Campaigning is now under way ahead of the November 8 election, and business are wary of political considerations which may affect their plans in Myanmar.
Government ministers and senior advisors have sought to downplay these concerns, likening the vote to just another sea to be crossed, and pointing to the country’s long-term potential.
U Zar Yar Aung, chair of the Myanmar Investment Commission and minister of both energy and telecoms, told The Myanmar Times on the sidelines of the fourth Euromoney Myanmar Global Investment Forum in Nay Pyi Taw yesterday that elections are now simply part of the national political landscape.
“They will happen every five years,” he said. “Investors do not need to worry about any impact.
“The current flow of investments is quite good, better than everybody expected. I would like to urge foreign investors to make their investments quickly, as now is the best time.”
Speaking during a panel discussion, U Aung Tun Thet, economic adviser to the president and vice chair of the National Economic and Social Advisory Council, said the election is an internal affair, and for investors it does not matter which party will win the election.
“It should be [about the] national interest rather than personal interest. The investor has to cross the seas,” he said.
U Aung Tun Thet also pointed to Myanmar’s advantages. While the country has about 51 million people, it has an excellent location near the 600 million people in ASEAN as well as neighbouring China and India.
“Please do not look at us as another small country – look at us as a regional hub, in a much wider context. We belong not only to ASEAN but to the South Asia region. With China and India too we are a market of more than 3 billion,” he said.
He added the economy is set to grow rapidly after 2015, but foreign investors are waiting. “But you cannot cross the sea by staring at the water. We are really serious about engaging with the global economy. There is no doubt. There is no turning back too,” he said.
“Please be positive – it is our national aspiration to become a middle-income country. We want to engage.
“Myanmar is now a butterfly –it will never become a caterpillar again.”
Private businesspeople said the country’s re-engagement with the global economy has been promising.
“I am very positive about the country’s reform process and also excited about the election,” said Ken Tun, a conference speaker and chief executive officer of Parami Energy.
“This is our last chance. Strike when the iron is hot. We have to strike it. It is a matter of pride for everyone on the street.”
Mr Tun added that the country needs to have a domestic agenda, to empower the people and to be inclusive. He noted that 70pc of people are rural, and transition should not just be for the elite. “I hope the new government will find a way to unleash the power of our rural engine,” he said.
U Zay Yar Aung told The Myanmar Times that the country has made major strides improving its economy, particularly in the financial sector.
The 2013 Central Bank Law has set up an autonomous institution, while the currency transitioned to a managed float in April 2012, away from an outdated peg. The Central Bank has also granted licences to private banks to run foreign exchange counters as well as to private companies.
The country is also in the midst of setting up the Yangon Stock Exchange, which is due to open in December. It will also be accompanied by a new Companies Act, which is expected to revise the rules over what constitutes a foreign company.
Currently, foreign companies are barred from listing on the exchange, and the current Companies Act stipulates that any foreign ownership at all in an otherwise Myanmar company makes it foreign.
“The highest priority in financial system is to build strong institutional foundations for banking system that will improve efficiency of financial transactions and improve their safety and security,” said U Zay Yar Aung.
He also pointed to efforts to revise the Financial Institution Law which governs the banking system and is ongoing with the assistance of the World Bank. The law is expected to set out licensing requirements for private banks, corporate government arrangements and conditions for foreign investors’ participation in banking sector.
The government is also moving forward on high-priority infrastructure projects, in areas such as upgrading airports and improving water and power supplies.
U Zar Yar Aung also pointed to growth in the foreign direct investment with ongoing reforms, particularly in telecoms and energy sectors.
Approved foreign direct investment amounts to US$8.01 billion in 2014-15 fiscal year, about double the target of $4 billion. The government aims to reach $6 billion in the current financial year.
As of the end of August, $2.9 billion had been approved this financial year, with about $2 billion being oil and gas projects, according to statistics from the Directorate of Investment and Company Administration.
“But Myanmar requires large-scale infrastructure investments in power generation, transportation and special economic zones and resource development, as well as other supporting infrastructure, to realise its long-term growth and development,” said U Zay Yar Aung in his speech.
He added that a number of new laws or laws being revised, including the Myanmar Companies Act and the combination of the Foreign Investment Law and the Myanmar Citizens Investment Law into one document, are now being undertaken and will be completed in this government’s term.
U Aung Tun Tet said the goal of Myanmar is to be vibrant, not only economically but in setting up an inclusive society where everyone is valued as an individual in a country which is democratically anchored.
“Please come, do your homework, try to understand … We are open for business,” he said.
Source: Myanmar Times