Posts in category: INVESTMENT

Majority of foreign enterprises eye the manufacturing sector for investments in the first quarter of the current financial year 2020-2021, pulling in US$158 million from 13 projects, the Directorate of Investment and Company Administration (DICA) stated. Myanmar has attracted foreign direct investments of more than US$348.8 million in Oct-Dec of current FY, including the expansion of capital by existing enterprises and acquisitions in the Special Economic Zones, DICA’s statistics indicated. Out of 23 foreign enterprises permitted and endorsed by Myanmar Investment Commission and the respective investment committees between 1 October and 31 December of current FY, 13 enterprises pumped FDI into the manufacturing sector.

Livestock and Fisheries sector attracted three projects while agriculture, power and other services sector pulled two projects each and one foreign enterprise entered the hotels and tourism sector. At present, labour-intensive enterprises face financial hardship, disputes between the employers and employees and the closure of factories. However, those cases in the industry did not hinder new investments. The manufacturing enterprises and businesses that need large labour force are prioritized, MIC stated.

During the current FY2020-2021, Myanmar Investment Commission (MIC) will give the go-ahead to 24 proposals submitted in the previous FY2019-2020. The commission is carefully assessing the projects, and upon approval of the ministries concerned, it will grant permission. Twenty-four foreign investment proposals have an estimated capital of over US$3 billion. The commission is carefully reviewing 24 proposals due to large projects, he continued. MIC intends to reach the FDI target of $5.8 billion for the current FY2020-2021. According to the DICA data, the country almost reached an FDI target of $5.8 billion in the 2019-2020FY. However, due to the COVID-19 impacts, it has only registered FDI inflows of $5.68 billion.

Source: The Global New Light of Myanmar

Myanmar has approved the development of an Integrated Domestic Gas to Power Project involving US$2 billion in investments in Kyaiklat, Ayeyarwady Region. The Ministry of Electricity and Energy granted a Notice to Proceed to Thai national oil company PTTEP for the 592-megawatt project, which will be carried out under a 20-year Build, Operate and Transfer basis. An option to extend for five years will also be included.

PTTEP will utilise gas produced domestically at its Zawtika and M3 gas fileds in the Gulf of Moattama to generate affordable electricity for Myanmar. The project, which is expected to be implemented in the first half of 2024, was approved in line with Myanmar’s Sustainable Development Plan and its Energy Master Plan, which aims for all households to have access to electricity 2030. Natural gas produced aat PTTEP’s fields will be transported via onshhore and offshore pipelines totalling 370km.

The pipelines will connect Kanbauk, Daw Nyein and Kyaiklat to two newly constructed gas receiving stations at the project site. The electricity generation from this project is expected to account for approximately 10 percent of Myanmar’s existing installed power plant capacity. The generated power will be sold to state-owned Electric Power Generation Enterprise. It will supply power to future projects around Yangon and Ayeyarwady regions while surplus energy will be fed to the national grid via a 230 KV transmission line from Kyaiklat to the Hlaing Tharyar substation. A final investment decision will be made by early next year.

Source: Myanmar Times

The Myanmar Investment Commission (MIC), gave the green light to five new investment proposals including two 30 MW solar projects and approved the four existing projects for capital expansion, according to a video conference held on 30 December 2020. The permitted investments covered the energy, fishery, hotel and services sectors, with an estimated capital of US$138.178 million and K109.204 billion. The projects are expected to create over 4,000 job opportunities. According to the Ministry of Investment and Foreign Economic Relations, the new projects permitted by the MIC include two 30 MW solar power projects in Sagaing Region and a shrimp farm project in Taninthayi Region.

The solar power projects are in keeping with the commitment made by State Counsellor Daw Aung San Suu Kyi to tackle climate change in her address to the virtual Climate Ambition Summit held on 12 December 2020. In her statement, the State Counsellor announced Myanmar’s intention to submit its Nationally Determined Contribution (NDC) by the end of the year. The NDC will aim to reduce over 243 million tonnes of carbon dioxide by increasing the share of renewable energy to 39% and reducing the forestry sector’s net emission by 25%, the ministry stated. The Ministry of Electricity and Energy is implementing solar power plants by next summer to meet the country’s growing demand.

