PWC MYANMAR WEEKLY BUSINESS INTELLIGENCE - ISSUE 163 1 JUNE 2019
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www.pwc.com/mm PwC Myanmar Weekly Business Intelligence Issue 163 1 June 2019
Disclaimer PricewaterhouseCoopers Myanmar Co., Ltd helps organisations and individuals create the value they’re looking for. We’re a member of the PwC network of firms in 158 countries with more than 250,000 people who are committed to delivering quality in assurance, advisory and tax services. Tell us what matters to you and find out more by visiting us at www.pwc.com/mm. This content is for general information purposes only, and should not be used as a substitute for consultation with professional advisors. © 2019 PricewaterhouseCoopers Myanmar Co., Ltd, a company duly established and operating under the laws of Myanmar. All rights reserved. PwC refers to the Myanmar member firm, and may sometimes refer to the PwC network. Each member firm is a separate legal entity. Please see www.pwc.com/structure for further details. The information contained in this publication is for general guidance on matters of interest only and is not meant to be comprehensive. The application and impact of laws can vary widely based on the specific facts involved. Before taking any action, please ensure that you obtain advice specific to your circumstances from your usual PricewaterhouseCoopers Myanmar Co., Ltd client service team or your other tax advisers. PwC | June 2019 2
1. Weekly Key Financial & Business News PwC | June 2019 3
Weekly Key Financial & Business News
Headlines
Myanmar's fuel market: from fanfare to standstill
Italian loan to facilitate electrification process
Forthcoming Report to Shine Light on Private Sector Expansion and Liberalization Drive
Fintech Challenge Myanmar To Catalyze Financial Inclusion
Myanmar Sees 30 Percent Increase in Tourism During First Four Months of 2019
PwC | June 2019 4Weekly Key Financial & Business News
Headlines
Emergency power plans impossible without price rises: official
Urbanisation to drive expansion of indoor network
Companies to commence exploratory drilling in 2019 and 2020
Businesses collaborate to launch new loan facility for landowners
States, regions seek greater share of power
PwC | June 2019 5Newspapers
Frontier Myanmar
Myanmar's fuel market: from fanfare to standstill
27 May 2019
IN JULY 2017, Frontier reported on the imported US$2.7 billion of processed fuel last
longstanding frustration among drivers in year, show figures from the International Trade
Myanmar at the poor quality of fuel sold at local Center, and in January 2017 BMI Research
stations. Just a few months earlier, the Myanmar forecast consumption to grow at an average
Investment Commission had abolished a annual rate of 6.0 percent a year for the next
requirement that foreign investors in the sector decade.
partner with the Ministry of Energy and “Everybody who is anybody in international fuel
Electricity. The larger local players were already tanking, storage and retail has been negotiating,”
aligning with foreign partners. “The long fuel says Mr Edwin Vanderbruggen of legal advisory
lines at the few private stations with a good firm VDB Loi.
reputation could soon be a thing of the past,” we Cooling off
wrote. Interest has cooled considerably since then,
Almost two years later, though, there has been however, as the difficulties of closing a deal and
almost no perceptible change: few foreign brands, making a profit become clear.
the same old complaints from drivers about price Shell and Max Energy, for example, signed a
and quality. But a long-closed, profitable market licensing agreement in July 2017 under which
has supposedly opened up, so why have investors they targeted rolling out Shell-branded retail sites
mostly stayed away? throughout the country over the following three
Although there is no single answer, it’s certainly years.
not lack of interest. Back in mid-2017, Shell,
Total, PTT and CNPC among others were all said
to be in the middle of talks with potential Source: Frontier Myanmar
partners. https://frontiermyanmar.net/en/myanmars-fuel-
It’s not hard to see the attraction. Myanmar market-from-fanfare-to-standstill
PwC | June 2019 6Newspapers
Myanmar Times
Italian loan to facilitate electrification process
28 May 2019
Italy will extend an interest-free €30 million (K51 The World Bank has lent US$400 million towards
billion) loan towards Myanmar’s National the project, with the MOEE receiving US$310
Electrification Project (NEP). An agreement million and the remaining being channeled to
between the two countries was signed yesterday. MOALI. In 2016-17, the Department of Rural
The loan comes with a grace period of 18 years, Development helped to light up 90,000
after which it should be paid back within ten households in 2708 villages.
years. It was approved in Parliament in August In the last fiscal year, it helped to light up 80,000
2018. using solar energy, said U Sai Thura Kyaw, deputy
The funds will be used to develop rural off-grid director of the Department of Rural Development.
projects implemented by the Department of Rural
Development under the Ministry of Agriculture,
Livestock and Irrigation (MOALI).
This will bring electricity via solar power and
small-scale power systems to an estimated 96,500
households in 2019 villages in Chin State, one of
the country’s poorest and most inaccessible areas,
and Sagaing Region.
Meanwhile, German state-owned development
bank KfW has also extended €9 million towards
bringing electricity to southern Shan State.
