Business

The Irrawaddy Business Roundup (December 17)

By Kyaw Hsu Mon 17 December 2016

BASF Plans Construction Chemicals Plant

The German chemical company BASF has announced plans to build a manufacturing plant in Burma to produce chemicals for the construction industry.

The project, which is subject to regulatory approval, is expected to commence in Rangoon in 2017.

BASF is said to be the world’s largest chemical producer. Its operations around the globe include a significant presence in Asia.

“As Myanmar’s construction industry grows more sophisticated in its scope, which includes high-rise buildings, roadways, and bridges, the requirement for high-quality technical and construction chemical solutions will increase,” Christian Mombaur, head of the Asia division of BASF Construction Chemicals said in a statement.

“BASF has a successful track record in supporting major building and infrastructure projects in Myanmar such as Thilawa Special Economic Zone, Yeywa hydropower dam, Myingyan steel mill, and others. We can draw on our decades of experience in the region and around the world to support Myanmar’s development in this important sector,” he said.

BASF opened an office in Rangoon in 2015 and has supplied concrete admixtures, construction systems and mining chemical solutions in the country for a decade, it said.

Eden Group to Invest in Affordable Housing Projects

Local conglomerate the Eden Group plans to expand its construction operations to include affordable housing, chairman U Chit Khine told Nikkei Asia on a visit to Japan recently.

Eden Group’s current business portfolio ranges from construction to finance and agriculture. U Chit Khine told the Nikkei that affordable housing outside main cities was now in the company’s sights.

‘‘Our country needs to develop so much infrastructure and real estate,” U Chit Khine said. ‘‘We need to expand our business for the future.’’

Eden Group’s construction record has included universities, hospitals, industrial complexes and the presidential palace in Naypyidaw.

In future it will also focus on residences, hotels and serviced apartments, U Chit Khine said. The market for middle and lower-middle income homes would increase as family earnings rise in Burma, he said.

 

Customs Takings on the Rise at Airport

The customs department at Yangon International Airport levied tariffs worth more than 100 million kyat from mainly passengers during November, according to the Global New Light of Myanmar.

Imported items subject to customs tariffs at the airport consisted of consolidated cargo, documents, newspapers and personal goods, according to the department.

A total of around 90 million kyat was collected in September and around 100 million kyat was collected in October.

Thailand’s Dusit Group Plans Rangoon Hotel

Hospitality company Dusit International has signed a management agreement with local firm the Myanmar V-Pile Group to operate the Dusit Thani Yangon, a five-star hotel which will operate within a  mixed-use development in Rangoon.

The 388-room hotel aimed at the corporate and MICE market will include a convention center, offices and retail and residential units and will be located in the area slated to become Rangoon’s second central business district.

Mrs Suphajee Suthumpun, group CEO of Dusit International, said the move to Rangoon would set the group up well for further expansion to destinations such as Bagan, Mandalay and Inle Lake.

Dr Sone Han of Myanmar V-Pile said the group was ‘‘very excited to commence our first phase of the secondary central business district (Mindhama) project.’’

Dusit International operates 29 properties around the globe and another 40 are due to open within the next three years, the company said in a statement.

Corn Production Expected to Jump

Total corn production in Burma is expected to increase by 6 percent during 2016-17, the foreign agricultural service (FAS) of the US Department of Agriculture said in a release this week.

Expansion of rain-fed corn growing areas and increased demand from neighboring countries accounted for the projected rise, according to World Grain News. The bulk of Burma’s corn production is exported to China

Corn farmers need large amounts of seed annually and most farmers have to buy from commercial companies or the government. Thailand-owned Myanmar CP Livestock holds around 65 percent of the local corn seed market, World Grain News said. CP produces hybrid seeds through contract farming with growers in mainly southern Shan State.

The Myanmar Department of Agriculture has also developed corn seed varieties and the government holds an estimated 8 percent share of the corn market. Government seeds are known as Yazin varieties, and are cheaper than the seeds sold by private companies.

The area planted with corn in Burma has steadily increased in recent years, the report said, due mainly to lower production cost and better profitability for corn compared to competing crops such as potato and garlic. The corn market is expected to grow in line with a growth in animal feed and other markets for corn.

China Tin Imports Jump, Mainly from Wa State

China’s imports of tin ores and concentrates more than doubled in October over the previous month, with most of the imports coming from Burma, according to Chinese customs data.

The imports totaled 36,515 tonnes, more than double that of the previous month, according to SMM news.

China’s tin imports for the first ten months of 2016 were also up significantly, by around 35 percent over the same period the previous year.

Of China’s total tin imports of 383,690 tonnes in the first ten months of the year, only around 1000 tonnes was not from Burma.

The International Tin Research Institute has estimated that as much as 95 percent of Burma’s tin output comes from the Man Naw area in Wa State, but output there is expected to decrease. Exports to China this year may have been from stocks accumulated over the last few years, the ITRI said in September.

Unless new resources are found, tin mining in Wa State could peak by 2017, the ITRI said.

A Reuters story last month said that tin sourced in the Man Naw area was going to Chinese firms supplying a range of international companies including Apple, Starbucks, Huawei, General Electric and Nokia. The companies could be in violation of sanctions placed by the United States placed on the United Wa States Army for suspected narcotics trafficking in 2003, the report said.

Great Hor Kham Preparing for YSE

The Burma-based Great Hor Kham Public Company plans to issue shares on the Yangon Stock Exchange in four tranches over the next four years, DealStreet Asia reported.

The listing is aimed at funding the company’s Nam Paw Hydropower project in Muse in Shan State, a company official said.

The first of the four issues is expected to be in March 2017 when the company lists on the exchange, managing director Sai Ohn Myint said.

Great Hor Kham is among six companies that were scheduled to be listed on the stock exchange since it was inaugurated in December 2015. To date three firms are listed, while First Private Bank, Myanmar Agricultural Business Public Corporation and Great Hor Kham are still making preparations.

Great Hor Kham expected to submit its prospectus to the Myanmar Securities Exchange Commission this month, Sai Ohn Myint told Dealstreet.

It intends to raise half of the estimated cost of US$40.6 million for the hydropower project via the listing, Dealstreet reported. Great Hor is also in ‘early talks’ to secure loans from local banks and some other foreign players, Sai Ohn Myint added.

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