Business

The Irrawaddy Business Roundup (March 18)

By The Irrawaddy 18 March 2017

CMP Sector Sees Jump in Earnings

Burma’s cutting, making and packaging (CMP) garment export sector has generated more than US$1.6 billion in business during 11 months of this fiscal year, an increase of almost $1 billion over the same period the previous year, according to the Ministry of Commerce.

A large number of investment permits issued by the Myanmar Investment Commission this year were in the garment manufacturing sector, the Global New Light of Myanmar reported.

The commerce ministry has predicted that the CMP sector will earn about $1.8 billion over the full 2016-17 year.

The sector is primarily focused on the manufacture of shoes, garments and bags, and the products are exported mainly to Japan, as well as to some European countries, South Korea, the US and China.

Around 65 percent of the total investment in the sector is from China, according to the report.

Government to Take Over Vocational Training Institute

The government will gradually take over the running of the Singapore-Myanmar Vocational Training Institute (SMVTI) in Rangoon, it announced this week.

Under a memorandum of understanding signed in Naypyidaw during a visit by Singapore’s Emeritus Senior Minister Goh Chok Tong, the government will gradually take over responsibility for the management and funding of the institute.

It offers courses in hospitality and tourism, electrical skills and electronics, and facilitates management and engineering services. It also offers job matching services.

During the three-year handover period, Singapore will continue to provide technical and management skills to the institution.

The SMVTI was launched in June last year and is modeled after Singapore’s Institute of Technical Education.

More than 700 students have graduated so far and 66 percent have reportedly found jobs quickly after graduation, according to Singapore’s Ministry for Foreign Affairs. Ten graduates are currently doing internships in Singapore.

Singapore is the second largest investor in Burma, after China. In December last year, visa requirements were lifted between the two countries.

Movies-on-demand Service Enters Burma

Kuala Lumpur-based Internet TV service iflix is expanding its international movie streaming service to Burma, at a price to consumers of 3,000 kyats per month for monthly subscriptions and 30,000 kyats for annual deals.

The service will offer TV shows, comedies, dramas, K-dramas, cartoons plus movies from Hollywood, the UK, Asia and more for download on mobile phones, laptops, tablets and TVs.

“As the fourth fastest-growing mobile market on earth, Myanmar is without question one of the world’s most exciting and dynamic countries and we are thrilled to introduce our first-of-its-kind service here,” said Adeana Greenlee, country manager of iflix Myanmar, in an official press release.

The company also said it has recruited the former vice president of content (Global Television) at Netflix, Sean Carey, as its new chief content officer.

At Netflix, Carey helped to acquire licensing for television series, children’s and family content, and co-productions across all of Netflix’s markets. Netflix introduced a service to the Burma market last year.

“What iflix has achieved in just over a year with its service and multi-territory rollout is incredibly inspiring and a testament to the strength of the company. I am very excited to join the iflix team as chief content officer, and look forward to leveraging my industry expertise to help accelerate the company’s new growth phase,” said Carey.

iflix is already available in Malaysia, Thailand, the Philippines, Indonesia, Sri Lanka, Brunei, the Maldives, Pakistan, Saudi Arabia and Vietnam.

Earlier this month it announced that it had raised US$90 million in funding to support its expansion into emerging markets.

Government to Draft Legislation to Control Import Surplus

The Ministry of Commerce plans to submit a draft “Safeguard Law” along with an anti-dumping law and a countervailing duty to curb excessive imports and protect local businesses, according to a briefing service by Dezan Shira & Associates.

The move reflects a concern in Burma about import dumping from foreign businesses, according to the report.

To penetrate a market, foreign businesses sometimes export products at a much lower price than locally produced goods, the report noted. Trade experts believe an anti-dumping duty and countervailing duty will help curb excessive imports.

The central bank restricted import of luxury goods last year to reduce the trade deficit and control Burma’s falling currency in relation to the US dollar, the report noted.

The Trade Promotion Department believes the laws will assist small and medium-sized enterprises counter import surpluses, the report added.

Increasing import taxes will also assist in providing a level playing field for local businesses. With the implementation of the three laws, the government aims to reduce the growing trade deficit, which stood at US$4 billion for the 2016-17 year, according to the report.

Container Freight Station Plan for Rangoon

KMA Shipping has entered into a joint venture with Japanese logistics company Suzue Corp to operate a new container freight station in Rangoon’s Dagon Seikkan Township.

The freight station will be built on a site of 18,211 square meters (196,021 meters) and will have a total floor space of 1,558 square meters, as well as a container yard and an open storage yard, according to a February statement by Suzue. The facility is expected to open in January 2018.

The joint venture called KMA-Suzue Logistics Myanmar Ltd will operate the facility on the right bank of the Bago river, close to Rangoon port.

Philippines Firm ‘in Talks’ with Port Authority

Harbor Star Shipping Services of the Philippines has said it is in talks with the Myanmar Port Authority to assist in the building of a tank ‘farm’ to serve as an oil depot for an oil company, the Philippines Star reported.

Harbor Star is a provider of harbor assistance, lighterage, salvage and towing services and is expanding its international operations.

Its president and chief executive Geronimo Bella Jr. said in an interview at the sidelines of a recent special stockholders meeting that the company had held talks with Burma’s Port Authority to provide tugboat assistance to the tank depot which is due to be completed by the end of this year. The location of the site was not provided in the report.

Myeik Islands Visitor Numbers Up

The number of tourists traveling via motorboat around the Myeik Archipelago during the first two months of this year was higher than the same period a year ago, according to the Ministry of Hotels and Tourism.

More than 1,300 tourists visited the islands in the period, most of who entered via Thailand. In 2016, the islands received a total of 4,000 visitors.

The Myeik Archipelago consisting of more than 800 islands off the Tenasserim region is one of Burma’s most promising tourism destinations, with a vast expanse of unspoiled islands and coastal landscapes.

Visitor numbers are still low while costs to travel in the region remain relatively high, due in part to the high costs associated with the official permits that are required to travel in the location.

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