The NEP has two parts. One involves projects
being carried out by the Ministry of Electricity Source: Myanmar Times
and Energy (MOEE) and the other involves the https://www.mmtimes.com/news/italian-loan-
Village Department under MOALI. facilitate-electrification-process.html
PwC | June 2019 7Newspapers
Myanmar Business
Today Forthcoming Report to Shine Light on Private Sector
Expansion and Liberalization Drive
28 May 2019
A forthcoming report by the Oxford Business Understanding (MoU) with OBG for its
Group [OBG], a global research and consulting forthcoming publication. Under the MoU, the
firm, will chart Myanmar’s efforts to enhance chamber’s representatives will help OBG to
investment in the environment as a way of produce The Report: Myanmar 2020.
boosting revenue and promoting economic Peter Crowhurst, CEO of the chamber, said that
growth. he looked forward to teaming up with OBG to
Entitled The Report: Myanmar 2020, this update UK business leaders on what steps are
document will take a detailed look at the country’s being taken to facilitate market entry, and
plans to increase the contributions made from the enhance the local investment climate.
private sector to the economy, and to maintain “Oxford Business Group’s research into the
momentum in its liberalization drive. economy shines a light on the many opportunities
OBG will examine the financial service reforms available in Myanmar for those willing to grasp
that have been implemented; it will also consider them,” he said. “It will be a pleasure to work with
what they mean for investors who are looking for its representatives to increase the prevalence of
potential in this country. There will be special British business in the country.”
coverage of the insurance industry, which is set Welcoming the chamber’s team on board, OBG’s
for a complete overhaul as international players Country Director for Myanmar, Mila Dimitrova,
are allowed to enter the market. said that while the bulk of investment entering…
The report will also explore the significant
developments under way in Mandalay, which is
quickly carving a niche for itself as Myanmar’s Source: Myanmar Business Today
second-most important commercial city. https://www.mmbiztoday.com/articles/forthcom
The British Chamber of Commerce (BCC) ing-report-shine-light-private-sector-expansion-
Myanmar has signed a further Memorandum of and-liberalization-drive
PwC | June 2019 8Newspapers
Myanmar Business
Today Fintech Challenge Myanmar To Catalyze Financial
Inclusion
28 May 2019
The DaNa Facility, United Nations Capital financial services to large customer segments.
Development Fund (UNCDF) and the Asian Among these are micro- to small-enterprises,
Development Bank’s ADBVentures announced rural dwellers and farmers, and low-income
the launch of a new program, entitled Fintech people living in urban areas. The recent
Challenge Myanmar (FCM). This new technology worldwide explosion of financial technology [or
innovation program it designed to spur “fintech”] has not excluded Myanmar, and there is
innovation and financial services to promote hope that it will fill this gap. The focus of Fintech
greater financial inclusion within the country. It Challenge Myanmar is to identify fintech
will receive financial support from UK Aid and the solutions that can improve the quality and
Australian Government. quantity of financial services to the underserved
FCM was developed in close cooperation with the and unbanked.
Central Bank of Myanmar (CBM) and the Fintech Challenge Myanmar is open to fintech
Financial Regulatory Department (FRD) of the companies from both inside and outside
Ministry of Planning and Finance. It is anticipated Myanmar who are interested in collaborating with
that the CBM and FRD will sign on as “Impact financial service providers to pilot and scale
Partners” to promote the initiative. solutions; the goal is to improve financial services
Fintech Challenge Myanmar is part of a regional, in categories like micro insurance, agricultural
ADB-led initiative called Fintech Lab Mekong. finance, financial literacy, and digital identity
Parallel challenge programs to Fintech Challenge verifications [eKYC].
Myanmar are being organized, including ones in
Vietnam and Cambodia.
Myanmar’s financial sector has grown Source: Myanmar Business Today
substantially in recent years, but financial https://www.mmbiztoday.com/articles/fintech-
institutions still find it challenging to provide challenge-myanmar-catalyze-financial-inclusion
PwC | June 2019 9Newspapers
Myanmar Business
Today Myanmar Sees 30 Percent Increase in Tourism
During First Four Months of 2019
28 May 2019
The number of tourists coming into Myanmar free program for travelers from South Korea and
during the first four months of this year has risen Japan, enabling people from those nations to visit
by 30 percent over the same period last year. This Myanmar without requiring visa applications.
information was shared by U Ohn Maung, Union Positive results quickly followed. Seeing the
Minister of the Ministry of Hotels and Tourism, at improvement in numbers, the Ministry decided to
a press conference held to explain what the extend the program for another year. Now it is
government has accomplished during its third also planning to extend a visa-free program for
year. travelers from some European countries.
