Monthly Business Brief, June 2024

by Business Article

Monthly Business Brief, June 2024

Economy

Myanmar’s economy continues to face significant challenges in 2024- World Bank June report

 According to Myanmar Economic Monitor, June 2024 of the World Bank Myanmar, economic activity has been constrained by elevated conflict, increased macroeconomic volatility, and a challenging business environment. World Bank assessed that ongoing impacts are on household livelihoods and agricultural production, conflict continues to disrupt land border trade with China and Thailand, as well as domestic supply chains. Since October 2023 more than one million people have been displaced by conflict, bringing the total number of internally displaced persons (IDPs) to 3.1 million. Kyat depreciation and lack of access to foreign currency and import licenses have led to persistent inflation and shortages of essential imported inputs. Electricity outages have worsened for households and industries. WB estimated Myanmar GDP growth by just 1 percent in the year 2023- 2024 in compare to official data of 3.5%.

Finance

Kyat depreciates to K 4,500 against US dollar and CBM interventions

 Kyat weakened to K 4,500 against US dollar at end June at the over the counter market.  The Central Bank of Myanmar (CBM) sold US$3 million and 40 mllion Thai baht only  in June. The CBM injected a total of  US$180 million, 32.7 million yuan, and 2.2 billion Thai baht for exporters and importers and market in the past six months (January-June) 2024, with a view to curbing the volatile exchange rate in the local forex market.

Trade

Customs tariff relief announced for SKD, CKD fuel vehicle imports with MIC are to be domestically assembled under the semi-knocked down system and entirely built up (completely knocked down) system with the permit of the Myanmar Investment Commission are eased Customs tariff. According to the Myanmar Customs Tariff 2022, the previous Customs duty for personal vehicles under 2000 CC was set at 30 per cent for completely build-up vehicles, 7.5 per cent for SKD vehicles and five per cent for CKD vehicles. The reduced amounts are five per cent for SKD vehicles and three per cent for CKD. For personal cars above 2001 CC, tariffs were cut to 5 per cent for SKD and 3 per cent for CKD from 40 per cent for CBU, 7.5 per cent for SKD and 5 per cent for CKD. The tariffs for personal three-wheelers were reduced to 3 per cent for SKD, 1.5 per cent for CKD from 20 per cent for CBU, 7.5 per cent for SKD and 5 per cent for CKD.

Moreover, auto parts for trucks, body and building, commercial three-wheelers, and buses were set at 10 per cent for CBU, 7.5 per cent for SKD and 5 per cent for CKD. They are now at 3 per cent for SKD and CKD, respectively. The tariff for motorcycles was also reduced to 1.5 per cent for SKD and CKD compared to the previous duties of 3 per cent for CBU, SKD and CKD.

MoC announces 1,100 HS codes for Customs warehousing

The Ministry of Commerce nod­ded four import categories in customs warehousing with 1,100 HS codes, including pharmaceu­ticals (117 HS codes), electric vehicles and related parts (56 codes), industrial raw materials and chemicals (866 codes) and food raw materials (61 codes).

Apart from those goods au­thorized in customs warehous­ing, seeking an import licence for the goods before arrival at the port is obligatory, and fail­ure to do so is subject to a fine and sentence under the existing laws. Without obtaining a permit, no one shall be allowed to export and import the specified goods that need to seek a licence. The Trade Department warned the exporters and importers of pen­alties for non-compliance with the Export and Import Law, di­rectives and guidelines starting from 1 July 2024. It informed them to seek licences first as pre-arrival documentation for all types of shipment by air, sea and road.

Manufacturing

CMP garment sector shows positive growth in 2024

MYANMAR garment manufacturers received growing foreign orders this year as the garment orders improved significantly. The buyers who were supposed to go to Bangladesh turned to Myanmar after Bangladesh doubled labour wages. Myanmar’s manufacturing sector is primarily concentrated in garment and textiles produced on a Cutting, Making, and Packing basis, and it contributes to the country’s employment and GDP to a certain extent.

