Two top Burmese government officials attending a business conference in Singapore said foreign companies are ready to “flood” into Burma upon the completion of the government’s new foreign investment law, which is expected sometime in the next two months.
Tin Ko Win, deputy director general of the Directorate of Investment and Company Administration, said in an interview with the Wall Street Journal on Tuesday, “Our country is ready for any foreign partnership, joint venture or investment.”
The investment law is one among several crucial pieces of legislation that must unfold in the coming months, if Burma is to meet foreign companies expectations after the lifting or suspension of sanctions.
The bill is now being debated in the Upper House of Parliament. Assuming passage there, it would then go to the president for review and his signature, which could take up to 15 days. Observers are calling for the bill to be law sometime before late August.
“This is the most opportune time for foreign investors to do business in Myanmar, making best use of its abundant natural resources,” Tin Ko Win said, adding that the government plans to seek investment in sectors such as electricity generation and oil and natural-gas production and other areas. The proposed law will ensure that local and foreign investors are on equal footing, he said.
Tin Ko Win and Ye Aung, an assistant director at the Central Bank of Myanmar, were in Singapore for the Myanmar Business Conference organized by FRC Conference and Burma’s FBC Services Co.
The amended Foreign Investment Law will no longer require foreigners to establish businesses with Burmese citizens and will grant them a five-year tax holiday, according to reports in the domestic and foreign media. Some of its provisions include:
Foreigners would be allowed to own companies 100 per cent or to set up joint ventures with local citizens or government departments with involvement of at least 35 per cent foreign capital.
Foreign investors would be permitted to lease land from both the state and private citizens with an initial lease of up to 30 years, with additional 15-year extensions.
Foreign companies would not be allowed to recruit unskilled foreign workers and local citizens must make up at least 25 per cent of the skilled workforce after five years.
The percentage of Burmese workers' must be at least 50 per cent after 10 years and 75 per cent after 15 years.
The law would prohibit nationalization of a foreigners' business during the period allowed in the contract or extended in the contract other than by giving compensation based on current prices in the market in the interest of the general public.