Jul 27, 2016

Myanmar seeks to build on foreign-investment momentum: finance minister - Nikkei Asian Review

Myanmar aims to attract more foreign investment over the next five years than under the previous government, Finance Minister Kyaw Win told The Nikkei in a recent interview.

The country received about $28 billion in foreign direct investment over previous President Thein Sein's five years in office, driving rapid economic growth estimated at an annualized 8% this year. Kyaw Win said, "the new government, which came into power at the end of March, plans to attract even more money through such changes as making it easier for foreign investors to buy land."

Past investments focused mostly on natural gas and other resource development projects. "The government is looking to strike a better balance between industries, and will place more effort into drawing funds for the agricultural and manufacturing sectors," the minister said.

"Japan has a long history of friendship and understanding with Myanmar and is the country's most important partner," Kyaw Win said. He expressed hopes that Japanese companies would equip Myanmar workers with advanced training and technology, helping the government achieve a key goal of creating new jobs.

Trading on the Yangon Stock Exchange began in March, but foreign players remain unable to invest in the two stocks listed there. Kyaw Win stressed the importance of the new bourse as a way to funnel excess cash in the country to corporations, and said investors abroad will be given access to the exchange within the next year.

Myanmar has designated three special economic zones where foreign companies can operate under preferential tax treatment and receive other benefits. Sumitomo Corp. and two other Japanese trading houses have been involved in the development of the Thilawa zone outside Yangon. Over 70 companies, many of them Japanese, have decided to set up shop there.

"Thilawa is the most important outpost for Myanmar trade," Kyaw Win said. He stressed that he will continue to support the development of the industrial park, and said he is even considering setting up a new economic zone to build ties with India and Africa.

Regarding Myanmar's growing budget deficit, the minister said, "inefficient state-run companies must be overhauled. He said that the government is reviewing possible candidates to privatize these businesses, with a high priority on the manufacturing and logistics sectors."

As the first head of the Ministry of Planning and Finance, Kyaw Win is responsible for Myanmar's economic strategy, fiscal management and securities market.

Source: NIKKEI Asian Review

Exports up by $266 Million in first quarter

The National League for Democracy (NLD)-led government has outpaced its predecessor’s export totals during the first quarter of the 2016-17 fiscal year by $266 million.

At the beginning of previous fiscal year, the export volume for April through June reached $2.22 billion, but this year’s export volume has reached $2.48 billion, according to Ministry of Commerce.

“Agriculture and fishery products export volumes have increased while gas and garment exports have decreased since last year. The government is working on ways to raise export in each sector. We expect this year’s export to be higher than last year,” U Khin Maung Lwin, deputy secretary of the Ministry, told Myanmar Business Today.

Union Minister for Commerce Dr Than Myint has pledged to raise export volume threefold within five years of the new government and the Ministry is currently conducting research in agricultural products to penetrate the European market for better prices as well as placing a focus on quality products to match international standards.

“We are mainly focused on European markets because we can earn higher prices from those markets, but we have to work on producing quality products to match European standards,” U Khin Maung Lwin said.

Last year’s first quarter total import and export volume reached $5.54 billion and this year it reached $5.91 billion during the same period, according to statistics from the Ministry.

Source: Myanmar Business Today

Myanmar Switches Focus to Sustainable Development

Myanmar's economic policies under the current government are expected to focus on sustainable development and diversification into other sectors instead of resource-related business, says the Delegation of German Industry and Commerce in Myanmar.

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Jul 21, 2016

Foreign JVs cleared to trade construction materials

The Ministry of Commerce has eased trade restrictions for construction materials on local-foreign joint venture firms in Myanmar.

Previously, construction material trade was only permitted for state-owned and local firms.

“There are some processes that must be completed to start trading construction materials. Joint-venture companies must be registered under the trading category at Myanmar Investment Commission (MIC). They again have to apply for an import and export licence at the Ministry of Construction for materials import,” deputy permanent secretary of Ministry of Commerce, U Khin Maung Lwin, told Myanmar Business Today.

Any joint-venture company in trading category can import construction materials, but companies based in construction must apply to MIC to change their business category first.

