The Irrawaddy Business Roundup (Feb. 14, 2015)

By William Boot 14 February 2015

One of the world’s largest beer makers, SABMiller, has declined to comment on reports that it is considering buying a stake in the Burmese brewing business run by the military controlled Union of Myanmar Economic Holdings Limited (UMEHL).

Reuters quoted unnamed sources as saying that the London-based brewer was interested in investing in Burma.

“Any such deal involving Myanmar Brewery would likely be seen as a vote of confidence in the country’s nascent consumer sector, which is emerging after decades of military dictatorship,” Reuters said.

A substantial share in the UMEHL operation is available following a legal case last year by the Burmese enterprise against Singaporean partner Fraser & Neave (F&N).

“A Singaporean tribunal ruled that [UMEHL] was entitled to buy out F&N’s 55% stake in Myanmar Brewery, taking full control of the brewer, because F&N had defaulted on a term in their joint venture agreement,” Reuters said.

London-based SABMiller refused to comment on the report, said British beverage industry analysts Just Drinks.

Other foreign brewing firms rumored to be interested in partnering MEHL are Kirin Holdings of Japan and Boon Rawd Brewery of Bangkok, the brewer of Singha beer, Reuters said.

SABMiller is the world’s second-biggest brewing company by revenue, while UMEHL has an 80 percent share of Burma’s beer market.

Carlsberg of Denmark is due to begin brewing in Burma in March in its joint venture with UMEHL’s local rival brewer Myanmar Golden Star, reports in January said.

Kyaukphyu SEZ Contracts to be Awarded: Myanmar Times

Contracts to build sections of a special economic zone at Kyaukphyu on Burma’s Arakan State coast will be awarded at the end of this month and seem likely to include Chinese development companies, a report said.

The first phase contracts will be for port facilities, an industry park and housing, said the Myanmar Times, quoting the government bid evaluation committee.

Eleven of the 12 contract bids submitted have come from China, the Times said.

Existing Kyaukphyu developments are predominantly the work of Chinese firms, with the state-owned China National Petroleum Corporation (CNPC) building an oil import terminal and storage facilities, as well as gas and oil pipelines that extend across Burma into China’s Yunnan Province.

CNPC has just opened the oil line, which is intended to send crude from the Middle East to feed a new refinery in Kunming.

Plans by China’s state-owned Railway Engineering Corporation to build a railroad from Yunnan to Kyaukphyu have stalled, but a recent report by the Chinese news agency Xinhua said Beijing was still interested.

Firms Jostle to Provide Rangoon Stock Exchange Services

Sixty businesses have bid for licenses to provide financial and support services for Burma’s first stock exchange when it opens.

The businesses are seeking permits to provide brokering, underwriting and consultancy services at the exchange, which is scheduled to open in October, said Myanmar Business Today.

Winners of the service licenses are expected to be announced in April, it said.

The Myanma Economic Bank (MEB) last December signed an agreement with the Japan Exchange Group and Daiwa Securities Group to formally establish and operate the exchange.

The two Japanese firms have been advising Burma on the formation of an exchange. The Japan Exchange Group is the operator of the Tokyo Stock Exchange.

The shareholding split in the Yangon Stock Exchange Joint Venture Company is MEB with 51%, Daiwa with 30.25% and Japan Exchange Group with 18.75%, Myanmar Business Today said.

‘Thousands’ of Burmese Migrant Workers in Thai ID Scam

Thousands of forged identity cards may have been issued to Burmese migrant workers in Thailand in return for bribes by labor agents, a report has claimed.

A district administrator in Kanchanaburi province on the Burmese border, Sattha Khachapalayuk, has filed a complaint with Thai police in which he identified more than 400 allegedly false ID cards, the Bangkok Post reported.

The 5,000 word complaint names local government officials in two Thai provinces who are alleged to have forged papers for migrant workers, the Post said. The allegations go back to 2006 when Sattha became a district administrator at Muang.

“[Sattha] said the documents he gave to police clearly showed 421 cards had been illegally issued although he believed there might have been tens of thousands of forged ID cases in Kanchanaburi alone,” the Post said.

Sattha said he “expected more incidents of falsification of documents as opportunists and gangs are already waiting,” the Post said.

As many as 2 million migrant workers are estimated to be in Thailand, most from Burma, and many of them there illegally. There have been persistent reports of Burmese workers being mistreated, underpaid and forced to work long hours, especially in the fishing and fish processing industries.

The Post quoted a senior police officer saying the complaint would be forwarded to Thailand’s Public Sector Anti­Corruption Commission.

Bangladesh Approves Bay of Bengal Seabed Surveys

The government of Bangladesh is inviting foreign companies to make undersea seismic surveys of areas of the Bay of Bengal adjacent to Burma.

The state oil and gas company Petrobangla has called for the surveys in a new effort to attract international interest in offshore exploration and production contracts, the industry website Energy Bangla said.

“After the settlement of disputes with neighboring [Burma] and India, Bangladesh last year invited international bidding for offshore hydrocarbon exploration,” Energy Bangla said. “But the response was not very encouraging. Many officials and energy experts believe that non-availability of marine seismic data was the main reason behind the poor response at that time.”

The exact location of the sites to be offered for seismic surveys has not been publicly identified, but will cover a total area of 85,000 square kilometres, said Energy Bangla quoting an unnamed Petrobangla source.