Myanmar Business Today is Myanmar’s first and the only bilingual (English-Myanmar) business newspaper, distributed in both Myanmar and Thailand. MBT covers a range of news encompassing local business stories, special reports and in-depth analysis focusing on Myanmar’s nascent economy, investment and finance, business opportunities, foreign trade, property and real estate, automobile, among others. MBT also provides detailed coverage of regional (ASEAN) and international business stories. For more information please visit www.mmbiztoday.com.
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Myanmar Business Today is Myanmar’s first and the only bilingual (English-Myanmar) business newspaper, distributed in both Myanmar and Thailand. MBT covers a range of news encompassing local business stories, special reports and in-depth analysis focusing on Myanmar’s nascent economy, investment and finance, business opportunities, foreign trade, property and real estate, automobile, among others. MBT also provides detailed coverage of regional (ASEAN) and international business stories. For more information please visit www.mmbiztoday.com.
Facebook: www.facebook.com/MyanmarBusinessToday Twitter: @mmbiztoday
Google Plus: https://plus.google.com/107379179269023670071/posts
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Myanmar Business Today is Myanmar’s first and the only bilingual (English-Myanmar) business newspaper, distributed in both Myanmar and Thailand. MBT covers a range of news encompassing local business stories, special reports and in-depth analysis focusing on Myanmar’s nascent economy, investment and finance, business opportunities, foreign trade, property and real estate, automobile, among others. MBT also provides detailed coverage of regional (ASEAN) and international business stories. For more information please visit www.mmbiztoday.com.
Facebook: www.facebook.com/MyanmarBusinessToday Twitter: @mmbiztoday
Google Plus: https://plus.google.com/107379179269023670071/posts
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mmbiztoday.com mmbiztoday.com May 15-21, 2014| Vol 2, Issue 19 MYANMARS FIRST BILINGUAL BUSINESS JOURNAL Inside MBT The Bonds That Will Tie The NuLIon (PurL ) P- Semen Indonesia to Buy $o-m SLuke In Myunmur CemenL Muker P-q Corruption The Biggest Con- cern for Myanmar Business- es: Survey P-5 SMIB Louns Not Som cient Ior SMIs In 2013-14, a total of K10 billion ($10.4 million) was disbursed to only 62 SMEs around Myanmar T he amount of loans provided by the state-owned Small and Medium Indus- trial Development Bank (SMDB) Is noL udequuLe for Myanmars small and medium enterprises, while the loan procedure Is uIso noL eecLIve, en- Lrepreneurs und om cIuIs told Myanmar Business Today. n zo1-1q hscuI yeur which ended March, the bank disbursed a total of K1o bIIIIon ($1o.q mII- IIon) Lo onIy 6z SMEs uround LIe counLry. Currently, SMIDB gets loans from the govern- ment-owned Myanmar Economic Bank, which provides funds to SMIDB uL u specIuI 8.z percenL InLeresL ruLe. SMDB LIen Iends Lo SMEs uL 8. per- cent interest rate, while other banks in Myanmar Iuve u IendIng ruLe oI 1 percenL. The bank wants to give loans to most of the SMEs not just to selected enter- prises for a period of three yeurs. BuL now, LIe bunk May Soe San can only give loans after it receives special funding from the government, U San Thein, senior advisor at SMIDB told Myanmar Business Today. He said collaboration between international donor organisations and the government is still weak, rendering the bank unable to lend enough to SMEs. However, In zo1q- 1, SMDB wIII doubIe LIe Ioun umounL Lo Kzo bII- IIon, bunk om cIuIs suId eurIIer. If other organisations such as JICA (Japan In- ternational Cooperation Agency) gIves hnuncIuI assistance to the bank the situation will be better, U Sun TIeIn suId. He said there have al- ready been discussions wILI JCA Ior Om cIuI Development Assistance (ODA) Iouns buL IL Is sLIII noL sure. U Myat Thin Aung, an entrepreneur and vice chairman at Yoma Bank Ltd, told Myanmar Busi- ness Today: The more loan the bank will give, the better it will be for the SMEs. MosL oI LIe SMEs do not own buildings or any other forms of collat- eruI. So, LIe governmenL also needs to assume risks In gIvIng Iouns Lo SMEs. It [the government] also needs to revise the loan procedure. U San Thein said SMIDB Is IucIng dIm cuILIes In cur- ryIng ouL hnuncIuI ussess- ments of SMEs to deter- mine loan viability as the IocuI SMEs Iuve weuk h- nancial management and inadequate data and re- cord keepIng sysLem. Also, as there is no leg- islation for the SMEs at present the banks pro- vide loans to SMEs after getting approval from the SME Centre, a depart- ment under the Ministry of Industry which keeps registration records of SMEs. AILIougI, u druIL SME Law has been sub- mitted to the parliament and will be discussed in the Hluttaws upcoming sessIon In IuLe Muy. Foreign experts from the German Society for International Coopera- LIon (GZ) ure expecLed to give training to banks including SMIDB, KBZ and Yoma Bank on moni- toring and loan procedure LIIs yeur. U San Thein also urged the government to im- prove industrial and ser- vice sectors of the country for the development of SMEs. CurrenL GDP`s qo per- cent is coming from ag- rIcuILure und zo percenL Irom IndusLrIuI secLor. The GDP will only in- crease with the develop- ment of the SMEs, he suId. U San Thein also point- ed out that Myanmars number of export items Contd. P 9...(SMILB) Contd. P 9...(SMILB) Myanmar Summary A worker makes a Iacquer-ware at a workshop in Bagan in MandaIay region. In 2U13-14 scaI year, the state-owned Small and Medium Industrial Development Bank (SMIDB) managed to disburse a total of K10 billion ($10.4 million) to only 62 SMEs around the country. U A u n g / X in h u a . . ~....:.. ~.~ .:. .~ . . . , ..:.e _e .~ .~~ .q. ~~ ~ SMIDB ~.,_e _._ ~.q ~....:..~.~.:. .~ . . . , ..:.e _e .~ .~~ .. q, _:.q.~.:~~..:. ... .~ q ..: ._ . ~. .| ..,..:.~~~ e...: q ~ .~ ._ .q:~ . .q ._~: . .q._. _._ ~ .~....:.. ~.~ .:..~ . . . , ..:.e _e .~ .~~ q, ~..|~. ~..q~ ~.._e...: _.,.:...:..q. ~ MEB . qq..:.~ May 15-21, 2014 Myanmar Business Today mmbiztoday.com 2 LOCAL BIZ MYANMARS FIRST BILINGUAL BUSINESS JOURNAL Board of Editors Editor-in-Chief - Sherpa Hossainy Email - sherpa.hossainy@gmail.com Ph - 09 42 110 8150 Editor-in-Charge - Wai Linn Kyaw Email - linnkhant18@gmail.com Ph - 09 40 157 9090 Reporters & Contributors Htun Htun Minn, May Soe San, Phyu Thit Lwin, Phyo Aung Myint, Kyaw Min, Aye Myat, David Mayes, Kyaw Myo Htoon, Wai Linn Kyaw, Sherpa Hossainy Art & Design Zarni Min Naing (Circle) Email - zarni.circle@gmail.com Ph - 09 7310 5793 Ko Naing Email - nzlinn.13@gmail.com Ph - 09 730 38114 DTP May Su Hlaing Translators Wai Linn Kyaw, Phyu Maung, Bone Pyae Sone Advertising Seint Seint Aye, Moe Hsann Pann, Htet Wai Yan, Zin Wai Oo Advertising Hotline - 09 420 237 625, 09 4211 567 05, 09 31 450 345 Email - sales.mbtweekly@gmail.com Managing Director Prasert Lekavanichkajorn pkajorn@hotmail.com 09421149720 Publisher U Myo Oo (04622) No. 1A-3, Myintha 11 th Street, South Okkalapa Township, Yangon. Tel: 951-850 0763, Fax: 951-8603288 ext: 007 Shwe Naing Ngan Printing (04193) Printing Subscription & Circulation Aung Khin Sint - aksint2008@gmail.com 09 20 435 59 Nilar Myint - manilarmyint76@gmail.com 09 4210 855 11 Khaing Zaw Hnin - snowkz34@gmail.com 09 4211 30133 Bosiness News in BrieI For ei gn i nvestor s r eluctant to i nvest i n state- owned pr oper ty Foreign investors in Myanmars booming property market have started avoiding making investments in state-owned land because of a requirement to sign BuIId, OperuLe und TrunsIer (BOT) ugreemenLs, IocuI media reported, citing CEO Aung Kyaw Win of United GoIden PuIuce ConsLrucLIon Co. Under LIe BOT ugree- ment, immoveable property can be only leased for long terms, but cannot be sold and foreign investors do not want to take the trouble likely to be faced in extending Ieuse Lerms, Ie udded. Rice huer stock to he sold through competi- ti ve bi ddi ng TIe resL oI LIe qoo,ooo meLrIc Lonnes oI rIce LIuL wus sLored us buer sLock Ior LImes oI dIsusLer wIII be soId through competitive tenders soon, local media report- ed, quoting chairman Aung Than Oo of Myanmar Rice MercIunLs AssocIuLIon us suyIng. He suId some oI LIe stocked rice was sold last July to help control soaring prIces In LIe domesLIc murkeL. Aung TIun Oo dId noL suy Iow mucI rIce wus In sLock. SME to get loons up to K1oo million State-owned Small and Medium Industry Develop- menL Bunk (SMDB) wIII soon oer Iouns umounLIng up Lo K1oo mIIIIon ($1oq,zoo) Lo smuII und medIum enLerprIses (SMEs) uL 8. percenL InLeresL ruLe, IocuI media quoted SMIDB Managing Director Tin Maung HLuy us suyIng. He suId SMDB receIved u K-zo-bIIIIon loan from the state-owned Myanma Economic Bank at 8.z percenL InLeresL Ior SME IendIng. SMDB pIuns Lo oer soIL Iouns Lo SME uL Iower InLeresL ruLes wIen IL gets grants from JICA (Japanese International Coop- eruLIon Agency). Neu income tox policg hurdens most people Rates under the new income tax policy, which comes InLo eecL In Muy, ure reIuLIveIy IIgIer LIun neIgIbour- ing countries and will increase the burden on most tax- payers, local media reported, quoting economists and busInessmen. MyuL TIIn Aung, cIuIrmun oI HIuIngLI- ayar Industrial Estate Supervision Committee, said that LIose wIo eurn Iess LIun K1o,ooo (ubouL $1o.q1) per day should not be required to pay any taxes, but under LIe new poIIcy unyone eurnIng more LIun Kz mIIIIon ($ z,oo) unnuuIIy wIII Iuve Lo puy Income Lux. EconomIsL and legal expert Tin Than Oo said any tax should not be a burden for payers and there should be incentives for them like good utility services, otherwise they would evude Luxes. Thirtg nine unused oirports to he opened ofter upgr ade A LoLuI oI q unused uIrporLs, mosLIy In LIe CIIn und Shan states in northern Myanmar, will be upgraded in cooperation with private companies and put into ser- vice during this year to help cope with the steep rise in domestic air travel, local media reported a senior of- hcIuI Irom LIe DIrecLoruLe oI CIvII AvIuLIon us suyIng. Ruhher grouers suer os glohol prices dioe SmuII scuIe rubber growers ure suerIng Iuge Iosses as a result of plunging rubber prices in the world mar- ket, local media reported, citing secretary general My- InL KIIne oI Myunmur Rubber Growers` AssocIuLIon. AL present, a metric tonne of rubber in the world market Is ubouL $z,ooo, down Irom $z,oo In MurcI. To muke matters worse, Myanmar rubber fetches only about $1,6oo, ubouL $qoo Iess LIun prevuIIIng worId prIces becuuse oI Iow quuIILy, MyInL KIIne suId. L Is very dIm - cult for the manageable scale rubber growers to survive under presenL condILIons, Ie suId. Yongon to designote zo1o os 'Visit Mgonmor Year Yungon wIII desIgnuLe zo16 us VIsIL Myunmur Yeur to attract seven million foreign visitors, local media re- ported citing sources from the Federation of Myanmar TruveI AgencIes. Sources suId LIe exIsLIng vIsu-on-ur- rival system needs further improvement while the e- visa system should be introduced to lure more tourists InLo LIe resource rIcI counLry. Myanmar Summary ~....:.. ~.~ .:..~ . . . , ..:.e _e ..q.~ (SMIDB) ~.,_e ~. .,. ~~~ ~:. ~~..,. ... q:..,._e ~....:.. ~.~.:. ..,..:.. ~....:..__e.._~:. ._~_:.._. SMIDB ~.,_e _.,.:...:..q.~. ~.. ~ .e~:. ~~.. ... q:..,._e qq._.._e.._. ~,q.,._ ~q,., .~q. ~, , .,.~:. ._~:.~ ~.|.:...'e~: ~.q:..:..__e.._~:. _.,.:.., ~ , ._ .:.~. .~ ~ _., :.._ . ~q, ., .:.~:. e. . . ~ . .~ _._ ~ ....~ ~ ~:. , ._ ...q, ~ .q: .. ._ . . _.:..:.q .. ._. . . . .:.~.,_e _., .:. -~ . _. ._....~ ~ _ q .. ._. . . _~q:~ Build, Operateand Transfer (BOT) .:.. .:... . q, . ~. ._ ~. .q. ._..:.~ q .. ._.. . q, .q : q :. .:_~._~: . . q._ .BOT .:.. ~q .q ._.: ..q. ._ .. _ . .:.~:. ..q_:.q...q.__e...:._. .._.:..q:... .q... ...~ .~ ~ . .._ ~ . . , . ~|.~.. ._ ...~ .. .:.~ _..:...:._~: ~.,.....:.~.:..~:. ~,. ...__e.._~:. .q._. ~..|...~q ~.q~. ~. ~...:..~:~ qq..:.._ ._._ ~.,......:q, ..~...:._. .~|.~..~q ~.... ~....,.~ .qq.._... ~..,.....:q.__e.._. May 15-21, 2014 Myanmar Business Today mmbiztoday.com 3 LOCAL BIZ Myanmar Summary Contd. P 10...ation (Part z) Contd. P 10...ation (Part z) The Bonds That Will Tie The Nation (Part II) Kyaw Myo Htoon I nfrastructure project hnuncIng Is enLIreIy dIerenL Irom LIe wuy private businesses raise cupILuI. TIey very mucI depend on large amount oI Iong-Lerm debL or Ioun. Usually debt is composed oI ;o percenL Lo 8o per- cent of total capital re- quirement, and such long-term debt can only be sourced from capital markets both local stock exchange and interna- tional stock markets as bonds. TIe benehLs oI u weII- developed capital mar- ket are immense and these have been well re- seurcIed. An oIL quoLed study by the World Bank has clearly demonstrated that GDP grows faster in economies with more liq- uId cupILuI murkeLs. I- nancial institutions like IMF strongly recommend developing deep and liq- uid local stock and bond murkeL. BuL LIe cIuIIenge is that development of lo- cal Myanmar bond mar- ket may even take longer to become liquid than Myunmur sLock murkeL. If the local capital market absorbs a large amount of government bonds there will be a crowdIng ouL eecL, which means the govern- ment will use all the capi- tal in the Myanmar capi- tal market and less money will go to private business sectors thus hurting their deveIopmenL. There are challenges too for Myanmar government to sell foreign currency bonds via international capital markets since it will be exposed to cur- rency excIunge ruLe rIsk. Nevertheless, under cur- rent circumstances, it is the only viable solution to issue foreign currency bonds to spur the eco- nomic growth in years to come. Bond Is borrowIng against the expenses of the future generations so it must be invested wisely und properIy. Government revenue can be used in various activities and sectors that greatly enhance pro- ducLIvILy oI u counLry. A nations productivity is measured by its GDP (Gross Domestic Produc- LIon) growLI. n muLured economies like Japan and the United States GDP growLI ruLe Is ubouL 1 percent compared with developing countries like Myunmur (6 Lo ; percenL). But such growth will not Luke pIuce uuLomuLIcuIIy. Vietnam and China both depIoyed mussIve hnun- cial resources to develop the countries infrastruc- ture such as power and roud. rom 1qq6 Lo zoo;, Vietnam maintained a higher infrastructure in- vestment rate than its GDP growth and as a result maintained con- sistent average Foreign DIrecL nvesLmenL (D) ruLe oI 8 percenL Lo GDP, while Chinas miracle GDP growth rate (now sIowIng down) In LIe IusL few decades came from Chinese infrastructure in- vesLmenL ruLe oI 1o Lo 1z percent of its GDP annu- uIIy. Case in point, the out oI conLroI Lrum c probIem in Yangon is just simply a result of lack of infra- structure and it is starting Lo uecL boLI empIoyers and employees, and will soon impact productivity in Yangon and the dom- Ino eecL cun creuLe Iur reucIIng consequences. Yangon is heading for Ja- kurLu sLyIe grIdIock Lrum c, one of the most notorious Lrum cs In LIe worId, und it is no wonder because Indonesia only invests be- low 5 percent of GDP in InIrusLrucLures. Yungon city can issue municipal sub-sovereign bonds for roads and transportation after sovereign bonds are Issued by LIe governmenL. Organisations like the Asian Development Bank (ADB) und WorId Bunk recommend at least 5 percent of GDP for infra- sLrucLure InvesLmenL. I Myanmar wants to fol- low Vietnams investment model with current GDP growLI ruLe uL 6 percenL, infrastructure investment rate should go around 7 percent of the GDP which LrunsIuLes Lo $q bIIIIon In zo1 und up Lo $; bIIIIon In zozz (Myunmur GDP wIII runge Irom $q8 bII- IIon Lo over $1oo bIIIIon In zozz). So, LIe LoLuI re- quirement of infrastruc- ture investment for the nexL 1o yeurs Ior Myun- mur wIII be $; bIIIIon. McKinsey Global In- stitute analysis suggests that an increase in in- frastructure investment equIvuIenL Lo 1 percenL oI GDP could translate into un uddILIonuI .q mIIIIon direct and indirect jobs In ndIu, 1. mIIIIon In LIe UnILed SLuLes, 1. mIIIIon In BruzII, und ;oo,ooo In ndonesIu. n Myunmur, Infrastructure invest- ment implies both busi- ness infrastructure like road, power and social infrastructure and also educational and health- cure InsLILuLIons. n or- der to attract FDI, it will take development of both business and social infra- sLrucLure componenLs. There are ongoing infra- structure activities in My- unmur Loo. TIe Jupun n- ternational Cooperation Agency (JCA) Ius been preparing a master infra- structure plan for Myan- mar as well as a Yangon Urban Development plan, while ADB and World Bank have been working hand in hand for infra- structure development areas such as power and LrunsporLuLIon. Even funding all those infrastructures with bonds, ODA and loans, theres shortfall in coun- tries like India, Vietnam und ndonesIu. TIey ure increasingly seeking in- vestment from their pri- vuLe secLor Lo hII In LIe hnuncIng gup. n order Lo attract private investment in infrastructure projects, sound and transparent PPP legal framework pIuy u mujor roIe. RecenL Myanmar governments eorL Lo ruIse eIecLrIcILy LurI wus u rIgIL move Lo attract private investment into the sector although how it will manage this sensitive issue is debat- ubIe. DespILe uII LIese eI- forts, funding those infra- structures will remain a major challenge for years to come for Myanmar as well as other emerging economIes. EInsLeIn once said, Insanity is doing the same things and ex- pecLIng dIerenL resuILs. Simply put: bold results requIre boId ucLIons. Infrastructure invest- ment is politically, eco- nomically and socially important and most of Myanmars challenges today are basically infra- sLrucLure cIuIIenges. ELI- nIc conIcLs uIso creuLe transportation and com- munication gap that cre- ates wider divide devel- opment among cities and provinces, and the ethnic groups. MosL peopIe In remote provinces never have been to major cities and lack exposure, breed- ing conservative minds to create racial and religious conIcLs In LIe counLry. Moreover, development and investment of infra- structure in ethnic areas and provinces is the only way to strengthen the IrugIIe peuce process. Therefore, infrastruc- ture investment will play critical role in Myanmar long-term economic de- velopment but having a plan is just the begin- nIng oI LIe journey. TIe pIun ILseII wIII noL Luke o without a capable man- ugemenL Leum. AL LIe end of the day, it is the peo- pIe LIuL muLLer LIe mosL. But having a competent team in place is only half the journey their way of management practices need to comply with the accepted code of conduct besides being transpar- enL. Last but not least, hav- ing all the above three in- gredients in place will not suddenly earn trust from LIe pubIIc. TIe govern-
The out of control traffic problem
in Yangon is simply a result of lack of infrastructure and it is starting to affect both employers and em- ployees, and will soon impact productiv- ity in Yangon and the domino effect can create far reaching consequences. The increasingIy worsening trafc in Myanmar`s commerciaI capitaI Yangon exempIies the urgent need of investment in the country`s in- frastructure. The totaI requirement of infrastructure investment for the next 1U years for Myanmar couId be around $57 biIIion. O liv e r