MIC and the relevant investment committees in the past three months (Oct-Dec) of the current financial year 2020-2021 gave the go-ahead to 19 foreign enterprises from China, Singapore, the Republic of Korea, Thailand, India and Viet Nam in manufacturing, livestock & fisheries and agriculture, energy and hotels and other services sectors. They brought in investments of over US$337.75 million, including the expansion of capital by existing enterprises. The foreign enterprises created over 11,000 jobs for locals.
The FDIs have flowed into 12 sectors. They are oil and gas, power, transport and communications, real estate, hotels and tourism, mining, livestock and fisheries, industrial estate, agriculture, construction, manufacturing and other services sectors. Of 51 foreign countries and regions investing in Myanmar, Singapore put the largest investments, followed by China and Hong Kong (SAR).

Source: The Global New Light of Myanmar

The domestic and foreign enterprises permitted and endorsed by the Myanmar Investment Commission (MIC) and other regional and state investment committees created 9,031 jobs in the first two months (Oct-Nov) of the current financial year 2020-2021, according to the Directorate of Investment and Company Administration (DICA). The job creation in the past two months slowed further than the rate in September, according to statistics issued by the Myanmar Investment Commission (MIC). The job creation stood at 4,485 in November and 4,546 in October, which plunged from 11,990 jobs in September. During the October-November period, the foreign enterprises created over 7,081 jobs for locals, adding the existing foreign enterprises’ recruitment.

The domestic enterprises under the Myanmar Investment Commission created 1,950 jobs for local people, including increased employment by the existing enterprises. MIC and the relevant investment committees in the past two months gave the go-ahead to 14 foreign enterprises from China, Singapore, the Republic of Korea, Thailand, India and Viet Nam in manufacturing, livestock & fisheries and agriculture and other service sectors. They brought in an estimated capital of US$199.756 million, including the expansion of capital by existing enterprises. Meanwhile, 17 domestic enterprises invested K69.86 billion in manufacturing, real estate, hotel & tourism, agriculture and other service sectors. In the previous financial year ended 30 September 2020, the domestic and foreign enterprises have created about 200,000 jobs since October 2019.

The job creation includes employment of about 5,000 expatriate workers in Myanmar, according to the Directorate of Investment and Company Administration (DICA). MIC is prioritizing the labour-intensive businesses. The commission ensures to approve responsible companies by assessing environmental and social impacts. The commission is working together with the relevant departments to screen the projects, said director-general of the DICA. According to the DICA, domestic and foreign projects employ over 670,000 residents in the incumbent government period. Those enterprises have created over 96,000 jobs in the FY2016-2017, 110,000 jobs in the FY2017-2018, over 53,000 jobs in the 2018 mini-budget period, over 180,000 jobs in the FY2018-2019 and 210,000 jobs in the FY2019-2020 respectively.

Source: The Global New Light of Myanmar

Myanmar is raising efforts to draw more foreign investments into the local manufacturing sector. On December 27, the government inaugurated the US$274 million Yangon Amata Smart and Eco City industrial park project, which will be jointly constructed by the Myanmar Department of Urban and Housing Development (DUHD) and Thailand’s Amata Corporation PCL under the supervision of the Yangon Region Government.

The Yangon Amata Smart and Eco City will be built on 2000 acres of land beside the No.2 highway near Lay Htaunt Kan village, with 1200 acres in Dagon East and 800 acres in Dagon South townships. The project will be developed in five phases over a period of five years in order to enjoy tax exemptions granted under the Myanmar Investment Law. It is expected to create 35,912 new jobs when it is complete.

It is understood that four Thai firms, including Thailand’s national oil company PTTEP, will jointly construct a power plant to supply power for the project. The Department of Urban and Housing Development will own a 20 percent stake in the industrial park, which is registered in Hong Kong, while Amata Asia Myanmar Ltd will hold the remaining 80pc. A land lease agreement has been signed on January 24, according to the Ministry of Construction.

