Weekly Business News from Myanmar

Only 20 companies out of 200 companies qualified for getting access to Myanmar Government’s emergency COVID funds
Of the 200 companies eligible to receive a government COVID-19 soft loan, just 20 qualify for funding of more than K100 million. These included firms in manufacturing, trading and industry. Out of the 70 tourism and hotel-related companies that qualified for financing, just one, Inle Princess, was eligible for a loan of K100 million and above. The remaining businesses were able to access smaller loans. Critics pointed out the companies that qualified for the larger loans have connections with the Ministry of Hotel and Tourism. “We don’t know how they are processing these loans. Some of the names of eligible hotels and tourism companies did not qualify. As this is a government loan, more transparency is needed and we would like to see the funds end up with those who truly need it,” said Daw Sabei Aung, managing director of Nature Dream Tourism
Applications for Exporter/Importer Registration Certificates will extend online until the end of July during COVID – 19
Applications to extend Exporter/Importer Registration Certificates will now be carried out online until the end of July in view of COVID-19, according to a statement issued by the Ministry of Commerce on April 27. This will help traders bypass the need to physically go to the trade department "The Ministry of Commerce has eased many export/import restrictions for businesses during the Covid-19 pandemic to make things more convenient and to avoid mass gatherings at government offices," said U Khin Maung Lwin, assistant secretary at the ministry. Export/ import permits have been issued online since April 1 and HS code lines for 73 export items and 742 import items have also gone online.
Myanmar Government will provide social security benefits for insured workers from factories and workshops which are temporarily suspended for inspections
The Ministry of Labour, Immigration and Population will provide social security benefits for insured workers from factories and workshops which are temporarily suspended for inspections. “We’ll pay 40 percent of the social security fees to them as benefits,” the ministry announced in statement on April 28. As such, owners of the suspended factories and workshops should apply for social security benefits for their registered insured workers at their township social security offices, the statement said. In Myanmar, there are about 1.3 million insured workers who regularly pay social security fees. On April 20, the government ordered factories not to reopen after the long Thingyan holiday break before being inspected by the health ministry to ensure compliance with COVID-19 safety measures.
Ministry of Commerce and Myanmar Rice Federation (MRF) set rice export quota of 150,000 tonnes in May 2020
The Ministry of Commerce and Myanmar Rice Federation (MRF) have planned to export 100,000 tonnes of rice through sea trade and 50,000 tonnes through border trade. They are negotiating with ASEAN and neighbouring countries to sell the rice through government (G to G) plan. The export quota of 150,000 tonnes is set based on the suggestions made by private and public sectors and the actions of other foreign countries. The quota is imposed on exports of rice, broken rice and sticky rice. However, there’s no restriction on parboiled rice export. Regarding rice export quota in May 2020, about 112 companies will ship them through maritime trade, while 200 companies will conduct the trade via borders. The export volume for each company is proportioned on 60 per cent of the average monthly export volume in the past 30 months. Those companies which have better performance in contract farming, supply chain and value chain, and for the millers and warehouse investors; and those which have the partnership with foreign firms will surely get more shares, as per the federation’s statement. The exporters can contact the MRF via email admin@mrf.com.mm for further enquires.
Government seeks new investments to manufacture COVID – 19 necessary medical equipment at inoperative factories
New investments have been invited for the production of medicines and medical equipment necessary Covid-19 at inoperative State-owned factories, said Union Minister for Investment and Foreign Economic Relations Thaung Tun. As Myanmar purchases medicines and medical equipment from international market, plans have also been made to buy personal protective equipment (PPE)and face masks from local manufacturers, the minister commented his news article “The Measure of a Nation: Myanmar’s “Whole- of-Nation Approach” to Combating Covid-19” published in State-owned newspapers. For the prevention, control and treatment of Covid-19, measures are being taken to build more hospitals and clinics and provide more diagnostic equipment and ventilators.
The drafting on Credit Guarantee Corporation Law is in the process in order to support the provision of financing for micro, small and medium enterprises (MSMEs)
The Financial Regulatory Department under the Ministry of Planning, Finance and Industry is in the process of drafting a Credit Guarantee Corporation Law, U Thant Sin, director of the department, told The Myanmar Times. The aim of the law is to support the provision of financing for micro, small, and medium enterprises (MSMEs) by enabling the establishment of a Credit Guarantee Corporation to guarantee credit to such companies. It will also allow participating financial institutions to spread the credit risks and provide loans without collateral. "Whether a collateral is provided or not, the state-backed Credit Guarantee Corporation can function as an intermediary organisation between the borrower and the lender. The Credit Guarantee Corporation on behalf of the borrower will give a guarantee to the lender for a loan. The borrower then pays a specified premium rate to the Credit Guarantee Corporation,’’ U Thant Sin said.
The Central Bank of Myanmar (CBM) has slashed interest rate by another 1.5 percent in the third time amid COVID – 19 pandemic to facilitate the economic recovery
The Central Bank of Myanmar (CBM) has cut its key interest rates by a further 1.5 percentage points as the global COVID-19 pandemic continues to take a toll on the country’s economy. This is the third time the CBM has reduced rates since it announced a 0.5 percentage point cut on March 12, followed by a further 1 percentage point reduction on March 24. In total, the bank has cut the rates by 3 percentage points in less than two months. CBM Governor U Soe Min told The Irrawaddy that the reduction is aimed at encouraging low-interest loans to businesses in order to facilitate an economic recovery. According to the bank’s directive, the minimum bank deposit rate will be lowered from 6.5 percent to 5 percent, while the maximum lending rate will be lowered from 11.5 to 10 percent for collateralized loans and from 14.5 to 13 percent for non-collateralized loans.
Ministry of Planning and Finance (MOPF) officially released economic stimulus plan to fight COVID – 19
The Ministry of Planning, Finance and Industry (MoPFI) on April 27 issued a comprehensive economic stimulus plan (CERP) consisting of seven goals, 10 strategies, 36 action plans and 76 actions that cover a range of emergency fiscal and monetary measures. The CERP “seeks to mitigate the inevitable economic impact posed by COVID-19 while establishing foundations that will facilitate Myanmar’s rapid economic recovery,” State Counsellor Daw Aung San Suu Kyi said in the report. She added that “the significance of COVID-19 induced tax revenue shortfalls cannot be downplayed, with anticipated revenue underperformance requiring reallocations of government spending to create space for COVID-19-related outlays, and policies.”
Myanmar Thilawa SEZ Holding Public Limited (MTSH) will give Ks 200 dividends per share for 2019 fiscal year
Myanmar Thilawa SEZ Holdings Public Limited (MTSH) announced that it will give K200 dividends per share for 2019 fiscal year, in accordance with the decision of board of directors held on April 25. The company will give a total of K7.7 billion this year while it gave K9.7 billion last year. In 2016-2017 fiscal year, the company gave K260 per share marking the record high in company’s history.
Myanmar Government set to regulate multi-level marketing (MLM) companies through a new legislation
The Myanmar government is set to regulate multi-level marketing (MLM) companies through a new legislation. U Myint Lwin, director general for Department of Consumer Affair, told this newspaper that the draft Direct Selling Law will put forward a regulatory framework for those firms. The department is responsible for the new legislation and the draft law has been made public. MLM businesses, also called network-marketing or direct-sales companies, often sell products by employing a network of distributors.