RANGOON — Citing strong figures through the first four months of the fiscal year, Burma’s investment commission says it is confident that foreign investment will not be negatively impacted by the political uncertainty that surrounds a general election due Nov. 8.
Aung Naing Oo, secretary of the Myanmar Investment Commission (MIC), said the cloudy political outlook had not made foreign investors gun-shy from April to July, with government data showing a threefold rise in foreign investment when compared with figures over the same period in 2014.
“[Comparing] the number of projects that we’ve approved last year and this year, the project total has almost doubled, and in terms of financing, the number has increased more than three times this year,” he told The Irrawaddy on Wednesday.
According to MIC data, last year’s April-July period saw the commission approve 39 projects totaling US$810 million. The same period this year saw 71 projects approved at a valuation of $2.65 billion.
“There are still almost 40 projects left requiring approval for this year,” Aung Naing Oo said, adding that investment projects tied to the Thilawa special economic zone (SEZ) worth $400 million were not included in the figures for the first four months of 2015-16.
“Our schedule of FDI expectation for this year is $6 billion, but it will be higher than what we expect, like last year,” Aung Naing Oo said.
Some investors thought if they set up their business before the election, they would be ready next year.”
Last year, though the government forecast $5 billion in FDI, the figure reached $8 billion.
Myat Thin Aung, chairman of the Hlaing Thayar Industrial Zone, said rather than wait on the results of the November vote, some investors were seeking an early-mover advantage.
“Some investors thought if they set up their business before the election, they would be ready next year. Most of them are from the manufacturing sector, such as garment makers,” he said.
“Garment factories are still coming, even though there is the election, but for heavy industry, it will lag as the government still can’t provide electricity and land for investors,” Myat Thin Aung said.
Last year’s record $8 billion in FDI was a doubling of the country’s 2013-14 total.
Despite MIC’s approval of $8 billion in foreign investment in 2014-15, Aung Naing Oo said only $3 billion had entered the country last year.
“It’s typical; for example, though they’ve pledged to invest $10 million, it will come as $6 million in equipment, then the rest comes in cash year by year,” he said.
Currently, the top foreign investment sectors in Burma are power (33 percent), manufacturing (22 percent), oil and gas (20 percent), telecommunications (11 percent), and hotels and tourism (5 percent), according to MIC data.
Singapore was the top foreign investor through the first four months of the current fiscal year, with commitments totaling $1.6 billion. The Netherlands ($430 million) and India ($219 million) were second and third.