019-2020 to more than US$1.7 billion from $853 million registered in the corresponding period of the 2018-2019FY, according to the data provided by the Ministry of Commerce. Between 1 October and 12 June in the current fiscal, Myanmar’s external trade increased to over $26.4 billion from $24.57 billion recorded in the year-ago period.
The domestic investments touch K 1,370 billion and USD $ 284.769 million in the current fiscal year
Domestic investments by Myanmar citizens, including an expansion of capital by existing enterprises, have reached K1,370 billion and US$284.769 million as of 18 June of 2019-2020 financial year since October, according to a press statement issued by the Myanmar Investment Commission (MIC). Between 1 October and 18 June in the current fiscal, Myanmar Investment Commission (MIC) and the respective region and state investment committees gave green lights to 87 local enterprises to invest in various sectors, with estimated capitals of over K1,101 billion and $189 million. Domestic investments have flowed into the real estate, manufacturing, hotels and tourism, construction, industrial estate, energy, mining, livestock and fisheries, agriculture, and other services sectors, according to the Directorate of Investment and Company Administration (DICA).
Ministry of Electricity and Energy (MOEE) is committed to new refinery projects with private sectors under Public Private Partnership
The Ministry of Electricity and Energy (MOEE) is making plans to build new oil refineries in Myanmar to meet domestic oil demand and boost energy security in the country, said U Tin Maung Oo, Permanent Secretary of the MOEE. The new refinery projects will be implemented with the private sector under Public Private Partnership schemes, he said. The MOEE expects to build one new refinery capable of processing up to 5 million tonnes of crude oil near the government's Petrochemical Complex (Thanbayarkan) in Magway Region. There are currently just two oil refineries in Myanmar : No.1 Refinery (Thanlyin) in Yangon Region which was constructed in 1955 and No.2 Refinery (Chauk) in Magway Region which was constructed in 1954. The No.1 Refinery (Thanlyin) is now shut down as officials attempt to gauge its commercial viability.
Myanmar retail sales slashed by 80 percent in this fiscal year when compared to the same period of previous year due to the COVID – 19 outbreak
Myanmar allowed its citizens to go out and buy essential commodities during the period considered the peak of the local transmission. However, people tried to avoid going out and spent less, resulting in an 80 percent retail sales drop compared to last year, according to Daw Win Win Tint, Managing Director of City Mart Holdings. Demands gradually dropped below normal trend in the previous year, and May and June, for example, saw a 20 percent decline compared to the same period last year. There are over 300,000 retail shops and mostly are conventional ones, without any proper bookkeeping, which hold almost 90 percent of the market share.
Yoma Strategic Holdings plans to take controlling stake and its existing shareholding of Wave Money
Yoma Strategic Holdings will establish a new company, Yoma MFS Holdings (Wave Holdco) to increase its existing shareholding and take a controlling interest in Digital Money Myanmar Limited (“Wave Money”), according to a company press release. Wave Holdco plans to acquire the entirety of Telenor Group’s current 51% stake in Wave Money for US$76.5 million and will raise funds from a consortium of investors led by Yoma Strategic. Upon the completion of the transactions, Yoma Strategic will invest up to an additional US$25 million and become the largest controlling shareholder in Wave Money, cementing its role as a leading player in Myanmar’s fintech sector.
Asian Development Bank (ADB) forecasted Myanmar economy expected to grow 1.8 percent in 2020
The Myanmar economy is expected to grow at just 1.8 percent in 2020, according to updated forecasts by the Asian Development Bank (ADB), released June 18. In its initial forecast in April, the ADB had expected GDP growth in Myanmar to be 4.2pc. The country expanded at 6.8pc in 2019. The ADB revised its forecasts for Myanmar after new data pointed toward a sharp slowdown in regional growth as a result of COVID-19. Growth in developing Asia is now forecast to grow by just 0.1pc in 2020, compared to 2.2pc initially forecast in April. That's the slowest rate of growth for the region since 1961, as containment measures to address COVID-19 hamper economic activity and weaken external demand, the ADB said.
The Construction on China’s BRI deep sea port in Kyaukphyu will start soon as both Myanmar and China sides preparations are on track
The construction of the China-backed Kyaukphyu deep-sea port will begin soon, as preparations on both the Myanmar and China sides are on track, according to the Ministry of Commerce. The project is a crucial part of the Kyaukphyu Special Economic Zone (SEZ) in western Myanmar. The SEZ is expected to boost development in China’s landlocked Yunnan Province and provide China with direct access to the Indian Ocean, allowing its oil imports to bypass the Strait of Malacca. The Kyaukphyu SEZ is a backbone project under the China-Myanmar Economic Corridor (CMEC), which is itself a part of China’s ambitious Belt and Road Initiative (BRI). The project also includes plans to construct an industrial zone with facilities for textile and garment manufacturing, construction materials processing, food processing, pharmaceuticals, electronics, marine supplies and services and research. The entire project is planned to cover 4,300 acres.
Chinese firm is applying to conduct feasibility study on Mandalay – Kyaukphyu railway project
A Chinese company is applying to conduct feasibility studies for a high-speed railway between Mandalay-Kyaukphyu, said U Nyi Nyi Swe, general manager of Myanma Railways. The railway is part of a larger railway project connecting Muse to Mandalay. A memorandum of understanding for the railway was signed between the Myanmar government and China Railway Eryuan Engineering Group Co Ltd (CREEG) on October 22, 2018. “The Muse-Mandalay MoU includes applying for permission to conduct feasibility studies to build the railway from Mandalay to Kyaukphyu. The feasibility study takes two or three years,” U Nyi Nyi Swe said.
KBZ MS Insurance extended free 50 percent bonus COVID – 19 coverage for all existing and new health insurance policyholders until 13 September 2020
KBZ MS General Insurance, a joint venture between IKBZ Insurance and Japanese insurance giant MSI, announced an extension of its free 50% additional COVID-19 coverage for all existing and new health insurance policyholders until September 13, 2020, under its KBZ MS Arrawjan policy. It offers free additional coverage for customers diagnosed with Covid-19, offering an additional 50% coverage on outpatient care, hospitalization fees, and death benefits. The program began on 13 March 2020 and was set to end on 13 June, however, given the ongoing spread of COVID-19 in Myanmar, the insurer has decided to extend the free coverage by another three months until 13 September.