S lo w ~._.. ~..:~ ~~ . q:. .~,..:.~q..._..._...: . . ~. .. :..q...,..:.~ .q._.~_... .~ ... , .~ ._ . . q _ .. .. .:.~..'~ . :.. :. . .,q ._ .. . , ~:._e .... .:.._ . . ..| .. q .- ~ q:..,.. ~ q:..,.~ .~..,_.. ~. .|. . q _ .. .. . :.. : _ ._ ~ ...~: .q: ... . ~_ ._ _ ._ . q:..~: .. . ~ ~ . .:.. .:..._ . q . ...~ ~ .:.. qq . ._ . e_e._...q....~~.:.~ .,_e . .~.,.:....:. : ....:_.._~._~..:~ ~~ ..~.~ ..:.._ .qq ._ _e.._. ~.:~- ...:.~q GDP ~.~~._.,., ._.. . :..q... .~ ~ . :.~ . . . .:._ . q ....~ ~ .:. q ._~: . .q.._. IMF ~...:.._~.~e ~._..:.~.,_e . .:. : e _e . . .:...:q~q,. _._~. ..~: . .:. . .. .~ ~ . :. ..:..q, ~_~_.:.._. ...: _.,.:.- .~q _._ ~ ..:.. ...~ ~ ._ _.,.: ..~: ...~ ~ ~ . . . :q, ~. , e q._ .,..'..:. _~.~.,q._. ~~e _ _._ ~ ....~ ~ .:.~.,_e~..q.:.. .:. ~:._~..:..:~ee_~.|~ ~ ..q~.,_e .q..:.~:.. . ~:. _ ., .:. q . .. . ~ ~ May 15-21, 2014 Myanmar Business Today mmbiztoday.com LOCAL BIZ 4 Myanmar Summary Myanmar Summary Semen Indonesia to Buy $30-m Stake in Myanmar Cement Maker I ndonesias largest cement producer PT Semen Indo- nesia Tbk has agreed to buy a minority stake in a Myanmar- bused cemenL muker LIIs yeur. At the moment we can only enter with minority control, so we wIII sLurL wILI u o percenL ownership, President Director Dwi Soetjipto told reporters last week in Jakarta, Indonesia me- dIu reporLed. He said the stake is worth ubouL $o mIIIIon. He declined to name the My- anmar company involved in the deal, but said it has an annual producLIon cupucILy oI up Lo 1. mIIIIon meLrIc Lonnes. We will gradually increase our control there in the future, but we need an entry point now, SoeLjIpLo suId. Semen Indonesia, formerly known as Semen Gresik, op- erates four units throughout ndonesIu. TIe compuny un- nounced last year that it plans Phyo Aung Myint Lo spend up Lo $zoo mIIIIon on un ucquIsILIon In Myunmur. This investment follows the companys venture into Viet- num In zo1z, LIrougI LIe ucquI- sILIon oI TIung ong CemenL. For Indonesia, it is targeting qo.8 mIIIIon Lonne unnuuI cu- pucILy by zo1; Irom 1.8 mII- lion estimated by the end of this yeur. Indonesias state-owned en- terprises, including Semen Indonesia and Bank Mandiri among others, have been urged by the government to expand LIeIr presence In LIe regIon. The cement producer has ob- LuIned Rp1.q LrIIIIon ($16q mII- IIon) In bunk Iouns Lo hnunce the construction of a new plant In WesL SumuLru. TIe ;-yeur-oId hrm soId 6.z million tonnes of cement in the hrsL quurLer oI LIIs yeur, up . percenL compured Lo .q mIIIIon tonnes sold during the same period last year, according to a compuny sLuLemenL. Semen Indonesias net in- come rose . percenL Lo Rp1. LrIIIIon ($11 mIIIIon) In LIe hrsL quurLer oI LIIs yeur, wIIIe revenue Increused 11.q percenL Lo Rp6.z LrIIIIon ($q mIIIIon). Ooredoo Tests First OH Network Culls O oredoo Myanmar said it has successfully tested LIe hrsL mobIIe cuIIs Lo and from its network and that of the other new mobile op- erator, terming the event an important milestone in the rollout of telecommunications InIrusLrucLure ucross Myunmur. In our industry it is impor- tant that operators do collabo- rate to enable total connectiv- ity and choice for customers, Ooredoo CEO Ross Cormack said, highlighting the impor- tance of good working relation- sIIps beLween operuLors. The Qatar-based company and Norways Telenor last year won the bid for the two telecom- munIcuLIons IIcences oered Lo IoreIgn hrms by LIe Myunmur government, which seeks to cede its ironclad control over the countrys telecommunica- LIons secLor. Punishing SIM card prices and state monopoly have left Myanmars telecoms infra- structure in shambles and only managed a dismal mobile pen- eLruLIon ruLe oI 1 percenL oI LIe popuIuLIon. We hope to be able to pro- gress our work in connecting to the existing MPT network in the neur IuLure, Cormuck suId. The company said in order for the people of Myanmar to enjoy LIe benehLs oI IeuILIy compe- LILIon IL Is vILuI LIuL dIerenL networks are able to intercon- necL wILI eucI oLIer. Ooredoo is currently rolling out a voice- and data-enabled G neLwork, IoIIowIng LIe om- Htun Htun Minn cial awarding of the licences in ebruury. TIe hrm suId IL wIII hnIsI roIIIng ouL ILs neLwork across the country within six monLIs sInce LIe omcIuI uwurd- Ing. This interconnection mile- stone brings together Ooredoos next generation technology with that of the current genera- tion technology being deployed by the other new operator, the hrm, wIIcI currenLIy empIoys over ;oo IocuI sLu, suId. A worker Ioads a sack of cement onto a boat for shipping to Indonesia`s Bangka IsIand, at the Sunda KeIapa harbour in ]akarta. Ooredoo ._ , .-. ~ e~ .~ .e.q.~.~~..-..~,q~ . ~_.,~.,.~.~..._~:. . q._ .e .~ . .q .~ . . _. .._ ~.:~.. .~.e.q..,. ~_ ..:~q:~ ~.~~..: ~.q. ~.._e.._~:. Ooredoo Myanmar -~. ..: ~q:q .. Ross Cormack ~ ._.:.._. .~ . ~ _., q:~ . ..~ . e .q.~.~.:.~_~:. .~:..,..: .~..q.q_..._ ~.q.~_~... ~.~ _e. ._~: ., .~.~ ._.:._ . Ooredoo q ..,..~~ ~.:. _._ . .q ..e . e ~~ ~ . .~ . ~ ~.... ....|...:q~e ~q.. ~.q._~..|~e .. . ._~:. ~. , ~~ . .:._. _.,.:.~.e.q...,.q ~,q~.~, ...~.~..e. ..: . .|~e ''e Ooredoo~. ..: ~q:q..~ ._.:_~:..._. Ooredoo Myanmar ._ .:._ . .:.~ , .~ -~, ..: . .:.~ .~ . ~ .~ . q, _. . .~ q _. . .~ q ~. ,~ _.,.:..:.~,....|. ~~ .~: ~ .,~.:._.._e.._~: . .q._. ~ . , .q :.-~_~ .. . .. ._. ~ ... PT Semen Indonesia Tbk ~.,_e _., .:. ~._.. ~ .. ._. ~ . . , .-q e e:~,_ .. ~:. e. ..~~. ~eeq, ..:~_. ._~:. .q._. ~..|~.~._ _.,.:~._..~ ~.~- qee: ,~ q:..,.~:. ~e e ._ _e. _. . ~..q ~, ..'.:., . ,~ ~,e.q._~:. ~.~~_ Dwi Soetjipto . ~.,.q:.. ~:~: ~ e.~.~~ ~.e:._.:_~:. .._. e. Semen Gresik e ._~._ Semen Indonesia ~.,_e ~ . , .q :. . ~. ~ ..~ e ,. .... _e . . ~ .~ q ._ .~ . ~ ~.,_e e. . . ~ _., .:. ~ ~..q ~, ..'.: ., . ~~q .. ._. . . . :..__e. ._~: .._~_: .._. v a n k h a n h c o . c o m May 15-21, 2014 Myanmar Business Today mmbiztoday.com LOCAL BIZ 5 Myanmar Summary Corroption The Biggest Concern Ior Myunmur Bosinesses: Sorvey C orruption is the top con- cern for businesses in Myanmar, which is un- dergoing liberal reforms after the end of military rule, accord- ing to a UN-led survey released IusL week. Five decades of military rule left Myanmar mired in poverty and plagued by corruption, but a quasi-civilian government LIuL Look power In zo11 Ius enacted sweeping political and Jared Ferrie economic reforms aimed at at- tracting foreign investment and cIeunIng up LIe economy. However, the survey suggests the reforms have thus far had only a limited impact on cor- rupLIon. AbouL zo percenL oI LIe more LIun ,ooo hrms quesLIoned IdenLIhed corrupLIon us u very severe obstacle to their opera- tions, according to the survey from the United Nations, the Organisation for Economic Co- operation and Development and the Union of Myanmar Federa- tion of Chambers of Commerce und ndusLry (UMCC). Access to skilled labour and LecInoIogy were IdenLIhed us the second and third biggest obsLucIes. SIxLy percenL oI LIe hrms surveyed said they had to pay bribes for registration, licences or permILs. AbouL IuII LIe hrms suId LIey puId $oo In exLru fees while about a dozen said exLru Iees exceeded $1o,ooo. For the bulk of Myanmar businesses, the business envi- ronment has not changed, said Kim Ninh, country representa- tive of the Washington-based Asia Foundation, speaking at LIe survey`s IuuncI. She said she was surprised by LIe hndIng LIuL LIe uveruge compuny wus 1 yeurs oId und few new ones had emerged dur- Ing LIe reIorm perIod. Curiously, not many in recent years and the increase hasnt been as strong as youd think with the opening of Myanmar, KIm NInI suId. Myanmars parliament passed anti-corruption laws last year and appointed an anti-graft commIssIon In ebruury. Win Aung, president of the UMFCCI, said he was optimistic ubouL LIe governmenL`s eorLs Lo hgIL corrupLIon buL LIuL suc- cess would depend on whether the authorities really acted on LIe new IegIsIuLIon. There should be action against those who breach the law, he said in an interview on LIe sIdeIInes oI LIe evenL. OnIy in that way can the elimination oI corrupLIon be eecLIve. Despite Myanmars ongo- ing reforms, the World Bank runked IL 18z ouL oI 18q coun- tries in its annual report on the business environment last Oc- Lober. TIe counLry`s Iow score was due to corruption, Charles Schneider, a World Bank econ- omist based in Yangon, said at the time, though he added the country was improving trans- purency. Reuters About 2U percent of the more than 3,UUU rms questioned identied corruption as a very severe obstacIe to their operations in Myanmar, according to a survey from the United Nations, the Urganisation for Economic Co-operation and BeveIopment and the Union of Myanmar Federation of Chambers of Commerce and Industry (UMFCCI). R e u t e r s New Tax Rate Comes into Force This FY M yanmars new income tax and commercial tax Iuw Ius come InLo Iorce In LIe currenL hscuI yeur oI zo1q-1. Under LIe new Iuw, peopIe wIo eurn Irom Kz mIIIIon Lo K mIIIIon ($z,o8 Lo ,zo8) u yeur wIII Iuve Lo puy 5 percent income tax; those earning from above K5 mil- IIon up Lo K1o mIIIIon Iuve Lo puy 1o percenL; Ior eurn- ers Irom ubove K1o mIIIIon up Lo Kzo mIIIIon LIe ruLe Is zo percenL und LIose wIo eurn ubove Ko mIIIIon wIII Iuve Lo puy z percenL, LIe nLernuI Revenue DepurL- menL suId. n LIe new Iuw, Lux reducLIon Is oered Ior murrIed coupIes und Ior LIose wIo Iuve cIIIdren. CommercIuI Lux wIII be coIIecLed sLurLIng Irom K1 mIIIIon und Lux exempLIon Is oered Ior 6o ILems oI goods, the department said, warning that those who fail Lo puy Luxes wIII be hned under LIe commercIuI Lux Iuw. AccordIng Lo LIe depurLmenL, u LoLuI oI K.8z LrIIIIon ($.; bIIIIon) In revenue wus coIIecLed durIng zo1-1q. Myanmars parliament approved the two tax-related bIIIs In MurcI. Kyaw Min Myanmar Summary _.,.:.~ ...:..q...,..:. ~~~ .:.:..._ ..~....q. ~_. . . . ~.q. _._. ._.: .. .q.. . , . .:.. . ..: .,. ~~ .~. ~_..,: _e..:.,._~:. UN ...:._ .. ~. .-. , . ._ ~.~ ~ ~ _., . ..:~.~ ~.~ .:.~q . q._ . .. ~ . .. .q.~ .e . . . |.. , ..|. ~.q:~ . ._ _., .:. -.:.:. . .:.._~: ~ ._._ . : . .q . . ..|._. . .~ . .,q._ .. ..: ~q. .:.~. .q ~_e. ~~~ . . . ~ ~:~:qe._ ~.,..~~: ...:..q.. ..q. _._.._.:....:. ....:.~q _.. ._.:.q..._.....:.. ., q . ._ . .. :..q.~. ~ ~~, ._e. .:q, ....:.,._. ...: ...:.~.:.~q ~..| _._. ._.:.. . .:.._ .: .:.. ~..' ~,_ .e .: .q:~ . q ._ . _., .:. -~ . . , . ~ , . e . , .:.~.,_e e. ~~,~ _: .q...~ .~~.~~_._e.._. e. ...~.. ~q ~. . . . ~ . .,.~ . .,.~ ~..q ~,..'.: ~, . ~,qq ._ . .:..:. ~.,_e ~.., q:..,. ... ..:q, .~..__e._.. .,. ~ . .,. ~~~ qq..:.~.,_e ~.... ~~ q:. . , . .....: q._ _e. ._. _. ~. .,. ~~~ . ~~ ~_~:.qq..:.~.,_e ~ q: ..,. .....:q.__e._.. .,. ,~~ ~~ qq..:.~.,_e q:. . , ......: q._ _e. ._~: . _._ ~ . ~.,.:...._:,. ~_.,:.._. May 15-21, 2014 Myanmar Business Today mmbiztoday.com LOCAL BIZ 6 Myanmar Summary Myanmar Summary Contd. P 18...(ALB) Zhulian Corp Sees Myanmar Entry by Q3 M alaysia-based Zhulian Corp Bhd, an invest- ment holding compa- ny, will enter Myanmar market by the third quarter of this year as part of the groups overseas murkeL expunsIon. Group managing director Teoh Meng Keat said Myan- mar is touted as the new fron- tier market amongst emerging countries in terms of the con- sumer segment and has ap- pointed a local master agent to oversee LIe busIness LIere. He said due to local laws lim- iting company ownership, the group will export its products directly to the master agent, wIo wIII LIen seII IL Lo IocuIs. We will continue to expand our overseas market to over- come escalating raw material prices, increasing operating cosLs, sLI murkeL compeLILIon und reduced consumer conh- dence in spending, he told re- porters after the groups annual general meeting, Malaysian news ugencIes reporLed. He said the group also plans to channel investments towards increasing the production ca- pacity in line with the objective of growing the business by ex- tending the scale and capability of its food and beverages manu- IucLurIng dIvIsIon. The group sales ratio is mostly exports at 57 percent to Thai- Iund, 8 percenL IocuI, Iour per- cent to Indonesia and one per- Phyu Thit Lwin cenL Lo SIngupore. However, Teoh said the group Iud uIIocuLed RM mIIIIon ($1o.86 mIIIIon) us cupILuI ex- pendILure (cupex) Ior LIe nexL 1z monLIs. From dealing with only a small range of gold plated jewellery, ZIuIIun Loduy Ius dIversIhed ILs product lines into home care, food and beverages, nutritional supplements, personal care, cosmetics, air and water treat- ment, sleep enhancement and dIsposubIe IygIene producLs. Currently, Zhulian has about 6q,;oq dIsLrIbuLors und z6 agents in Malaysia, Thailand, ndonesIu und SIngupore. Iorope Provides Sopc oI LIFT Fund in Myanmar T he EU and six of its mem- ber states are the founder and largest donor of the Livelihood and Food Security TrusL und (T), uccounLIng Ior 8o percenL oI LIe IundIng granted to Myanmar, the Euro- pean Union Delegation to My- unmur suId. n zooq, LIe EU LogeLIer wILI other donors launched the mul- ti-donor Livelihoods and Food SecurILy TrusL und (T) Lo tackle the issue of poverty and hunger directly in Myanmars ruruI communILIes. AL presenL, more LIun 1o donors ure con- LrIbuLIng Lo T. n Myunmur, un esLImuLed z6 percent of the population live in poverty and 5 percent live in extreme hardship, with little or no income to spend on essential food, according to the Integrat- ed Household Living Conditions Survey In Myunmur zooq-zo1o. Poverty and the lack of means to buy or access basic food re- quirements have been and re- main a persistent problem in Myanmar, particularly in rural ureus. In line with Millennium De- veIopmenL GouI 1 - Lo erudIcuLe extreme poverty and hunger LIFTs work focuses on improv- ing food and livelihood secu- rity in areas around the country where poverty is of particular concern. Through LIFT we have been able to target two million of Myunmur`s ruruI poor. We ure proud to contribute to more May Soe San LIun qo percenL oI LIe und us EU and to have played a lead- ing role in the creation of LIFT, said Roland Kobia, the Euro- pean Unions Ambassador to Myunmur. Together with EU member states, the European contribu- tion to LIFT, notably of the UK, represenLs 8o percenL oI LIe IundIng. LIFT supports a wide range of activities and projects imple- mented by local and interna- tional NGOs and agencies such as increasing productivity and yields, improving local seed va- rieties, diversifying production, ensuring a more diverse and nutritive diet, promoting inclu- sive value chains, easing access to markets, strengthening farm- ers organisations, or ensuring mIcro-hnunce reucIes LIe ruruI poor. The focus of the fund is to as- sist smallholder farmers to de- termine their own way out of poverty, and support them to become active players in the so- cial and economic development of the country, the delegation suId. LIFT has developed an iden- LILy oI ILs own. L Is u successIuI experience of donors working together to achieve the same goal: reducing rural poverty and malnutrition in Myanmar, said KobIu. The EU ambassador said: Improving living conditions in rural areas is one of the top priorities of the government, as reecLed In LIe rumework Ior Social and Economic Reforms and in the Strategic Framework Ior RuruI DeveIopmenL. T Is now adapting its strategy to mir- ror the priorities of the govern- menL Lo reduce ruruI poverLy. ....q:. ~._..~ Zhulian Corp Bhd ~.,_e _._ ....~ ~ . . ._ ~.,_e _., .:. ...~ ~ . e. . . ~~ e. ...~ ~ ~ .q:~ .__e.._~:. ._~_:.._. ~. .|. . , .- ...: , _~:..q. . . Teoh Meng Keat . _.,.:. ._ .~ q e _e .....~ ~ .:.~ ~. .: ....: ...~~_e.._~:.. _.,.: .~ ...:..q...,..:. ..~ .q, ~e.:..e.,~.:.._~:. ._.:_~:..._. , .. _., .:. -...._ ~ . ~ . . . ~:. ~, .~ :...:._~: , .~ ~.,_e _., .:. . ~ , .. _ . .:. ~.~: _._~.~e.:..e. _e,_e..:..__e.._~:. ._.:_~:.. ._. IiveIihood and Food Security Trust Fund (IIFT), founded by the EU and six of its member states, supports a wide range of projects impIemented by IocaI and internationaI NCUs and agencies. F a h m id
B h u iy a / P G M F .q:.... ~e~..:.._ the Livelihood and Food Security Trust Fund (LIFT) - ~_.:. .:._e._.. ~ q:..,...: q,.. ~:. _.,.:.....~..:..__e. ._~:. _.,.:..q: .q:. ..~e.:..e. ._.:_~:..._. ~~ . . . ~ .q:... ~.,_e ~_ .:. . .| , . . .:. . ~~ ~~ Livelihoods and Food Security Trust Fund (LIFT) ~:. _.,.:.- .~.. ....:.q . .q . . ..|.. . ~.: .q.:_.~ .. . ~:. .:~ . .... q, ~_.:._.._e.._. .~q~ ~.q.e..~:. LIFT ~:. _~.~_.~q._. _.,.:.~ ...q- .,.,.._. ' q:. . , .._ . .q . . ..|.. :., .,q_. . |.q:. . , .. : .~ . . : q ., .,q~: .:...:~.,.q.~~~ ~ . . ..:~ . :.q ._~: . Integrated Household Living Conditions Survey in Myanmar 2009-2010 ~q .q ._. ..q....|... ~._..~.:.~.: .~..~.:. ~eeq, .~..._ _., .:. -.~.. ....:.~ ~.~ ~.~..~_e. q.,...._..q:. .. ~e ~ . .:.. ~~ .q:.. .:.~._. LIFT . _~~_. .:. _..._~_.. _-~,.. q,..- ~ q:..,.~:. _~...:._.. _e.._. ADB, Japan to Assist Myanmar Improve Water and Sanitation Works A bouL 18,ooo peopIe In Yangon and Mandalay will soon have access to safe, regular water supply and improved sanitation facilities wILI LIe sIgnIng oI u $q mII- lion grant funded by the Japan Fund for Poverty Reduction and administered by the Asian De- veIopmenL Bunk (ADB), LIe Mu- nIIu-bused Iender suId IusL week. The four-year community in- frastructure and basic services project is expected to reduce the prevalence of infectious diseas- es, improve the system of solid and liquid wastes disposal, and reduce oodIng und wuLerIog- ging in two of Myanmars most popuIuLed cILIes, ADB suId. Community participation will Wai Linn Kyaw be instrumental in the delivery, operation and maintenance of these infrastructure subpro- jects said Linda Adams, social development specialist at ADBs SouLIeusL AsIu DepurLmenL. ADB said the project will in- troduce a self-perpetuating community operation and maintenance fund, with com- munity development commit- tees responsible for the collec- tion of fees and administration oI LIe InIrusLrucLure. The grant will also include im- proving drainage of storm and ood wuLer, und enIuncIng uc- cess Lo rouds und IooLpuLIs. Improving living conditions in Myanmars major cities by enhancing sanitation and clean May 15-21, 2014 Myanmar Business Today mmbiztoday.com 7 LOCAL BIZ Myanmar Summary Myanmar Summary Allen & Overy Steps into Myunmur with Sixth ASIAN Om ce U K-based Allen & Overy (A&O) suId IL Ius opened ILs sIxLI om ce In LIe ASEAN region in Yangon, be- coming the latest in the line of InLernuLIonuI Iuw hrms LIuL ure swarming into Myanmar to tap LIe IusL economIc IronLIer. TIe new om ce wIII be mun- aged by Simon Makinson, Allen & Overy ASEAN group chair- mun, wIo Ius Ied LIe hrm`s push into Myanmar when sanc- LIons begun Lo IIIL Lwo yeurs ugo. Through this investment, we believe we can not only play a role in helping Myanmar with its legal framework, we can also help clients across our global network better understand the mechanics and nuances of what has been, up until recently, an unknown quantity from an in- ternational investment point of vIew, MukInson suId. He suId Irom wIen LIe hrm began work in the market two years ago weve been extremely busy with a multi-faceted ap- proucI Lo LIe murkeL. Last year, A&O, which is one of the so-called magic circle hrms, IeIped ILs Iong-sLundIng Norwegian client Telenor to win one of two telecoms licences granted to foreign companies allowing it to provide telecom- munications services in Myan- mur. Our work Ior LIIs cIIenL continues with network deploy- menL, MukInson suId. On the client side we are ad- vising across all active sectors with the big ticket deal to date beIng our work Ior TeIenor. Besides telecoms, we have also been active in banking and hnunce, energy IncIudIng oII and gas, infrastructure, manu- IucLurIng und consumer goods. US OFAC and EU sanctions advice also feature prominently Htun Htun Minn ucross uII secLors In LIe hrm`s porLIoIIo oI experIence, Ie suId. While risk is still a key factor for corporations looking to in- vest in Myanmar, the business and legal framework for oppor- tunity is improving day-by-day, MukInson udded. In terms of industry devel- opment, we have been active in the power sector, working with developers and multilater- als, including assisting with the development of a standardised power purchase agreement for uII eIecLrIcILy suIes. TIe hrm Is uIso u member oI the UK-Myanmar Financial Ser- vices Task Force reviewing My- unmur`s bunkIng reguIuLIons. There are two other senior law- yers and three business services sLu on LIe ground, us weII us u team of sector specialists made up of partners and lawyers from LIe hrm`s Bungkok und SIngu- pore om ces, A&O suId. Having people on the ground, alongside the contacts and goodwill we have established over the past two years, has been critical in enabling us to udvunce, MukInson suId. This latest opening takes the hrm`s om ce counL Lo 1z In AsIu- PucIhc, uugmenLIng ILs exIsLIng ASEAN oerIng wIIcI IncIudes om ces In SIngupore, Bungkok, Ho Chi Minh City, Hanoi and JukurLu. On LIe pro bono sIde, LIe hrm has rolled out educational pro- grammes for government and regulatory agencies, members of the local legal profession and law students to help build Myan- mars foreign investment know- Iow. TIIs Ius been deveIoped In partnership with the Myanmar ALLorney-GeneruI`s Om ce und LIe UnIversILy oI OxIord. EsLubIIsIed In 1qo, A&O op- eruLes q om ces In o counLrIes wILI upproxImuLeIy z,8z1 Iuw- yers und ,o;; empIoyees, und revenue oI ubouL 1.1q bIIIIon ($z.o1 bIIIIon). _-~,~._..