During the period encompassing January-April Along with the visa-free programs for the two
2018, the number of tourists entering Myanmar countries mentioned above, Myanmar also
by land, sea, and air amounted to 500,000. granted an arrival visa program for travelers from
During the same January-April period of 2019, Hong Kong, Macau, and China. Instead of
that figure rose to 650,000. applying for visas in advance, travelers from these
Through the entire 2018 calendar year, some 3.55 counties can pay $50 for visas upon arrival at
million tourists came to Myanmar, an increase of airports like Yangon, Mandalay, and Naypidaw.
0.11 percent compared over the 2017 figures, Visa-free travel is also permitted for those
which saw 3.44 million visitors. entering the country from Brunei, Cambodia,
Minister U Ohn Maung added: “We are working Indonesia, Laos, Philippines, Singapore,
on extending the visa-free and entrance visa Thailand, and Vietnam.
programs for another year; these programs were
granted to certain countries in October of last Source: Myanmar Business Today
year.” https://www.mmbiztoday.com/articles/myanmar
With the goal of boosting tourism, on October 1, -sees-30-percent-increase-tourism-during-first-
2018, the government launched a one-year visa- four-months-2019
PwC | June 2019 10Newspapers
Frontier Myanmar
Emergency power plans impossible without price
rises: official
29 May 2019
YANGON — Electricity prices need to rise before hydropower and gas-fired plants, but during hot
the government can move forward with plans to season many dams are unable to generate power
meet demand for next hot season, a senior due to lack of water. Most of Myanmar’s
Ministry of Electricity and Energy official says. domestically produced gas is exported, which
With many areas of the country suffering from leaves little room to expand the use of gas-fired
crippling power cuts, the ministry earlier this plants.
month announced a range of potential solutions Although power supply should improve once the
to meet demand in the next few years, including monsoon rains begin to refill the dams that
liquefied natural gas barges, imports from China provide water for the country’s hydropower
and Laos, and solar photovoltaic projects. plants, the cuts are expected to worsen in the
U Han Zaw, deputy director general of the years ahead due to annual electricity demand
Department of Electric Power Planning, said the growth of 10 to 15 percent.
ministry was under pressure from the “We are like most farmers in Myanmar – we
government to come up with solutions to the depend largely on rainwater,” Han Zaw said,
power shortages, which have forced the ministry referring to Myanmar’s reliance on hydropower.
to introduce scheduled outages since late April “We have to change it … We need to diversify into
and prompted significant public criticism. other sources.”
“It is our responsibility to find ways to prevent
blackouts like these in the future,” Han Zaw told
Frontier in an exclusive interview.
The supply cuts follow delays to three proposed Source: Frontier Myanmar
power plants fuelled by imported liquefied https://frontiermyanmar.net/en/emergency-
natural gas. power-plans-impossible-without-price-rises-
Myanmar presently relies on a combination of official
PwC | June 2019 11Newspapers
Eleven Myanmar
Urbanisation to drive expansion of indoor network
29 May 2019
WITH MORE people moving to major cities for buildings.
better opportunities, Myanmar is planning to “On the one hand, we need real estate developers
improve the quality of its indoor network to reserve some space and a pipeline for
coverage as part of preparing for the fifth communication devices in the buildings,” he said.
generation of wireless technology (5G), officials “On the other hand, each operator and supplier
say. needs to provide the best solution and high-
Soe Naing, deputy director-general of the Posts quality installation services in order not to
and Telecommunications Department, told the damage buildings and the environment.”
recent Myanmar Indoor Coverage Digitalisation As networks need to pay more attention to
Summit 2019 that the country would focus on evolvability, the input of communication
improving the indoor experience of users, given equipment integrators is much needed to ensure
that more than 70 per cent of the traffic occurs healthy and stable development of the network,
indoors, especially in urban areas. he said. According to the official, as Myanmar
“As Myanmar has a hot climate and a long rainy rapidly enters the information era, the
season, people usually spend their time mostly in transmission of information is inseparable from
indoor areas,” he said. the network. “The information transmitted by the
“The quality of the indoor network greatly affects network is becoming more and more abundant,
the user experience. In the future 5G era, we will and the amount of data transmitted is also on the
need more and more indoor sites, especially in rise,” he said. As the carrier of information,
highly intensive areas such as shopping malls and optical fibre plays a critical role in the
residential buildings.” transmission of information, he added.
The official stressed the need for a reliable and Source: Eleven Myanmar
stable solution to meet the requirements of users https://elevenmyanmar.com/news/urbanisation-
without causing trauma and destruction to to-drive-expansion-of-indoor-network
PwC | June 2019 12Newspapers
Myanmar Times
Companies to commence exploratory drilling in 2019
and 2020
30 May 2019
Exploration drilling will commence this year and the study period, claiming there were no
next for oil and gas companies that won tenders prospects. “By drilling, the companies can decide
in 2014 and 2015, based on the contracts signed if there are sufficient reserves or not. If they
with the with Myanmar Oil and Gas Enterprise believe the prospects are good, they will spend the
under the Ministry of Electricity and Energy money to continue drilling,” he said.