The Yangon Amata Smart and Eco City was inaugurated shortly after development of the US$100 million Korea-Myanmar Industrial Complex (KMIC) commenced in Hlegu township, Yangon, on December 24. The Korea-backed industrial park will be jointly owned by the Ministry of Construction, Korea Land and Housing Corporation and Korea’s Global SAE-A Ltd on 558 acres of land in Nyaung-nhit-pin, Hlegu township. Land plots in KMIC’s industrial park will be available for lease online at rates between US$69 and US$75 for one square meter starting from January 21.

The two new industrial parks will give investors more options to open manufacturing facilities in Myanmar as they will come equipped with basic infrastructure such as roads and power plants and offer incentives such as tax exemptions. Currently, Myanmar has just one such industrial park – the Thilawa Special Economic Zone in Thanlyin township, Yangon – which opened in 2015. By developing more industrial zones that meet international standards, the government is hoping to lure foreign manufacturers to open up factories in Myanmar. Already, some 135 Korean firms are expected to invest US$ 48.5 million in KMIC.

Another two Yangon industrial parks, the US$230 million Myanmar Singapore Industrial Park in Hlegu township and China-banked Htantabin park in Hlaing Tharyar township are now also being constructed. Besides drawing more foreign direct investments and creating jobs, the investors are also expected to introduce new technologies and skills to Myanmar.

During the Yangon Amata Smart and Eco City ceremony, it is said that there is a need for more technology-based ventures and large-scale investments post COVID-19. He added that the Thai-backed project will draw tech-savvy investors to set up factories in Yangon. It is also said that Myanmar must keep up with technological advances, and if it continues filling only the basic jobs, it will not be able to move up the value chain in the future.

Source: Myanmar Times

This week Metro would like to introduce you to the Lucky Square Condo Project, which is located on Kyaik Khauk Pagoda Road at the end of Thanlyin Bridge. It’s a place that’s attracted much investor interest, and promises to be a top venue for business and leisure in the city. Located just across the Yangon River, Lucky Square is a convenient distance from the downtown area but far enough away to maintain a relaxing and quiet suburban feel. Two types of condo designs are available, and both have access to the adjoining shopping center. Buyers can choose from apartments which include either two or three bedrooms, and prices vary according to unit size and location within the complex.

The condo project contains a total of 228 apartments, and the price per square foot will start from around K110,000. Individual units range from around 1,000 to 1,855 square feet. The condo includes high-end facilities such as swimming pool, gym, 24-hour security, a function room, BBQ area, bar and lounge, as well as access to free wi-fi and TV channels. As with all modern condos in Myanmar these days, residents no longer need to worry about blackouts with a backup generator always on hand. The adjoining shopping mall provides all the shopping essentials to make condo living convenient, also offering resident plenty of options for dining-out.

Moreover, spacious car parking is also included, and a drive to the city will take less than ten minutes across the nearby Thanlyin Bridge. The project is also close to Thilawa SEZ, as well as many cultural attractions south of the river – such as the ethnic village, Portuguese church and Kyauktan Pagoda. The real estate prices for Kyaik Khauk Pagoda Road in Thanlyin township start from K17,000 per square feet for the current financial year. This price factors in the current down-trend in the market, making down estimates by 25 pc from last year. However, Thanlyin township continues to see a healthy degree of sustained investor interest, with nearby condo and industry projects still tabled for completion in the coming years.

Source: Myanmar Times

Union Minister for Investment and Foreign Economic Relations and Myanmar Investment Commission Chairman, U Thaung Tun provided a comprehensive update on recent reforms to Myanmar’s investment environment via a video message to the high-level virtual event jointly organized by the ASEAN-Japan Centre and the Myanmar Embassy in Tokyo, supported by the Myanmar Ministry of Investment and Foreign Economic Relations (MIFER) and the Japan International Cooperation Agency (JICA). Mr Masataka Fujita, ASEAN-Japan Centre Secretary-General launched the event with welcoming remarks. U Soe Han, Myanmar’s Ambassador to Japan then delivered a keynote speech during which the Ambassador noted that Myanmar’s natural environment has huge potential for the production of agriculture and fisheries. He added that as more than 70% of the country’s population live in rural areas and engage in the agricultural sector, it would be advantageous for investors to invest in agriculture.