The liberalisation aims to develop the construction industry by expanding access to quality construction materials amid a wave of foreign investment into the industry, according to the Ministry.

The imported materials have to meet MoC-set standards and also are allowed for retail and wholesale distribution in the domestic market, according to a Ministry notification.

The trading licence includes allowances for both exports and imports, but the construction industry in Myanmar has yet to develop to a point where they could export products. Imports have been increasing in recent years.

Myanmar’s construction industry grew 7.7 percent in the fiscal year 2014-15 and is expected to grow 8.3 percent in 2015-16, according to Oxford Business Group research. Foreign investment in the country’s construction sector amounts to $37.7 million as at the end of June.

With the relaxing of trade restriction for joint venture firms, prices of high-quality building materials will become more competitive in the domestic market, according to U Soe Min Naing, director of Shine Construction Company.

“The liberalisation of construction materials will impact international higher-standard materials’ availability in the domestic market and result in cheaper competitive market prices,” U Soe Min Naing Aung told Myanmar Business Today.

The Ministry announced that it will adapt the changes on the list of the permitted companies depending on domestic market demand, market situations and domestic business development as needed.

Regulations on agricultural product exports and imports like fertilisers, pesticides and seeds were eased earlier this year.

Source: Myanmar Business Today

Condo supply up, demand cooling, prices flat

Supply

There were 272 new condominium units completed for the quarter which led to a total stock of more than 4,400 units. The number is estimated to grow by 40% following the completion of 16 new residential projects in the remainder of the year.

Given the substantial project launches witnessed in the last two years, building completions should lead to a significant growth in stock going forward. Colliers estimates that there will be 10,118 units scheduled to complete in the next three to four years. However, with the recent weakening of sales, some of these projects may experience delays, with completion dates likely to be extended to a later date.

Demand

The number of sales launches dropped by 66% compared to the same period last year – an expected result given the lackluster performance witnessed especially in 2015. New project launches include Kanbae Towers and Tritone Towers, collectively consisting of more than 600 units.

The average take-up rate further declined albeit at a lesser magnitude by 3% QoQ to 51%. The rate is likely to improve should the number of project launches grow at a modest pace. Nonetheless, the mid-market segment appears to be resilient registering a relatively strong sales take-up of 56%. Meanwhile, the introduction of the condominium law is likely to stir further demand. However, the implementation of the law has yet to be initiated.

Sales Price

Despite the sluggish sales activity, there was no significant reduction in prices recorded. However, some sales offices which temporarily shut down are starting to review their sales price schedule. On the other hand, some of the recently launched projects are now aimed to sell between $1,500 to $2,500 per sq m, relatively lower than many of the developments introduced in the past.

[In association with Colliers]

Source: Myanmar Business Today

Jul 20, 2016

Ministry adds new items to re-export list

The Ministry of Commerce has approved 14 new commodities to be added to the re-export list in a bid to boost export figures as it plans to triple export amount during the current government’s tenure.

Previously, only three items: sugar, betel nut, and oil were approved for re-export. Now, tyres, sesame (white and black), dried chilli, groundnut, cotton, soy beans, textiles, fresh fruit, electronic materials, cosmetics, juices and other groceries, clothes, edible oil and garlic have been included.

Licence applications for the 14 items became available in late June, permanent secretary of the ministry, U Khin Maung Lwin, said.

“Re-export means that we import goods from abroad, process it in the country and then export to global markets. Its strength is that local businesspeople earn more money. They don’t have to be involved in the whole supply chain of value-added products, so it will save costs.

“Singapore also practices the re-export system as they don’t have natural resources. They import the materials and process them locally and re-export them to the international market. It is like a broker business,” he said.

Despite this, some of the products on the list will not have value added to them; rather, Myanmar will act as a middleman for items such as betel nut and cosmetics which it will import from other countries and ship to Northeast India through border trade, according to U Myint Soe from the Ministry of Commerce.

While India is capable of producing its own cosmetics and betel, the transportation costs to ship products to that region of the country are more than what it would pay to import the products from Myanmar.

Although the ministry allowed these items for re-export, there are some restrictions for tyres and groceries.