~ Allen & Overy (A&O). ,.- ._.._.:~,..,.~:. q, ~ , ~ e . . ._ _e. ._~: .._~_: . ._ .~. .|,.., .~:. . , . ._ . . . . .~ : ~_., .:. ~:. . .. :..q.. ~ . . .:.,~ . .....q, _~... .. ._ Allen & Overy ASEAN group - ~__e.. Simon Makinson ~ _~._~..__e. ._~:.._. .q._. , .. Allen & Overy (A&O) ~., _e _.,.:.~ .,.._ .... ~~_.~.~ . . ~ . _. ._e. _. . .~ q ~ ...~ ~ . q:. . , ..:._e ~. . ,..~q._~:. .q._. US OFAC . EU ~ - _., .:. ~..' . .. :..q.. ~ . :.. .:.._e..: ._..._ Allen & Overy (A&O) -.~: _. ._ . ~ ~ ~. . _e. ._~: . ~ ._. ~. .|~ . ~ ~ _. ._.:_~:. . ._ . Thailand Seeks Business Development with Myanmar Through Fairs T hailand is aiming to de- velop a stronger business relationship with My- anmar by organising business matchmaking fairs, a top Thai om cIuI suId. Myanmar and Thailand are neighbouring countries and uIso cIose busIness purLners. To tighten the business relationship between two countries, we need more collaboration and coopera- tion in business, said Boon Inti- ruLunu, counseIor (commercIuI), Om ce oI CommercIuI AuIrs, RoyuI TIuI Embussy. One such fair, Thailand Week BIzmuLcI uIr zo1q, wus IeId Irom Muy q- uL TuLmuduw HuII In Yungon. Entrepreneurs from Thailand seek small and medium entre- preneur purLners In Myunmur. So, we introduced Myanmar entrepreneurs with Thailands high quality businesses and producLs, nLIruLunu suId. There were also business con- claves at the Bizmatch Fair and Thai cuisine cooking sessions Ior LIe pubIIc. HoIdIng sucI IuIrs be beneh- cial to improve the partnership beLween LIe Lwo counLrIes. As Myanmar is a long-term busi- ness partner of Thailand, it makes sense to do more busi- ness collaboration with Myan- mar, a Thai entrepreneur com- menLed. Pann Nu .. ~.,_e _., .:. . . .. :. .q..q:.~..q.~:. ..._... q,~~~ ... :..q...:.~...,_.. _e. ._~: . .~_~ .~, .~q:q ~. . . ._.:_~:.._. ,.~~,~. Thailand Week Bizmatch Fair 2014 ~:. ... , q~. q~~ q,~,_. ~...~: .,..~ ~...._. v a n k h a n h c o . c o m May 15-21, 2014 Myanmar Business Today mmbiztoday.com LOCAL BIZ 8 Myanmar Summary Ioreign Lenders Prepure Ior Myunmur Intry Timothy Sifert F oreign lenders are expect- ed to receive requests for proposals on new bank- ing licences from the Central Bank of Myanmar as early as this month, the Southeast Asian nations latest step towards a more open und compeLILIve h- nuncIuI murkeL. New banking licences, expect- ed as early as this year, will al- Iow IoreIgn hrms Lo expund be- yond LIe represenLuLIve omces muny now operuLe. Myunmur has been opening up its mar- kets to foreign companies since the US and European Union started lifting economic sanc- LIons In LIe pusL Iew yeurs. The country granted telecom licences to Norways Telenor and Qatars Ooredoo earlier this yeur. SeveruI IoreIgn brunds, such as Coca-Cola, General Electric, Unilever and Visa, have been introduced, or rein- Lroduced, oI IuLe Lo consumers. At the same time, the Tokyo Stock Exchange and Daiwa Secu- rities Group are advising the cen- tral bank on the establishment of the Yangon Stock Exchange, ex- pecLed Lo open nexL yeur. The lenders likely to get the hrsL IIcences ure LIose wILI represenLuLIve omces In LIe counLry. Among LIem ure DBS, United Overseas Bank, OCBC, CMB und SLundurd CIurLered. However, oLIer hrms - noL onIy SE Asias regional players are expected to seek to licences, as weII. With companies like Coke and Unilever doing business here, its very encouraging, said a source at a foreign bank wILI u Myunmur rep omce. We are waiting just for RFPs (Re- quesL Ior ProposuIs). Happy r etur ns Coke, IIke oLIer IoreIgn hrms, is returning to the country and pIuns Lo InvesL sIgnIhcunLIy us Myanmars economy is expect- ed, with the help of FDI, to grow ;.8 percenL In eucI oI LIe nexL hve yeurs, uccordIng Lo LIe M. Coke opened a new bottling plant near Yangon in the mid- dIe oI IusL yeur, LIe hrsL LIme In more LIun 6o yeurs LIuL LIe brund Is produced In Myunmur. Coke suId IL wouId InvesL $zoo mIIIIon over hve yeurs, some- thing permitted under the new foreign investment law, signed In November zo1z. At the outset, new bank licen- sees will likely be limited in the types of business they can pur- sue, owing to regulations, as well as the fact that the banking and capital markets in Myan- mur ure so underdeveIoped. Nonetheless, lenders see promise in the country, not least because it is located between India and China, the two most popuIous counLrIes. Myunmur posLed u GDP oI $6.q bIIIIon IusL yeur, uccordIng Lo LIe M. TIe hgure Is seL Lo doubIe In LIe nexL sIx yeurs or so. oreIgn hrms, sucI us DBS, are naturally interested in a growIng SE AsIun murkeL. As Myanmar moves to devel- op ILs hnuncIuI secLor, DBS weI- comes the opening up of Myan- mar to foreign banks, and we would be keen to tap on bank- ing opportunities there, a DBS spokesperson suId. Another Singapore lender has sImIIur pIuns Ior LIe counLry. OCBC sees potential in Myan- mar, said a spokeswoman at LIe bunk. As und wIen LIe reg- ulations allow for banks to have more sIgnIhcunL InvesLmenLs In the country, we will be keen to explore deepening our presence LIere. TIe rougIIy IoreIgn bunks wILI rep omces In Myunmur do noL conducL busIness IocuIIy. nsLeud, omce Ieuds enguge In IucL hndIng und consuILIng wILI uuLIorILIes. A lot of what we do now is education, the source at the rep omce suId. We IeIp Lo provIde knowIedge Lo LIe cenLruI bunk. I we want to be in this market, why noL uIso Lry Lo IeIp sIupe IL. 1M1 help The central bank has been willing to seek outside advice Irom LIe rep omces, us weII us gIobuI InsLILuLIons IIke LIe M. A March report from the IMF said that authorities in the coun- try are moving rapidly to issue IIcences Lo IoreIgn bunks. TIe introduction of licensed foreign hrms wouId ucceIeruLe InLegru- LIon wILI InLernuLIonuI hnuncIuI murkeLs, LIe M suId. However, the authors of the report said that the central bank should limit the number of new hrms Irom LIree Lo hve uL hrsL, because supervising more lend- ers than that would pose an un- necessury InILIuI burden. Once supervisory capacity has improved, further licences cun be uwurded, IL suId. Myanmar Committed to Sustainable und Green Growth: Minister It is unclear how many licenc- es the central bank will ulti- muLeIy grunL. YeL, despILe uII LIe uncertainties related to Myan- mars nascent markets, foreign banks have kept on opening rep omces. SeveruI ndIun und Ko- rean banks, including Shinhan Bank, Industrial Bank of Korea and Kookmin Bank, landed in LIe counLry IusL yeur. Such an on-the-ground pres- ence wIII IIkeIy gIve u hrm some advantage in working on Myan- mur-reIuLed InLernuLIonuI hnunc- ing opportunities, even if their IocuI operuLIons ure nomInuI. Wai Linn Kyaw M yanmar is fully com- mitted to green growth as it navigates a transi- tion to a more open country, a mInIsLer suId. U Win Tun, union minister for environmental conservation and forestry, said at the Forests Asia Summit in Jakarta that the gov- ernment is fully committed to climate change mitigation and sustainable forest management as it seeks to transform itself po- litically, economically and social- Iy uILer yeurs oI IsoIuLIon. Observers are keen to see whether Myanmar can main- tain the growth in its newly lib- eralised economy without dam- aging its forested landscapes a path that many of its more- developed neighbours have tak- en In recenL decudes. The minister also discussed development of production for- ests with the Indonesian Forestry MInIsLer ZuIkII Husun. Myanmar wants to learn about the land concession system and ways to transform forest areas into a production forest from In- donesIu, ZuIkII LoId ndonesIun medIu. The Indonesian minister was expected to accompany U Win Tun to view the forest business that was started by state-owned IoresLry compuny PT PerIuLunI. ZuIkII suId Myunmur Is InLer- ested in the management of for- ests in Indonesia because it has similar forest conditions as Indo- nesIu. CurrenLIy, ndonesIu Ius oo wood processIng compunIes oI wIIcI zo percenL ure munuged by LIe IocuI communILy. U Win Tun said Myanmar is in- terested in studying the way In- donesia manages its forest areas to transforms them into a pro- duction forest, while also main- taining the environment and bio- dIversILy oI LIe IoresL. Myanmar Summary ThaiIand`s Siam CommerciaI Bank`s representative ofce on Kaba Aye Pagoda road in Yangon. The roughIy 35 foreign banks with rep ofces in Myanmar do not conduct business IocaIIy. Instead, ofce heads engage in fact nding and consuIting with authorities. O liv e r
S lo w A truck Ioaded with Iogs runs on a road in Yangon. Ubservers are keen to see whether Myanmar can maintain growth without destroying its forests. U A u n g / X in h u a _., .:. ._ . . . . .._ . ~_e.. ~.._.:..,._~..:~ ~. . ..q: e _e ..q.~:. ~_._ ~~. . ..:.,_~:. ...~:. .:~ .~~,.~,.....q._._.:. ~, _~ . .~ . , .. ~:~:~ _.. . ._ Forests Asia Summit ~ ._.:_~:..._. Zulkifi . _.,.:.._ _.,.: ...~._ ~.,.q:..- ...~:.:....~ .~~.:..~q ._. ~.q.~:~:q- .,:~....' .._~....~~~.._e.._ _.,.: .~ .~~:......:.~., _e e..~..:..~ _.,.:. .~: -e~. ~..~.. .:. ..:~:..._~:. ..'.:.:. qqq, ..:..,._~:. .q._. ~ . . ~.. ~:. e. . . ~..: ..~ .:....q, ..:..,_.. ...:. ._.:. ..,..:.~:. ,.~- ~e.:..eq..:.. ~.. . . ~ . ._ _e. ._ . _., .:. ~.,_e , .-...~ ~ .:.~:.. _.:. ~.~.:.. ~..q~,. .q:. ..~ ...:..q..~.:...:.~:. eeq:..~._ .,.._..~,_. e ~. .~ . . ..: .,_. ._e. ._. _.,.:.~.,_e .,:.~~._..~ ~e..,:.~:~:~._..~ ~q.. ~~:. e...~..:..~ .. .:. . :..... ._ .~ ~:~ .: General Electric, Unilever . Visa ~ ~.,_ e _ ., .:. ~~ .~ ~ .q:~ . . ~ .~ q _. . ~. . : ~.q:~q, _...~q._. May 15-21, 2014 Myanmar Business Today mmbiztoday.com LOCAL BIZ 9 Myanmar Summary Thome Group Opens Myanmar Manning Agency S ingapore-based ship munugemenL hrm Thome Group has opened a crew recruit- ment and placement ser- vices agency in Myanmar in a bit to support its bur- geoning Southeast Asian shipping cluster, the com- puny suId. Thome Myanmar is seen as an impor- tant step in the com- panys expansion into the growing economies of South- east Asia and posi- LIons IL weII Lo oer its full range of ship management ser- vices to the country, LIe compuny suId. It will immediately enable Thome to tap into the vast wealth of seafarer potential that Myanmar has wILI ILs 6o mIIIIon strong population, it udded. Thome group chairman Olav Eek Thorstensen said: Phyo Aung Myint The oil and gas sectors are also very important in this part of the world and LIe openIng up oI un omce here places the Thome Group in a good position to service the future needs of this and other growth ureus. He said establishing a manning operation in Myanmar underlines the groups commit- ment to this fast- moving and highly important seafarer recruitment mar- keL. The Myanmar/In- dia/Sri Lanka region is seen as an area of massive potential growth for Thome, not only as far as crew recruitment and training is con- cerned but also in the supply of general shi pmanagement services, the compa- ny suId. Thome already em- pIoys cIose Lo 1,ooo crew from the region and it says it sees sIgnIhcunL opporLunILIes for expansion through the new omce. Michael Elwert, director of group HR, strategy and support at Thome Group, said seafarers from Myan- mar are extremely quali- hed us LIey ure educuLed Lo u very IIgI IeveI. Thome Myanmar has received its manning agency and MLC licences and a programme of cadet recruitment has already sLurLed wILI o cudeLs uI- reudy Luken on. Training is important to us and we have ap- pointed a regional train- ing manager who will oversee the training of such cadets and others from the Myanmar/In- dia/Sri Lanka region, El- werL suId. Thome was one of the hrsL sIIp munugemenL companies to visit as part of an earlier Scandinavian IucL-hndIng LrIp Lo LIe counLry. Claes Eek Thorstens- en, president of Thome Group, said: Thome brIngs over o yeurs oI quality ship management experience to this impor- tant market and we look forward to working even more closely with new and existing clients in the monLIs und yeurs uIeud. The companys other expansions in Asia in- voIve osIore consuI- Luncy OC. TIe compuny registered LOC Seoul and opened ILs hrsL omce In SouLI Koreu In AprII. Thome Group of Com- panies provides services ranging from ship man- ugemenL Lo runnIng o- shore vessels, FSOs and FPSOs, port agency, ves- sel inspection, newbuild- ing site supervision, and crew LruInIng. As an independent in- ternational ship manager, LIe hrm Ius more LIun zoo vesseIs under LecInI- cal management serviced by 6oo sIore sLu und 1o,ooo crew members. L uIso Ius 1zo vesseIs under pure crew management engugemenLs. Thome Myanmar is seen as an important step in the company`s expansion into the growing economies of Southeast Asia and positions it weII to offer its fuII range of ship management services to the country, the company said. s h ip m a n a g e m e n t in t e r n a t io n a l. c o m . ~:. ~._.. ~ .. :. . . , . .q.~.~_e.._ Thome Group ~.,_e ~.q .~: ~: q .. :. . , .. ~:.~.:~ ~. .... q, ~~ ~ .. :.:. q:.e.q.. .,q:.:..q.~, ..: . .~ . ~:. _., .:. ~e...__e.._~:.._~ _:.._. Thome Myanmar ~.,_e ~.q .~: ~:q -e _ e ..: ..:. .. :..q.~._.~.,.:.~ ~ . ~ . . ._ ~.q..|..: ._.. . .~_e. , _. _. ., .~ ~., _e _., .:. ~~ ~ _._ . ..: ..:...,....,..:.... . . .. ._ _e. ._~: ..q._. is still lower than other neighbouring and re- gional countries, and the government should re- form the economic infra- structure to increase the number. The Myanmar govern- ment is now desperately trying to strengthen its esLImuLed 1zo,ooo SMEs ahead of the ASEAN Eco- nomIc CommunILy (AEC) In zo1. TIe Iree ow oI goods and labour within the AEC is expected to pose sLI cIuIIenges be- fore the ill-funded My- anmar SMEs who will be competing against their superior rivals in the re- gIon. From page ...(SMILB) From page ...(SMILB) _., ._ _e_ ~ ._. ._e. _. .~. .| SMEs. . , ..:.~:. . ..:~ .:........q, ~_.:...: .~~:~e~._..:.. .: .q:~ . ...| ...: q ~ . . : ~:.,_ ..,_. . ~. .q~ ~. . ~_ .. .: . . ...._. .._~: _e. ._. . . , .~ .q.~: ~ ... . ~ . .. . _~:~:.~. . ~ ..,.~..~_.~ ~.:._~. ~ ......~:.e ~ . . , . ~.:..~ ~e~e_.,_.,... . ~e .~. ~. .q. ~q. . ... ....q~e.~_.:.~e~._. ..: JICA ~ ~._ . .... qq . .~: .~e ..:~. .. . . ~:q ...e ....: . ' ' e SMIDB . ~_~.~,.~_~... ...,.~ ._.:._. SMIDB ._ _., .: . .. :..q. ~. ~~..,. ... q:..,._e..._.. _._~.q SMEs .:. ~~ .. , . ... q:. . , ._e _., ._ ~ ... _. ._e. ._ .~_.:...:~ .:. .: ~~..,. ~, q:..,._e ~....~q._. .:._ ~~,~~ _: .q.. . ~ SMIDB . SMEs . . , ..:.~~ ~ .... .~ ~: ~.. ~ .e~... . :.._ _e. _. . e ..... ..:~ ._ e. . . _:.q.~ .....~..._.._e.._. e. . . ~ _., .: . .. :..q.~ .qq...: ~.. ~~ .e ~ ..,...|. ' .. ~ ....... ._ ..~ . ~ , . . , .q .:.~. .~ _ ._.~ . ..~: ~._. ~.:._~........ q._. ..~:.~e. SMEs ~.:.. ~ ~ e . ~..:~ ~~ .q ~:.:.~e .~. .q~.,, ._. .,.:..e_....q~: ~.~ .~..._.. ~_.~ _.,...~: .~ q ~e ..|.~ ~ _., .. ...e .~e''e ,.~ ....._.: _~:.._. May 15-21, 2014 Myanmar Business Today mmbiztoday.com LOCAL BIZ 10 Myanmar Summary ment still needs to com- municate their plan that will align with public in- terests in simple and plain Iunguuge. At this initial develop- ment stage of a country like Myanmar, it is very hard to show big tangi- bIe und pIysIcuI resuILs. What the government can do right now is sell hope (or u LungIbIe pIun) Lo LIe public and earn their trust so that they can minimise public resistance along LIeIr wuy. TIe govern- ment also needs a public reIuLIons ugency Loo. From page ...ation (Part z) From page ...ation (Part z) The knowledge will give control to the people and control in turn will give hope to them in the fu- Lure. PeopIe wILI Iope wIII beIuve weII. TIere are several road junc- tions in Yangon without Lrum c IIgILs wIere drIv- ers act desperately to es- cupe LIe mess. BuL sume drivers at junctions with Lrum c IIgIL ucL LoLuIIy op- posILe. TIose Lrum c IIgILs are like a plan that will control the public and such control will spawn hope that they will escape the mess when the time comes. n oLIer words, highly capable leadership will bring public in the back seat of the leaders car and will see the chal- lenges and opportunities on LIe roud uIeud. eud- ers have to earn trust and sympathy while driving along a bumpy road drive to achieve a common des- LInuLIon. Former US President BIII CIInLon dehned Ieud- ership during an inter- view with Fortune maga- zine as bringing people together in pursuit of a common cause, develop- ing a plan to achieve it, and staying with it until LIe gouI Is ucIIeved. Myanmar leaders and policy makers can learn a lot of development les- sons from Vietnam and India to take the ad- vantage of being a late mover instead of invent- ing a Myanmar way (of course there will be some cusLomIsuLIons) LIuL Ius stunted the country for LIe IusL hve decudes. TIe very hrsL sLep oI leadership will be having u soIId pIun. WILIouL one at hand, no matter who wIns LIe zo1 eIecLIon, Myanmar leaders will face a troubled time in leading the change that Myanmar people has been yearning Ior so Iong. Kyaw Myo Htoon (John) is c bestsellin uriter cnd c jncncicl consultcnt. His recent bool Under- standing Equity and Pro- ject Iincncin become c bestsellin business bool in Myanmar. He is also a director ct Youn & Rubi- ccm cdtertisin cenc. He ccn be recched ct: johnQmcnmcrpinnc- clejncncicl.com.
