Foreign investment into the manufacturing sector this year has already more than doubled all of last year, said director general U Aung Naing Oo of DICA, the Directorate of Investment and Company Administration.
From April through September, nearly US$1.8 billion has flowed into the country, of which nearly $1 billion has gone to manufacturing, compared to $1.4 billion for the whole of the 2012-2013 fiscal year, when about $400 million went to manufacturing, according to DICA.
The increase is attributed to the passage of the foreign investment law a year ago. DICA had opened a One-Stop Services facility in April, to help citizens and foreigners set up a business.
About 60 percent of investment this year, from China, Hong Kong, Japan, Singapore and EU countries, is going to manufacturing, especially in the garment industry, followed by investment in services such as the hotel business, he said.
“We are no longer inviting just any kind of investment, but encouraging labour-intensive industry and quality investments,” said U Aung Naing Oo.
Some reform was needed to make the law more user-friendly, and the country’s infrastructure and banking industry needed updating, he said.
Economist U Hla Maung said power cuts and the recent rise in electricity charges could also have repercussions for investors. Myanmar was the second most expensive country in Asia for land prices, and foreigners were not allowed by law to buy land here, he added.
“We have to rely on foreign investment because we need capital and technology,” he said.
“But investing in the garment industry will not provide those requirements,” he said, adding that garment work created jobs but added little in terms of technology transfer or contribution to GDP. Myanmar would welcome the IT and cosmetics industries, said U Hla Maung.
Source: Myanmar Times