As for tyre trade, imports are only available through maritime importation and must be re-exported through the Muse border gate to China and also must be done during the raining season to protect rubber planters and procedures.

Juice and other groceries need the Food and Drug Administration’s (FDA)’s approval certificate for re-export licences, according to the Ministry’s statement.

“It happens in some foreign countries. They import Myanmar goods, process them in their countries and re-export them. However, Myanmar has to utilise its GSP benefits. If we face some problem with the re-export system, the goods will crowd the domestics market,” U Soe Win Maung, a consultant at Myanmar Pulses, Beans and Sesame Seeds Merchants Association, said.

Source: Myanmar Business Today

Jul 18, 2016

Bosch registers healthy growth in Myanmar

Yangon, Myanmar – Bosch, a leading global supplier of technology and services, ended its 2015 fiscal year with a healthy double-digit sales growth in Myanmar. This growth was mainly backed by a strong increase in the company’s automotive aftermarket business and sales of power tools to the construction industries. “Myanmar continues to be an important growth market for Bosch in Southeast Asia. We anticipate an increased demand for our products and services due to a positive development of the automobile and industrial sectors in Myanmar,” said Andre de Jong, representative of Bosch Group in Myanmar. “With our products ‘invented for life’, we help make a difference in the region,” he added.


ရန္ကုန္၊ ျမန္မာ။ ။ ကမာၻအႏွံ႔တြင္ နည္းပညာ၀န္ေဆာင္မႈလုပ္ငန္းမ်ား လုပ္ကိုင္ေနသည့္ Bosch က ၂၀၁၅ ခုႏွစ္ ဘ႑ာေရးႏွစ္အတြင္း ေမာ္ေတာ္ယာဥ္သံုး ဆက္စပ္အပိုပစၥည္းႏွင့္ ေဆာက္လုပ္ေရးလုပ္ငန္းသံုး Power Tools ပစၥည္းေရာင္းခ်သည့္လုပ္ငန္းတြင္ တိုးတက္မႈရလဒ္ေကာင္းမ်ား အဓိကရရွိခဲ့ျခင္းေၾကာင့္ ေရာင္းအားပမာဏ ျမင့္တက္မႈသည္ ကိန္းဂဏန္း ႏွစ္လံုးထိ ရရွိခဲ့ပါသည္။ “အေရွ႕ေတာင္အာရွေဒသအတြင္း ျမန္မာႏိုင္ငံဟာ Bosch အတြက္ အရွိန္အဟုန္နဲ႔ ဖြံ႔ၿဖိဳးတိုးတက္ေနတဲ့ အဓိကေစ်းကြက္တစ္ခုအျဖစ္ ဆက္လက္တည္ရွိေနပါတယ္။ ျမန္မာႏိုင္ငံရဲ႕ ေမာ္ေတာ္ယာဥ္က႑နဲ႔ ေဆာက္လုပ္ေရးက႑ေတြ အရွိန္အဟုန္နဲ႔ ဖြံ႔ၿဖိဳး တိုးတက္ေနတဲ့အတြက္ Bosch နည္းပညာျမင့္ ထုတ္ကုန္နဲ႔ ၀န္ေဆာင္မႈ အမ်ိဳးမ်ိဳးကို ေစ်းကြက္အတြင္း လိုအပ္ခ်က္ ျမင့္တက္လ်က္ရွိပါတယ္” ဟု BOSCH လုပ္ငန္းစု၏ ျမန္မာႏုိင္ငံေစ်းကြက္ကိုယ္စားလွယ္ Andre de Jong က ေျပာသည္။ “ဘ၀တစ္သက္တာ စက္မႈနည္းပညာဆိုတဲ့ ေဆာင္ပုဒ္နဲ႔အညီ ေဒသတြင္းေစ်းကြက္မွာ ထူးျခား ေကာင္းမြန္တဲ့ အရည္အေသြးျမင့္ ၀န္ေဆာင္မႈေတြကို ဆက္လက္ပံ့ပိုးေပးသြားမွာျဖစ္ပါတယ္” ဟု ၎ကေျပာသည္။

 
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