There are challenges too for My-
anmar government to sell foreign currency bonds via international capital markets since it will be exposed to currency exchange rate risk. Nevertheless, under current circum- stances, it is the only viable solution to issue foreign currency bonds to spur the economic growth in years to come. Initial Census Results to be Released in August Aye Myat M yanmar authorities will release in August the initial results of this years nationwide census conducted in March-April, U Khin Yi, minister for immigra- LIon und popuIuLIon, suId. U Khin Yi made the disclosure at a press conference on the zo1q PopuIuLIon und HousIng Census Enumeration at Yangon RegIonuI PurIIumenL buIIdIng. The preliminary results will include the census on popula- tion taken state-, region- and LownsIIp-wIse, Ie suId. It is expected that the launch of the main population infor- muLIon wIII be In Muy zo1, Ie udded. The minister said all com- pleted questionnaires are now being retrieved from townships in a swift, secure and safe man- ner Lo LIe cupILuI Nuy PyI Tuw. He said there were about 81,ooo enumeruLIon ureus where counting was done by qo,ooo enumeruLors und z,ooo supervIsors. Myunmur`s zo1q nuLIonwIde census covered 1o.;1q mIIIIon households except some in the countrys restive northernmost Kachin state and western Rakh- ine state, according to the min- IsLry. nIormuLIon Irom LIe heId suId q; vIIIuges Irom z vIIIuge tracts in Kachin were not enu- meruLed. In Rakhine state, three out of hve dIsLrIcLs were purLIuIIy enu- merated due to non-response from Bengali community, the minister said referring to the community otherwise interna- LIonuIIy known us RoIIngyu. TIere Is u LoLuI oI 1. mIIIIon population of Bengalis in the counLry, oI wIom 1.o mIIIIon live in Rakhine state, U Khin Yi suId. Myunmur`s 1z-duy nuLIonuI census Irom MurcI o Lo AprII 1o, LIe hrsL In LIree decudes, collected data on current popu- IuLIon, economIc und socIuI hg- ures, aimed at working out a na- LIonuI deveIopmenL pIun. He revealed that the prepara- tions for enumeration started on Muy z, zo11, Lwo monLIs uI- Ler LIe governmenL Look om ce. n LIe 1q8 census, Myun- mur`s popuIuLIon wus . mII- lion excluding an estimated 1.1; mIIIIon (. percenL) non- census ones for security rea- sons, Ie suId. Minister for Immigration and PopuIation U Khin Yi speaks at a press conference in Yangon. U A u n g / X in h u a _., .:~:~:. .:.~.,_e e. . . .~.. -_..~ ~....~ .~:~ . . ._ ., ...| .:q .- ~, .q.. .:.~:. _. ~ .~ ~ _.,.:..__e.._~:. .q._. . ~ . _~ ._~. .q.. _._ . ~ ~:. ~,_~. ..q. q,~,~..~.~: ~..:~~~~ ~~, Population and Housing Census Enumeration ~._ _e _.. . ._ .~ ..:q .. . .~ .._.:_~:.._.._e.._. ~. .|~, .q.. .:.~ ., ...| .:q..~:~.._ _._,e ~.. _.,e.:q..:. .|~.__e.._~:. . q._ .., ...| .:q .~. . . .- ~.~~.~.:.~:. ~~ .~. ~ ~ .e: ._.:_~:.. ._ _e. ._~: . ._. ~,_~.. ._.:_~:..._. _. .,...|.:q.~ _.._._. .:._e_~:.:...:.~:. e.~.|~ _. ,e .:.. ~. . . _. . :_e _. .~: .,_._.~:. .ee.,_._e.._~:. ~, _~ .~._.:._ ., .~., ...| .:q . .~:~..,q: ~,~~~ ~,~. ~,~~~ ~:. _~._~.. ,~~~ _e ....:.._~:. ._.:_~:..._. _.,.:.- ~~, ....q: .,...|.:q.._ ~..:. ~~ ... ~ ., .~:..~:~ . . _. . ~. _._,eq ~.....:.. q._._ ,e ~.,:~ e~ ....:.~ .~:~ e ._...q._~:. .q._. ~._._.q .~.q:~.. .. .~.q: q:.: .~:~.._...q ._~: .. q._ .q. _._ ,e ~ ., |..~,~. ...~:. |.....:. . ._e_~:._...q._~~~ .~:~. ._...q.._~:. ._.:_~:..._. ~~.._.q.__e._.. ~,_. e..:.._~..:..: .. ~...:..q.~_..q:~q~: , .~ -e _ e .. ~:. . ~ .. ._ ..~.qq.__e. ._. _.,.:~..q~.,_e.._~. . . e . . , . :. . :. ~:. _ . . _ . .._ .,:~ . ~ ~: .._~....~~~ . _ .:.. ._ ~..:. . . :..q: . ..q, ~~~ .,..'..:.. _~.~.,q._. ...:.~q ~._.~.,.:. .~:~ ~ . .. : ._ ._ e q..~~..._ . _.:.. ._~..:...:.~:....:..q. e _ e .. . ~~ .q: .. . q, _e.._. May 15-21, 2014 Myanmar Business Today mmbiztoday.com LOCAL BIZ 11 Contd. P zz...(ReBecting) Reecting On Myunmur's Iotore Jon Springer W hen it comes to covering Fron- tier Market in- vesting, there are always LIe currenL IoL counLrIes. Myanmar (formerly and sLIII Lo muny, Burmu) Is uL this crossroads and may hold hot country status for a run of several years because the hopes for the country are high and the timeline to unlock the country from military dic- tatorship is likely to take muny yeurs Lo unIoId. The promise A country of an estimat- ed 6o mIIIIon peopIe, My- anmar is emerging from a Tatmadaw dictatorship goIng buck Lo 1q6z (TuL- madaw is the name of LIe mIIILury). TIe process of democratic reforms begun In zoo8 und Ius gained traction with the beIIeI LIuL zo1 wIII see full and open democratic elections that might see Nobel Peace Prize Winner and former political pris- oner Aung San Suu Kyi Luke LIe omce oI presI- denL. AILIougI LIe sLory of a country emerging to- ward democracy is inter- esting, what gets investor juIces owIng Is wIuL eIse Myanmar could be, and once was: - A country strategically located between India und CIInu. - A land of largely unex- ploited oil, gas and other natural resources lying in wuIL Ior deveIopmenL. - A new venue for cheap labour, cheaper than most uvuIIubIe. - A nation with long coastlines and a long un- der-utilised port network wuILIng Lo be deveIoped. - A new good-sized mar- ket for goods from cell pIones Lo IoodsLus. - A country of great beuuLy und (BuddIIsL) spiritual importance now open Lo LourIsm. - A people in which its advocates see the entre- preneurial spirit neces- sary for successful capi- LuIIsm. - A country with huge agriculture and aquacul- ture potential that was the worldwide number one exporter of rice from 1q6o Lo 1q6. The prohlems During a panel at the Milken Institute Global ConIerence zo1q recenL- ly, there was an excellent array of representatives Irom Myunmur. WIen LIe panel was queried on why the country was now de- mocratising, the general consensus was: we should focus less on why and more on the process of encouraging both democ- ratisation and free mar- keL cupILuIIsm. YeL, LIere are some contradictions to the narrative that My- anmar is headed toward democratic free market success: - Under current law, the Tatmadaw automati- cuIIy occupy z percenL oI LIe purIIumenL. Aung San Suu Kyis National League for Democracy (ND) purLy wouId Iuve Lo wIn 6; percenL oI seuLs open Ior eIecLIon In zo1 Lo guIn o. percenL oI LIe purIIumenL. - Under the current con- stitution, Aung San Suu Kyi cannot attain the of- hce oI presIdenL becuuse her husband was a for- eIgner. - The notion that Myan- mur wus cIosed o Irom LIe worId sInce 1q6z Is exaggerated as relations have been normal with most Asian countries in- cluding Singapore and China while western Europe and the United States engaged in sanc- tions against the country over LIe yeurs. - While the government states there are new press freedoms and has recent- ly passed new press free- dom laws, the local Daily Eleven Newspaper said, Journalists do not fully receIve LIe benehLs und protection under the two medIu Iuws. DespILe new legislations, they remain under threats by oscil- lating law enforcement which can be manipulat- ed to fault and jail them uL uny LIme. ndeed, hve journalists await trial for revealing state secrets by investigating a potential cIemIcuI weupons pIunL. Pr ogr ess On the panel at the con- ference were Ko Ko Gyi and Dr Min Zaw Oo, both members of earlier itera- tions of pro-democracy movements in Myanmar that respectively endured 18 yeurs In Burmese prIs- ons und z1 yeurs In exIIe. The mere presence of these men on a panel rep- resenting Myanmar today Is u Iuge sIgn oI progress. Min Zaw Oo in fact now serves the government of Myanmar as director oI ceusehre negoLIuLIons und ImpIemenLuLIon. MIn brings a wealth of experi- ence to the complexity of Myanmars peace nego- tiations with his resume including USAID election projects in Afghanistan, service to the US govern- ment-funded Political Instability Task Force, a PI.D. Irom George Mu- son UnIversILy In conIcL analysis and resolution and a MA from George- town University in securi- Ly sLudIes. TIe compIexILy oI Myunmur Is reecLed in a government that rec- ognIses 1 eLInIcILIes oI wIIcI 16 were urmed und hgILIng LIe governmenL to varying extents at the sLurL oI LIe peuce process. Under the peace process, 1q oI 16 groups Iuve now sIgned peuce uccords. Moreover, among Myan- mur`s 1q sLuLes, LIere pre- viously was armed con- IcL In 1o regIons buL now onIy Lwo. The peace process does ignore the Rohingya population, a population that are not a recognised ethnicity and are receiv- Ing sIgnIhcunL uLLenLIon from the human rights community recently wILI IILLIe posILIve resuIL. There are also refugees Irom LIe vurIous conIcLs and many ethnic groups in Myanmar scattered around the world from neighbouring Thailand to LIe UnILed SLuLes. Whot uill democrocg ond free morkets meon? During the panel, Ko Ko Gyi stood out as the per- son who did not mince words. HIs ImprIson- ments include involve- ment with the pro-democ- rucy movemenLs oI LIe 88 GeneruLIon In 1q88 und LIe Suron RevoIuLIon In zoo;. Some oI IIs poInLs made during the panel that may be of summary note to investors are: - TIe uprIsIng In 1q88 was people being upset that their country has plenty of natural resourc- es [yet] we are among the least developed coun- tries we [could not] ac- cept such a situation that is why we are against the single party dictator socIuIIsL regIme. - the political power and economic power are still in the hands of the old guys - democracy, peace and stability cannot be sepa- rated - [the] former mili- tary regime, why they change such a situation [from dictatorship to de- mocracy]? democracy and market economy is the world trend [the military] never got in- ternational credibility, international legitimacy; thats why our army gen- erals are very clever how to deal with the interna- tional community to get the legitimacy - When people recog- nise positive changes in the country such as more media freedom, we agree, the media chang- es. BuL mosL oI LIe IocuI printed media are in the hands of proxies of the government especially LIe broudcusL medIu. TIIs Is noL yeL Ireedom. Myanmar Summary
We as activists are commit-
ted to our country to develop ... But, up to now, so many investments in our country [have] no transparency at all ... no- body knows how to sign a contract, how to share the benefits ... Trafc moves through the streets of Yangon. B r e n t
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P z...(\S Myanmar) Cracks Appear in US Myanmar Rapprochement New legislation signals growing concern over the Obama administrations Myanmar policy R ecent legislation intro- duced to US Congress to put conditions on US co- operation with Myanmars mili- Lury muy be one oI LIe hrsL sIgns of emerging dissatisfaction with President Barack Obamas rap- prochement policy with the posL-junLu governmenL. The bill was sponsored in the House of Representatives April z by RepubIIcun SLeve CIuboL, cIuIrmun oI LIe oreIgn AuIrs Subcommittee on Asia and the PucIhc, und DemocruL JosepI CrowIey. L grows ouL oI con- cerns that the Obama admin- istration, having begun limited cooperation with Myanmars military, is moving too quickly without demanding reforms Irom Myunmur hrsL. TIe bIII Is u modIhcuLIon oI sImIIur, eurII- er bipartisan House and Senate legislation and follows enact- ment of language in a funding law limiting spending for assis- Lunce Lo Myunmur. Myanmars military is notori- ous for atrocities including de- stroying villages, using villagers us Iorced Iubour, und rupe. OLI- er concerns include Myanmars military ties with North Korea and continuing government hgILIng wILI eLInIc mInorILIes. So far, US cooperation with Myanmars military has been modesL. EorLs Iuve IncIuded allowing observers during the last two Cobra Gold region- al military exercises, human rights talks, and exchanges and workshops on such goals as promoting civilian control oI LIe mIIILury. TIey Iuve uIso included exchanges with My- anmar military leaders, judge udvocuLe omcers, und oLIers on human rights law and law of urmed conIcL. In addition, Myanmar was umong 1o counLrIes DeIense Secretary Chuck Hagel invited to participate in last months meeting of Association of Southeast Asian Nations de- fense ministers in Hawaii, the hrsL sucI meeLIng Lo be IeId In LIe UnILed SLuLes. AdmInIsLruLIon omcIuIs Iuve publicly cited the importance of working with Myanmars mili- Lury In eorLs Lo IosLer reIorm LIere. SLrengLIenIng LIe ruIe of law and promoting security sector reform are essential el- emenLs oI LIe reIorm eorL, State Department Senior Ad- visor for Burma Judith Cefkin told Chabots subcommittee in December. Voices from across Bur- mese society including civil society, ethnic minority repre- Steve Hirsch sentatives, and members of the government and political oppo- sition are urging us to engage with the Burmese military and civilian police force to teach new models of conduct that help make the security services a stakeholder in the success of democruLIc reIorm, sIe suId. We believe that carefully calibrated military-to-military engagement to share lessons on how militaries operate in a democratic framework will strengthen the hand of reform- ers, sIe LoId LIe puneI. However, Chabot, in an inter- view, called it nave to think Myanmars leaders will be con- vinced to follow the appropriate path simply by asking them to do so and continuing to giving them all the goodies without ac- tually requiring them to follow LIrougI. The Chabot-Crowley bill would tie funding for certain types of security assistance to military and other reforms in Myunmur. L wouId bur sucI funding unless the secretary of SLuLe cerLIhes LIuL Myunmur has met conditions related to reforming its military, ending military ties to North Korea, opening the process of amending the constitution and opening elections, getting the military out of commercial businesses, and working to end eLInIc conIcLs. n uddILIon, LIe cerLIhcuLIon would have to show that My- anmars army is improving its human rights performance, ceasing attacks on ethnic mi- nority groups, moving to with- druw Iorces Irom conIcL zones, IoIIowIng ceuse-hre ugreemenLs and signing and implementing u code oI conducL. Chabot dismissed the defense that US cooperation with My- unmur`s mIIILury Is IImILed. The military, he said, is such u sIgnIhcunL eIemenL In Myun- mar and its government, and its abuses have been so substan- tial that having them reform is such a critical element that without that happening, the rest of it really doesnt matter all that much, when youre talk- ing about the lives that are ac- LuuIIy beIng uecLed In Burmu. So its critical that we insist on the reform of the military and it essentially cleaning up its act and stopping all the human rights abuses, we need to insist on that at every level and that should be a key aspect of our in- teraction with the government, Ie suId. Backers of placing conditions on military cooperation are not asking the administration to ignore Myanmars military, which still wields substantial power und Inuence LIere. Keith Luse, a well-regarded former Senate Foreign Rela- LIons CommILLee sLuer wIo has also called for linking mili- Lury engugemenL Lo specIhc re- forms, expressing his personal opinion, has cited the need for the US government to deal with LIe Myunmur mIIILury. He told a Heritage Founda- tion session in October that US-Myanmar military relations should be contingent on meas- urable reform benchmarks in- cluding a wide range of human rights issues and ending Myan- mars military relationship with NorLI Koreu. In addition, though, he said progress and reform in Myan- mar are more likely to acceler- ate with substantive mil to mil engagement and confrontation, due in part to the disdain often held toward professionals with- in Burmas Foreign Ministry by LIose In unIIorm. Over the long-term, he said, communication exclusively be- tween the United States, others in the international community und Burmu`s (so-cuIIed) cIvIIIun leadership will have incomplete resuILs. He also said before proceed- ing on a long-term plan, Hagel must be fully informed on the Myanmar-North Korea mili- tary relationship and on the status of Myanmars nuclear, biological, chemical and missile programs points where the international community has been dismal in expressing inter- esL or concern. use IuId ouL u IIsL oI 1o ques- tions to be answered on this subject, such as which Myan- mar military or other projects have involved North Korean LecInIcIuns und omcIuIs, pro- jects or facilities with North Ko- reans present that have played a role in the development of My- anmars missile or nuclear pro- grams, countries that knowingly or not have helped Myanmars nuclear and missile programs, and the range of military equip- ment and weapons provided or in the works to be provided by NorLI Koreu Lo Myunmur. Jennifer Quigley, executive director of the US Campaign for Burma, called the Chabot bill a message to the administration that they have not been clear, theyve not laid out a roadmap not just to Congress, but to the Burmese as to what this engagement with the Burmese military is about, what they hope to accomplish with that engugemenL. Murray Hiebert, a senior Southeast Asia specialist at the Center for Strategic and Inter- national Studies in Washing- ton, raised concerns about the bill but acknowledged that it shows a drop in support for the udmInIsLruLIon poIIcy. He said the bills backers are trying to constrain something that is so tiny, you cant even meusure IL rIgIL now. He called administration ef- forts so far really very mini- mal, consisting of talks, mostly on human rights issues and rules of engagement, but no LruInIng or weupons suIes. Its engagement basically on human rights issues, now why wouId we hnd LIuL u probIem? Ie usked. He uIso wondered how the United States could promote democracy, human rights and reform if we cant even talk to the most powerful InsLILuLIon In LIe counLry. The bills introduction comes as scepticism is growing about the reality of change in Myan- mar, which has led to questions about whether the administra- LIon Ius moved Loo Iur Loo IusL. Although Myanmar has seen sIgnIhcunL cIunges sInce LIe end of junta rule, anti-Muslim vIoIence Is wIdespreud, hgIL- ing with ethnic groups contin- ues, and doubts are rising about poIILIcuI reIorms. or exumpIe, there is increasing expectation that opposition leader Aung San Suu Kyi will be barred from runnIng Ior presIdenL nexL yeur. Chabot said he sees consid- erable concerns by himself and others about the administra- tions Myanmar policy and said LIe sLruLegy Ius sIgnIhcunL uws. I think that they have been too hasty and been too willing to overlook all the evidence on the ground that the military, in particular, is not living up to its US President Barack Ubama sits with Myanmar's President Thein Sein in the UvaI Ufce at the White House in Washington.
