OPPORTUNITIES IN MYANMAR
Direct Investment ( FDI )
With regard to Foreign Direct Investment (FDI), the Union of Myanmar Foreign
Investment Law (FIL) was promulgated in November 1988 and its procedures
were prescribed in December 1988. Myanmar has opened the doors to foreign
investors to participate actively in exploiting natural resources thereby
enhancing long – term mutually beneficial economic co-operation. The policy
on foreign investment is an important component of the overall economic
restructing and development policy of the country.
In order to oversee and administer the FIL, the Myanmar Investment Commission
(MIC) was formed. It is an initial approving authority for foreign investment
Foreign investment may be made in any of the following forms :-
In forming with the above forms :-
Minimum foreign capital to be brought into Myanmar has been notified by
MIC. The minimum amount of foreign capital required to be eligible under
the Foreign Investment Law is :-
For manufacturing US$ 500,000
For services US$ 300,000
Foreign capital can be brought into Myanmar in any foreign currency acceptable
to the Myanma Foreign Trade Bank.
As the Foreign Investment Law is aimed at bringing in more foreign capital
into the country, it offers investment incentives and guarantees to foreign
investors. An enterprise permitted by the FIL shall enjoy a tax holiday
of three years inclusive of the year the enterprise commences its commercial
operation and also to a reasonable additional period upon application
approved by MIC, in the interest of the state. MIC may grant one or all
of the following exemptions and reliefs:-
guarantees that an economic enterprise formed under a permit shall not
be nationalized during the term of the contract or during an extended
term, if so extended.
On the expiry of the term of the contract, the Government guarantees an
investor of foreign capital, the rights he is entitled to, in the foreign
currency in which such investment was made.
to Transfer of Foreign Currency
who has brought in foreign capital can transfer the following :-
amount of Foreign Direct Investment by country / sector
investors are Singapore, United Kingdom, Thailand, Malaysia and United
States of America. Approved amount of FDI up to the end of March, 2000
is US$ 7177 million of 327 projects from 25 countries.
sector being the mainstay of the Myanmar economy with about 36% percent
of the total GDP and about 46 percent of foreign exchange earnings in
Since 1990, according to the policy for the participation of private sector
in agricultural sector, local and foreign investors are encouraged by
the government and now some areas such as distribution of agricultural
machinery and inputs are being engaged by private sector.
However, there is no significant participation of private investors in
crop production because investors has been attracted by other most profitable
economic sectors. Nontheless, from the last year, 1998, participation
of private investors in agriculture is rapidly increased when the Government
introduce a scheme to go out rights of land utilization for the purpose
of agricultural activities with the aim of private sector participation.
Interested company and groups are now allowed for the land from deep water
flooded and waste land area and now 33 applicants have already been granted
0.98 million acres up to February 1999. Land preparations for further
necessary assistance are being given by respective agencies under Ministry
of Agriculture and Irrigation.
National entrepreneurs are encouraged to cultivate cash crops like paddy,
rubber, cotton, palm olein, pulses and beans on commercial scale. Among
these, with effect from 1999 crops, except oil crops, the 50 percent of
the production of restricted items like rice and other items will be allowed
to export annually subject to recommendation of the Agricultural Crops
Supervisory Board under the Ministry of Agriculture and Irrigation.
Myanmar has 18 million hectares of cultivable land of which only 9 million
hectares are under cultivation. We still have 9 million hectares available
for cultivation. Myanmar is rich in agricultural land resources and agricultural
labour is relatively cheap. The investment in this sector is a very promising
one. Local and foreign investors are welcomed to invest in the form of
joint – venture or 100 percent investment and profit sharing basis.
total water resources of approximately 870 million acre – feet per annum
and presently utilising only 6 percent. So far, 86 irrigation projects
have been completed. The Ministry of Agriculture has taken every efforts
to raise the irrigation coverage of the cropped area to 25 percent in
the short term.
and Fishery resources
development of the livestock and cattle industry, Myanmar has vast pasture
land with suitable climate. Myanmar with a coastal line of 2832 km is
also rich in marine resources. It has been estimated that one million
metric tons of fishery resources could be exploited annually on a sustainable
basis. The present exploitation is only 60 percent of the maximum sustainable
yield. The continental shelf covers 228,781 sq.km. and Myanmars’ exclusive
economic zone is 486,000 sq. km wide. The fishery together with the livestock
breeding is the important sector of the economy and it contributes 7.1
percent of GDP. Investment in livestock breeding and fishery is also a
very promising one.
