Oct 8, 2012

Japanese companies edge closer to broad Myanmar investment

Japanese companies are likely to enter Myanmar en-masse to do business soon, a Japanese Chambers of Commerce and Industry spokesperson said on September 28.

The comments were made by JCCI vice president U Nyan Htun following a visit by 93 Japanese JCCI members that met senior Myanmar Investment Commission (MIC) and Ministry of Commerce officials in Nay Pyi Taw on September 27.

The delegation also held a business matching session with Union of Myanmar Federation of Chambers of Commerce and Industry (UMFCCI) members in Yangon on September 28.

The visit was the ninth joint UMFCCI-JCCI meeting.

The two sides discussed possible investment in agriculture, the food processing industry, manufacturing, tourism and infrastructure.

Officials said Japan wants to support Myanmar in its human resource development, as well as provide technical assistance and financial support for the development of the small- and medium-sized enterprise (SME) sector.

Mr Tadashi Okamura, JCCI chairman, said there are many Japanese companies that want to come to Myanmar and the mooted easing of the United States’ import sanctions last week would help to spur economic growth.

However, he said Japanese businesspeople had so far been reluctant to invest in Myanmar because of the lack of soft infrastructure, such as a clear investment policy, taxation and intellectual property laws, as well as hard infrastructure, such as reliable electricity supplies, roads and ports. “If Myanmar can solve these kinds of problems it has plenty of labour resources that will attract Japanese investors,” he said.

He said that Myanmar is in a transition period but the reforms enacted in the past year have not been enough to satisfy many potential investors but voiced confidence that the situation would improve soon.

“Although they [investors] have been reluctant in the past, they will show greater interest from now on, which will benefit SMEs,” he added.

Japan stands as a relatively modest investor in Myanmar, with only US$211 million invested in the country since 1988, compared with about $20 billion from China, MIC statistics show.

Meanwhile, Japan and Myanmar have signed an agreement to develop the Thilawa Special Economic Zone in Yangon’s Kyauktan/Thanlyin township and will begin implementing a master plan by the end of 2012, said JCCI’s deputy head, Mr Kohei Watanabe. He added that the development would be a joint government-private effort that would be supported by the governments of both nations.

He added that the Japanese government will likely provide financing for the Dawei SEZ, which is being developed by Italian-Thai Development Company.

Source: Myanmar Times