MIC is under new management and it is no longer ‘business as usual’: U Thaung Tun

25 June 2018
MIC is under new management and it is no longer ‘business as usual’: U Thaung Tun
Chairman of the Myanmar Investment Commission (MIC) Union Minister U Thaung Tun. Photo: Lynn Bo Bo/EPA-EFE

Chairman of the Myanmar Investment Commission (MIC) Union Minister U Thaung Tun said that the MIC, under new management, will be “transparent”, take a “proactive approach” and promote “responsible investment”.
Speaking at a meeting organised by the American Chamber of Commerce, the Australian Chamber of Commerce, the British Chamber of Commerce, and the European Chamber of Commerce at the Melia Hotel in Yangon yesterday, the MIC Chairman stressed that, with the launching of a number of significant steps, Myanmar is now open for business.
The MIC is under new management and it is no longer “business as usual” he said.
He continued “Let me underscore. The new MIC will be “transparent” and take “proactive approach” in seeking to promote “responsible investment”.
As you are no doubt aware, we have recently taken steps to further improve Myanmar’s investment environment.
Prominent among the changes is that the Myanmar Company Law, passed by the Parliament on 6 December 2017, allowing foreign nationals to hold up to 35% of shares in local companies. This will allow any such company to be recognized as a local company.
At the same time, we have enacted the Myanmar Investment Law (2016), creating more opportunities for foreign investment to expand. The new MIL will ensure transparency and levels the playing field for all businesses.
I may be bringing coals to New Castle by reiterating the trade and economic potential of Myanmar.
But it bears to be repeated that trade and investment have expanded rapidly in Myanmar since 2011, bolstered by economic liberalization, legal reforms and the country’s strategic location as well as resources.
However, several factors have damped investor enthusiasm in Myanmar in the past year due to a number of factors, including depressed global commodities prices and not surprisingly the Rakhine situation.
Indeed, new opportunities are being created every day as ASEAN seeks to promote connectivity. China is poised to implement its Belt and Road Initiative. Myanmar is also the first country that India sees when it seeks to implement its “Look East” and “Act East” policy.
The active engagement of neighbouring countries will no doubt have a positive impact on Myanmar’s trade and investment growth over the medium term.
Myanmar is now open for business. It signalled its intention to open up by launching a number of trade-related development plans and frameworks: they include the National Export Strategy; the Master Plan for the Establishment of the Myanmar Trade Promotion Organization; the Private Sector Development Framework and Action Plan and a Gap Assessment on the ASEAN Trade in Goods Agreement.
SEZs are also expected to play a prominent role in boosting exports, reducing the trade deficit and supporting diversification. The government has sought to promote investment in SEZ, such as Thilawa, Kyaukphyu and Dawei. Incentives for free zones in the SEZ include a 7-year income tax exemption, followed by 50% reduction for the next 5 years, and a 50% reduction on capital gains taxes for any profits, reinvested as a reserved fund. Investors in Free Zones are also exempted from value-added tax and Customs duties for raw materials, production, machinery, spare parts, and construction materials.
The successes of the Thilawa SEZ have highlighted the opportunities for investors. There are ample opportunities for value-added manufacturing. Please send this message to your home.
More importantly, the investment environment has been transformed due to changes arising from the promulgation of Myanmar Investment Law (2016) (MIL) and the Myanmar Investment Rules (2017) (MIR). The changes will make it easier for foreign investors to obtain long leases, which is the sine qua non for most of your businesses.
The outstanding change under the MIL is the MIC endorsement.
The MIL has introduced a new type of MIC approval called a MIC endorsement. This is a less time-consuming procedure.
A common complaint in the past was that the MIC permit process sometimes took 6 months or more. We will now try to redress the situation by settling “strict time limits” for processing application for both MIC permits and MIC endorsement. I understand that, currently, it is 60 days. We intend to pare it down substantially.
The government now provides a guarantee that it will not nationalize any investment or take any expropriation measures, directly or indirectly, that is likely to result in an investment being terminated.
The MIC has been reconstituted to take forward the momentum of change and transformation of the past few years.
Myanmar remains well-positioned to boost investment in priority areas and diversify its export base and generate more jobs.
I would like to underscore that Myanmar has enormous potential and that the time is ripe to invest in the country. We will strive to ensure that investment opportunities result in a win-win situation.
We have a new management at the MIC that is determined to turn Myanmar into a major regional trade and investment destination.
The new MIC will be “transparent”, “efficient” and “investor-friendly”.
We have many challenges but there is no challenge that we cannot overcome. We want Myanmar to emerge as a reliable partner to investors – a country that seeks to build relationships with old friends and new ones alike.”