A week after major businesses in Myanmar reopened, the country reported 25 new COVID-19 cases, including two local transmissions, bringing the country’s total cases to 261 as of Friday morning.
Despite the reported COVID-19 cases, businesses in Myanmar are attempting to resume operations in order to stay afloat and foreign investors are again showing interest in Myanmar.
This week, a group of firms from Hong Kong expressed interested in investing in Myanmar’s garment sector and the Yangon regional government approved three foreign investments from China and Hong Kong.
A nationwide survey found this week that two-thirds of businesses in Myanmar are facing a lack of cash flow to the point that they are struggling to survive the COVID-19 crisis.
However, the Myanmar tourism sector, which has been heavily impacted by the pandemic, plans to resume operations soon.
A group of Hong Kong Firms plans to invest in Myanmar
A group of Hong Kong Firms will be visiting Yangon and Bago Region this year to invest in the garment industry, the Myanmar-Hong Kong Chamber of Commerce and Industry (MHKCCI) said on Tuesday.
According to the European Union’s Generalized Scheme of Preferences (GSP) trade program, finished products from Myanmar’s garment industry enjoy a 12.5 percent tax break when exported to European markets.
Hong Kong investors are interested in investing in Myanmar’s cut-make-pack (CMP) garment industry because of these trade privileges, according to Dr. Maung Maung Lay, vice president of the Union of Myanmar Federation of Chambers of Commerce and Industry (UMFCCI).
“We welcome foreign investment. Our CMP sector can create jobs due to those investments,” Dr. Maung Maung Lay told The Irrawaddy.
A recent survey by MHKCCI said that during the COVID-19 crisis, half of its 64 member companies in Myanmar have seen a drop in revenue, with the average decline being 47 percent. However, 15 percent of their members have seen neutral impacts and 35 percent managed to increase revenue.
The majority of their member businesses—77 percent—plan to maintain their business in Myanmar at its current size for the next 12 months, while 21 percent plan to expand their business and 3 percent plan to scale down their operations, said MHKCCI.
Two-thirds of business in Myanmar are struggling to survive the COVID-19 crisis
A nationwide survey by The Asia Foundation found that nearly two-thirds of businesses in Myanmar have struggled during the pandemic due to cash flow problems, putting their survival at risk as government emergency loans have reached only a fraction of businesses.
The survey, published Monday, said that on average, businesses estimated that they require 18 million kyats (US$12,851) in additional cash flow in order to survive until September 2020.
It also estimated that businesses nationwide require an additional 900 billion to 2.1 trillion kyats (US$642.5 million-1.5 billion), equivalent to 0.7-1.7 percent of the International Monetary Fund’s (IMF) projection of Myanmar’s GDP for the 2019-2020 fiscal year.
About half of the 750 businesses surveyed said that their commercial survival was at either moderate or high risk due to the COVID-19 pandemic.
Foreign investments approved in Yangon
On Wednesday, the Yangon Investment Committee approved about US$7.4 million in foreign investments by investors from China and Hong Kong and 1 billion kyats (US$709,000) in investments from local investors, according to the Directorate of Investment and Company Administration (DICA). The investments are focused on the industrial sector.
The Yangon Investment Committee said it expects that the four investments would create job opportunities for 656 people.
Myanmar tourism sector expects to reopen soon
The Hotel and Tourism Ministry said that Myanmar’s tourism sector is expected to reopen soon as they have begun implementing the third stage of the ministry’s strategic road map for survival, reopening and relaunching.
Meanwhile, some tourist sites in Myanmar have reopened for domestic tourism. Since June 1, many townships in southern Shan State have reopened to visitors following an agreement between township authorities and local businesses.
Hotels in southern Shan State have also been approved by the regional tourism committee to receive visitors, after setting up COVID-19 preventative measures.
Kayah State, also a tourism destination, has reopened to all domestic visitors except for people from two Yangon townships—Insein and Mayangone—where the most COVID-19 cases have been reported.
“Flights are due to resume in June, but exact instructions about the lockdown have not come out,” U Hnaung Hnaung Han, chairman of the Myanmar Tourism Federation, told The Irrawaddy. “Domestic tourism will begin first as the tourism sector is approved to reopen.”
Myanmar tourism businesses are among the most heavily impacted by COVID-19.
Over 80 percent of small tourism businesses in Myanmar are extremely affected by the pandemic, according to a recent survey by the Ministry of Hotels and Tourism.
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