Business Article


Monthly Business Brief, February 2024

March 1, 2024

Economy

People’s Military Service Law to come into force on 10 February

The SAC activated the People’s Military Service Law on February 10, 2024. Although the law was enacted in 2010, it had not been activated until now. Under this mandate, all men aged between 18 and 35, and women between 18 and 27 have to enter compulsory military service for at least two years, up to five in times of emergency. Skilled professionals, such as doctors, engineers, technicians, etc., may be recruited up to 45 years of age. The Ministry of Defense is currently in the process of drafting the necessary bylaws, procedures, announcements orders, notifications, and instructions.

Internal displaced persons reached nearly 2.7 million

The UNOCHA reports that nearly 2.7 million people are internally displaced in Myanmar, since the events of February 2021. Much of the displacement has occurred due to the rising levels of conflict in regions including Northern Shan and Rakhine State.

The UNOCHA acknowledges the critical issue and direct consequences of underfunding affecting its performance and requesting US$ 994 million in funding to aid 5.3 million people in Myanmar including 1.8 million in most severely restricted areas in need of humanitarian assistance, prioritizing food security, shelter, and protection.

 11,000 Myanmar workers will be sent to Korea under EPS in 2024

As of February, A total of 10,611 Myanmar workers have been selected to work in Korea under the EPS system, an increase of about 1,500 additional workers from last month. They will be working in several fields including manufacturing, construction, agriculture and livestock, and construction. Workers with specialized skills, such as welders, have also received employment opportunities.

Banking and finance

The CBM pumped US$77 million and 850 million Thai Baht into the financial market

The Central Bank continues to prop up the Kyat by selling more and more of its foreign reserves. In February, it has sold off US$ 77 million and 850 million Thai Baht.

Currently, the over-the-counter rate for the US$ dollar hovers around Ks. 3610, an increase of about Ks. 200 over the past few months. The Baht stands at Ks.101, and the RMB stands at Ks.500. The official reference remains unchanged since August 2022.

Trade

Supervision committee enforced on fighting illicit trade

On February 20, a meeting of the Illegal Trade Eradication Steering Committee was held in Naypyidaw, chaired by Vice Chairman Vice-Senior General Soe Win. The meeting addressed the issue of illegal trade and emphasized its adverse impacts on business, economy, security, and the environment. The nature of the situation was in a serious position and called for need strict actions against illegal traders.  Regarding the illicit trade in Myanmar, smuggling shared 60%, under invoice 30% and parallel trade 10%.

83 companies have been commissioned to carry out EV related activities

The national committee on electric vehicles reported that there were a total of 83 businesses that were permitted and licensed to carry out businesses related to electric vehicles. Two companies are permitted to operate charging stations across the country and two well-known bus companies will operate electric buses. Since November 2022, when the government announced its pilot phase for EVs, several EV brands, mostly from China, have made an appearance in Myanmar, including BYD, Wuling, MG, and BAIC.

EV import licences to be granted for car showrooms

Initially, EVs in Myanmar could only be sold by authorized companies, who had to operate their own car showrooms that were wholly dedicated to electric vehicles. On February 1, 2024, the rules have been relaxed, as independent showroom operators can now receive a license to import EVs, provided they meet set requirements and guidelines.

Investment

Cancellation of investment of the Shwe Byai Phyu Group from AOTM shares

Shwe Byai Phyu (SBP) Group announced on February 9th 2024 that it had fully divested its shares from Investcom Pte Ltd, the holding company that owns telecommunications company ATOM Myanmar. Its shares would be taken over by Myancom Holdings.

SBP was targeted in the latest series of sanctions by the United States. ATOM, previously known as Telenor, have said that it maintains no links with any sanctioned individual or organization, and will continue to follow all rules and regulations.

Petrochemical refinery will be built at Dawei SEZ

The Myanmar Special Economic Zone Central Committee announced that a petrochemical factory will be built in the Dawei SEZ, as well as various manufacturing plants and oil refinery.

 

Manufacturing

Construction begins on bran oil, cooking oil production plant

Myanmar is building its first factory of rice bran oil and cooking oil, as announced by the Myanmar Rice Federation. Myanmar Rice Bran Oil Co. Ltd (MRBO) will begin construction on the refinery within the Myanmar Agribusiness Public Corporation (MAPCO) compound in Pyinmana, Naypyidaw. This will alleviate the pressures caused by imported oil and ensure self-sustenance.

 

Energy

Electricity demand is increasing by 15% a year

In a meeting held by the National Renewable Energy Committee (NREC), the Union Minster of the Ministry of Electric Power reported that Myanmar’s electricity demands were increasing by 15% annually. Furthermore, he elaborated that the country’s energy needs were currently met by hydropower, solar, and thermal (coal, natural gas, and LNG), at 47.1%, 1.7%, and 50.7% respectively.

Supervision Committee on Fuel Oil Importation, Storage and Distribution

Throughout January and continuing into February this year, fuel prices has been steadily increasing. The Supervisory Committee on Fuel Oil Importation, Storage and Distribution releases daily reference prices to contain and regulate the market. The prices dropped slightly in mid February. However, prices increased to Ks.2,770 for Octane 92 and Ks. 2,875 for Octane 95, Ks.2,595 for diesel and Ks. 2,640 for premium diesel on 16 February.

Transportation

Myanmar Korea Friendship Bridge Project (Dala) will become land mark of Yangon City

Construction is underway for the Myanmar-Korea Friendship Bridge, which will connect the township of Dala proper with the city Yangon. The project began when Korean GS Engineering Group won a tender and become the main contractor and developer of the project. Financed by the Economic Development Cooperation Fund, construction began in 2019, although it was temporarily suspended during the COVID-19 pandemic. The project resumed once events were clear, and it is expected to be complete in 2024.

Construction of Thanlyin Bridge No (3) completed by 97%

ThanLyin Bridge (3) is 97% complete, according to the Ministry of Construction. In November last year, the central section was completed and currently, work is underway to finalize the project, which is due to be open this year. The bridge, built with financial and technical assistance from Japan, will connect Yangon and Thanlyin, as well as improve transportation between the city and Thilawa SEZ.

COVID

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

Bulletin

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