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Govt expands list of relief measures for businesses, investors

The government has been rolling out a slew of relief measures to help ease the pain for businesses affected by the COVID-19 pandemic and keep investors interested in Myanmar.

In an April 11 directive, the Ministry of Commerce exempted traders from import license fees for all medicines and medicinal raw materials.

There were two precedents in 1993 and 1998 with similar fee exemptions for 36 and 31 medicines and related raw materials, respectively.

Overriding those previous notifications, the latest import license fee exemption will take immediate effect and will cover all kinds of medicines and related raw materials in order to provide some relief to businesses in the sector.

Investors who wish to apply for permission to invest in the country will only have to pay half the normal application fees, the Myanmar Investment Commission (MIC) announced on April 9. This includes both Myanmar and foreign investors. The new fee structure will take effect from April 20 onwards and remain effective until the authorities review and revise the fees.

Delaying repayments

Microfinance and other non-bank financial institutions have been instructed to allow borrowers to defer their repayments, as most consist of small businesses and low-income workers who could be hit by the economic fallout of COVID-19.

The Ministry of Planning and Finance’s Microfinance Business Supervisory Committee said on April 6 that neither principal nor interest should be collected “with force”.

License extension

Car dealers will be granted a two-month import license extension, allowing them to better manage the drop in demand for new imported vehicles, senior official of the Ministry of Commerce said on April 9.

Import licenses are typically renewed every three months. Before this, the Ministry of Commerce allows one-month extensions for a maximum of two times.

Faster approvals

The MIC will accelerate approvals for investments in labour-intensive and infrastructure projects, MIC secretary U Thant Sin Lwin said on April 6. This is to ensure as many workers find jobs as possible to offset the impact of lay-offs in other sectors such as manufacturing and tourism.

The MIC will also accelerate approvals for healthcare and medical equipment businesses, including those involved in manufacturing supplies such as face masks. It will also prioritise pharmaceutical enterprises, healthcare service providers, U Thant Sin Lwin said.

Tax dues extended

Income and commercial tax payments due in the second and third quarters of the fiscal year have been made extendable to the end of the fiscal year, according to the government.

An exemption for the 2pc advance income tax on exports to the end of the fiscal year has been announced.

Easing rates

The Central Bank of Myanmar cut the policy interest rate by 0.5 percentage points on March 12 and announced a further 1 percentage point cut to be effective April 1.

The Central Bank rate is now 8.5pc per annum. Banks are required to pay a minimum deposit rate of 6.5pc and lend at a maximum of 11.5pc for secured collateral and 14.5pc for unsecured collateral.

Loan approvals

The government has approved loans for 88 businesses affected by COVID-19 as at April 9.

A COVID-19 Fund worth K100 billion (US$70 million or 0.1 percent of GDP) was established last month, with the funds to be disbursed as soft loans to affected businesses in the garment and tourism sectors as well as small and medium enterprises.

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Source : Myanmar Times

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