Transportation

Yangon-Kawthoung-Ranong container shipping starts at end June

The container shipping to and from Yangon-Kawthoung-Ranong for Myanmar-Thailand border trade will commence at the end of June 2024. MV Beypore Sultan of Gold Shipping Agency Services Limited loaded with maize will leave for Thailand’s Ranong Port and it will carry goods from Ranong to Yangon Port. That border trade must be in accordance with the standard operation procedures (SOPs) of the departments concerned. The Trade Department under the Ministry of Commerce gave the go-ahead to container shipping to and from Yangon-Kawthoung-Ranong for Myanmar-Thailand border trade.

COVID

  • In order to continuously control the infection of COVID-19, the rules and restrictions have been extended until the end of July 2024.

MPA: 50 container vessels scheduled to call in Yangon Port next month

by LOGISTICS

A total of 50 container vessels are slated to arrive at the Yangon Port in July, the Myanma Port Authority announced.
In July, eight container vessels operated by SITC Shipping Line, six each by Cosco Shipping Line and Samudera Shipping Line, five by Maersk A/S Line, four each by CMA CGM Line and MSC Line, three each by Evergreen Line, ONE Line and RCL Line, two each by BLPL Shipping Line and PIL. Line and one by BAY Line၊ Land and Sea, Maersk A/S Line and Ti2 Container Line are slated to enter the Yangon Port.
Myanma Port Authority has arranged maritime trade channels to handle increasing imports to meet domestic demand, bolster exports, and improve port capacity for significant arrivals in ships. Myanma Port Authority will inform exporters and importers of ship arrival schedules in a timely manner.
Myanma Port Authority stated that 49 vessels in January, 53 in February, 55 in March, 50 in April, 52 in May and 50 in June arrived at the Yangon Port.
Yangon Port handled 629 container vessels in 2023. Thanks to the draft extension, the international ocean liners can access the inner port for now, according to the Myanma Port Authority’s statement on 22 June 2022.
Draft extension work accelerated after the new navigation channel (Kings Bank Channel) accessing the inner Yangon River had been found. Afterwards, the port can now handle larger ships. Container vessel MV SITC Zhaoming (185.99 metres LOA, 35.25 metres Beam, 29,232 GRT and 2,698 TEU) of Hong Kong-based SITC Shipping Line docked at Asia World Port Terminal for the first time on 22 June, which is the largest ship that AWPT Port handled.
Since May 2021, the arrival of ships at terminals in Yangon has increased again. To fulfil the seaborne trade requirements, three new container vessels by Maersk Line Myanmar (SeaLand Maersk) started to run in 2021.
Earlier, larger ships had draft problems preventing their sailing on the Yangon River. With the draft being extended up to 10 metres, more giant ocean liners can enter Thilawa Port. 

Businesses bound to comply with export/import regulations

by ECONOMY

All business entities must sign a letter of commitment that they are aware of export/import news bulletins and will comply with export and import rules and regulations, the Union of Myanmar Federation of Chambers of Commerce and Industry notified on 25 June.
The Trade Department declared that certain types of goods are allowed to be stored in customs warehousing according to the export and import news bulletin of 2/2024.
The Trade Department warned the exporters and importers of penalties for non-compliance with the Export and Import Law, directives and guidelines starting from 1 July 2024. It informed them to seek licences first as pre-arrival documentation for all types of shipment by air and sea, according to the export and import news bulletin 3/2024 of the Trade Department.
Regarding those statements, companies engaged in export and import activities are called to meet and sign the commitment letter that they are bound to comply with rules and regulations.
Only the signees will be considered in import licensing. Therefore, the directors and representatives of the companies that have not signed it yet are asked to proceed to signing at the Trade Department in Nay Pyi Taw and the nearest export and import offices (Yangon, Mandalay) and MIC (One Stop Services).
Director-level representatives of the companies must sign in the designated form that they are aware of news bulletins and will comply with them, and send it to the Export-Import Division of the Trade Department through contact number 09 765595406 and email dottradepolicy1@gmail.com and to the UMFCCI via 01 2314344-49 Ext (464) and email ma@umfcci.com.mm.