(MOEE), ministry officials said. However, the MOEE has the right to seize a
This is the next phase after seismic surveys and proportion of the investments made and
testing operations were carried out over the past deposited in the bank in the event that the
five years under the terms of the Production companies do not move on to production or if
Sharing Contracts (PSCs) between the companies they renege on any other terms, he said.
and the government. It includes both onshore and “According to the nature of the contract, the
offshore drilling. companies are committed to drilling beyond
Around 20 oil and gas companies, including exploration. However, if there is a valid reason to
Thailand’s PTTEP, Italy’s ENI, South Korea’s discontinue drilling the MOEE will accept it,” U
Daewoo and Australia’s Woodside Energy have Min Min Oo said, adding that some companies
commenced drilling and other geological and may be experiencing financial difficulties from the
seismic activities in Myanmar so far this year. fall in global oil prices.
“The companies have reached the drilling phase
under the contract. Should they decide that it is
not commercially viable to move on to production
after drilling has been conducted, they can choose Source: Myanmar Times
not to continue with the contract,” said U Min https://www.mmtimes.com/news/companies-
Min Oo, assistant secretary of the MOEE. commence-exploratory-drilling-2019-and-
In the past, some firms gave up their blocks after 2020.html
PwC | June 2019 13Newspapers
Myanmar Times
Businesses collaborate to launch new loan facility for
landowners
30 May 2019
iMyanmarHouse.com has introduced an amount will be dependent on the value of the land
installment loan programme in Myanmar for U Nay Min Thu said. “The maximum loan that can
those who own land but lack the capital to build a granted will be 70pc of the land value, and the
house or a building for commercial purposes. maximum term will be 25 years. Those who wish
The company is aiming to grant loans to those to carry out conservation work on existing
who don’t have enough capital to construct luxury buildings can also apply for the loan,” said U Htay
buildings, high-rise buildings, hotels, warehouses, Aung, head of KBZ’s home loan department.
and other buildings on land they own, said U Nay The programme will also grant three-year loans
Min Thu, managing director of for the commercial buildings such as hotels,
iMyanmarHouse.com. motels, restaurants, hostels, factories, and
Designed in collaboration with KBZ Bank and warehouses, depending on their business models,
Myanmar Art Construction and Development Co he said. The interest rate for the loans is 13
Ltd, the loan is said to be the first of its kind in the percent a year. Loans with longer repayment
country. periods will be considered based on the value of
KBZ bank will issue loans to the applicants on the the land and the financial standing of the
condition the building work is done by Myanmar applicant. Required documentation includes land
Art Construction & Development. ownership evidence, source of income, a copy of
iMyanmarHouse.com will vet the documents for the household register, and bank statements for
the loans and ensure the buildings are completed, six months.
said U Nay Min Thu. He said that Myanmar Art
Construction projects that it will be able to Source: Myanmar Times
construct buildings within a year of the granting https://www.mmtimes.com/news/businesses-
of a loan, with construction time stretching to two collaborate-launch-new-loan-facility-
years for a high-rise building. The maximum loan landowners.html
PwC | June 2019 14Newspapers
Myanmar Times
States, regions seek greater share of power
31 May 2019
Chief ministers of several states and regions are central government can make those decisions.
urging more decentralisation and less The process would be smoother and faster if the
bureaucracy to speed the way to a federal system state governments had more authority,” Salai
for the country. Lian Luai said.
“We chief ministers are very active in inviting Under the Myanmar Investment Law 2016,
investments in our states and regions, but we are investment committees were established in every
hampered by the central government. Without region and state.
sufficient decentralisation, it will be hard to The committees include representatives from
streamline and simplify the investment process,” government departments and are headed by the
U Zaw Myint Maung, chief minister of Mandalay chief ministers. They have the authority to permit
Region, said this week at a workshop on boosting foreign investment of up to US$5 million, and
investment in northern Myanmar. local investment of up to K6 billion.
At the event, Salai Lian Luai, chief minister of The 2008 Constitution lays out the powers of the
Chin State, where only four townships are regional and state governments, and the chief
electrified, said that although the state has ministers say it gives too much authority to the
hydropower, the effort to bring power to more central government.
townships is delayed because of the need for “However hard the State Counsellor urges us to
central government approval. work with the union government, there’s still a
“The challenge in the electricity sector is that gap. As long as centralisation exists, it will be
regions and states can only authorise projects harder for us to progress,” said U Zaw Myint
under 30 Megawatts, while those with higher Maung.
output can only be carried out by the central Source: Myanmar Times
government. The other problem is we can’t decide https://www.mmtimes.com/news/states-regions-
the price of the electricity generated. Only the seek-greater-share-power.html
PwC | June 2019 152. Weekly Key Policy News PwC | June 2019 16
Weekly Key Policy News
Headlines
Schools told not to enrol students from other townships
What Industry 4.0 Demands of Myanmar
IRD to introduce Income tax bill to parliament
Mandalay city to roll out online payment system
Myanmar signs on as observer for BRI tax cooperation pact
PwC | June 2019 17Newspapers
Myanmar Times
Schools told not to enrol students from other
townships
27 May 2019
Schools in Yangon have been instructed not to from now until Friday. School starts on June 3.
