MIC approves 123 companies in the current fiscal year

Fifteen local and foreign companies were granted approval by the Myanmar Investment Commission (MIC) in June, taking the total number of companies approved this fiscal year to 123, according to U Aung Naing Oo, secretary of the MIC.

“Creating local job opportunities is our main focus this financial year, so MIC has approved more contract manufacturers than companies in other sectors,” said U Aung Naing Oo, adding that investments into other sectors have also been approved.

The number of contract manufacturers granted approval is 35 so far this fiscal year, accounting for 43 percent of total permissions granted, according to a statement by the Directorate of Investment and Company Administration last week.

U Aung Min, chair of the contracted manufacturers association said, “The capital needed to invest in contract manufacturing is lower than for manufacturers. Moreover, they don’t have the headache of distributing their products in the market. Most of the foreign investments in this sector are from Korea and China.”

The statement said that a majority of MIC approvals were to companies in the manufacturing sector, including agricultural production, livestock production, wood finishing production, and the production of foodstuff, with 45 approvals granted this fiscal year, which began on 1 April.

During the first three months of this financial year 39 local enterprises, 41 joint ventures between a local and a foreign company, 32 foreign investments and 11 joint ventures between foreign companies and the government were permitted to do business.

Oil and gas extraction is permitted through joint-ventures between the government and international companies, and all of these joint ventures are formed through a profit sharing agreement. Oil and gas has been the most profitable of Myanmar’s export sectors since 2013, according to an official from the Ministry of Commerce.

Of the investments proposed by local companies, 11 were in the hotel sector, said U Aung Naing Oo. “Investment into the hotel sector is increasing because it has become an important sector for tourists coming to Myanmar,” he said.

From 1988 to May 2015, 657 foreign companies have pledged US$46.2 billion in investments to Myanmar.

During that period, 26 percent of approved projects were from China, the largest source of approved foreign investment into Myanmar.

Thailand and Singapore were second and third at 18pc each, and Hong Kong in fourth at 12pc.

Source: Myanmar Times

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