51 percent of Myanmar is covered by forests. There are over 5,000 different
plant species. The forest policy of Myanmar has been formulated according
to the forestry principles adopted by the United Nations Conference on
Environment and Development. Teak, hardwood, bamboo, rattan and other
minor forest produce are the basic products received from Myanmar’s forest.
Despite higher global demand, Myanmar cut 432,000 cubic metres of teak,
and 2,340,000 cubic metres of non – teak hardwood. The fifteen percent
of total land area is kept as Reserved and Protected Public Forests. Myanmar
is also carrying out a sustained programme of reforestation. As of 1997,
there were over 610,000 hectares of forest plantations. Solely owned or
joint – venture investment can be made in the forestry sector to produce
semi-manufactures and manufactures.
well endowed with mineral resources and has many deposits. These resources
are very much under – utilized and as there still exist a large mineral
potential, it is the policy of the Ministry of Mines to immediately boost
up the present production for domestic use and exports . Emphasis is given
on the increased production of copper, gold, lead, zinc, iron and steel,
dimentional granite and marble, nickel, tin and tungsten and limestone.
Quite a number of local and foreign companies are now very active in mining
sector. Investments can be made through production sharing or profit sharing
Manufacturing and Jade Carving
intention of acquiring new technology in Gem cutting, polishing, manufacturing
of jewellery and also earn added value, Myanmar Gem Enterprise is looking
forward to expand its joint co-operation in jewellery manufacturing with
suitable foreign partners.
Oil and Gas Enterprise ( MOGE ) is the only State Enterprise which carries
out exploration, drilling, production and transportation of crude oil
and gas in the country, both inland and offshore. In 1989, the Ministry
of Energy had invited foreign compaines for exploration and development.
At present, international oil companies including Total / Unocal, Mitsui,
Premier, Texaco, Nippon Oil, ARCO of United States, Genting Group and
Dataran Isibumi of Malaysia, and other oil companies from USA, Hong Kong,
Canada and Australia are now very active in oil and gas exploration. The
total expected recoverable gas now reached to 9.5 trillion cubic feet.
MOGE has signed a voluminous sales contract of natural gas to PTT of Thailand
and the construction of 36″ diameter pipeline for a distance of 430
km from the field to the border is in progress. For increased electric
power generation, the Ministry of Electric Power is inviting foreign investors
for joint operation and development of hydropower projects in States and
Divisions throughout the country.
is a cultural destination with its rich cultural heritage and is also
blessed with natural environment like snow – capped mountains, beautiful
lakes, long rivers, lush tropical forests, unspoilt beaches and archipelagoes.
There is a growing need for international class hotels in major tourist
sites in States and Divisions. A sound infrastructure ( airports, roads,
super high ways, railroads, hotels, motels, telecommunication etc. ) is
highly crucial for the promotion of tourism and so investors who are looking
for investment opportunities in these areas are also welcome.
Ministries of Industry (1) and (2) there are quite a number of factories
inherited from the time of centrally planned economy. Most of them are
German, English and Japan origin. Some of these factories need renovation
and modernization to enhance their production to the maximum level.
has allocated industrial estates for the foreign and local investors,
at the strategic places from the business point of view.
labour force constitutes one of the primary resources of the country.
Estimated active labour force is about 18.36 million in 1997/ 98. Fairly
well trained manpower and skilled labour is available for the industrial