I think there is, probably, a diminu-
tion of support. I think earlier on they gave them ... a sort of blank check you know what youre doing, carry on and now people are asking more ques- tions, and it goes beyond the military. L a r r y
D o w n in g / R e u t e r s May 15-21, 2014 Myanmar Business Today mmbiztoday.com REGIONAL BIZ 13 Myanmar Summary Thai Rubber Farmers Say to Protest Against Govt Plan Apornrath Phoonphongphiphat T hai rubber farmers will protest against the governments pIun Lo seII zoo,ooo tonnes of rubber from its stocks as they fear the sales will drag falling pric- es down further, the head of a group representing farmers of the commodity suId on Tuesduy. Top global rubber producer Thailand had planned in April to sell uround zoo,ooo Lonnes of rubber it had bought Irom Iurmers. No suIes were made last month, but caretaker Agriculture Minister Yukol Limlaem- thong told Thai media last month the stocks would be released soon to avoid IurLIer Iosses. We will submit an open letter to the government this week, asking them to hold the plan to sell the sLuLe sLock IndehnILeIy, Boonsong Nabtong, head of the Federation of Rub- ber Planters Association oI TIuIIund, LoId ReuLers. The Federation groups several rubber coopera- tives across the country und Ius uround 1.z mII- IIon members. He added farmers would gather in Bangkok to voice their concerns about fall- ing prices and to force the government to stop adding more supply in the market LIrougI LIe sLock suIes. To sell the stocks is to kill farmers indirectly and we are telling the govern- ment that we dont want to be killed by this policy, Ie suId. TIIs won`L be LIe hrsL time rubber farmers are proLesLIng. TIey sLuged several protests in Octo- ber and November last year, demanding action to sLop IuIIIng prIces. A far more controver- sial rice-buying scheme stoked massive protests from farmers late last year and this year when the government failed to muke puymenLs Lo LIem. TIe zoo,ooo Lonnes rubber stocks the govern- ment has said it plans to sell are smoked rubber sheets bought from farm- ers beLween OcLober zo1z und MurcI zo1 Lo sup- port prices in the domes- LIc murkeL. Yukol said he planned to release the rubber stocks in April when the seasonal dry weather cut rubber supply, in a bid to geL good prIces. However, the dry sea- son in March-April in key global rubber produc- ers Thailand, Indonesia and Malaysia has failed to check the declines in physical rubber prices, which are being pres- sured by falls in Tokyo rubber IuLures. Benchmark TOCOM futures are down more LIun z percenL LIIs yeur on fears about falling demand in China, the worlds biggest rubber consumer. TIe prIce oI benchmark grade Thai smoked rubber sheet (RSS) Is down uround zo percenL LIIs yeur. Reuters Visa Crackdown Risks Stranding Phuket Expats in Myanmar Ranong Immigration warns that any foreigner who exits ThaiIand after using three consecutive visa exemption entries must get a proper visa. C h r is
H u s t e d / P h u k e t
G a z e t t e Chutharat Plerin O mcIuIs uL Runong Immigration last week conhrmed Lo the Phuket Gazette that they are turning away any foreigners attempting to enter Thailand after using three consecutive walk- In vIsus. The news follows re- ports of immigration of- hcers uIIegedIy sLoppIng Phuket expats on visa runs to Ranong from exit- Ing LIe counLry. Runong, neurIy qookm norLI oI Phuket, has for decades been a prime destination for foreigners conducting vIsu runs. We began enforcing LIe ruIe Irom Muy |SuL- urday] after receiving an order from Bangkok, an omcer uL Runong mmI- gration told the Gazette on condition of anonym- ILy LIIs mornIng. We have already spo- ken with several foreign- ers and strongly advised that they do not exit Thailand to arrive in Kau- thaung [in Myanmar], as there is no Thai embassy or consuIuLe LIere. We explained that if they went and tried to re- enter Thailand without hrsL obLuInIng u vIsu Irom a Thai embassy or consu- late, we would have to re- fuse them entry because they would have already entered Thailand three consecutive times on visa exempLIon` sLuLus. Any foreigners who ig- nore the advice risk being stranded in Myanmar, the omcer wurned. TIe omcer expIuIned that the crackdown on the three-visa-and-out rule was aimed at catching foreign criminals staying In TIuIIund. TIIs Is jusL LIe hrsL sLep in a crackdown on expats and tourists who keep re- newing their visas so that they can live in Thailand for the wrong reasons, Ie suId. Some foreigners live here and form their own networks to carry out il- IeguI busIness. Some oI the people we are target- ing are known associates of international crimi- nuIs. Visa run companies in PIukeL Iuve been noLIhed oI LIe sILuuLIon, LIe omcer ussured. These companies can explain the rules to for- eigners before they book them on a visa run, he suId. TIIs wIII IeIp uvoId any problems at the Ra- nong cIeckpoInL. As I said, this is just the hrsL sLep us we uLLempL to root out foreign crimi- nuIs. TIe nexL sLep mIgIL be tougher than this one, but law-abiding foreign- ers should be aware that we are not picking on any particular nationalities criminals are the ones we wunL Lo cuLcI. Any foreigners caught overstaying their permit to stay are subject to a hne oI oo buIL per duy, up Lo u muxImum hne oI zo,ooo buIL. Foreigners caught grossly abusing the maxi- mum oversLuy hne ruIe risk being deported and added to the immigration blacklist, barring the for- eigner from re-entering LIe counLry. Phulet Gczette Myanmar Summary Farmer Khot Samnung pours raw Iatex into moIds to prepare rubber cup Iumps at a pIantation adjacent to the Thai Hua Rubber PcI factory in Samnuktong, Rayong province, ThaiIand. D a r io
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May 15-21, 2014 Myanmar Business Today mmbiztoday.com REGIONAL BIZ 14 Myanmar Summary More Chinese Cities Ease Grip on Housing As Economy Stutters Xiaoyi Shao and Koh Gui Qing M ore Chinese cities are rolling out measures to encourage home purchases, in a sign that local governments are increasing ef- forts to safeguard an important driver of growth in Chinas fal- LerIng economy. The loosening of home pur- chase rules in the eastern city of Tongling in Anhui province and Ningbo, the coastal city of eastern Zhejiang province, fol- lows several other smaller stim- ulus steps in recent weeks to juice the worlds second-biggest economy. Tongling has introduced steps including providing tax subsi- dIes Lo hrsL-Iome buyers, und cutting down-payment rates to zo percenL Irom o percenL Ior select buyers, the city govern- menL suId on ILs websILe. Ningbo has also relaxed home purchase restrictions, the of- hcIuI CIInu SecurILIes JournuI newspaper reported, quoting a meeting held by a local industry ussocIuLIon. By relaxing the rules, local governmenLs ure eecLIveIy reversIng u neur-hve-yeur-oId policy of reining in Chinas frothy property market, under- scoring policymakers resolve to support an economy growing at ILs sIowesL puce In decudes. Analysts believe the health of Chinas property market will IIkeIy Inuence wIeLIer AsIu`s economIc powerIouse suers u shallow or deep downturn, not- ing that the real estate sector uccounLs Ior ubouL 1; percenL oI the countrys total annual eco- nomIc ouLpuL. Chinas growth engine has lost steam in the past year, squeezed by lacklustre demand for ex- ports and the governments push to cut its own investment In u bId Lo resIupe LIe economy. Given slackening growth, Bei- jing will likely back local gov- ernmenL eorLs Lo supporL LIe housing market lest a collapse in prices jolts the economy and undermines its reform drive, LIe unuIysLs suy. If property activity weakens IurLIer, we LIInk LIe (cenLruI) government may allow vari- ous local governments to relax home purchase restrictions and cut down the current hefty down-payment requirements, economists at UBS said in a noLe Lo cIIenLs. The latest moves follow recent similar measures by three other cities the southern city of Nan- ning, the eastern city of Wuxi and the Xiaoshan district in the east- ern city of Hangzhou to ease ruIes Ior buyIng Iomes or Iund. A cooling property market pressures the incomes of local governments, which depend on the real estate sector for a sub- sLunLIuI purL oI LIeIr proceeds. Data from the land ministry showed in April that residential Iund prIce InuLIon cooIed Ior LIe hrsL LIme In neurIy Lwo yeurs In LIe hrsL quurLer, und Is IIkeIy Lo euse IurLIer. The steps in the housing mar- ket join other measures by Bei- jing to shore up the economy, even though it has ruled out the use oI mujor sLImuIus Lo hgIL sIorL-Lerm dIps In growLI. Recent measures include the relaxation of reserve require- ments for some rural banks, tax breaks for more companies to support job creation, and speeding up investment in rail- wuys. Reuters Bangladesh April Remittunces Lp Ior Third Straight Month Ruma Paul M oney sent home by Bangladeshis work- ing overseas in April rose .z percenL Irom u yeur eurIIer Lo $1.z bIIIIon, LIe LIIrd sLruIgIL monLI oI guIns. Millions of expatriate Bang- IudesIIs remILLed $11.; bIIIIon Irom JuIy Lo AprII, LIe hrsL 1o monLIs oI LIe currenL hnuncIuI yeur, down neurIy q.8 percenL from the same period the pre- vious year, central bank data sIowed. OmcIuIs suy remILLunces have dropped over the last few months because of political tur- moil in the months leading up Lo un eIecLIon In Junuury. Fewer Bangladeshis are also going abroad to work as jobs have dried up in traditional markets such as in Middle East- ern counLrIes. nows oI remILLunces Lurned posILIve In ebruury - LIe hrsL year-on-year increase since last AugusL. Strong remittances in recent years have helped build foreign exchange reserves that stood at un uII-LIme IIgI oI $zo.; bII- IIon uL LIe end oI AprII. n LIe hrsL 1o monLIs oI LIe hscuI yeur, LIe cenLruI bunk purcIused neurIy $q.z bIIIIon from local commercial banks to stem an appreciation in the do- mesLIc currency. BungIudesI receIved $1q.q6 billion in remittances in the zo1zJ1 hscuI yeur, up 1z.6 per- cenL Irom u yeur eurIIer. RemILLunces Irom ubouL q million citizens abroad are criti- cal for the impoverished nation and are a key source of foreign exchange, alongside garment exporLs, wIIcI uccounL Ior 8o percent of total export earnings oI ubouL $z; bIIIIon u yeur. Bangladeshs economic growth LIIs hnuncIuI yeur, Iowever, Is expected to be slower than the 6 percenL In zo1zJ1, IurgeIy be- cuuse oI poIILIcuI unresL. Reuters Myanmar Summary MiIIions of expatriate BangIadeshis remitted $11.73 biIIion from ]uIy to ApriI, the rst 1U months of the current nanciaI year, down nearIy 4.8 percent from the same period the previous year, centraI bank data showed. R o m e o
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O h s u m i/ B lo o m b e r g May 15-21, 2014 Myanmar Business Today mmbiztoday.com REGIONAL BIZ 15 Myanmar Summary Wung Jing: Chinu's Connected Telecoms Tycoon Matthew Miller E ntrepreneur Wang Jing is little-known outside China, but the turnaround of his core telecoms business shows he is a well-connected hgure umong LIe BeIjIng eIILe. Wangs key compa- ny, Beijing Xinwei, was sLurLed In 1qq us u joInL venture between China Academy of Telecommu- nication Technology and Cwill Telecommunica- tions, a US entity set up by former Beijing Xinwei presIdenL CIen WeI. The company helped deveIop CIInu`s hrsL homegrown wireless technologies, including the mobile communica- tions standard, TD-SCD- MA. BuL by zo1o, BeIjIng Xinwei was foundering, with reported revenue for LIe yeur oI 1.8 mIIIIon yuun ($z1.6 mIIIIon) und neL prohLs oI .z; mIIIIon yuun ($z6,qoo). Wang said he was con- tacted by a friend, Wang QIngIuI, wIo In 1qqq be- came an early investor In LIe hrm LIrougI IIs venLure hrm, Bonunzu n- vesLmenL Group Ld. Wang initially helped Bonunzu ruIse 1o.8 mII- IIon yuun Lo hnunce sub- scrIpLIon oI 1zo mIIIIon new sIures, wILI 88 mII- lion shares later placed In IIs nume. InvesLed in Xinwei with my own money, without the help of friends or family, he suId. Since Wangs arrival, Beijing Xinwei has made u sIurp rebound. TIe company has gained ven- dor cerLIhcuLIons Irom the General Armament Department of the Peo- Wang ]ing, CEU of Xinwei TeIecom Enterprise Croup, speaks during an interview at the company's head- quarters in Beijing, China. A le x a n d e r
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Y u a n / A P ples Liberation Army and the State Commission of Science and Technology, allowing it to sell equip- ment and services directly to the Chinese military und Iuw enIorcemenL. It continues to build public telecom networks, along with private net- works Ior oIIheIds, power grIds und LrunsporL. Key enter pr i se desi g- nati on Beijing Xinwei is clear- ly well-regarded by the CIInese IeudersIIp. Ive central government min- istries, including the Na- tional Development and Reform Commission, the Ministry of Industry and Information Technology and the Ministry of Fi- nance, jointly designated the company a key soft- ware enterprise for stat planning, giving it a pref- erential corporate income Lux ruLe. n zo11, LIe CIInu De- velopment Bank also
My special contribution has
been hard work. I arrived at Xinwei 4 years ago, and since then I havent rested. I eat and live at the office. My life is about work. granted Beijing Xinwei a 1z bIIIIon yuun ($1.qz bII- IIon) IIne oI credIL Lo sup- port the companys going gIobuI sLruLegy. In the last three years, Beijing Xinwei has inked global deals to build tel- ecoms networks in Myan- mar, Cambodia, Ukraine, und NIcuruguu. TIe Cum- bodia project, which is rolling out a mobile net- work and wireless ser- vices through Xinweis local subsidiary CooTel, InvoIves u z.z bIIIIon yuun credit guaranteed by Chi- na Development Bank, uIong wILI un 8oo mIIIIon yuan US dollar credit fa- cIIILy. TIe UkruIne projecL uses hnuncIuI guurunLees from China Construction Bunk oI up Lo $q1z mII- IIon. Xinwei has gained the governments trust, and some government sup- port, but this is entirely because Xinweis technol- ogy is advanced and, more importantly, because Xin- weis technology is the intellectual property of a Chinese company, said Wung. I XInweI were a US company it would receive the same kind of support from the US gov- ernmenL. By zo1z, BeIjIng XInweI reported operating in- come oI q1 mIIIIon yuun ($1q6. mIIIIon) und neL prohLs oI qq1 mIIIIon yuun. TIe compuny suId zo1 operuLIng revenues reucIed z.6 bIIIIon yuun ($;;.qz mIIIIon), pro- ducIng neL prohLs oI 1.;1 bIIIIon yuun. Reoerse tokeooer Last September, Bei- jing Xinwei and Beijing Zhongchuang Telecom Test Co, a Chinese maker of network testing devic- es, announced their in- tention to undertake the biggest reverse takeover in Chinese stock market IIsLory. The deal, which may be hnuIIsed beIore LIe sum- mer, now calls for Beijing XInweI Lo InjecL q.61 per- cent of its shareholding, vuIued uL zz.qq bIIIIon yuan, into Beijing Zhong- chuang, in exchange for z.61 bIIIIon new sIures. TIe IIsLed hrm wIII uIso ruIse q bIIIIon yuun Lo support new projects and settle some high-interest Iouns. At the deals close, Bei- jing Xinwei shareholders wIII Iuve un 8o percenL sLuke oI LIe IIsLed hrm; Wang Jing himself will IoId o.q1 percenL. Wang and his colleagues have added a sweetener, oerIng LIeIr own sIures In LIe combIned hrm Lo guurunLee LIuL prohLs Ior Beijing Xinweis underly- Ing usseLs wIII rIse Irom z bIIIIon Lo z.; bIIIIon yuun over the next three years, uccordIng Lo u MurcI z hIIng. Beijing Zhongchuang sIures, wIIcI spIked 18 percent in the month fol- lowing the takeover an- nouncement, have since sIed qo percenL. My special contribu- tion has been hard work, suId Wung. urrIved uL XInweI q yeurs ugo, und since then I havent rest- ed. euL und IIve uL LIe omce. My IIIe Is ubouL work. Reuters Bangkok Bank Cuts 2014 Loan Growth Target Manunphattr Dhanananphorn B angkok Bank Pcl, Thailands larg- est lender by as- seLs, Ius cuL ILs zo1q Ioun growLI LurgeL Lo - per- cent from 5 percent to re- ecL LIe weuker economIc outlook and the impact from prolonged political unresL. The revision was based on assumption that the countrys economy will grow z percenL LIIs yeur and the banks non-per- forming loans will remain stable at the current level oI ubouL z percenL oI LoLuI loans at the end of this year, President Chartsiri Sophonpanich told re- porters at a sideline of a murkeLIng evenL. Separately, Teeranun Srihong, president of Kasikornbank, said the countrys fourth-largest lender is maintaining its zo1q Ioun growLI LurgeL oI 8 percenL due Lo sLrong demand from large cor- porate clients, especially in the infrastructure, en- ergy und exporL secLors. Reuters D a r io