The Union Minister said in his message to the Webinar a comprehensive overview of recent reforms undertaken to improve Myanmar’s investment environment, including an analysis of new investment opportunities made possible by Myanmar’s signing of the Regional Comprehensive Economic Partnership (RCEP) last month. The Union Minister highlighted the important contribution Japan has been making to our nation’s development efforts – from infrastructure to industry, from transport to tourism, from energy to environmental sustainability. He welcomed Japan’s commitment to the development of the Dawei Special Economic Zone. He also informed the meeting of Myanmar’s intention to set- up a Special Economic Zone in Mon State, pointing out the strategic location of the state in the Greater Mekong East-West Economic Corridors.

Mr Noriji Sakakura, Chief Representative of Japan International Cooperation Agency (JICA) presented Japan’s projects on technical cooperation, economic reforms, financial support and loan assistance in Myanmar. U Sett Aung, Deputy Minister of Planning, Finance, and Industry, and U Aung Naing Oo, Permanent Secretary of MIFER responded to questions posed by the participants. It is learnt that over 380 local and foreign participants including senior officials from MIFER and the Japan International Cooperation Agency (JICA) took part in the event.

Source: The Global New Light of Myanmar

Foreign investors have purchased 4,460,060 shares of First Myanmar Investment (FMI) on the Yangon Stock Exchange (YSX) as of November-end, holding 13.47 per cent of shares, according to statistics released by the exchange. The upper limit for foreign shareholding amount is at 14 per cent with 4,635,357 shares. The foreign investors are about to reach the limit for shareholding, and consequently, the status of buy order acceptance is suspended on 1 December 2020.

The Securities and Exchange Commission of Myanmar (SECM) has allowed foreigners to invest in the local equity market from 20 March 2020. The foreign shareholding amount stood at 4,509,475 shares of three listed companies on the exchange as of November-end. At present, shares of six listed companies — First Myanmar Investment (FMI), Myanmar Thilawa SEZ Holdings (MTSH), Myanmar Citizens Bank (MCB), First Private Bank (FPB), TMH Telecom Public Co. Ltd, and Ever Flow River Group Public Co., Ltd (EFR) — are available for local investors for trading. Of them, FMI, MTSH, TMH and EFR accepted foreign shareholding, and FPB is for block trade only. The foreign shareholding ratio of the companies on the exchange, except FMI, is less than one per cent.

As of November-end, foreigners hold over 4,460,060 shares of FMI, over 38,520 shares of MTSH, 4,405 shares of TMH and 6,490 shares of EFR. The SECM, under the Ministry of Planning and Finance, issued a notice on 12 July 2019, announcing that foreigners would be allowed to invest in shares listed on the YSX. After opening bank and securities accounts, an investor can send buying/selling orders under the stock trading rules stipulated in the Trading Business Regulations, the SECM notified. Senior Executive Manager U Thet Htun Oo of the Yangon Stock Exchange highlighted, at the seminar held last year, how foreign participation would entail better capital inflows, long term and sustainable investment, encourage good corporate governance, and support market orientation.
Regarding the share trading, the foreign investors must strictly comply with the rules stipulated by the Central Bank of Myanmar.

The security companies will monitor the daily trades of foreigners, in keeping with the rules and regulations, so that they do not exceed the limit set for each listed company. Under Section 42 (a) of the Securities and Exchange Law and Section 4 of the Trading Participant Business Regulations, the YSX has granted trading qualifications to the following securities companies — Myanmar Securities Exchange Centre Co. Ltd. (MSEC), KBZ Stirling Coleman Securities Co. Ltd.

