Business Roundup

Irrawaddy Business Roundup

By Zaw Zaw Htwe 26 September 2020

As a Yangon health chief revealed that Myanmar’s health ministry is considering a new strategy to fight COVID-19 in the city, State Counselor Daw Aung San Suu Kyi promised a fund of 1 trillion kyats (US$758 million) to deal with the outbreak.

It was announced this week that the ban on international flights would be extended until Oct. 31.

Meanwhile, garment factories in Myanmar’s Yangon and Ayeyarwady regions have been closed until Oct. 7 and the government approved more than 20 billion kyats ($15.3 million) in loans for around 1,000 enterprises impacted by the pandemic.

Also this week, China reopened border trade with Myanmar after lifting its lockdown in Ruili and Yangon approved six foreign investment packages.

Myanmar extends international flights ban

On Sept. 24, the government extended its ban on international flights until Oct. 31. The Ministry of Transport and Communications said the National Central Committee for Prevention, Control and Treatment of COVID-19 approved the extension.

On March 29, Myanmar banned all commercial international flights to prevent the COVID-19 cases arriving from other countries after the first COVID-19 case was detected on March 23.

To curb COVID-19 transmissions within Myanmar, domestic services have been grounded until Oct. 1, meaning only relief, cargo and special flights are allowed.

Yangon and Ayeyarwady garment factories close

To slow the spread of COVID-19 in the city, all garment factories in Yangon were ordered by the Ministry of Health and Sports to cease operations until Oct. 7. The Ministry of Labor, Immigration and Population said workers who had paid social security fees will receive 40 percent of their monthly wage while the factories are closed.

U Myo Aung, permanent secretary at the labor ministry, told The Irrawaddy this week that there were plans to provide cash assistance to workers who have not paid social security fees.

There are more than 600 clothing factories with nearly 600,000 employees in Myanmar, of which 80 percent are in Yangon Region.

The Ayeyarwady regional government also ordered all its garment factories to cease operations until Oct. 7 after reporting COVID-19 cases in two factories.

The regional labor department director told The Irrawaddy that the regional government will report to the labor ministry in Naypyitaw to provide social security payments to workers for the two-week closure.

1,041 companies offered loans

On Tuesday, Myanmar’s working committee on the economic impact of COVID-19 announced the approval of 20.7 billion kyats ($15.4 million) in loans for 1,041 enterprises that have suffered financial losses due to coronavirus.

However, companies that have been prosecuted by a bank for defaulting on loans are ineligible.

Daw Aung San Suu Kyi said on Monday that the government had allocated 1 trillion kyats to the natural disaster management fund for the fight against COVID-19, including a recovery plan for sectors impacted by the virus.

The Ministry of Investment and Foreign Economic Relations said the government had issued 1 trillion kyats in loans to impacted sectors, including garment manufacturing and tourism, small and medium-sized enterprises and agriculture, by Sept. 4.

The 12-month loans have a 1-percent interest rate.

China’s border reopens for trade

Trade between Myanmar and China has restarted after the authorities in the Chinese border town of Ruili lifted their lockdown on Sept. 21.

U Sai Nom, chairman of the Muse-Namkham Border Trade Chamber of Commerce, told the media this week that employers needed to know about lockdowns in advance to prevent further losses in the future.

On Sept. 15, the authorities in Ruili, the town across the border from Muse in China’s Yunnan Province, imposed a lockdown and ordered all residents to be tested for COVID-19 after two Myanmar nationals tested coronavirus-positive.

The authorities also shut down the Ruili’s customs clearance office, a crucial checkpoint for goods from Myanmar.

Border trade completely halted, U Min Thein, vice-chairman of the Muse Rice Wholesale Center, told The Irrawaddy last week.

Foreign investment in Yangon approved

On Wednesday, the Directorate of Investment and Company Administration (DICA) said it approved six foreign investments from China and Taiwan in Yangon, the center of Myanmar’s COVID-19 outbreak.

DICA said the industrial investments would create almost 4,000 jobs while not revealing the amount of each investment.

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