P ig n a t e lli/ B lo o m b e r g Myanmar Summary ..- ~_~....... ~_e.._ Bangkok Bank Pcl ~.,_e ,.~- .... ~ .~~ . , q:. . , .. q:. .,.~:. q:..,.~ _e~ .~:~.~_.. .-~:.,_. .:._ . .. :..q.~._.~.,. . .q..~_ _ . . ~:. _...~ q._. ~. .|_. . . ._ . . .. :. .q.~ e. . . ~~ . . . q:. . , . ~ .~~ . ._ ~..'~ ~._.. _. ._e. _. .~ -~. . .. . ._ .... ._ .~ q .... ..:~ -. . q:. . , ._e e. . . ~ , ~ ~__..._~:. ~~_ Chartsiri Sophonpanich . ._.:_~:.:.._. .,.~. Wang J ing ~:. ~, ~ . _._ .~ . . ,_.._....: ,.- .~ .e.q...,.~:. _~__.. ~:._e ,.._ .....:. .q..q..'. .:.. ~.~ ~. e q._~:. ..._. Wang - ~.~~.~_e. ._ Beijing Xinwei ~:. ~ ~ China Academy of Tel ecommuni cati on Technology . e. Beijing Xinwei -~ __e. . Chen Wei - Cwill Telecommunications ~. ~~.~....|.~: ~_ .:.._. ~. .|~ . ~ ~.,_e ~, ~ . -... ._._ ~ ._~ .. ,_ . ._:.:. _ e. ._ TD- SCDMA ~:. ~_e,~.. ._ .. ..: ~~~ ~ Beijing Xinwei ._ ~..|..~ e . ~,, ... . . e ~..q ~, ..'.: ~ ... ' . . e , . ~.:.~ ~_.~ e . ,., . ~..q ~, ..'.: ',~~, qq.._. Wang . ,.~:. ~..| . . , .~ . -. . , . Bonanza Investment Group Ltd .~. . ~..:..q..._..... Wang Qinghui ...: .e ...~.. .~..._.._e. ._~:. .q._. Wang ~., _e Bonanza ~:. e. ~,~ ... .,.qq..q,~_... ._.. qee:~.. .,. ~~ ~:. ~.q:..._. May 15-21, 2014 Myanmar Business Today mmbiztoday.com INTERNATIONAL BIZ 16 Myanmar Summary Myanmar Summary Siemens Unveils Overhaul, Q2 Disappoints on Energy Charges Noah Barkin G erman engineer- ing giant Siemens unveiled a long- awaited strategic over- haul in a bid to catch up wILI more prohLubIe rI- vals, as it posted weaker- than-expected quarterly earnings last week, hit by charges in its energy busi- ness. The Munich-based hrm`s CIIeI ExecuLIve Joe Kaeser has been working on the new strategy since taking power last summer following a boardroom coup that pushed out his predecessor Peter Loe- scher following a series of prohL wurnIngs. The company an- nounced that it was buy- ing energy assets from Rolls-Royce for roughly Cqo mIIIIon ($1.z bII- IIon) und LrunsIerrIng u majority stake in its Aus- trian metals business to Japans Mitsubishi Heavy Industries for undisclosed Lerms. Siemens also said it was streamlining its divisional sLrucLure, spInnIng o its hearing aids business and separating out man- agement of its health- care business all steps aimed at strengthening LIe hrm`s Iocus on eIecLrI- hcuLIon, uuLomuLIon und dIgILuIIsuLIon. The earnings and stra- tegic revamp, dubbed VIsIon zozo, come us Siemens mulls a formal oer Ior LIe energy busI- ness of French rival Al- stom, which has already received a bid from US gi- unL GeneruI EIecLrIc. Under former CEO Loe- scher, Siemens went on an aggressive drive for growth, leaving it lum- bered with a complex porLIoIIo oI busInesses. Retur n to r oots Kueser, 6, u q-yeur veteran of Siemens who previously served as its hnunce cIIeI, Ius vowed to restore the sense of pride at a company that has lagged big competi- tors like GE and Philips in terms of innovation and prohLubIIILy. In a signal that Siemens is returning to its proud roots, Kaeser is mak- ing his presentation at LIe hrm`s IIsLorIc SIe- mensstadt industrial complex in Berlin, which was the site of its head- quarters between the two worId wurs. ToLuI secLor prohL, or operuLIng prohL, Ior LIe hscuI second quurLer end- Ing MurcI 1 cume In uL C1.; bIIIIon on revenues oI C1;.q bIIIIon, mIssIng consensus. ProhL In LIe energy sec- Lor LumbIed q percenL Lo Cz mIIIIon, IurgeIy due Lo C1o mIIIIon In project charges related to two high-voltage di- rect current transmission (HVDC) projecLs In Cun- udu. The second quarter showed that we still have a lot to do to improve our operating performance, suId Kueser. NeverLIe- less we are on course to reach our targets for the hscuI yeur, Ie suId, con- hrmIng u gouI Lo Increuse earnings per share by at Averuge LS Imployee Only Tukes HulI oI Iurned Vucution Time: Sorvey Wai Linn Kyaw W hile the US gov- ernment, under the Fair Labor Standards Act, does not currently require employ- ers to grant employees puId LIme o, empIoyees who do earn vacation time may need a reminder Lo ucLuuIIy Luke IL. According to Glass- door`s Q1 zo1q EmpIoy- menL Conhdence Survey, the average US employee (of those who receive va- cuLIonJpuId LIme o) onIy Lukes IuII (1 percenL) oI his or her eligible vaca- LIon LImeJpuId LIme o. n addition, when employ- ees do Luke puId LIme o, LIree In hve (61 percenL) udmIL doIng some work. Each quarter, the Glass- door Employment Con- hdence Survey monILors four key indicators of empIoymenL conhdence: salary expectations, job security, the job market und compuny ouLIook. This quarters survey also took a look at em- ployee vacation time, in- cluding the percentage of eligible vacation time/ puId LIme o empIoyees actually take, how much they work and why while on vacation, among other reuIILIes. Emplogee oocotion r eali ti es While most employ- ees may be using at least some of their earned va- cation time, three in four (; percenL) ure noL Luk- Ing uII oI IL. Among em- ployees who receive vaca- LIon undJor puId LIme o, 8 percenL reporL LukIng uL IeusL some LIme o In LIe pusL 1z monLIs wIIIe 1 percenL reporL LukIng no vacation/paid time o. n IucL, one In Iour (z percenL) reporL LukIng 1oo percenL oI LIeIr eIIgI- bIe LIme o. Two In hve (qo percenL) empIoyees reporL LukIng z percenL or less of their eligible LIme o. Plus, when employees ure ouL oI LIe omce on vacation, that doesnt necessarily mean theyre catching up on rest and reIuxuLIon. OI empIoy- ees who took vacation in LIe pusL 1z monLIs, one In 1o (11 percenL) reporL they used vacation/paid LIme o Lo InLervIew Ior unoLIer job. EmpIoyees 18-q yeurs oId ure doIng this more than any other uge group, us one In hve (zo percenL) udmIL usIng vucuLIonJpuId LIme o Lo InLervIew Ior unoLIer job. So why are employees working while on vaca- tion? Of those who report working while on vaca- tion, they say they do so prImurIIy becuuse: u) No one else at my company cun do LIe work ( per- cenL); b) eur oI geLLIng beIInd (z8 percenL); c) Complete dedication to compuny (zz percenL). PeopIe waIk out of an ofce buiIding of Siemens AC in BerIin. F a b r iz io
B e n s c h / R e u t e r s ~..q ~, . - Fair Labor Standards Act ~q ~. .q~., _e ~. . q .:.._ ~. . ..:. .:.~:. ~. . . , _. .~ . . . ...q, ..~...:._. ~:. .. q~ ~ ~. . . . ~ ._ ~....:..:.~.,_e . . . ..: q, ~. ....~ . ~. ._~:. .q._. Gl assdoor - ~~, Employment Confidence Survey ... ...~ .. .:. ~q ~:... q~e ..: .:., ~..q ~, ~. . ..:..:.._ , .~ -~:... q~ ~ q:. .,.~.: qe._~:. .~qq ._. ~_. ~:...q~e ._ ~....:. .. , . ~ '~ q:. . , ., ._ ~. .| ~:... q~ ~ ~_.:.~. . .:. ..~._~:. ~,.:.._. . ...~ ~. . . ~~ ~ Glassdoor Employment Confdence Survey ~.,_e ~....:..:.- .,.,...: ~. . . . _. .q. ~. . ... ~~. ~.~~._.~.,.:. ~:. ~._..:....:_.._e. ._ . :.,~.~ Siemens ~., _e e. ~.~ ~., . , .._ ~ ..: ~._ . ...~ ~ . .:q . ~ ~_.,_...,:~ ..~~. ~_.~qq..._ .e:-e:.:. ~:. ._..._. ~ . ~ ~.,_e e , ..| ., . ~~..q ~, ..'.: ~ ... , . e ,~, e .q q e e:.:. ~:. Rolls-Royce . ~e e ._ _e.._~:. ._~_:._.. ,.- _..._~...~ . . , ..q e e: ~.:.. ~:. ., . Mitsubishi Heavy Industries ~:. . ._.: . .__e.._~:.~._. ._~_: .._. .~. ,~ q~~ _..... ._ . ~ e. ...~ _:.q.. . ~ . . ..| .~_~. ~ ~_.~ ., ~...~_.~~.,_e e,..| ~ ... .e qq . _. . ~_.~ . . ..|. e , ..| ~ ... , . e qq . ._ . . . .~ ~_~.,_e ~.,.| .q high-voltage direct current transmission (HVDC) . . ~ , .. . . ._ e , ..| ., . ,~~ ~ , ~._ ~~ ~ ~_.~ . , q:..,. e,..| .,. ~...._. IeusL 1 percenL In LIe currenL hscuI yeur. Reuters May 15-21, 2014 Myanmar Business Today mmbiztoday.com INTERNATIONAL BIZ 17 Myanmar Summary Myanmar Summary Ford Suspends Vehicle Assembly in Venezuela Eyanir Chinea U S automaker Ford has halted opera- tions in Venezuela due to a lack of foreign currency to import parts for assembly, workers at ILs pIunL suId. Like other private busi- nesses in Venezuela, car- makers have been com- plaining that the socialist governments currency controls are preventing them from importing es- sential products due to restrictions and delays in purcIuses oI doIIurs. Workers, who spoke to Reuters on condition of anonymity, said the plant in the central city of Va- lencia would be paralysed unLII LIe end oI Muy. Transport Minister Haiman El Troudi con- hrmed LIe sLoppuge uL LIe plant but said it should reopen in two weeks after a meeting between Ford representatives and gov- ernmenL omcIuIs LIuL re- solved some critical bot- LIenecks. Toyota Motor Corp halt- ed vehicle assembly in Venezuela in February for LIe sume reusons. Venezuelas struggling uuLo IndusLry suw hrsL- quarter production fall ;6 percenL Lo jusL ,qzq vehicles, compared with 1q,16 unILs In LIe sume perIod oI zo1, uccordIng to national automakers orgunIzuLIon Cuvenez. Ford assembled only qqq curs In LIe hrsL LIree monLIs oI zo1q. Automobiles are just one sector of many where President Nicolas Ma- duros government is fac- ing clamour to release more doIIurs Ior ImporLs. He says unscrupulous businessmen exaggerate needs In order Lo Ip doI- lars on the black market Ior prohL. A worker at a Ford assembly plant. B lo o m b e r g But nevertheless min- isters are holding urgent meetings with business heads to try and resolve problems and help re- verse the slide in local producLIon. Venezuela operates three exchange controls - uL 6. boIIvurs per doI- lar for preferential goods, und uL uround 11 und o for other sectors via two Central Bank mecha- nIsms. The dollar is trading at ubouL 66-68 boIIvurs on the black market, accord- ing to illegal web sites LIuL Lruck IL. General Motors, Mit- subishi, and Fiat Chrysler also have assembly plants In VenezueIu. Reuters US, Singapore Reach Agreement on Tax Evasion Patrick Temple-West & Rachel Armstrong S ingapore has reached a tax in- formation-sharing agreement with the Unit- ed States under a new law meunL Lo combuL osIore tax dodging by Ameri- cans, a US Treasury De- partment spokeswoman suId IusL week. The deal, which was ex- pected for more than a year, will make it much easier for institutions in one of Asias biggest wealth management cen- tres to comply with US rules, and puts it ahead of rival Hong Kong which is yeL Lo hnuIIse u deuI. SeL Lo Luke eecL on JuIy 1, LIe oreIgn Ac- count Tax Compliance US Bepartment of the Treasury InternaI Revenue Service (IRS) 1U4U IndividuaI Income Tax forms for the 2U13 tax year are arranged for a photograph in TiskiIwa, IIIinois. R e u t e r s AcL oI zo1o (ATCA) wIII require foreign banks, investment funds and in- surers to hand over infor- mation to the US Internal Revenue Service about accounts with more than $o,ooo IeId by AmerI- cuns. oreIgn hrms LIuL do noL compIy Iuce u o percent withholding tax on their US investment Income und couId eec- tively be frozen out of US cupILuI murkeLs. The Singapore deal, known as an intergovern- menLuI ugreemenL (GA), will come as relief to the city-states wealth man- agement industry which Iud S$1.6 LrIIIIon ($1.o LrIIIIon) In usseLs under management at the end of zo1z. Like most of the other FATCA deals, the Singa- pore agreement will al- Iow hrms Lo reporL US account-holder informa- tion to their local tax au- thority, which will send it along to the IRS, saving them from dealing direct- ly with the US tax authori- LIes. The Singapore deal was agreed in substance and musL be hnuIIsed by LIe end oI LIe yeur. The advantage this gives to Singapore insti- tutions is the certainty on how they should go about their compliance eorLs und muke LIe reI- evant registrations, said Michael Brevetta, who is PricewaterhouseCoopers FACTA lead for Southeast AsIu. Hong Kong is looking to sign a similar agreement, and inked a separate tax information agreement with the United States in MurcI us LIe hrsL sLuge Lo achieving a full IGA, al- though it is unclear if that wIII be done beIore JuIy 1. China has also been in talks with the US Treas- ury on whether to sign such a deal, although no information has been re- leased on how much pro- gress Ius been mude. InuncIuI hrms In coun- tries that have not reached a FATCA pact must report directly to the IRS and risk violating local priva- cy laws, a particular risk in China, which has broad sLuLe secrecy ruIes. More LIun 6o GAs Iuve been negotiated to date, including deals with In- donesia, Peru and Kuwait announced in recent days, according to the Treasury DepurLmenL`s websILe. FATCA was enacted af- ter a scandal involving Americans hiding money In SwIss bunk uccounLs. Reuters ~..q ~, ~:. ~ . . .q. . . , ._e. ._ Ford ~.,_e ..: .~: e: ~. . .q.. . ..: q, . _.:.. ._~._.~ .. . . _~ .~ .:._ ~~ ~ - , ~ .:.. q , .-. . , .._ .~ . .:.~:. q. ~, . ~ ._~: . . q ._. - , ~ .:.q ~_.:.. . ~. . , . .:.~.. ~:.~....:. ~.,_e , .~ -~ , .. _ .~ . .. . _.:.. ._~..q.q:~ ~ . q e .. ~. .q-. ._~. . q: , ... . .:._.. . .,_. . .:.~:. _~.~ .,q_.._e. ._ . ~e~:~:.~.~~.,_e ._. .e.e: ~|q .~~ . - , ~ .:.. ~ ..: .~: ~:. ~ . . . .:.~:. q. . .. ._ . 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May 15-21, 2014 Myanmar Business Today mmbiztoday.com INVESTMENT & FINANCE 18 Myanmar Summary From page 6...(ALB) Chiang Mai Reps visit Myanmars Kengtung to Boost Trade Ruedee Pavasiriporn R e pr e s e nt a t i v e s from Thai city of Chiang Mai recent- ly visited Chiang Tung in Shan state (also known as KyuIngLong or KengLung) in Myanmar to tighten Lrude reIuLIonsIIp. n LIe pusL, LIe hve Chiangs, which include: Chiang Rai, Chiang Mai, Chiang Tung, Chiang Rung (currently referred Lo us JIngIong In CIInu), and Ching Thong (which is now Luang Prabang in uos) used Lo bousL sIgnII- icant trade relationships wILI eucI oLIer. To help strengthen the relationship in the pre- sent day, delegates had been sent to visit Chiang Tung In LIe hrsL week oI May, according to Pairoj Kullawanich from Chiang MuI`s Omce oI Commer- cIuI AuIrs. The talks included open- ing new border check- points, discussions about the hazards of cross-bor- der wIIdhre smog, und enhancing transportation cooperation between the Lwo cILIes. BusInesspeo- ple from Chiang Mai also showcased their products In KengLung. The two cities are ex- pected to sign a sister city pucL In LIe IuLure. Myanmar Summary Iyn Kok, the new chief executive ofcer for the Creater Mekong Sub-region of Standard Chartered. Standard Chartered Appoints New CIO Ior Greuter Mekong Myanmar market a key focus May Soe San S tandard Chartered has appointed Lyn Kok as the new chief execuLIve omcer Ior LIe Greater Mekong Sub-re- gion, the UK-based bank suId. In her new capacity, she will work closely with Chief Representative for Myanmar, Tina Singh- sacha to leverage cross- border opportunities and enhance the banks ability to provide strategic sup- port to its international clients exploring oppor- tunities in Myanmar, the bunk suId In u sLuLemenL. Standard Chartered resumed its Myanmar operations last year by opening a representative omce In Yungon IoIIowIng u o-yeur IIuLus. SLurLed In 186z, LIe bunk oper- ated in Myanmar as the hrsL IoreIgn bunk buL wus nuLIonuIIsed In 1q6 dur- ing the infamous dictator Ne WIn`s regIme. The Greater Mekong CEO role is a new region- al leadership position that sees Lyn assume govern- ance responsibilities for Greater Mekong, which comprises Thailand, Viet- nam, Myanmar, Cambo- dIu und uos. In addition to her re- gional responsibilities, Lyn will continue in her current role as president und cIIeI execuLIve omcer for the banks Thai opera- LIons, LIe bunk suId. Lim Cheng Teck, re- gional chief executive omcer Ior ASEAN, suId: The potential of the Greater Mekong region Is Iuge. By uIIgnIng our business operations in those markets under the Greater Mekong umbrel- Iu, we wIII be ubIe Lo oer our clients doing business in those markets targeted, regIon specIhc hnuncIuI insights and enhanced servIce. I believe Lyns deep ex- perience and understand- ing of the region will help take our business to new IeIgILs. Lyn was appointed president and CEO for Standard Chartered Bank (TIuI) In JuIy zo1o. PrIor to that was she was man- aging director, country head of strategy & cor- porate development and general manager, Beijing for Standard Chartered Bunk In CIInu. S C B Standard Chartered ~., _e Lyn Kok ~:. .e:...| ....-~...:~q:q.. ~.. ~_e. ., ~. . ~ ._~: . .q._. . .~.,_e _., .:. . q: _:.,~ e .:. . e Ti na Singhsacha . _.,.:.~ ,e .. _e~ .~: ~. ~.q..:. _.,.:.~ ~.~....:. .:.q:~q:.e_~._ ~_._ _._ . q:. . , ..:.~:. .e: -e:~~ ~_.:~..... .:.~ . . . ..: . .q.~~ ~ ~~ ~~ . . ..: _~q._ _e. ._. Standard Chartered ~., _e _.,.:.. .. ~ _~: .~.~:.,q:. e...~ _., ._ ~ .q:~ . _. . q, ~ , _. ~ ~e.:..e,. e...._. Standard Chartered ._ ~' . .~~: _.,.:.. ~.q:~.._ ......: ._.:.~_e.._....: ~', . . . ~ ..,~.~~:~: ...~: _._.. ~.....q ._. .e:. ..| ...~. ..: ~q:q..q:.._ .... q: ..| ...: . . . q: .~.. ~. . _e. _. . Lyn ~.,_e . -e~,. _.,.: ~..:..e:. . .:~ ~ .|~ ._ .e:. ..| ...- ~ . .. .q.~:~, .:. ._. ....:q.__e.._. Lyn ._ ~, ~ . . . q Standard Chartered Ban - ...: , _~:..q.. . . .q: .e:-e:. ....|. ..:q~.q.~_~.~~~_e. . ...: . _. . ~~~ ~ . ~ Standard Chartered Bank (Thai) -~...:~q:q.. ~_e. .,~._...q._. water access is crucial to ensuring that the countrys growLI Is IncIusIve, wILI benehLs reucIIng vuInerubIe and poor populations, said Matsuo Hideaki, counsellor (economIc und overseus deveIopmenL ussIsLunce) oI LIe Embussy oI Jupun In Myunmur. The grant can demonstrate to city authorities innova- tive and sustainable methodologies for the planning and delivery of improved sanitation and urban services in- IrusLrucLures wILI communILy InvoIvemenL. By zo18, LIe grunL uIms Lo buIId z,ooo sunILury Iu- LrInes, consLrucL 1; kIIomeLres oI druIns IInked Lo cILy networks, and build four community solid waste sys- Lems In Iour LownsIIps. L wIII uIso buIId cupucILy wILIIn local government and develop community action plans und mobIIIse 1oo CommunILy DeveIopmenL CommIL- tees to partner with Township and City level Develop- menL CommILLees, ADB suId. Myanmar Summary .,.- ..q....|....:..q. q,.. ~..q~,..'.: ....,.~:.~:qe_e..q.~ (ADB) ._~ ._~. ~:. . ..: ._ . . ~ , .._~: q, ~ , . .. ...q . ..q~. ..: . q..:~._ ._~:. ~ ., q .. ~ .q._ ..:~ . ..q. .q. .., . . . ,. .:. qq .~: ._ _e. ._~: . ADB .._~_::.._. ~. .|.... . . . ~ , .~.,_e .q:|_., . :.. , ... _. . .q. .., . . .,. .:. _. ~ _. . .q_~ .. ~:. ..: ._. . ~~:. _.,.:.- _._~..._.~....:.__e.._~:. ADB . ._.:_~:.._. ADB.~..|..~,.._ ...~ ~, .~ ~._.. _. . . q, . . .,. ~:.. ~ .~ ...._ _ e. _ . .. . ~, .~ ~.,_ e ~._ . . ~..:~ ~~ .:.~:. ~....~~~ ~.._~...~:~. _. . . . _. ..:.. . ..: q._ _e. ._ . ~. .|.... ._ . , ~ ..:.._~: .q. _. ..q_~ ._. .. .. . .:. . . :. ._~ .:.~ ._. .q.~ ~~ ~ .| .|~ ._ _e.._. .. .... ~e.:. .e.:.~.,_e q.._._,e ~ .~ _ . . _ ., .:. . ...:..q..q: .~.e.q. .:.~._.q,~~~.:..q:~ .._~:. .q._. e. ~ Chiang Rai, Chiang Mai, Chiang Tung, Chiang Rung . Ching Thong ~ ._ ~. _. . ~. _. . .. :..q. .q:.~.e.q._~._. e.~.| .~.~~.q, ~~~ .... ~e.:..e .:.._ ~.~_.. ... ...~ ~~ .