Burma Business Roundup (Sept. 14)
By William Boot 14 September 2013
Neighboring Countries ‘Taking Advantage’ of Burma’s Lack of Safeguards
China and Thailand should follow the lead of India and abandon their plans to build large hydroelectric dams on Burma’s rivers, an environmental NGO said.
“China and Thailand are adhering neither to international standards nor their own domestic regulations when building dams in Burma,” said Burma Rivers Network (BRN) in a statement. “They are taking advantage of Burma’s lack of safeguards protecting the environment and local livelihoods in order to access cheap power for their own domestic use.
BRN praised the Indian government for an apparent decision to cancel its plans for a 1,200 megawatts capacity dam at Tamanthi on the River Chindwin in Burma’s far northwest. Most of the electricity from this dam would have been transmitted to India, the NGO said.
“BRN urges China and Thailand to take similar responsibility for our shared environment and halt their accelerated plans to dam Burma’s major rivers to fulfill their domestic power needs,” it said.
It called for action to halt approvals by Burma’s Ministry of Electric Power in March for six hydro dams on the River Salween in eastern Burma bordering Thailand.
New Companies Law Planned to Replace Century-Old Colonial Rules
Burma plans to introduce a new companies law by the end of 2014. It will overhaul an existing law that has stood unchanged for almost 100 years since its introduction in the British colonial era.
“[The law] aims to improve transparency and update rules governing the operations of companies in Burma,” said Singapore’s Channel NewsAsia (CNA).
An outline of the new law was given at an investment forum in Naypyidaw.
“We are trying as early as possible to revise this law so that there will be a better business environment in [Burma],” the director-general of the Directorate of Investment and Company Administration at the Ministry of National Planning and Economic Development, Aung Naing Oo, was quoted by CNA as saying.
“The new law will be supportive of SME [small and medium enterprises] development.”
One important new element of the revised law will be to lay down the definitions for determining whether a company is classified as foreign or Burmese, and will be based on the makeup of the management, said CNA.
Burma Construction Firm Seeks Partners in South Korea, Thailand
Burmese industrial company Shwe Taung Group is reportedly seeking partners from Thailand and South Korea for joint developments in Burma.
The construction-to-real-estate company is planning to invest US$500 million over the next five years, “focusing on property, shopping complexes and office towers,” chairman Aik Htun was quoted as saying by Bangkok’s The Nation newspaper.
Among other plans, the group is negotiating with CJ Entertainment of South Korea to establish a chain of cinemas in Burma, the paper reported.
The firm also wants to expand its Junction Centre shopping mall chain in Burma.
Border Trade Grows US$400 Million in April-August Period
Cross-border trade between Burma and its four neighboring countries increased by almost US$400 million between April-August compared with the same period of 2012, media reports said.
The value of the trade was $1.88 billion, which was $391 million more than in the 2012 five-month period, said China’s Global Times, quoting local media.
More than $1.1 billion of the total was due to exports via 15 land border crossings with China, Thailand, India and Bangladesh.
The biggest border trade avenue was the Shan State town of Muse to China’s southwest Yunnan Province, said Global Times, followed by the Myawaddy crossing into Thailand.
Foreign Investment in Burma Grows Fivefold since New Law Passed
Foreign investment in Burma has grown more than 500 percent since the Foreign Investment Law came into force at the end of 2012, said the Directorate of Investment and Company Administration (DICA).
“In the past, the total foreign investment [for one year] in Myanmar [Burma] used to be only around US$200 million. This year, it reached US$1.4 billion in the first five months,” DICA director-general Aung Naing Oo was quoted by Eleven Media as saying this week.
An earlier report by Reuters said much of the investment increase had gone into clothes manufacturing.
However, DICA said the oil and gas industry was also a major beneficiary of investment.
In August alone this year, over $730 million of investments came into Burma, mostly from East Asia and including China and Japan.
Suu Kyi for Singapore Business Conference at End of East European Tour
Opposition leader Aung San Suu Kyi has gone on a week-long tour of several East European countries, during which she will attend a major forum in Prague attended by scores of business leaders.
Suu Kyi will visit Poland and Hungary as well as the Czech Republic, giving several lectures and meeting national leaders in each country.
On her way back to Burma she will attend the Singapore Summit, an annual gathering of Asia region business and economics leaders. In Singapore she is scheduled to give a speech on Burma in transition.