The Irrawaddy Business Roundup
By Zaw Zaw Htwe 27 June 2020
Though many sectors of Myanmar’s economy have resumed operations, Myanmar State Counselor Daw Aung San Suu Kyi spoke via video conference this week about how the government remain wary of the risk of a second wave of COVID-19 infections.
In this week, Myanmar managed to approve additional foreign and local investments for the country and Yoma Strategic announced plans to acquire Telenor Group’s majority stake in Myanmar’s leading mobile money company, Wave Money.
A new report by the World Bank said that Myanmar could see its economic growth drop from 6.8 percent to 0.5 percent this fiscal year due to the impacts of COVID-19.
Meanwhile, the Myanmar government said that it will launch its latest Investment Policy Review.
Myanmar approves over US$30 million in foreign investment
This week, the Myanmar government approved more than US$30million in foreign investments for projects in Yangon, regions, according to the Directorate of Investment and Company Administration (DICA).
On Wednesday, the Yangon Regional Investment Committee approved almost US$9.2 million in foreign investments by three investors from China and about 2.3 billion kyats (US$1.7 million) from a local investor.
The three Chinese investments are focused on the garment sector and the one local investment is in the food production sector.
The investments in Yangon Region are reportedly expected to create job opportunities for 3,038 people.
On Thursday, the Bago Regional Investment Committee (BRIC) also approved US$13.3 million in foreign investments by the three new foreign investors as well as an extension of one existing foreign investment.
BRIC expected that the investments would employ 1,200 workers.
In addition, the Tanintharyi Investment Committee has approved US$7.5 million and 12 billion kyats (US$8.7 million) in investments by two local investors. The investments focus on the electricity sector in the region and are expected to create job opportunities for 730 people.
In Myanmar’s north, Kachin State approved 965 million kyats (US$700,000) in local investments focused on the agriculture sector, which will reportedly employ 117 people.
Yoma Strategic to buy stake in Wave Money from Telenor
On Wednesday, Yoma Strategic Holding, headed by Chinese-Myanmar tycoon Serge Pun, announced that it will acquire the majority stake in Wave Money, worth US$76.5 million, from Telenor.
Currently, Wave Money is running a network of more than 57,000 agents across 295 townships in Myanmar, covering approximately 89 percent of the country.
More than 21 million people have used Wave Money’s services, including Wave Pay, for remittances, utility payments, airtime top-ups and digital payments, accoding to Yoma Strategic.
Yoma Strategic also said that it will invest up to an additional US$25 million in Wave Money.
Myanmar to launch its Investment Policy Review
On Wednesday, Myanmar’s Ministry of Investment and Foreign Economic Relation (MIFER) said in their annual press conference that they have finished their second Investment Policy Review (IPR) and will publish it in the next three months.
The review was finalized with the help of the France-based Organization for Economic Cooperation and Development (OECD) and identifies policy reforms required to make the country a more attractive destination for quality, responsible investment.
MIFER said the OECD’s review provides Myanmar with a comprehensive overview of global and regional investment trends, including policies and practices affecting the investment climate of Myanmar.
MIFER Permanent Secretary U Aung Naing Oo said that the latest policy review identifies investment policies that need to be improved and makes it clear what Myanmar needs to do to pursue more investment.
Myanmar’s economic growth could drop
This week, the World Bank’s latest report said that Myanmar’s economic growth could drop from 6.8 percent to 0.5 percent this fiscal year due to COVID-19.
The report also said Myanmar’s GDP growth rate is projected to bounce back to 7.2 percent in the 2020-21 fiscal year—if Myanmar controls the local spread of COVID-19 and the global economy swiftly recovers.
According to the World Bank, the slowdown in economic growth threatens to partially reverse Myanmar’s recent progress in poverty reduction while reducing the incomes of households who are already poor.
Also, the bank warmed that “precautionary behavior and travel bans continue to negatively impact wholesale and retail trade, tourism-related services, and transportation.”
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