~ . :..q:~ . ._~: .. .. ~ , . e .q..q.q: ,.. Pairoj Kullawanich . ._.:_~:..._. May 15-21, 2014 Myanmar Business Today mmbiztoday.com INVESTMENT & FINANCE 19 Myanmar Summary Myanmar Summary David Mayes T here is a lot of downside risk in both the stock and bond markets at the mo- ment, but with interest rates currently so low I am often asked if there is a way of partici- pating in them while limiting your downsIde. TIe unswer Is yes, and it is not as complicated us mosL peopIe LIInk. TIere Is Hedging Your Market Exposure a generally misguided fear of anything labelled a derivative, in fact if you scan through the medIu you wIII hnd IL Is noL oI- ten you will even see the word derivative unaccompanied by LIe word compIIcuLed. YeL noL all derivatives are complicated, and it is a relatively straightfor- ward process to insure a port- IoIIo uguInsL poLenLIuI Iosses. An American style put option gives the owner the right to sell the underlying stock or stock index at a certain price, the strike price, anytime up until LIe expIruLIon duLe. I LIe prIce of the underlying stock or index falls below the strike price, the option becomes in the money and becomes more valuable as the price in the market contin- ues Lo drop. TIus, II perIecLIy hedged, which I will discuss later, you can limit the down- sIde eecL on your porLIoIIo Lo the strike price of the options you IoId. For example, say you own a stock portfolio that is es- senLIuIIy LIe S&P oo worLI $1oo,ooo. You couId buy puL options at a strike price that is far out of the money, for in- sLunce 1 percenL beIow wIere the market is currently trading, and thus lock in a maximum Ioss on LIe sLock porLIoIIo II 1 percenL. Keep In mInd you don`L need Lo buy $1oo,ooo worLI oI options since they include a lot oI Ieveruge. You wunL Lo muke the number of shares underly- ing the contracts you buy add up to the value of your portfo- lio based on the current market prIce. The option cost is the sunk cost of insurance basically and should always be viewed this wuy. I LIe murkeLs don`L crusI these costs are deducted from the return you get obviously like anything else in life the more you spend typically means the more you get, and this is true with options as well gener- uIIy. An opLIon wILI u Ionger time frame to maturity will be more expensive than one with a sIorLer LIme Irume. TIe IIgIer the strike price of a put option also means the higher the in- surunce Is goIng Lo cosL. Not all stocks have the same volatility as the overall market, so in reality you will not likely puL on u perIecL Iedge. How- ever if you use an option on an index that has similar volatility and is correlated to the bulk of your holdings it will still do well in massively reducing downside exposure. or InsLunce II you hold mostly emerging market stocks like BRIC funds it might noL be wIse Lo use LIe S&P oo as it will not likely be volatile or even correlated enough to do a very good job. NexL week wIII write about how you can reduce your rIsk In LIe bond murkeLs. Dctid Mces MA protides ueclth mcncement sertices to expctrictes throuhout Southecst Asic, jocusin on UK Pension Trcnsjers. He ccn be recched ct dctid.mQjcrc- mond.com. Icrcmond UK is Boundary Settlement to Boost BD-Myanmar Trade Kyaw Min T he settlement of maritime boundary disputes between Bangladesh and Myan- mar provided an excellent opportunity to enhance maritime commerce and cooperation between the two countries, the Presi- denL oI BungIudesI suId. The exchange of more training for both sailors und omcers beLween LIe two countries may be con- sidered in order to foster friendship and sharing knowledge, Abdul Hamid said to commander-in- chief of Myanmar Navy Admiral Zeya Kyaw Htin Thura Thet Swe who visited Bangladesh last week, Bangladeshi media reporLed. During the meeting, Ab- dul Hamid said Admiral Zeya Kyaw Htin Thura Thet Swe said Myanmar always attaches impor- tance to its relations with Bangladesh, adding that this visit would increase the friendly thought be- Lween LIe Lwo counLrIes. There is a Iot of downside risk in both the stock and bond markets at the moment, but there are ways of participating in them while limiting downside. R e u t e r s .:... q . _., .:. ~_~:. .q. ,~ ~_ .. :.. ~:. ._eq . ._..._ ....q..,. ~,.e.. .......|. ..: q ~ .q.~~ ~ .:.. : ~.:~ ~~ _e. ._~: . .:. ..q..~. ._.:_~:..._. ~..|.~..~ Abdul Hamid . .q~.-..._~. .~e.~: . q.~ .. . _.,.:.. .~..q.._ .:...q.~~~ .:..: ~.q._~ ._. ....q....~:. ~ .. :...._~: .._.:_~:.. ._ . reulcted b the ICA cnd pro- tides cdtice on pensions cnd tcxction. .~q.:.~: ..~:...~~.~: .:.....~~.:.| ~....~q., .|~e. .|... .~q ~~..,.,_. ,_...'.:.~: .~~.,, .-:. ~ q ~. .. ~..'. : ~ _ ...e ,_ . ....~q..:...~: qe,q.| .....|~e. ~._e~.~: q.|~e. _...~: ~.|~._. ~.:.... , . , . . .. ..e ~ .| ... ._~. .:...~e: .ee~:._e.~: .~._~:~q...:_e._.. .~., , ...:.. .:. .q q . . . : .e ~ .|.. .|... .._~..:...~~. e:.~: ., . . ..| .._. ..~: ....: ..~....:.~~..e: ..,. .~.:.~.:..:....|._. ~..q~,..~.~: .q~ ~, .._..~~ .~~..~..~~..: ~,e..~.~.~~.., .q:... ...:..|~e. ~~e. ~,e..~ e: ..'....~:~ ..:~.:.q .~: ~,e.e: _ ~, :._,. _e..:_.. ...~~e:._. ~...:.:_e..|~e. .|._~: .~.,, .q~...,.~..' . q . ~ :.~ ~, e ., ..'...~ .~ . ~ ...:.. e . ~. .|~e . ..:~:._e S&P 500 ~ ~,e. ~:._e ~..q ~, ..'.: ~. ..: . . ~ q e e:~. . . .e . .|. . .,, ~ . . , ., . q . ~.,, ..'... ~ ..|~...q.~:~ ~ q:..,. , . _. . ..'. ~e e . .~: . ~e e . ..e.q ~....e: ...~~q ~.:... ..,..~,e. ~ q:..,. _e..,_._e..|~e. May 15-21, 2014 Myanmar Business Today mmbiztoday.com INVESTMENT & FINANCE 20 Myanmar Summary Frontier Fund Buyers Find It Pays to Look Under The Hood Most frontier fund managers are watching for opportunities in Myanmar, whose equity market is not yet open to foreign investors Alexandra Wexler F rontier market Iunds sIgnIhcunL- ly outperformed emerging market funds last year, with the top- performers in the fron- tier category returning as mucI us percenL. TIe eye-popping performance has caught investors at- tention, prompting a surge of interest in fron- LIer-murkeLs equILy Iunds. Its not hard to see why frontier funds are gen- eruLIng sucI u buzz. TIe MSCI Frontier Markets 1oo ndex guIned z6. percenL In zo1, wIIIe LIe MSCI Emerging Markets ndex IosL percenL. So far this year, the Frontier Index Is up ;.q percenL through March, while the Emerging index is down o.8 percenL. Eye-catching though the headline numbers are, perhaps more than in any other asset category it pays investors to look under the hood of any Iund LIey`re consIderIng. While the MSCI Frontier Markets index and the top-performing funds en- joyed a stellar year, not all funds in the category ended zo1 In LIe bIuck. The countries and regions in which the best- and worst-performing funds focused their holdings had a major impact on their returns, as did their InvesLmenL sLruLegIes. Some of the funds have a bottom-up focus, which evaluates companies on standalone basis, and others take a top-down approach, in which the counLrIes ure hrsL IdenLI- hed us poLenLIuI InvesL- menL opporLunILIes. MosL, though, combine the two approaches, selecting companies they see as undervalued in a range of countries in which they feel comfortable invest- Ing. Harding Loevners $q1;.1 mIIIIon ronLIer Emerging Markets Fund, which rounded out the top four performers, wus up 1; percenL IusL yeur. AccordIng Lo porL- folio manager Pradipta Chakrabortty, the fund takes a bottom-up invest- Ing upproucI. What were looking at are companies that are very well positioned with- in the industry and ex- pecLed Lo benehL over LIe long run from growth in LIese economIes, Ie suId. or zo1q, CIukruborLLy is bullish on Africa and SouLIeusL AsIu. Markets like Kenya have continued to look very robust, he noted, citing the banking and tel- ecom industries as being purLIcuIurIy InLeresLIng. The fund owns Safaricom, a Kenyan mobile network operator that Chakrabort- Ly suys Is poIsed Lo benehL from consolidation in the Kenyun LeIecom secLor. Proponents of frontier markets as an asset class argue that the asset pool is continually growing as more companies list on stock exchanges and more countries become viable investment desti- nuLIons. or InvesLmenLs that will start to become IeusIbIe beyond zo1q, most frontier fund man- agers are watching Myan- mar, whose equity market is not yet open to foreign InvesLors. Its a massive market in terms of population, but its very backward in terms of development, CIukruborLLy suId. HIs fund has exposure to My- anmar through Thai and Filipino companies that have operations there, he udded. L`s goIng Lo be a big market in the very Iong run. Morgan Stanleys $qz.q mIIIIon ronLIer Emerging Markets fund takes a more top-down approach, analyzing the macroeconomic environ- ment in all the countries IL IdenLIhes us IuvIng sustainable economic growLI. TIe Iund bougIL into Vietnam only last yeur, Ior exumpIe. We thought the growth level oI 8 percenL |prIor Lo LIe hnuncIuI crIsIs| wus re- ally unsustainable, said Timothy Drinkall, the Iund`s porLIoIIo munuger. But when policy makers slowed Vietnams GDP growLI down Lo beIow 6 percent, the fund began InvesLIng LIere. Once the fund man- uger Is conhdenL In un economy, he looks for es- tablished businesses that have considerable growth poLenLIuI. We`re reuIIy looking for companies that are market leaders or soIId No.z In un IndusLry, DrInkuII suId. TIe sLruL- egy cerLuInIy puId o IusL year: Morgan Stanleys was the top-performing frontier fund with a re- Lurn oI percenL. David Wickham, who munuges HSBC`s $1qq.8 million frontier markets fund, said that liquid- ity risk is one that can be handled by keeping in- vestments to a managea- bIe sIze. We`re noL goIng Lo grow Lo $z or $ bII- IIon, Ie suId. WIckIum, whose fund racked up u z.;% guIn Lo become the second-best fron- tier performer last year, explained: We want to be nimble, and if youre munugIng $z bIIIIon, you just cant move the money quIckIy. Mobile Internet is a theme that fund manag- ers are following closely In IronLIer murkeLs. Wickham sees local retail consumers driv- ing growth in frontier markets, so hes focusing on trends including mo- bile phone use, Internet penetration, and alcohol consumption, as well as LrunsporLuLIon. We`re trying to capture posi- tive change thats hap- pening in these markets, WIckIum suId. TIere are many ways to play the consumer, including low-cost airlines, mobile phones and shopping muIIs.
Its a massive market in terms
of population, but its very backward in terms of devel- opment. Its going to be a big market in the very long run. Most frontier fund managers are watching for opportunities in Myanmar, whose equity market is not yet open to foreign investors. U A u n g / X in h u a e.,..~~. ,e.~.... ~ ~ q, . . .:.._ e _e ..... ~ ~ q, . . . :.~ . .: .~:..,.: ....:.._.. ~.~: .. .. . ..: . . .:. ~.,_e ,, q:. . , ., ..|. _., ._ qq . ._ . ~. .|. . ..: .~.:.._ q..._.....:. ~:. . ..: .~ q _. . ,e .~. ...~ ~ .:.~ q .. ._. . . . .:. . . ~ q, . ~ ~ .:..:_~_. _e. ._. MSCI Frontier Markets 100 Index ~.,_e ~~, ...~~. ' ... , q:. . , .~_.~ qq . ..: ._ . MSCI Emerging Markets Index ~., _e q:..,. ..,..._. e... .~.~ Frontier index ~.,_e ... q:. . , ._. ~~ .~ q _. . Emerging index ~.,_e ._... q:..,. ~...~q._. May 15-21, 2014 Myanmar Business Today mmbiztoday.com INVESTMENT & FINANCE 21 Myanmar Summary Myanmar Summary Myanmar Summary From page z...(\S Myanmar) end of the bargain and as a result, you know, the eth- nic minorities and a lot of people on the ground are conLInuIng Lo suer, und so I do think that theres not uniform support for the total Burma policy, Ie suId. He acknowledged that progress has been made, and said he would com- mend the administra- tion on that, but I think theyve been way too hasty to allow the military-to- mIIILury connecLIons. He said there have mis- givings from the start about the administra- tions policy, that it was going way too far too fast without establish- ing benchmarks so out- siders would know what to measure to determine whether the strategy was successIuI. They kind of gave away the store, he said, cost- ing them the ability to Inuence LIe Myunmur mIIILury. The administration, rather than establishing standards or benchmarks, their idea has been to keep LIe sLruLegy very ex- ible, and I just think that doesnt work not with a regime like Burmas, he suId. A congressional source who asked for anonymity wus more poInLed. He said he thought the administration has de- clared victory and hoist- ed the mission accom- plished banner too soon and without a policy in pIuce Lo ucLuuIIy geL LIere. Youd think that after LIe pusL 1z yeurs we`d learn that in foreign pol- icy, wishing doesnt make IL so, Ie suId. Hiebert suggested that there are now more ques- tions about Myanmar policy, particularly in the House, than there would have been two years ago, partly because it is now becoming clear that re- forms such as those un- derway in Myanmar are compIIcuLed. I think there is, prob- ably, a diminution of sup- porL. LIInk eurIIer on they gave them a sort of blank check you know what youre doing, carry on and now people are asking more questions, and it goes beyond the mIIILury, Ie suId. The Diplomct Stete Hirsch is c Wcsh- inton DC-bcsed journclist uho hcs reported exten- sitel on Western policies towards Myanmar. FDI Created over 90,000 Jobs in Myanmar Last FY Aye Myat M ore LIun qo,ooo jobs were cre- ated by foreign dIrecL InvesLmenL (D) projects in Myanmar dur- Ing LIe hscuI ended MurcI 1, sLuLe-run medIu re- porLed. The English daily New Light of Myanmar, which is widely regarded as a government mouthpiece, said total accumulated FDI Irom z6 InvesLor counLrIes us oI LIe end oI IusL hscuI wus $6.161 bIIIIon. China tops the list of in- vesLors wILI $1q.1q bII- lion, followed by Hong Kong wILI $6.qo; bIIIIon und SIngupore wILI $q.18 bIIIIon, LIe puper suId. The oil and gas sector attracted the most FDI wILI $1.6o bIIIIon, IoI- lowed by electrical power wILI $1.zq bIIIIon und manufacturing with $ z.;8 bIIIIon, LIe puper udded. China Remains Myanmars Biggest Trading Partner Kyaw Min C hina continued to be the biggest trad- ing partner of My- unmur durIng LIe hscuI yeur ended MurcI 1, uc- cording to data released by the Commerce Minis- Lry. Bilateral trades with CIInu durIng LIe hscuI yeur umounLed Lo $;. billion out of the coun- trys total traded volumes worLI $zq.8; bIIIIon, uc- counting for slightly more LIun o percenL oI Myun- mur`s LoLuI Lrude. Myanmars export to CIInu wus $z.q1 bIIIIon while Chinas export to Myanmar reached over $q bIIIIon durIng LIe pe- rIod. WILI over $.6 bIIIIon worth of bilateral trades, Thailand turned out to be the second biggest trad- ing partner of Myanmar IusL hscuI. Myanmar mainly sold rice, corn, beans, pulse, sesume, rubber, hsIery products, teak, hardwood, natural gas, jade and gar- ments to China, India, Bangladesh, Australia, UAE, Belgium, Indone- sia, Italy, Japan, Korea, Malaysia, Pakistan, Phil- ippines, Russia, Saudi Arabia, Singapore, Spain, Thailand, UK, USA, and Vietnam, the Central Sta- LIsLIcs OrgunIzuLIon suId. .~.~ _......_ e. _:.q.. . .:q ..:.~~, ~ . ~.,_e _., .:. -~_~ . ..~,.ee~. ~.,_ e .~ .~ q. ~_ .~ q ._~: . .q._. . -e. . . ~ , . e . ~, e..:~..q ~, ..'.:, ... . e q ._ ~,~ ~, ~ . . . . . ~,.e.~,e..: ~..q~,..'.: ... , .e qq._.. _.,.:.- . . ..| .~ , . e . -,~q:. .,..~:q.,_.._e.._. _.,.:..~,~..~ ...:~..q ~, ..'.: ... ~ . e q._.. ~,~..: ~...: ~.. q~,..'.: , .e. .q:~q. ._. .~.,~q~~_......_ _. .. ._ _:.q.. . ~~ . ~_.__._ . q:~ ~ , ~ q .. . _. . . . .:.~.,_e _.,.:. ~~..~~..|. ~,~~~ .~: e, ~ ..... . ._~: .~. . q. .~ ..:. .e: _.:.._ . New Light of Myanmar ., . ~ ~ . . .~ ..:~q. _.:.~~,~q.. ._. . . ._ ' .. e. _:.q...~~. q .. ._. . . ._~,e..:~..q ~,..'.: ,'...~'~ . eq._~:. .q._. ._~:....~ ..._._:,. .~ ~:. ~..q ~, ~ , q~ . ~ _.._ ~.| _., .:. - ..~..,:~.~..q. ..~ Barack Obama ~- _.,.: ..q: ....|...:q~. . ~|.~ ..~,. . ._:, .:. ..~_~ . ~_e. ..' ~ .:_. _e.._. ~..|..._~..~:. ~:q . ..e~....q:._.:. .q. ...~:.~~_ Steve Chabot . J oseph Crowley ~ . -_. . q~ ., ~ .~:~ . ~ .~: _~ _.. _. ._e. ._ . ~..|..._~..~q Obama ~. .q~.,_e _., .:. - .. ~. . . ...| ...: q ~ . .:. ~:. ~, .~ .~ . . . ..: ._ ~ . . ...| .. .:.._ ~.,_.,.,_.. _.,.:.- _._.._.:....:.~:. ..: . . ..: q, ~ ~ ~ , .. _. ..q ._~:. .~q_.._e.._. R e u t e r s May 15-21, 2014 Myanmar Business Today mmbiztoday.com INVESTMENT & FINANCE 22 Myanmar to Host 2014 ASEAN Business And Investment Summit Kyaw Min M yanmar will host zo1q ASEAN Business and In- vesLmenL SummIL (BS) in Nay Pyi Taw in Novem- ber, according to Vice- President of the Union of Myanmar Federation of Chambers of Commerce und ndusLry (UMCC) U WuI PIyo. U Wai Pyo who is also a member of ASEAN Busi- ness Advisory Council (BAC) suId LIuL LIe zo1q ASEAN BIS is slated for November 1z-1q. ASEAN BIS, organised annually by the ASEAN Business Advisory Coun- cII (ASEAN BAC), pro- vides a platform for the business community to engage with ASEAN Leaders and economic ministers as well as key decIsIon mukers, Ie suId. This annual summit aims to increase ASEANs attractiveness as a region for trade and investment and enhances regional competitiveness, ASEAN BAC suId In u sLuLemenL. The ASEAN BIS is ex- pected to be attended by prominent government, business and thought leaders to discuss issues of strategic importance to ASAN und EusL AsIu. Myanmar takes the ro- tating chair of ASEAN LIIs yeur Ior LIe hrsL LIme after joining ASEAN in 1qq;. ASEAN comprises Bru- nei, Cambodia, Indone- sia, Lao, Malaysia, My- anmar, the Philippines, Singapore, Thailand and VIeLnum. Myanmar Summary - We as activists are committed to our coun- try to develop But, up to now, so many invest- ments in our country [have] no transparency at all nobody knows how to sign a contract, how to sIure LIe benehLs. we ask democratic countries to think of how to invest in our country, responsi- ble investment or ethical investment that means to have a sustainable devel- opment and democracy in our counLry. From page ...(ReBecting) From page 8...(ReBecting) - We are ready to work on the market develop- menL Ior LIe benehL oI uII our people, not a few peo- pIe. Surfoce or uhot lies heneoth The panellist that in- sLIIIed LIe mosL conh- dence from an investors point of view was Win- ston Set Aung, vice gov- ernor of the Central Bank oI Myunmur. SeL Aung spoke clearly about how Myanmar is making great strides in reforming its InsLILuLIons. He spoke uL length about the quantity of reforms that are not superhcIuIIy seen In order for the visible reforms for example joining the global currency exchange mechanisms to take pIuce. He eIucIduLed LIuL while many reforms are not very much visible to the people that is not possible without having the strong and sustained political will and commit- ment of the people and government to keep mov- ing forward ahead with the democratisation pro- cess, to keep improving und keep mukIng u dIer- ence. He spoke about the challenge that the country is managing by simulta- neously addressing re- forms concerning politi- cal development, national reconciliation, economic development, social de- velopment and environ- menLuI deveIopmenL. While he said with some humility, Im a techni- cian, not a politician, he simultaneously made a good case that the country needs an army of techni- cians to help bring about eecLIve reIorm. Set Aung fairly points out it is early days for My- anmars reforms: Reform is a process it needs time to evolve Now we have gone through two and a IuII yeurs. SeL Aung uIso
