Business

The Irrawaddy Business Roundup (March 25)

By The Irrawaddy 25 March 2017

Govt, Army Facilities ‘Not Paying Electricity Bills’

The state electricity company operates at a loss, and national institutions that do not pay their bills are not helping, according to an industry figure.

“We are having many problems with government offices, army offices and other facilities that do not feel the need to pay their electricity bills,” Daw Ei Phyusin Htay of the Baron’s Group of companies told the Oxford Business Group.

“Another problem is that many users are adjusting the meters in their houses and factories in order to not pay their bills correctly. This is something that law enforcement must deal with and the state utility should take greater steps to eradicate,” she said in an interview on Burma’s energy sector.

In order to ensure a healthy revenue stream to the Myanmar Electric Power Enterprise, the government needs to conduct an analysis of how much revenue is being lost through these two channels and how much revenue is needed, Daw Ei Phyusin Htay said.

It should then create benchmark costs for electricity and gradually introduce a subsidy and tariff structure that would accommodate different kinds of consumers, she suggested.

Addressing Burma’s wider national energy needs, Daw Ei Phyusin Htay said the government should conduct an analysis of how much energy can realistically be created from new natural gas sources and other sources by 2020.

If there was a shortfall compared to the need, a case could then be made for the otherwise unpopular option of coal-fired energy production.

Rainy Season Rebranded the ‘Green Season’

Mild weather and lush green landscapes are among the benefits of visiting Burma during the rainy season, tourism promoters are informing potential international visitors.

“The main tourist attractions in Myanmar such as Bagan, Mandalay, Northern Shan State, Kalaw and Inle Lake only get a 25 percent chance of rainfall during the rainy season, and even if it rains on these days, it’s usually short,” said Daw May Myat Mon Win, vice chairman (Marketing) of the Myanmar Tourism Federation in a release.

In the latest campaign to promote year-round tourism, Burma is pushing 10 top reasons to visit the country in monsoon season. The number one reason is the chance to see “fifty shades of green, from paddy fields to forests.”

Other lures are that it’s “not too hot in the dry zone, not too cold in the mountains,” and that the rainy season is the top time to experience Burma’s impressive fruits and vegetables. The chance to avail of promotions is also on offer.

A number of leading local travel agents, hotels and airlines are offering packages for low season visitors, including “stay for 3 nights, pay for two,” and free and unlimited luggage allowances on affordable domestic flights.

Foreign journalists and tour operators will also be invited to Burma to experience the “green season.”

Myanmar Tourism Marketing is part of the Myanmar Tourism Federation and is mainly privately funded by key members of the tourism industry in Burma.

Burma Coffee Tastes More Success

Burma’s coffee sector continues to make significant strides, with the quality of the product from mainly small-hold farmers seen to rise again at an annual coffee competition.

The winning coffee at the Third Annual Myanmar Coffee Association (MCA) Coffee Quality Competition scored a record-breaking 89.58 points.

The winner from the Mandalay Coffee Group was from a micro-lot from Ywangan in Shan State and was higher by two points than last year’s winner on the Specialty Coffee Association scoresheet, according to Global Coffee Report.

The winning coffee came out top in the “dry natural process” category as well achieving overall winner. It was described by judges as “clean and complex,” with the flavors of “orange, lemon, strawberry and red currant.”

The overall quality of coffees entered also rose, with 26 of 72 coffees achieving 85-points or better on a 100-point scale. Most of the high-scorers were dry natural processed coffees produced by smallhold community farmers.

The competition is a project of the Value Chains for Rural Development project funded by USAID and implemented by Winrock International. It is organized by the Myanmar Coffee Association and the Coffee Quality Institute (CQI). This year’s event was hosted recently at the Shwe Danu and Value Chains project office and coffee lab in Ywangan town, Shan State.

The international coffee sector will be able to taste some of the winning Burmese coffees at the London Coffee Festival from April 6-9 and the SCA Global Coffee Expo in Seattle on April 22.

FibreLink in Talks to Raise Funds

FibreLink Myanmar is in talks to raise $25 million equity as part of an $860-million investment plan, according to DealStreet Asia.

The company, which received approval in 2015 from the Myanmar Investment Commission to set up telecom infrastructure, intends to raise capital in stages, according to its CEO Garry Stephen. It is looking for interest from financial investors, including funds and high net worth individuals, and strategic investors that operate in the telecoms industry, DealStreet reported.

The company is a wholly-owned subsidiary of Singapore-based FibreLink Myanmar Holdings Pte Ltd, which is owned by Hong Kong-based ECCL Advisory Limited. It received its license to operate a network facilities service (Individual) license (NFS) in December 2015.

Local partners include co-founder U Kyaw Myo Htoon, and U Zaw Win Oo of Bright Time Trading, Bright Time Resources Development and Bright Time Gems.

As of January 2017, nearly 41 companies have been granted a network facilities service license from the Myanmar Ministry of Transport and Communications, the report said.

Jade Export Tax to be Assessed in Kyats

To help ease trade, tax on exports of finished jade products will be assessed in Burmese kyats instead of the US dollar from April, the Global New Light of Myanmar reported.

The tax rate will remain unchanged, according to U Myint Han, vice chairperson of the
Myanmar Gems and Jewelry Entrepreneurs Association.

A one-stop service for taxation of some grades of jade products started in 2011 and additional grades were added to the service in 2013.

MySquar Hooks Up with Telenor

The London Stock Exchange-listed social media applications company MySquar is partnering with Telenor Myanmar to ease payments for its games and services.

Mysquar announced the deal this week, saying it would give the company access to Telenor’s large subscription base and make purchases easier for users who are also Telenor subscribers.

Telenor will earn a share of revenues as part of the integration.

“We expect this streamlined payment process will contribute towards monetization results for the financial year ending 30 June 2017 and thereafter,” MySquar’s chief executive officer Eric Schaer said in a statement.

Bloomberg: Foreigner Law ‘Hurting Property Sector’

A law allowing foreigners to buy condominiums in Burma is unclear, and the confusion is helping to slowdown the residential property sector, according to a Bloomberg report.

Unanswered questions arising from legislation adopted in January, such as whether foreigners can buy existing apartments, is hurting efforts to woo investors, the report said.

The sector is now waiting for by-laws that will clarify the situation, according to Cyrus Pun of Yoma Strategic Holdings.

“There was a very bullish market from 2011 as the economy opened up and investment came in, but residential property has quietened down quite a lot in the past 18 months,” he said.

Mid-tier and luxury condominium prices have fallen significantly from 2014 when the property market experienced a bubble, but prices are still the highest in Southeast Asia, the report said.

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