(KBZSC), CB Securities Limited (CBSC), AYA Trust Securities Co. Ltd. (AYATSC), KTZ Ruby Hill Securities Co. Ltd. (KTZRH), and UAB Securities Limited (UABSC). Investors have to send their buy or sell orders to the YSX through the securities companies who have been issued a licence by the SECM as well as a trading qualification by the YSX, according to the stock exchange. The YSX was launched three years ago to improve the private business sector. It disseminates rules and regulations regarding the stock exchange and knowledge of share trading through stock investment seminars. The stock exchange has also sought the government’s support to get more public companies to participate in the stock market and help more institutional investors, such as financing companies, investment banks, and insurance companies, to emerge. Amid the COVID-19 crisis, Myanmar’s securities market has been able to continue operating without stopping trading.

Source- The Global New light of Myanmar

The Yangon Region Investment Committee has endorsed three foreign enterprises from China and Singapore in the manufacturing sector, with an estimated capital of US$3.5 million, in the first two months (Oct-Nov) of the current financial year. Those enterprises will create over 1,200 jobs. They will execute manufacturing of bags, footwear and garments on a Cutting, Making, and Packing (CMP) basis, YRIC stated. Between 1 October and 30 September of the previous financial year 2019-2020, Yangon Region stood at the first place with 137 foreign enterprises (with a capital of $308.768 million), followed by Bago Region with 18 foreign projects ($72.645 million) at the second place and Ayeyawady, with nine at the third place ($19.614 million).

Additionally, foreign direct investments also flow into Taninthayi Region from two projects worth $1.397 million, Magway Region from two worth $0.991 million, Mon State from two worth $1.664 million, Mandalay Region from one business valued $4.6 million, Sagaing Region from one worth $3 million, Kachin State from one worth $1 million, Shan State from one worth $4.13 million and Nay Pyi Taw Council from one valued $5.862 million. In the last FY, the respective investment committees of Kayah, Kayin, Rakhine and Chin states did not endorse any foreign enterprises at all, the DICA stated. The region and state investment committees endorsed a total of 175 foreign enterprises with an estimated capital of $423.671 million in the last FY.

The endorsed enterprises are to be engaged in the manufacturing, hotels and tourism, power, agricultural and other services sector. Of them, the majority of the investment goes into the manufacturing sector, followed by other services sector and hotels and tourism sector. The manufacturing sector has attracted the most foreign investments in Yangon Region, with enterprises engaging in the production of pharmaceuticals, vehicles, container boxes, and garments on a Cutting, Making, and Packing (CMP) basis. To date, foreign investments from China, Singapore, Japan, Hong Kong, the Republic of Korea, Viet Nam, India, China (Taipei), Malaysia, the British Virgin Islands and Seychelles are arriving in the region. To aim at making the verification of investment projects simple, Myanmar Investment Law allows the region and state Investment Committees to grant permissions for local and foreign proposals, where the initial investment does not exceed K6 billion, or $5 million. 

Source: The Global New Light of Myanmar

Finfund, which invests in responsible and profitable businesses in developing countries, has injected US$5.5 million in Early Dawn Microfinance Co., Ltd, the third largest microfinance company in Myanmar in terms of client outreach. The financing will support Early Dawn’s expansion in Myanmar’s underserved townships and peri-urban areas. Finnfund gets its funding from the State of Finland and the private capital markets, as well as retained earnings from its investments. All profits get recycled into new projects that drive sustainable development.

The state-owned fund makes 20-30 new investments worth €200 million- €250 million each year. At the end of 2019, Finnfund’s portfolio comprised 183 projects in 52 countries worth €957 million. This is its third investment in the microfinance sector in Myanmar, where almost 70 percent of the population lacks access to formal financial services. Early Dawn provides group loans to low-income women, and more recently expanded to extend individual loans to small businesses.

During the investment process, they have been impressed by Early Dawn’s commitment to responsible and sustainable conduct of business. Under instructions from the government, the lender has also rescheduled repayments and restructured loans to help borrowers survive the pandemic. Finnfund also favours businesses that advance gender equality. Almost all of Early Dawn’s clients are women, while 66pc of senior management and 60pc of board members are female.

Source: Myanmar Times