Burma Targets US$6 Billion FDI for Current Fiscal Year
Burma expects to reach $6 billion of foreign direct investment (FDI) in the fiscal year ending Mar. 31, 2017 despite FDI reaching just $3.65 billion through Dec.16, according to government body the Myanmar Investment Commission (MIC).
Director-general of the Directorate of Investment and Company Administration (DICA) and secretary of the MIC U Aung Naing Oo said Burma would enjoy an FDI influx even though this year’s FDI inflow is $1.3 billion less than that of last year.
“We are now reviewing 52 proposals worth nearly $3 billion, and may receive more proposals in the months to come. So, we are very likely to surpass the target,” U Aung Naing Oo said.
Singapore tops the list of foreign investors in Myanmar, followed by mainland China, Hong Kong, Thailand, and Japan.
World Bank to Support Reform of Burma’s Financial Services
The World Bank approved a $100 million loan this week to improve access to financial services for families and small and medium sized businesses.
Dubbed Myanmar’s Financial Sector Development Project, the loan aims to create a stable financial sector by reforming access to loans and financial products across the country and developing Burma’s nascent microfinance and insurance sectors.
“As Myanmar implements the Financial Sector Development Project, people in communities across the country will gain access to basic financial services and small loans,” said World Bank Country Director for Southeast Asia Ulrich Zachau in the statement.
Farmers, small businesses and low-income households will benefit from this support—improved access to credit will mean more jobs and higher incomes, he added.
“The project will help increase access to finance for households and small and medium-sized enterprises by reforming state-owned banks,” said U Maung Maung Win, Deputy Minister for Planning and Finance.
He added, “these reforms are expected to extend the range of basic financial products and services to underserved areas and populations.”
The credit will come from the International Development Association (IDA). The terms for the IDA credit include a maturity of 38 years, with a grace period of six years and a zero percent interest rate.
Mitsubishi Corp in Joint Venture with Local Construction Equipment Rental Company
Japanese trading corporation Mitsubishi Corp will work with Burma’s leading heavy machinery distributor Myanmar Kaido Co to capitalize on the country’s rampant infrastructure development by renting construction vehicles and equipment.
The new venture Diamond Rental Myanmar Co is 50 percent owned by Mitsubishi, 30 percent by Myanmar Kaido and by 20 percent by Mitsubishi subsidiary Nikken Corp.
At an opening ceremony earlier this month Rangoon Chief Minister U Phyo Min Thein said the partnership will benefit Rangoon’s urban development projects drafted by the Japan International Cooperation Agency.
“The capacity of heavy machinery will play a major role when we implement the urban development projects in the city,” the chief minister said.
The three companies have collaborated in rental businesses in Burma since 2013.
Honda Opens After-Sales Outlet in Rangoon
The joint venture comprises three groups: Eastern Nova, Honda Motor, and Honda’s regional headquarter for the Asia and Oceania Region Asian Honda Motor.
“Myanmar has been experiencing a very encouraging economy growth of around 8 percent in recent years, and it is regarded as one of the important markets with high potentials to grow in Asia with the population of 50 million,” Honda said in a statement.
Sales of new vehicles have been permitted since 2011 in Burma and Honda estimated that 42,000 Honda cars have been registered in the country.
Malaysia Manufacturing to See Labor Shortage After Burma Stops Sending Workers
Malaysia’s manufacturing sector will face a labor shortage after Burma’s government temporarily halted Burmese migrant workers going to Malaysia after a diplomatic row, the Federation of Malaysian Manufacturers (FMM) said.
Malaysian industries employed 100,349 Burmese workers as of June this year and were already facing labor shortage, said the home ministry, urging measures to counteract the loss in labor.
Burma’s Ministry of Labor, Immigration and Population announced earlier this month that overseas employment agencies would suspend sending Burmese workers to Malaysia because of protests led by Malaysian Prime Minister Najib Razak in Kuala Lumpur in support of the Rohingya .
“Myanmar has temporarily stopped sending workers to Malaysia from Dec. 6 because of the current situation in Malaysia,” it said in a statement.
Myanmar Overseas Employment Agencies Federation’s (MOEAF) central executive committee member U Myat Thu reportedly said that Malaysian companies would face “difficulties” following the suspension.
According to MOEAF data there are an estimated 500,000 to 700,000 Burmese workers living in Malaysia, most of them without legal documents, and about 3,000 Burmese workers a month were being sent to Malaysia.