accept the enrolment of students from other U Ko Lay Win said the inspection will be
townships during the coming school year, conducted without warning and at random.
according to U Ko Lay Win, director general of the But some said it will be difficult to detect the
Department of Basic Education. fraud, as parents fraudulently change their
He said the same instruction was issued during household registration to be able to enrol their
last year’s enrolment but was not followed, so the children at famous schools.
department would be stricter in enforcing the The Ministry of Education said this year’s
regulation this year. enrolment is likely to top the more than 9.14
“There are parents who want to enrol their million primary students who enrolled last year.
children at famous schools, and thus they pay A mother who wants to enrol her child at No. 5
teachers to get their children accepted. Issues Botahtaung School said the problem could be
arise. The instruction aims to avoid corruption,” avoided if the government ensured that all
U Ko Lay Win said. schools had the same quality of facilities and
The department will inspect famous schools in teachers. The documents required to enrol
Yangon and Mandalay. children include a school transfer certificate,
Ko Hein Latt, the father of a 2nd grade student in comprehensive personal record, copy of
Bahan, said, “If they won’t accept extra-township household registration or real estate purchasing
enrolment, we want to ask them whether teaching agreement or house rental agreement.
is the same in all schools. Are the schools safe? If
all schools were the same, parents won’t enrol
their children at schools in other townships. They Source: Myanmar Times
would rather enrol them in their own township.” https://www.mmtimes.com/news/schools-told-
School enrolment across the nation is taking place not-enrol-students-other-townships.html
PwC | June 2019 18Newspapers
Consult Myanmar
What Industry 4.0 Demands of Myanmar
29 May 2019
It is of primary importance, Myanmar Minister of hints at the notion that Myanmar is developing at
Industry U Khin Maung Cho told the more than a time that could enable it to “leapfrog” over
100 gathered at the Novotel Yangon Max hotel several of these stages of production directly into
Friday morning for the Industry 4.0 in Myanmar the new, digital economy.
conference, to create an inclusive digital economy. “At the end of the day,” AHK Myanmar Delegate
Industry 4.0—a term with a fluid definition but Martin Klose said, this fourth phase “should be
that generally refers to commercial and industrial focused on digitization, connecting production
advances in automation and digital connectivity, units, and a focus on on-demand production.”
and their resulting social and economic impacts— However defined, all expect the impacts to be
will “affect more than just manufacturing,” U profound. The world must be ready for
Khin Maung Cho said. “We have to develop our “revolutionary changes in production and in our
country to match with the other countries daily lives,” German Ambassador Dorothee
surrounding Myanmar.” Janetzke said in her opening remarks.
The event was hosted by the Delegation of “Digitization [in Myanmar industry] is still at the
German Industry and Commerce in Myanmar, beginning,” she said, but Myanmar has “an
known also by its German-language acronym ambitious population that is ready to embrace
AHK Myanmar, and defining the titular term was new technologies.”
itself a recurring theme of the conference. It is
often described as the next step in a process that
began with steam-powered mechanization at the
turn of the 19th century and in the 20th Source: Consult Myanmar
progressed through electric-powered assembly https://consult-
lines and, later, computer technology. The myanmar.com/2019/05/29/what-industry-4-0-
conference’s slogan, “leapfrogging across sectors,” demands-of-myanmar/
PwC | June 2019 19Newspapers
Myanmar Times
IRD to introduce Income tax bill to parliament
30 May 2019
The Internal Revenue Department (IRD) drafted taxpayers how IRD will administer the tax laws
a new income tax law with the help of for which it is responsible.
International Monetary Fund (IMF) expert, U The IRD has created a Technical Review
Min Htut, director general of Internal Revenue Committee (TRC) to ensure that tax technical
Department (IRD), told The Myanmar Times. issues are properly considered, and that
He said the new legislation will modernise the consistent guidance is provided to taxpayers. This
rules and “effectively cover” different parts of the committee meets every two months to consider
economy, catching up with international issues that have been raised by IRD offices when
standards. those issues require clarification or guidance.
The old income tax law was enacted since 1974, Typically, the referring office prepares a
hence the law is no longer up to date and not in memorandum explaining the issue and its
line with international standards. significance, describes the relevant law and
U Min Htut added the department is ready to policy, and proposes a variety of options for
submit the new law to the parliament once the tax dealing with it.
management bill, which is currently sitting in
Pyidaungsu Hluttaw since 2018, is approved.
The tax management bill seeks to reorganise the
various tax laws, from commercial tax law,
income tax law, specific goods tax law, and union
taxation law. The purpose is to allow taxpayers to
follow the regulations more easily.
