General & Misc

Better implementation of the Law needed to draw Foreign Investors

Date: 10 June 2019; Type: Legal News; Source: Myanmar Times

Lack of coordination between the Union and regional governments on development policies, red tape and weak implementation of new laws has hampered the flow of foreign direct investments (FDI) into Myanmar, said U Aung Naing Oo, permanent secretary of the Ministry of Investment and Foreign Economic Relations.

U Aung Naing Oo pointed out that having a fairly large population (according to the World Bank, the country’s population stood at 53.4 million in 2017) and low labour costs were not enough to draw foreign investors to Myanmar.

He added that political uncertainties, poor physical infrastructure, lack of skilled labour, an underdeveloped capital market, high taxes and a legal system with a hodgepodge of laws dating back to the British colonial era has held back investors.

The Myanmar legal framework requires an overhaul and has to be better rolled out and enforced. This is because foreigners will only be convinced to channel their money into the country if they knew that their investments would be protected by the rule of law.

“Many of Myanmar’s existing legislation is from the colonial era. More modern laws and regulations need to be enacted. However, there is also a need to improve performance of government agencies and ministries in enforcing the rules and regulations,” U Aung Naing Oo said.

He added that weak institutional capacity and lack of knowledge on procedure has hampered the effective implementation of new legislation in recent years. “It is not enough just to enact new laws. Good implementation of the rules and bylaws must be carried out as well. But many government organisations still do not know the procedures to enforce the law. For example, to implement the Intellectual Property Law, authorities need to undergo professional courses,” he said.

A local business owner, U Nay Lin Zin, said businesses frequently have to navigate through the lack of coordination and poor communication between ministries and agencies as well as the red tape.

“We are also concerned about policy changes that are not communicated properly. If it’s not good for local businesses, what more if it’s foreign investors,” he said.

Echoing the remarks of Minister of Investment and Foreign Economic Relations U Thaung Tun at the Yangon Region Investment Form held on May 10, U Aung Naing Oo said “government ministries and agencies at both the Union and region and state levels need to coordinate better and cooperate to cut red tape.”

“Coordination between the Union ad regional governments is very weak. We need to find a solution for this. There needs to be better communications on procedures such as license applications. For example, we need to consider granting businesses all the work permits at once rather than granting licenses only after other permits are obtained from various departments,” he said.

He added that there was a lack of communication among ministries and the private sector in the development of infrastructure such as highways, roads and bridges. “This lack of coordination and communications has made it difficult to fund these projects,” U Aung Naing Oo said.

In the first-half of the current fiscal year, Myanmar only received US$2.5 billion from foreign investors and the target may not be met for the year despite the government’s efforts to promote investments in the country.

So far, FDI is just 45pc of the US$5.8 billion targeted by the Myanmar Investment Commission (MIC) for 2018-19. Only four months remain to the current fiscal year.

Since 2012, the MIC’s annual target for FDI of US$ 6 billion was consistently met.

Data from the Directorate of Investment and Company Administration showed that so far, Singapore, with US$21.3 billion or 26.6 percent of total approved investments, was the largest investor in Myanmar, followed by China, with US$20.5 billion or 25.6 pc of total approved investments.

Myanmar saw the largest proportion of FDI in the transportation and communications sectors during the eight-month period from October to May in the current fiscal year, said U Thant Zin, acting director general of the Directorate of Investment and Company Administration (DICA) said last week.

FDI in Myanmar totaled US$ 1.1 billion by just three companies in the two sectors, representing around 42 percent of the US$2.6 billion in total investments.

Meanwhile, 115 companies invested in manufacturing, 13 in services and seven in livestock and fisheries. Investors also channeled funds into agriculture, hotels and tourism, energy, real estate and industry.

China topped the investors list with a total of 72 businesses investing in Myanmar. However, the Chinese channeled just US$260 million into the country compared to US$1.6 billion by 20 companies registered in Singapore. 

During the first eight months of the current fiscal year, Myanmar citizen investments amounted to more than K1 billion, including expansion by existing companies, said U Thant Zin Lwin.

The domestic investments were concentrated in real estate, manufacturing, hotels and tourism, construction, industrial estate energy, mining, livestock and fisheries and agriculture, according to the DICA.

Notice: The Publishers of Asean LIP acknowledge the permission granted by the relevant official/ original source for the reproduction of the above/ attached materials. You shall not reproduce the above/ attached materials in whole or in part without the prior written consent of the Publishers and/or the original/ official source. Neither the Publishers nor the official/ original source will be liable for any loss, injury, claim, liability, or damage caused directly, indirectly or incidentally to errors in or omissions from the above/ attached materials. The Publishers and the official/ original source also disclaim and exclude all liabilities in respect of anything done or omitted to be done in reliance upon the whole or any part of the above/attached materials. The access to, and the use of, Asean LIP and contents herein are subject to the Terms of Use.