Source: The Global New Light of Myanmar

MRF to offer door-to-door rice delivery service starting 1 July

by SERVICES

Myanmar Rice Federation (MRF) will provide direct delivery to household services from 1 July, according to its notification dated 25 June.
This service will cover Nay Pyi Taw, Yangon, and Mandalay cities, which MRF, Myanmar Rice Millers Association, and Myanmar Paddy Traders Association jointly implemented.
The federation announced the prices depending on the rice varieties. Buyers must contact MRF through Viber numbers 09 400067240, 09 400067250 and 09 400067260 and email sales@mrf.com.mm.
It is prepaid sales. Rice bags will be delivered within three days after payment.  MRF will try to extend the service with other rice varieties and various packages.
Prices are set in line with the reference price, and the federation will endeavour to cut the price lower. MRF requested individuals to coordinate in this and buy only when they need it as they are committed to programme sustainability.

Source: The Global New Light of Myanmar

Kawthoung border trade crosses US$18M in mid-July

by TRADING

Myanmar’s Kawthoung border with Thailand aimed to achieve a trade target of US$20 million for July, and actual trade value as of mid-July has reached $18.8 million, performing over 94 per cent of the trade target.
Fisheries exports at Kawthoung are operating with a free-on-board system. There is always a trade surplus at the Kawthoung border. The main export items are various fish, shrimp, squid, crab, anchovy and oil palm.
The Ministry of Commerce has been prioritizing trade promotion. Thailand grants zero tariffs for maize imports between 1 February and 31 August yearly. Myanmar conveys maize directly from Yangon Port to Ranong Port. Some are exported through the Kawthoung border as well.
Myanmar sent 76,838.3 tonnes of maize to Ranong via the Kawthoung border, with an estimated value of $17.887 million.
Kyat-Thai baht trade settlement is also operational in the Kawthoung border with authorized dealers (A Bank, MEB, KBZ and AYA).
The Kawthoung border attained the fourth-largest trade value between Myanmar and Thailand, according to the Ministry of Commerce’s statistics.

Source: The Global New Light of Myanmar

Myanmar-Thailand border trade nears US$500M in April-May

by TRADING

Myanmar’s border trade with the neighbouring country Thailand was estimated at US$495 million as of 10 May of the current financial year 2024-2025.
The figures plunged from $829.6 million recorded in the year-ago period, indicating a sharp drop of $334.6 million.
Myanmar conducts cross-border trade with Thailand via the Tachilek, Myawady, Kawthoung, Myeik, Hteekhee and Mawtaung border. Of them, the Hteekhee border performed the most extensive trade worth over $316.54 million in the past two months.
Moreover, the trade values stood at $50.95 million at Myawady border post, $44.64 million at Tachilek, over $35.45 million at Myeik, $39.38 million at Kawthoung and over $8 million at Mawtaung.
Myanmar carries out border trade with neighbouring countries such as China, Thailand, Bangladesh, and India. It exports agricultural products, livestock products, fisheries, minerals, forest products, finished industrial goods, and other goods, while it brings in capital goods, intermediate goods, consumer goods, and raw materials from the CMP enterprises.

Source : The Global New Light of Myanmar

93 freighters depart Mandalay Port in May

by LOGISTICS

A total of 93 cargo ships departed from Mandalay Port for destinations including Yangon, Bhamo, and other townships in May of this year, according to the Department of Marine Administration.
DMA reported an increase in the number of goods being sent from Mandalay Port, such as maize, sugar, cement, and other commodities, due to the ease of transportation via the Ayeyawady River during the rainy season.
A total of 0.63 tonne of cement, 58,049.6 tonnes of maize, 450 tonnes of limestone, 9,957.606 tonnes of molasses, 4,688.35 tonnes of sugar, and 670 rice bags have been transported so far.
“Despite the current high-water levels, cargo ship operators are reminded to adhere strictly to their vessels’ designated weight capacity. The Department of Marine Administration emphasizes that exceeding the tonnage limit or neglecting to consider a ship’s size and weight limitations can pose serious safety risks. 