Meanwhile, the IRD last November introduced a Source: Myanmar Times
new initiative to provide taxpayers with greater https://www.mmtimes.com/news/ird-introduce-
certainty regarding tax laws and to advise income-tax-bill-parliament.html
PwC | June 2019 20Newspapers
Myanmar Times
Mandalay city to roll out online payment system
31 May 2019
People will soon be able to pay their taxes and “Payments will be able to be made 24 hours a day,
service fees to the Mandalay City Development which will help make the city more efficient.
Committee online, the city’s officials say. Many people are mobile phone-savvy, so they will
The MCDC is working on the Mandalay Smart Pay not have any difficulty using the system,” he said.
project with Singapore-based tech company 2C2P has a presence in 10 countries in Asia and is
2C2P, which is owned by a Myanmar national and said to be one of the leading payment service
is not charging for its services, said Mandalay providers in Southeast Asia.
Mayor Ye Lwin.
“People will no longer need to go to the bank to
make payments, which they can make anytime
and anywhere. The system will be a crucial part of
Mandalay becoming a smart city,” U Ye Lwin said.
MCDC-owned Yadanarpon Bank and 2C2P signed
an agreement to implement the system on May
13.
Under the agreement, MCDC will place QR codes
or bar codes on notices or bills which customers
can scan to make payments. All municipal
charges, including taxes, can be paid under the
new system just by scanning the code, Ye Lwin
said in a post on his webpage.
The Mandalay Smart Pay app will be developed Source: Myanmar Times
within six months, and no fees will be charged for https://www.mmtimes.com/news/mandalay-
payments. city-roll-out-online-payment-system.html
PwC | June 2019 21Newspapers
Myanmar Times
Myanmar signs on as observer for BRI tax
cooperation pact
31 May 2019
Myanmar will sign as an observer an agreement implementation of the economic community that
on the establishment of the Belt and Road will result from the Belt and Road Initiative.
Initiative Tax Administration Cooperation Participating in tax management talks with other
Mechanism (BRITACOM), said Deputy Minister countries in the project will also enhance our
of Planning and Finance U Maung Maung Win. country’s tax management skills,” he said.
The mechanism is being established to deal with The MoU between Myanmar and China is a part
the complexities of business development, taxes, of the 21st Century Maritime Silk Road, which
trade, and infrastructure investments that will includes the establishment of the China-Myanmar
arise with the development of China’s BRI, U Economic Corridor, he added.
Maung Maung Win told a briefing at the Including Myanmar, 125 countries and 29
Pyidaungsu Hluttaw (Assembly of the Union) on international organisations have signed the
Wednesday. agreement to cooperate in the Economic
Thirty-four countries, including Cambodia, Community and BRI led by China. State
Indonesia and Bangladesh, have signed Counsellor Daw Aung San Suu Kyi is leading
memorandums of understanding as founders of Myanmar’s working committee for
the mechanism, and 16 countries, including implementation of the project.
Singapore, and six organisations have signed on
as observers. Myanmar has agreed in principal to
participate as an observer and will submit the
plan to the assembly for approval, said U Maung
Maung Win.
“Participating in BRITACOM as an observer will Source: Myanmar Times
strengthen relations between Myanmar and https://www.mmtimes.com/news/myanmar-
China, as it is part of the long-term signs-observer-bri-tax-cooperation-pact.html
PwC | June 2019 223. Weekly Investment News PwC | June 2019 23
Weekly Key Investment News
Headlines
Upcoming Event to Match Myanmar-Malaysia Businesses
Telenor, Axiata merger could result in better services for Myanmar
Allowing foreign insurance companies into local market
Germany keen to raise investment and trade in Myanmar
Toyota announces US$53 million assembly plant in Thilawa
PwC | June 2019 24Newspapers
Myanmar Business
Today Upcoming Event to Match Myanmar-Malaysia
Businesses
28 May 2019
Myanmar and Malaysia will hold an event to matters that are involved.
match up businesses from the two nations. The As of this writing, Malaysia stands as the eighth-
event’s goal will be to promote investment ties largest investor in Myanmar’s economy. They
between the two countries, and to make it easier have already invested $1.9 billion in total. This
to invest in the economy of Myanmar by creating has been spread around throughout various
connections between businessmen from the sectors: $729 million went to the industrial
respective nations. sector, $397 million to energy, $256 million to
The Myanmar Investment Commission [MIC] and telecommunications, $76 million in agriculture,
the Malaysian Embassy are organizing the event, $52 million to the hotel and hospitality sector,
which will help match Malaysian investors $21 million in livestock, and $0.2 million in other
interested in opportunities within Myanmar. A sectors.
location and date for the event has not yet been We will keep our readers posted as updates
announced, but the parties involved are become available regarding this interesting-
continuing to solidify their plans. looking event.
Daw Tin Aye Han, Acting Deputy Director of the
Directorate of Investment and Company
Administration, said: “We are negotiating on the
date and location with Malaysia. Investors from
Malaysia will visit Thilawa Special Economic
Zone, and study investments from Malaysia in
Myanmar that have already proved successful.
