The Irrawaddy Business Roundup (June 3)
By The Irrawaddy 3 June 2017
Burma’s Trade Volume with Asean Countries Slips
Burma’s trade volume with member countries of the Association of Southeast Asian Nations (Asean) was down in the 2016-17 fiscal year from the previous year, according to official figures.
Trade with Asean countries was US$9.6 billion during the 2016-17 fiscal year which ended in March, down from $10.4 billion the previous year and $12.6 billion in 2014-15, according to government statistics.
In 2016-2017, exports stood at almost $3.1 billion, while imports were more than double at $6.5 billion, the Ministry of Commerce figures reported by Xinhua indicated.
Thailand was the largest Asean trade partner with $4.2 billion in trade during the year, followed by Singapore with $2.9 billion, Malaysia with $980 million, Indonesia with $827 million, Vietnam with $494 million and the Philippines with $56 million.
Trade with Brunei, Laos and Cambodia was less than $3 million.
Burma’s main exports to the region include agricultural and marine products, minerals and finished industrial goods. Main imports include consumer goods, electronic products, capital goods and automobiles.
Jobs in Engineering
Engineers are in high demand in Burma and some of the country’s leading employers will be offering positions at a conference next weekend in Rangoon.
Jobs in everything from civil engineering to mechanics and project management will be offered at the conference organized by the jobs portal JobsNet on Sunday, June 11 at the Sedona Hotel.
Local and international speakers sharing insights into the engineering industry will be U Myint Pe of the Myanmar Engineering Society (MES), U Khin Maung Tint of Max Myanmar Construction, Gerhard Hartzenberg of Yoma Strategic Holdings | SPA Group, U Kyaw Kyaw Naing of IGreen Construction & Engineering and Daw Thin Thin Hlaing of Asia General Electric.
The conference is supported by Asia General Electric Co. Ltd., and Peace Myanmar Electric Co. among others. Anyone can attend, but prior registration is required.
Manufacturing PMI Falls Slightly in May
The Nikkei Myanmar Manufacturing Purchasing Managers’ Index, or PMI, fell to 52.0 in May from 52.9 in April, Nikkei Asia reported.
However, the figure also marked the fifth consecutive month of growth for manufacturing in Burma, as measured by the index.
“Supported by strong expansions in output and new orders, operating conditions in the sector improved further,” said Sian Jones, an economist at IHS Markit, which compiles the survey.
A reading above 50 indicates economic expansion, while a reading below 50 points shows contraction.
IHS Markit forecasts Burma’s overall GDP to increase by 7.1 percent this year.
AYA Bank Widens Market for Visa Cards
AYA Bank has announced that it is making Visa cards available to lower income earners on monthly salaries of above 150,000 kyats.
The bank is also offering its customers the option to redeem points earned through credit card use at gas stations and to purchase home appliances, rather than stays at luxury hotels.
Many banks in Burma require that customers earn a minimum monthly income of 300,000 to 400,000 kyats to apply for a Visa card. With the eased restrictions, AYA Bank hopes credit cards will no longer be restricted to higher earners, Nikkei Asia reported.
The use of credit cards is in the early stages still in Burma. Payments with credit cards issued overseas have only been allowed since 2012. Visa cards can now be used at about 7,000 outlets across the country, and the number is set to rise.
Farmer Program Boosts Agriculture Outputs
A Farmer-To-Farmer technical assistance program is being implemented by USAID-funded Winrock International, with the aim to help growth in the agriculture sector, according to a report.
Winrock has mobilized more than 65 volunteers through the Asia F2F program to support rural development and increased incomes for smallholder farmers.
Since 2014, vegetable growers have been trained in sustainable agriculture practices such as the use of cover crops, green manure, crop rotations, and bio-fungicides. A process to produce an on-farm, locally-made fertilizer was also introduced.
Training for the Mandalay Mango Farmer Group on post-harvest handling and processing techniques for mangos boosted farmers’ earnings in some instances by 200 percent, the report claimed.
Avocado growers were guided in techniques that have enabled more exports and resulted in improved fruit quality.
The F2F volunteer program has resulted in Burma farmers implementing improved technologies on more than 14,000 hectares of land and introducing more than 100 new or improved agricultural products and services, according to the report.
Vertiv Aims for Burma Expansion
Technology firm Vertiv which supports mobile and cloud computing among other products is aiming to expand in Burma, according to a report in The Nation.
Vertiv has been involved in business in Burma for more than 25 years through its partner Aung Myanmar, Anand Sanghi, Vertiv’s president for Asia told the newspaper.
Reforms in the telecoms sector in Burma had motivated the firm to expand in the country, Sanghi said.
Paul Churchill, Vertiv’s vice president for Southeast Asia Sales, said the company’s data centers and other technologies were specifically designed for developing countries like Burma where there is limited electricity and frequent blackouts.
The company, formerly named Emerson Network Power, opened an office in Rangoon in 2014 and has a current workforce of 16.
Another representative, Daniel Sim, said the firm recently signed a deal with Burmese technology firm KMD and is cooperating with two Burmese banks.
Chinese-Israeli Venture Eyes Burma Opportunities
A Chinese-Israeli asset management company is planning to invest heavily in agriculture-related industries in Burma as well as Vietnam and Sri Lanka, according to a report in The China Daily.
Hyleen Capital manages a total of $3.2 billion in assets and has been expanding its footprint in Southeast Asia for around two years, the report said.
“The Belt and Road Initiative has shed light on the Southeast Asian and South Asian countries, which used to be downplayed by private investors in China due to geographical and language barriers,” Hyleen’s chairman Wang Xiang told the news outlet.
“Now it’s the right time for private equity funds to go there as there are actual needs for foreign direct investment, while it’s getting increasingly hard to pick good projects for investment at home,” he added.
One of Hyleen’s subsidiaries, Yunnan Cross-border Equity Investment Fund Management Company, is looking at manufacturing, agriculture and education in Southeast Asia, according to a Hyleen Capital prospectus.
Yin Jiayin of Hyleen Capital said the company and its partners are waiting for government approval for a $30 million cattle quarantine project in Burma that would enable the animals to be legally exported to China.
Hyleen Capital is also investing in a sweet sorghum plantation project in Burma with a possible investment of $20 million, according to the report. Trial planting is being conducted with the help of Burma’s agriculture ministry, Yin Jiavin said.
Wang and Yin also pointed to challenges and risks in doing business in Burma. “The market requires approval from multiple governmental entities if a foreigner wants to set up a company, and there are not established laws telling companies what can and cannot be done,” said Yin Jiavin.