Challenges ahead for FDI

Challenges ahead for FDI

By Jeremy Mullins and Aung Shin   |   Wednesday, 11 September 2013

 

MYANMAR still has many hindrances for economic development even foreign investment figures showed higher recently according Myanmar Global Investment Forum on September 10 and 11 in Nay Pyi Taw.

The economic experts highlighted weakness of regulatory and lack of proper management for economic development, trade and investment sectors apart from other challenges such technology, human resources, electricity and land use.

"You need clear strategies for economic development, skill trainings are required as well as other infrastructures. The industries cannot run with only four hours electricity every day," said Doan Nguyen Hansen, Principal and Co-author of Myanmar's Moment: Unique Opportunities, Major Challenges of McKhinsey Institute.

Alisher Ali, Chairman of Silk Road Ventures also said in the panel discussion that the country should focus on five pillars of agriculture, manufacturing, services sectors such SME access, financing and technology for prompt economic development.

"Foreign investment means not only one big company. It is not enough to employ millions of people which means we need ten or twenty thousands of factories. In

Myanmar it is often necessary to visit the chairman of MIC (Myanmar Investment Commission) before considering where to invest," said U Thein Ngwe, Chairman of Surge Pun Associates.

The government is revising almost one hundred years old Myanmar Company Act and process of redrafting the law is to be done in end of December, 2014, said U Aung Naing Oo, Director General of Directorate of Investment and Company Administration (DICA) in the event.

The country is receiving more foreign investment so far after the New Foreign Investment Law is imposed in November, 2012. The FDI in this year is US$1.8 billion up to end of August and the 50 percent of FDI in manufacturing sector. The country received US$1.4billion of FDI in last financial year.

It was only US$300 million in 2010 – 2011 financial year before the law in practice, he said adding that the government has targeted to reach three billion US$ of FDI end of this financial year.

"Before Foreign Investment Law, we had received foreign investment guests only once a month. Now we are seeing seven or eight international delegates every day in our MIC office," said U Aung Naing Oo who is also a member of MIC.

However there can be mismanagement because of lack man power while MIC is working for a huge amount of very responsible jobs with only 15 members, said Surge Pun.

There are also misunderstandings between MIC and government ministries. And the government is going to revise again the foreign investment law and its sections of rules and regulations.

U Win Shein, Chairman of MIC and Union Minister for Finance told The Myanmar Times after the event that "We are working on revising foreign investment law. We have already reviewed but we have to send the parliament for approval. The law must be in accord with current mainstream. We are also implementing SEZs (Special Economic Zones) apart from other kinds of investments. Some of the things can be done at once but some takes time. We are ready to work for mutual interest both for the country and the investors."

Source: http://www.news.myanmaronlinecentre.com/2013/09/11/challenges-ahead-for-fdi/