The department will also explain investment Source: Myanmar Business Today
opportunities to the Malaysian investors, as well https://www.mmbiztoday.com/articles/upcomin
as help them understand some of the legal g-event-match-myanmar-malaysia-businesses
PwC | June 2019 25Newspapers
Myanmar Times
Telenor, Axiata merger could result in better services
for Myanmar
28 May 2019
Norway’s Telenor Group and Malaysia’s Axiata users; 62pc of which are data users. The average
Group are planning to combine their telecom data usage of a person is 2.7 GB, according to the
operations in Asia, according to Telenor Myanmar company.
Company. Among the 8300 Telenor towers in Myanmar,
Both aim to create a well diversified more than 6000 are 4G or Long Term Evolution
telecommunications company with operations (LTE) towers. Telenor has invested US$ 2.7
across nine countries, including Myanmar. billion in Myanmar and is the second largest telco
Telenor is expected to own 56.5 percent of the in the country.
merged entity, while Axiata will own the
remaining 43.5pc.
“We’re discussing a merger and will announce it
once an agreement is reached. If successful, the
merger would result in one of the biggest telcos in
Asia in terms of infrastructure and number of
users, which will amount to 300 million in Asia,”
said Ma Shwe Yin Mar Oo, external
communications manager at Telenor Myanmar.
This will lead to better overall services for
Myanmar.
Telenor’s aim of cooperating with Axiata is to
increase its exposure to communications Source: Myanmar Times
networks and technologies like 5G, Internet of https://www.mmtimes.com/news/telenor-axiata-
Things and Artificial Intelligence.. merger-could-result-better-services-
Telenor Myanmar currently has 18.4 million local myanmar.html
PwC | June 2019 26Newspapers
Global New Light of
Myanmar Allowing foreign insurance companies into local
market
29 May 2019
People save part of their income to deal with the Unsurprisingly, insurance market in Myanmar
inevitable consequences of old age, sickness and was very small. Insurance penetration rate didn’t
death for themselves as well as for their near and even reach one percent. Following table shows the
dear one. However mishaps like sickness and comparison of insurance penetration rates in
deaths occurs not only when a person gets old. It Myanmar, Laos, Thailand and Viet Nam.
can happen anytime anywhere. Due to illnesses, The reason for this low penetration was that
accidents, carelessness of self or other or natural Myanmar only has a state-owned Myanma
disasters, they will face discomfort and Insurance in the insurance market until 2013.
inconvenience at the least or even loss of life or Citizen owned private insurance businesses were
limb. Even if there was no personal injury or allowed into the market starting from 2013 and
death, there may be loss of property or home to today there are 11 citizen-owned private insurance
fire and natural disasters that had disastrous companies operating in the local insurance
consequence to anyone. For such cases, saving market. Since then an increasing numbers of
wouldn’t be enough for most of the people. insurance types were introduced to the people.
Individuals and organizations need to consider for Following this, the government is now arranging
such scenarios and take up preventive measures. for foreign insurance companies to enter into the
Measures that will ensure maintaining of an local insurance market.
existing lifestyle or business regardless of
whatever the disaster or mishap may be. That
preventive measure is insurance.
Majority of the people in Myanmar do not Source: Global New Light of Myanmar
understand the advantage of insurance http://www.globalnewlightofmyanmar.com/allo
protection. Most also didn’t prepare for the future wing-foreign-insurance-companies-into-local-
as well. So they have little awareness of insurance. market/
PwC | June 2019 27Newspapers
Myanmar Times
Germany keen to raise investment and trade in
Myanmar
28 May 2019
Germany is keen to continue fostering trade and Meanwhile, total trade volumes between
investment ties with Myanmar, said Oliver Hoos, Myanmar and Germany surpassed US$580
first secretary and head of the economic and million in 2017-18, with exports exceeding
commercial section at the German Embassy in imports by US$180 million.
Myanmar. During the year, Myanmar exported a total of
Mr Hoos added that German businesses are also uS$380 million worth of goods, mainly garments
keen to invest in the Myanmar energy and and textiles, to Germany. It imports machinery
agriculture sectors, adding to the US$32 million and pharmaceutical products from Germany.
worth of investments by four other German Myanmar exports to Germany continued to
businesses in Myanmar to-date, according to the expand in the five months between October 2018
Directorate of Investment and Company and March 2019 of the current fiscal year, during
Administration. which trade amounted to US$350 million.
