latest trend of myanmar’s economy · replacing moa and aoa into a single document called a...

Ms. Ei Ei Khine Economic counsellor

Embassy of the Republic of the Union of Myanmar

Latest Trend of Myanmar’s Economy

Myanmar’s Economic Indicators

Source: Ministry of Planning and Finance Economic Section, Myanmar Embassy, Tokyo 3

5.6

7.3

8.4 8.0

7.3

5.7

6.8

0.0

1.0

2.0

3.0

4.0

5.0

6.0

7.0

8.0

9.0

FY2011 FY2012 FY2013 FY2014 FY2015 FY2016 FY2017(P)

GDP Growth Rate

Agriculture 25.5%

Industry 35.0%

Services 39.5%

FY 2016 GDP by Sector

Trade Situation

12523.71 11136.52 11951.64

8159.04

16632.63 16577.94 17211.07

10503.34

29156.34 27714.46

29162.71

18662.38

0

5000

10000

15000

20000

25000

30000

35000

FY2014 FY2015 FY2016 FY2017(April-October)

US$

in m

illio

n

Total Trade

Exports Imports Total Trade

20%

5%

10%

2%

46%

17%

Export by commodity

Agriculture

Livestock & Fishery Mineral

Forestry

Manufacturing

Other

16%

10%

74%

Import by commodity

Investment

Industry

Consumer

Source: Ministry of Commerce and Central Statistical Organization Economic Section, Myanmar Embassy, Tokyo 4

556.43 393.75

784.26

525.7

1738.94

1452.22 1247.53

563.86

2295.37

1845.97 2031.79

1089.56

0

500

1000

1500

2000

2500

FY2014 FY2015 FY2016 FY2017(April-October)

US$

in M

illio

n

Export to Japan Import from Japan Total trade with Japan

Export to Japan Import from Japan

Garment Transport Equipment

Footwear Machinery and Mechanical

Appliance

Pulses Base Metals and

Manufactures

Prawn Electrical Machinery and

Apparatus

Sesame seeds Fabrics of Artificial and

Synthetic Fabrics

Trade with Japan

Source: Central Statistical Organization Economic Section, Myanmar Embassy, Tokyo 5

Foreign Direct Investment in Myanmar (As of 31-1-2018)

Source: Directorate of Investment and Company Administration

42120 46227

54237

63719 70368

75275

0

10000

20000

30000

40000

50000

60000

70000

80000

FY2012 FY2013 FY2014 FY2015 FY2016 FY2017(end of January 2018)

US$

in M

illio

n

19930.08

790.3

0

5000

10000

15000

20000

25000

Ch

ina

Sin

gap

ore

Thai

lan

d

Ho

ng

Ko

ng

U.K

*

Rep

ub

lic o

f K

ore

a

Vie

t N

am

Mal

aysi

a

The

Net

her

lan

ds

Jap

an

Ind

ia

Fran

ce

U.S

.A

Ind

on

esia

Can

ada

US$

in M

illio

n

Oil and Gas , 29.77%

Power, 27.84% Manufacturing, 12.41%

Transport & Communication,

11.76%

Real Estate, 6.44%

Hotel and Tourism,

3.99%

Mining , 3.85%

Livestock & Fisheries,

0.77% Agriculture,

0.51%

Industrial Estate, 0.32%

Construction, 0.05%

Other Services, 2.29%

Economic Section, Myanmar Embassy, Tokyo 6

Japanese Investment in Myanmar (As of 31-1-2018)

0.00

100.00

200.00

300.00

400.00

500.00

600.00

700.00

800.00

FY2011 FY2012 FY2013 FY2014 FY2015 FY2016 FY2017 (end of January 2018)

216.22 270.28

325.99

411.73

631.53

694.18

790.30

US

$ in

mill

ion

Fisheries Sector 2%

Manufacturing Sector

52%

Agriculture Sector

3%

Oil and Gas Sector

5%

Hotels and Tourism Sector

10%

Real Estate 5%

Transport and Telecommunicati

on 8%

Power 0.5%

Others Services 15%

Source: Directorate of Investment and Company Administration Economic Section, Myanmar Embassy, Tokyo 7

Investment in Thilawa SEZ ( As of 31-1-2018)

558.8

149.2 121.4 108.0

63.1 59.0

0.0

100.0

200.0

300.0

400.0

500.0

600.0

Japan Thailand Korea Malaysia Taiwan USA

US$

in m

illio

n

Investment by top 6 countries

Manufacturing 75%

Logistics 6%

Trading 11%

Services 5%

Real Estate 2%

Hotel 1%

Investment By Sector

Source: Thilawa SEZ Management Committee

Total investment US$ 1235.34 million


Special Economic Zone Law (2014)

Myanmar Investment Law (2016)

Myanmar Company Law (2017)