Get ASEAN LAW ALERT

Legal updates by e-mail. It's Free.

INDUSTRY UPDATES

PCC OKs East West purchase of PBCOM Auto Loan Portfolio

MANILA, Jun 19 (PNA) - The Philippine Competition Commission (PCC) approved the acquisition by East West Banking Corporation (East West) of the auto loan portfolio of Philippine Bank of Communications (PBCom).

Read More

INDUSTRY UPDATES

RI hopes for Progress in Timor Leste joining ASEAN

Jakarta, Jun 19 (ANTARA) - The Indonesian government has expressed its hopes that the ongoing evaluation of Timor Leste will result in its becoming a member of the Association of Southeast Asian Nations (ASEAN).

Read More

INDUSTRY UPDATES

MyCC to focus Efforts on Monitoring Cement Industry

KUALA LUMPUR, Jun 19 (Bernama) - The Malaysia Competition Commission (MyCC) says it will focus its efforts on consistently monitoring the cement industry in order to complement the government’s initiative in protecting the welfare of consumers.

Read More

INDUSTRY UPDATES

Amended Code did not affect Conflict of Interest - Witness

KUALA LUMPUR, Jun 18 (Bernama) - The Code of Ethics for Administration Members and Members of Parliament was amended by the Cabinet in 2013 but did not affect the conflict of interest provision, according to a Cabinet former deputy secretary-general (Constitution and Communication).

Read More

INDUSTRY UPDATES

Court urges Johor PTG to meet Orang Asli to settle Compensation Issue

JOHOR BAHRU, Jun 18 (Bernama) - The High Court here today encouraged the state Land and Mines Office (PTG) to engage in discussions with the Seletar tribe Orang Asli of Kuala Masai with the aim of settling compensation due as a result of wrongful acquisition of their land in Stulang Laut.

Read More

INDUSTRY UPDATES

Ex-CJ speaks out against Lawyers' Tendency to seek Postponements

KUALA LUMPUR, Jun 16 (Bernama) - Former Chief Justice Tun Zaki Azmi has spoken out against the tendency by certain defence lawyers to seek postponements of cases being heard in court.

Read More

INDUSTRY UPDATES

New Competition Commission already under Fire

Myanmar’s professed commitment to competition reform has come under fire after the government packed the new Competition Commission with bureaucrats serving under a minister.

Read More

INDUSTRY UPDATES

NA Deputies give Opinions on Revised Labour Code

Hanoi, Jun 12 (VNA) - The revised Labour Code will the focus during the sitting of lawmakers on June 12 in the ongoing 7th session of the 14th National Assembly.

Read More

INDUSTRY UPDATES

Ability to pay Taxes Online a Boon for Vietnam’s Import-Export Businesses

Hanoi, Jun 6 (VNS/VNA) - Around 99 percent of import and export tax payments in Ho Chi Minh City are made online, according to the customs department.

Read More

INDUSTRY UPDATES

OWWA joins Urban Poor Caravan

MANILA, Jun 8 (PNA) - The Overseas Workers Welfare Administration (OWWA) will be joining the Presidential Commission for the Urban Poor (PCUP) caravan to inform the public of its programs on overseas employment.

Read More

INDUSTRY UPDATES

Palace declares June 24 Holiday in Manila

MANILA, Jun 6 (PNA) - Malacañang has declared June 24 as a special, non-working holiday in the City of Manila in celebration of its 448th founding anniversary.

Read More

INDUSTRY UPDATES

Legal Profession faces inherent Risks not Exclusive to NUPL

MANILA, Jun6 (PNA) - A state lawyer of the Office of the Solicitor General said Thursday the legal profession faces "inherent risks not exclusive to the National Union of People’s Lawyers (NUPL)".

Read More

INDUSTRY UPDATES

DOJ forms Panel to probe Jacky Co Case

MANILA, Jun 6 (PNA) - A prosecution panel has been assigned for the preliminary investigation on the complaints filed against alleged Chinese drug lord Jacky Co and others implicated in the smuggling of PHP1.8 billion worth of illegal drugs into the country.

Read More

INDUSTRY UPDATES

Myanmar still short of Judges, says Supreme Court

The number of judges in the country is just two thirds of the number required, according the 2018 annual report of the Union Supreme Court.

Read More

INDUSTRY UPDATES

RCI on Judicial Misconduct is what People Want - Dr Mahathir

PUTRAJAYA, Jun 5 (Bernama) - The government agreed to set up a Royal Commission of Inquiry (RCI) on judicial misconduct because this is what the people want, said Prime Minister Tun Dr Mahathir Mohamad.

Read More