The largest investment by a Germany company in Myanmar exported US$260 million worth of
Myanmar is Metro Wholesale, which has goods to Germany during the period, according to
channeled approximately US$10 million into its the Ministry of Commerce. In September, organic
business operations in the country. Shew Pi Oo and Moe green teas will also be
Metro Wholesale is involved in food service exported to Germany said U Hla Baw, president
distribution for hotels, restaurants, catering of Pindaya Tea Cluster
firms, independent small retailers and offices. It
is a joint venture partnership between Metro AG,
the German specialist in wholesale food and
Yoma Strategic Holdings Limited, which is listed Source: Myanmar Times
in Singapore. Metro Wholesale procures its raw https://www.mmtimes.com/news/germany-
materials directly from local farmers. keen-raise-investment-and-trade-myanmar.html
PwC | June 2019 28Newspapers
Myanmar Times
Toyota announces US$53 million assembly plant in
Thilawa
30 May 2019
Toyota Motor Corporation (Toyota) announced previous year’s, Toyota said.
today that it will establish Toyota Myanmar Co
Ltd (TMY) as its first vehicle production company
in Myanmar, where it will locally produce the
Hilux from February 2021.
Toyota currently sells the Hilux, Vios, Rush, and
other vehicles in Myanmar by relying on imports,
but will establish TMY at the Thilawa Special
Economic Zone in Yangon in June this year.
Investment is expected to amount to US$52.6
million. It intends to assemble around 2500 Hilux
vehicles using the semi knock-down (SKD)
method and will hire around 130 employees.
Toyota will hold an 85 percent stake in TMY,
while its trading arm, Toyota Tsusho Corporation
will hold the remaining 15pc.
In its announcement, Toyota said it will “promote
initiatives that will allow even more customers to
choose Toyota vehicles, in preparation for a
market that promises to continue expanding
steadily, in accordance with the growth of the Source: Myanmar Times
economy.” https://www.mmtimes.com/news/toyota-
In 2018, more than 18000 new vehicles were sold announces-us53-million-assembly-plant-
in Myanmar, which is 2.1 times more than the thilawa.html
PwC | June 2019 293. Weekly New Tenders PwC | June 2019 30
Tenders (Myanmar)
List
No applicable Tenders announced for the week ending 31 May 2019
Note: tenders information are collected from http://www.mmtimes.com/, https://tender.yangon.gove.mm, http://consult-myanmar.com/, and
http://www.myanmar-opportunities.org/mm/tenders http://www.buildersguide.com.mm/en/ .
PwC | June 2019 31Tenders (Multilateral organizations)
List
ADB: TA-9074 MYA: Capacity Development for Project Implementation - Senior Consultation and
Participation Specialist (49297-001), Closing Date: 07 June 2019 (Individual)
ADB: TA-9554 REG: Southeast Asia Urban Services Facility - ASEAN Smart Cities Initiative (52064-
001), Closing Date: 12 June 2019
WBG: Tourism Development Consultant hiring for Myanmar Tourism Project, Closing Date: 12 June
2019
Note: tenders information are collected from https://wbgeconsult2.worldbank.org, www.devex.com, www.adb.org, https://www.ungm.org
PwC | June 2019 324. MIC Permitted Projects PwC | June 2019 33
MIC Permitted Projects (Meeting 8, 2019)
No. Name of Company Type of Investment Form of Investment
Network facilities services, network
1 Myanmar Unilink Communication Co.,Ltd Wholly Foreign Owned
services and application services
Network facilities services, network
2 AGB Communication Co.,Ltd Wholly Myanmar Owned
services and application services
Construction of jetty for container storage
3 Mon Petrol Co.,Ltd station, bonded warehouse and operation Wholly Myanmar Owned
of storage tanks for edible oils
Construction of jetty and LPG storage
4 Awra Energy Public Co.,Ltd Wholly Myanmar Owned
tanks, importation
Source: DICA
PwC | June 2019 345. Upcoming Events PwC | June 2019 35
Upcoming Events (June 2019)
List
Date Location Name of Event Sector Price Focus Points
“The modernisation of banks is taking root,
with many financial institutions rising to the
challenge of adopting international best
practices and investing in systems that will
transform the way they operate.This is the
only exclusive Summit dedicated to the
banking needs of Asia’s emerging markets.
11-12 June Emerging Asia Banking Banking and The Summit will dive into issues that keep
Yangon TBC
2019 & Fintech Summit Fintech top management of banks and financial
institutions up at night! Probe the challenges
and, more importantly, the best practices to
successfully operate in markets such as
Myanmar, Cambodia, Vietnam, Laos etc.
Hear from innovative industry experts from
countries such as Thailand, Singapore and
Japan.”
Note: Events information are collected from https://www.go-myanmar.com/events-and-conferences and https://10times.com/myanmar .
PwC | June 2019 36www.pwc.com/mm
PwC Myanmar Weekly Business Intelligence Publication
For further information please contact:
Jovi Seet
Senior Executive Director
jovi.seet@sg.pwc.com
Mark Rathbone
Capital Projects & Infrastructure Leader, Asia
mark.rathbone@sg.pwc.com
© 2019 PricewaterhouseCoopers Myanmar Co Ltd. All rights reserved. In this
document, “PwC” refers to PricewaterhouseCoopers Myanmar Co Ltd, which is part
of the network of member firms of PricewaterhouseCoopers International Limited,
each of which is a separate and independent legal entity.
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