Source: The Global New Light of Myanmar

Luxembourg entrepreneurs encouraged to invest in Myanmar

by INVESTMENT

Ambassador U Soe Lynn Han, Head of the Mission of the Republic of the Union of Myanmar to Belgium, the Netherlands, Luxembourg and the European Union (European Commission), invited foreign investments from Luxembourg, according to the Ministry of Foreign Affairs.
The fourth ASEAN Day 2024 was held under the theme of “Connecting the dots for a sustainable future” at the Luxembourg Chamber of Commerce on 3 June.
Myanmar Ambassador U Soe Lynn Han attended and elaborated on investment opportunities and challenges. Then, he invited foreign investments from Luxembourg.
Myanmar has enjoyed unilateral trade preference from the EU’s Generalized Scheme of Preference (GSP) and Everything but Arms (EBA Programme).
The Myanmar Ambassador attracted Luxembourg investors to produce import-duty-free goods in Myanmar under the GSP and EBA that can create jobs for locals. Following the presentation of the respective ambassadors from ASEAN regarding investment opportunities in the region, ASEAN representatives met with business delegates from Luxembourg separately and further discussed business and investment opportunities.
Prince Guillaume of Luxembourg attended the 4th ASEAN Day 2024 as honorary chairperson of the Board of Economic Development of the Grand Duchy of Luxembourg, an agency for economic promotion and development.
Mr Xavier Bettel, Deputy Prime Minister of Luxembourg and the Minister for Foreign Affairs and Trade, and Mr Lex Delles, Minister for Economy, SME, Energy and Tourism, also attended the event and joined a business lunch with ASEAN ambassadors.
ASEAN Day 2024 is a biannual event organized by the Luxembourg Chamber of Commerce and ASEAN-Brussels Committee to provide a platform for Luxembourgish companies to exchange information between Luxembourg and ASEAN and explore business opportunities in the ASEAN region. 

Source: The Global New Light of Myanmar

Myanmar entrepreneurs invited to MoHA construction projects

by CONSTRUCTION

Private entrepreneurs from Myanmar are invited to carry out necessary construction works for the forces/departments of the Ministry of Home Affairs.
For the financial year 2024-2025, the submission of proposed tenders for the necessary construction work for the forces/departments under the Ministry of Home Affairs is invited to submit proposals and tenders. Regarding the tender forms, the profiles of successful companies are invited to visit the relevant forces/departments (headquarters) from 13 May.
The companies that have to submit the price submission tender form must submit the price proposals according to the construction work groups of the forces/departments at Dekkhinathiri District Fire Station near the Sutaungpyae Monastery, Tawun Yadana Street, Htantabin Kyaukmyat Kwathit, Kyapin Quater, Dekkhinathiri Township, Nay Pyi Taw on 21 May from 10 am to 4 pm.
For more detailed information, interested people can contact the Minister’s Office, the Myanmar Police Force, Bureau of Special Investigation, the Correctional Department, and the Fire Service Department. 

Source: The Global New Light of Myanmar

MoC collaborates withUMFCCI to export maizeand rice, boosting economy

by ECONOMY

According to reports, a total of 5,400 tonnes of maize were exported from Min Htet Min Port (MHM), along with 2,700 tonnes from Shweme Jetty (SMJ) and 4,850 tonnes of rice from Wilmar International Port Terminal. This export initiative, conducted in collaboration between the Ministry of Commerce and the Union of Myanmar Federation of Chambers of Commerce and Industry (UMFCCI), aims to bolster the country’s economy.
Additionally, on 15 May, further exports included 71,900 tonnes of maize and 6,000 tonnes of rice from Sule Port Wharves (SPW), 53,500 tonnes of maize from Myanmar Industrial Port (MIP), 58,400 tonnes and 12,500 tonnes of rice from Ahlon International Port Terminal (AIPT), 29,500 tonnes of maize from The Myanmar Terminal-TMT, 5,400 tonnes of maize from Min Htet Min Port (MHM), 11,000 tonnes from Yangon International Gateway Terminal (YIGT), and 2,700 tonnes of maize from Myanmar Five Star Line (MFSL). These exports are set to continue.

Source: The Global New Light of Myanmar