Legal Framework


Pioneer SEZs: Special Economic Zones in Myanmar

3 Pioneer SEZs namely; - Dawei SEZ - Kyauk Phyu SEZ -Thilawa SEZ


Subject Investment in SEZ

Free Zone Promotion Zone

Corporate tax

Tax exemption 7 years 5 years

50% tax relief 5 years 5 years

50% tax relief for reinvestment

5 years 5 years

Import tax exemption

Import of construction materials, machinery, equipment

Exempted 5 years exempted + 5 years (50% relief)

Import of raw material Exempted Export portion is refundable


Initial Year 50 + Extension Year 25 Total Year 75

Land Use in SEZ


Initial Year 50 + Extension (10 Year 2 Times) Year 20 Total Year 70


Fair & Equitable Treatment

National Treatment and Most Favored

Nation Treatment

Right to Employ

Expatriates

Investment Guarantee

Transfer of Funds


Agriculture and its related

services (except

cultivation and production of tobacco and

Virginia)

Plantation and conservation of forest, and

other businesses with forest

Livestock production,

breeding and production of

fishery products, and its

related services

Manufacturing (Except

manufacturing of cigarette,

liqueur, beer, and other

harmful products to

health)

Establishment of Industrial

Zones


Establishment of New Urban

Areas

City Development

Activities

Construction of Road,

Bridge and Railway Line

Construction of Seaport,

River Port and Dry Port

Management, Operation and Maintenance

of Airport


Maintenance of Aircrafts

Supply and Transport Services

Power Generation,

Transmission and

Distribution

Production of Renewable

Energy

Telecommunication

Businesses


Education Services

Health Services

Information Technology

Services

Hotel and Tourism

Science Research

Development Business


Zone 1: Less Developed Zone

Total: 166 Townships in 13 States and Regions

except Yangon and Nay Pyi Taw Union Terriority

States (98 Townships) Kachin (14), Kayah (7), Kayin (7), Chin (9), Mon (2), Rakhine (17), Shan (42) Regions (68 Townships) Sagaing (34), Tanintharyi (4), Bago (5), Magwe (13), Mandalay (2), Ayeyarwady (10)


Zone 2: Moderate Developed Zone

Total: 122 Townships in 3 States, 7 Regions and

Nay Pyi Taw Union Terriority

States (26 Townships) Kachin (4), Mon (8) and Shan (14) Regions (88 Townships) Sagaing (3), Tanintharyi (7), Bago (23), Magwe (12), Mandalay (13), Yangon (13), Ayeyarwady (17) Nay Pyi Taw Union Terriority (8 Townships)


Zone 3: Developed Regions

Total: 46 Townships

in 2 Regions

14 townships in Mandalay Region 32 townships in Yangon Region


Exemptions or reliefs Subject

Customs Duty or other internal taxes or both

Import of construction materials, machineries, equipments, instruments , machinery components, spare parts, materials used for business

Import of raw materials and partially manufactured goods for export oriented business

Import of raw materials for export products

Income tax Reinvestment

Right to deduct the depreciation

Right to deduct the expense for research and development

Investors have Right to pay the income tax rate same as the citizens


Myanmar Investment Commission

(MIC)

Investment Capital Amount

up to USD 5 Million

or MMK 6 Billion

State and Regional

Investment Committees

For Issuance of Endorsement Order


Myanmar Company Law (2017)


Using a new electronic registry system

Providing tools to shareholders and stakeholders to create

better corporate governance and greater transparency

Replacing MOA and AOA into a single document called

a company constitution

Allowing companies with a single shareholder and single director to be established

Allowing foreign investors to hold up to 35 % of shares in local firms

Market Seeking Investment: Strategic Location

Resource based Investment: Human Resource Endowment

Population :

51.4 Million (2014)

Age between 15-65 year old :

65.6%

Adult Literacy rate: 89.6%

Lowest Minimum Wages in

ASEAN


Resource based investment: Rich Natural Resources

Gold Pearl

Jade Economic Section, Myanmar Embassy, Tokyo 30

Infrastructure Investment

3,192

4,531

5,727

0

1000

2000

3000

4000

5000

6000

7000

FY2015 FY2016 FY2017 FY2018 FY2019 FY2020 FY2021 FY2022

MW

Electricity Demand Forecast

Current Production 3,189

88.0% 84.0% 75.1%

64.1% 54.6% 51.6%

12.0% 16.0% 24.9% 35.9%

45.4% 48.4%

0%

20%

40%

60%

80%

100%

FY2011 FY2012 FY2013 FY2014 FY2015 FY2016

Development of Private Sector in Power Generation

State Own JV, IPP & Other

Target : 2020 Reliable Electricity Investment Opportunities;

Power Generation, Transmission and Distribution, Renewable Energy


Infrastructure Investment (Cont;)

Establishment of Industrial Zone

Establishment of New Urban Areas

Construction of Road, Bridge and

Railway Line

Construction of Seaport, River Port

and Dry Port

Management, Operation and Maintenance of

Airport

Maintenance of Aircrafts

Supply and Transport Services

City Development Activities

Telecommunication Businesses


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http://www.myanmar-embassy-tokyo.net/eco2017/






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