[the] former military regime, why
they change such a situation [from dictatorship to democracy]? ... democracy and market economy is the world trend ... [the military] never got international credibility, international legitimacy; thats why our army gener- als are very clever how to deal with the international community ... to get the legitimacy discussed the develop- ment of special economic zones and methodologies being put in place for all foreigners to invest on u IeveI pIuyIng heId. He added, The most impor- tant thing is we have been trying to create favour- able investment and busi- ness cIImuLes. Dissecting the oppor- tuni ty Coming away from the panel, one has the feel that economic develop- ment will come in spurts and stops while full dem- ocratic reforms may lag expecLuLIons. or Inves- tors and businesses, the timing of their entry re- lated to particular busi- nesses and investments wIII be key. or LeIecom providers Telenor and Ooredoo, the time to en- ter the market has already urrIved und LIeIr hrsL mover status will likely benehL LIem. TIuL suId, as much as one may be- lieve the trajectory of re- forms will continue if the NLD eventually comes to omce In zo1 eIecLIons or in the elections after that, it is in reality uncertain what the NLD will change and will keep from the currenL reIorm ugendu. L seems important to both encourage and question the development of My- anmar for the local people und LIe brouder regIon. At the same time, the case for coddling the current government to build re- lationships with a revital- izing country would seem to risk the incomplete political and economic reforms transpiring in the country, albeit perhaps prohLubIy. Iorbes 1on Spriner is c con- tributor ct Iorbes cnd urites cbout jrontier cnd emerin mcrlets, uith c focus on Asian economies. PaneIIists at a session at Iast year`s edition of the ASEAN Business and Investment Summit. E R I A _., .:. ~.,_e ~~, . . . . ~ :.~ ~:. e . .. :..q. . q .. ._. . . . . q:.. ... .. 2014 ASEAN Business and Investment Summit (BIS) ~:. .,_._.~:_ ~..._ _e.._~:. _.,.:.~,._ . .~..~...,.q.:. ~. ... . ~ e~ _ ..~_e . . ._.:_~:..._. ._~:.~ ~...~ Milken Institute Global Conference 2014 q .......,.~ _.,.: . ~ ._.:._._ . ~ ~ e .:. .e.~ ~~.q:~....... _~.|~e.........: _.,.: . e: :._~: . . ~.q. ~ ~.._.:..:~e.~ ....,. ..'. : .ee~._e~.~: ~, .~: ~ ~.,, :._~: .~ ~...~..'.: ~... :..., ..~.q.~.._.:. .q., . ~ .. ~ ...~ ~ . .. :. .,. _e. ..'.:.q.~..'. : . . , _.. ~e . ~:. _e. .|~e . .|... _., .:. q . . ~q~ ~. . ~ .. ~ ...~ ~ ..' ~ .: .q.~..'. : ., ~ .,~ ~.~ ~.~.~: q.,.|...~e. May 15-21, 2014 Myanmar Business Today mmbiztoday.com PROPERTY & REAL ESTATE 23 Myanmar Summary Contd. P z...(Colden Land") Contd. P z...(Colden Land") Golden "Lund: Protecting Investments in Myunmur Irom ispotes Foreign legal consultants John Lichtfeld and Kyaw Zin Htet report that Myanmar is fast emerging as a destination for foreign companies. Issues remain, however, over land ownership.. John Lichtefeld & Kyaw Zin Htet A s Southeast Asia has blossomed into a region at- tractive for investment, coveted land resources have become scarcer and disputes over land more common. Even wILI ILs vast size, Myanmar is no exception to this rule, as the nation struggles with eecLIve Iund regIsLru- LIon und LILIIng Issues. n zo1zJ1, Myunmur`s economy grew by 6. per- cent but land disputes remain a legal issue that developers are having to conLend wILI. TIere Is u huge farming community that have settled on this land for decades, land that foreign businesses will need to build infra- structure and establish operuLIons. While each nation in the region has its own unique and often historic obsta- cles to investment in land, Myanmar in particular suers Irom LIe eecLs of past nationalisation of land ownership and a tradition of mixed cus- tomary and common law practices with regards to Iund rIgILs. AILIougI Is- sues within the Golden Land have yet to garner the same outside atten- tion as land disputes in other Southeast Asian na- tions, property rights and ownership are a growing concern for Myanmar cit- izens, the Union Govern- ment and foreign inves- Lors uIIke. Di sputes between formers ond the gooernment In rural areas, disputes typically emerge between farmers and the govern- menL over LIe cIussIh- cation of farmland, the rights to cultivate land IndehnILeIy und LIe per- manence of the land use rIgILs grunLed. or Inves- tors, this can play out ei- ther as a challenge from the government or anoth- er interested third party of rights granted to the investor by way of sub- lease, or alternatively, in the form of a citizen pro- test over otherwise legiti- mate grants of land from the government to inves- Lors. n urbun Myunmur, rights disputes are more likely to occur where there is contested owner- ship over a single parcel of land, or when a local party fails to abide by the rules or limitations of a land grant from the gov- ernmenL. Investors seeking abso- lute certainty regarding land rights in Myanmar muy hnd IL dIm cuIL Lo navigate this labyrinth of seemingly opaque and compIex procedures. or example, registration for the rights associated with the land is haphazard in the cities and practically non-existent in many ru- ruI ureus. n muny cuses, land has changed hands on an informal basis, with the original or registered owners of property either having died in the interim or moved on from their IIsLed uddresses. DespILe LIese dIm cuILIes, Inves- Lors cun hnd some com- fort in their dealings by understanding the basics of land rights in Myanmar and following certain best prucLIces. WIIIe uImosL no due diligence in Myan- mar can be said to be fool- proof, understanding the basic laws relating to land and taking certain pre- cautions can help develop LIe conhdence necessury to pursue investment in otherwise uncertain con- dILIons. Lond rights generollg There is no overarch- ing land or property law in Myanmar that governs the ownership, use and transfer of immovable properLy. TIe generuI Ie- gal framework concern- ing immovable property in Myanmar today is con- tained in: (u) TIe ConsLILuLIon oI the Republic of Union of Myunmur (zoo8); (b) TrunsIer oI ProperLy AcL (188z); (c) RegIsLruLIon AcL (1qo8); (d) TrunsIer oI mmov- able Property Restriction uw (1q8;); (e) TIe urm und uw (zo1z); (I) TIe MunugemenL oI Cultivable, Fallow and WusLe und uw (zo1z); (g) Myunmur oreIgn nvesLmenL uw (zo1z) und NoLIhcuLIon qJzo11 on the Right to Utilize Land; and (I) und AcquIsILIon AcL (18qq). Additional acts and regulations, such as the Forest Law and the En- vironmental Protection Law, can have an ancil- Iury eecL on LIe use oI land, even if they do not directly regulate the own- ership, use and/or trans- Ier oI Iund. In general, all land in Myanmar is theoreti- cally held by government bodIes. WIIIe LIere ure sporadic cases of genu- ine private land owner- ship, these are rare and represent the exception ruLIer LIun LIe ruIe. o- cals with rights to land typically hold land use grants or land leases from a government body, usu- uIIy Ior Lerms oI o, 6o or qo yeurs. TIe concepLs of lease and grant are of- Len conuLed und IL Is noL uncommon to see sub- lease arrangements or as- signments referred to as sales even if actual title or ultimate ownership of a property remains with the governmenL. Laws regulating the use of land by foreigners set up a number of restric- tions on the ability of for- eigners or foreign entities to hold, transfer and/or use Iund. OI purLIcuIur importance to foreign in- vestors is the Transfer of Immovable Property Re- sLrIcLIon uw (1q8;) (LIe TPR (1q8;)), wIIcI forbids the transfer of immovable property to and from foreigners (in- cluding companies with uny IoreIgn InvesLmenL). Furthermore, the TIPRL (1q8;) resLrIcLs IoreIgn investors and individuals from entering into leases extending beyond one yeur. TIIs uecLs uII mun- ner of immovable proper- ty from residential leases to leases involving com- mercial projects, essen- tially limiting foreigners and foreign invested enti- ties to a single year lease Lerm. TIe onIy presenL exception to this other- wise onerous restriction is found in Myanmars Foreign Investment Law (LIe M (zo1z)). Ohtoining o permit Om cIuIIy pussed In No- vember zo1z, LIe M (zo1z) uIIows IoreIgn In- vestors to apply for an in- vestment permit (the MIC PermIL) wILI LIe Myun- mar Investment Commis- sIon (MC), wIIcI, umong oLIer benehLs, wIII uIIow the foreign investor to lease or use land in Myan- mar for extended periods beyond what is otherwise allowed under the TIPRL (1q8;). PursuunL Lo uny MIC Permit application, a potential foreign investor is required to submit to the MIC a draft lease for revIew. SIouId LIe MC approve of the proposed investment project, the MIC will also generally approve of the submitted lease of immovable prop- erty or land for a term of up Lo o yeurs.
Myanmar in particular suffers from the ef-
fects of past nationalisation of land owner- ship and a tradition of mixed customary and common law practices with regards to land rights. Although issues within the Golden Land have yet to garner the same outside attention as land disputes in other Southeast Asian nations, property rights and ownership are a growing concern for Myanmar citizens, the Union Govern- ment and foreign investors alike. HoteI construction work on a pIot of Iand in NgapaIi, Rakhine state. As investment spurs growth and infrastructure deveIopment in Myanmar, coveted Iand resources have become scarcer and disputes are becoming common. S h e r p a
H o s s a in y ~.q .~: ~:q . .:.- ~ , .~ ..e ~:~.:.._ q .. . _.....:.~~~ ...:., ..:._. ._.~_..:...:. _e. . :.. . :~ _ .,_~._ ._., .: .._._. .q:~._ ._..:q._.... ._.... ~~ ~ ~.~ ~. .:.. _~ .~ .,q._ .~~~, . . . ~~ . _., .:. -... :..q.._ ' ... , q:. . , .~ .~~ .:. ..: ._ . ._.~_ .. :.. .:.. : q .. . _. . . . .:.~~ ~ ~q:..q.. q:_..,:~.q.~_e. ~,q .,. _e. ._ ..e e:. . .:. ..:...:.._ ._.:.q... May 15-21, 2014 Myanmar Business Today mmbiztoday.com 24 From page z...(Colden Land") From page z...(Colden Land") PROPERTY & REAL ESTATE The exact period grant- ed muy be modIhed de- pending on the size and needs of the investment project, but generally, major investment pro- jecLs seek up Lo LIe IuII o yeur Lerm. Upon LIe ex- piry of the initial period, the MIC may then grant two extension periods of up Lo 1o yeurs eucI. TIe MIC may, with the prior approval of the Myanmar Government, provide for an even longer lease term if it is in the interest of the economic development of less-developed and inac- cessible regions of Myan- mur. As a foreign investor in Myanmar, it is critical to undersLund LIe dIerence between rights authorised under an MIC Permit and rights actually granted to a local partner pursuant to a land grant from the governmenL. TIe MC Permit authorises a for- eign invested company Lo Ieuse Iund Ior up Lo o years, plus the two ad- ditional ten year renewal terms; however, should the foreign invested com- pany enter into a lease for land that is subject to an initial grant that ends prIor Lo o yeurs, LIe Iund will revert to the govern- ment upon termination of the initial grant regard- less of the MIC Permits uuLIorIzuLIon. TIereIore when considering land for investment purposes, it is crucial to determine not just the suitability of the land for the invest- ment proposed, but also the capacity of the lessor to obtain an extension of their land grant to take full advantage of the MIC Permits extended lease perIod. GoIng Iorwurd In zo1q, there is a general expecta- tion by Myanmar real es- tate observers that a new Condominium Law will be pussed LIuL wIII oer an additional exception Lo LIe TPR (1q8;) sIn- gIe yeur Ieuse resLrIcLIon. Although only circulated in an unapproved draft form, the proposed Con- dominium Law foresees a regulatory regime where appropriately registered land development pro- jects may be allowed to provide ownership and long term leases of condo- minium units to foreign InvesLors. CerLuIn regIs- tration restrictions and local ownership quotas are in the present draft version of the Condomin- ium Law; however, even with these complications, passage of the Condomin- ium Law would represent major progress for land regulation in Myanmar and could result in ma- jor changes to the market Iundscupe. How i nvestor s can protect themseloes Foreign investors enter- ing into Myanmar should take precautions when preparing to secure land Ior InvesLmenL. One ruIe, above all others, is to know your IocuI purLners. Often, land is provided as in-kind contribution (generally through a long- term lease in the case of MIC approved joint ven- Lures) by u IocuI purLy, and it is left to the foreign party to ensure that the land is legitimately held and authorised for the its InLended use. WIIIe LIe temptation to rush into the market may be high, it is critical to take time to meet with and carefully evaluate potential local partners, and to ask ques- tions about their back- ground and the assets they will be investing in uny projecL. BeIore sIgn- ing on the dotted line, it is advisable to engage com- petent legal counsel to review any lease or other documents related to land to ensure that the land is indeed available and suit- able for the investment projecL conLempIuLed. Because of the lack of ef- fective central land regis- tration, the performance of due diligence on land in Myanmar typically relies entirely on the documen- tation provided by the lo- cal party contributing the Iund. TIe mosL common documents provided for review tend to be leases or grants, either from a third party to the local party, or more ideally, from a gov- ernment entity to a local purLy. EnsurIng un uccu- rate chain of title is criti- cal and leases that have been sublet or assigned through multiple trans- Iers cun be dImcuIL Lo ver- IIy. OLIer documenLs LIuL are useful, though not al- ways immediately availa- ble, are the land map and land history setting out the exact parameters of the property in question, as well as its registration history, and other docu- mentation of registration noting where a property has been properly regis- tered with the Registrar oI Deeds und Assurunces. While registration of land grants and leases ex- tending beyond one year are required by law, this requirement is frequently ignored, foregone with an eye to avoiding stamp duties or simply misun- dersLood by IocuI purLIes. Even when the laws are complied with, there ex- ist structural weaknesses in the system including the extended period in which land transfers may be regIsLered. TrunsIerees have up to four months after completion of lease or grant to register the transfer, thus, if registra- tion does not occur until the four-month dead- line, a less than scrupu- lous landholder could in the interim arrange for the sale or lease of the land to an otherwise un- suspecLIng LIIrd purLy. Even if the latter lessee should successfully reg- IsLer LIe properLy hrsL, u lessee having a legitimate lease entered into prior to the latter lessees lease may register at any time up until the four month deadline and take claim Lo LIe properLy. While the scenario wherein multiple parties are engaged simultane- ously by a lessor to lease a single property is rela- tively uncommon, is it not that rare for land registra- tion to be incomplete or mIssIng. As menLIoned above, tax avoidance and ignorance of the law are common causes for im- proper or missing reg- IsLruLIon. As u resuIL, u land lessors documents and assistance in work- ing with the Myanmar authorities are critical to establishing the suitabil- ity of land for investment; in absence of any truly ef- fective regulatory regime, it is these documents that will hold the key to deter- mining the provenance and suitability of land for InvesLmenL. Exisitng inoestment oppor tuni ti es Myanmar simultane- ously boasts exciting investment opportuni- ties and a challenging, and at times, inscrutable environment for doing busIness. nvesLors con- sidering major projects LIuL requIre sIgnIhcunL land use would be wise to move carefully into the market and avoid making hasty arrangements with unIumIIIur purLners. MIs- takes made early on in the process cun Iuve sIgnIh- cant and sometimes cost- ly consequences down the roud once sIgnIhcunL LIme and money have been in- vesLed. EnsurIng u good relationship with local partners and any local au- thorities with oversight of the relevant investor sec- Lor Is crILIcuI. Almost equally impor- tant is engaging experi- enced counsel, whether legal or general business consuILuncy, wILI u hrm grasp on the laws and on- the-ground realities of doing business in Myan- mur. L Is eusy Lo Luke Ior granted matters such as continuous electrical and water supply that would be certainties in more de- veloped regions, but are just now being brought online in this developing murkeL. TIe more esLub- lished consultancies can help a foreign investor manage these basic com- plications that might oth- erwise go unnoticed until they have metastasized into unmanageable prob- Iems. An ounce oI preven- tion is worth a pound of cure, and nowhere is this clichd axiom truer than in the obtaining suitable land for investment in a turbulent, emerging mar- keL. John Lichtefeld and Kyaw Zin Htet are For- eign Legal Consultants uith lcu jrm Keltin Chic Yangon Ltd. The article jrst cppecred in Globcl Lecl Post in its Globcl Vieu blo.
As a foreign investor in Myanmar,
it is critical to understand the dif- ference between rights authorised under an MIC Permit and rights actually granted to a local partner pursuant to a land grant from the government. In ruraI areas, disputes typicaIIy emerge between farmers and the government over the cIassication of farmIand, the rights to cuItivate Iand indeniteIy and the permanence of the Iand use rights granted. S h e r p a
H o s s a in y _.....:.- ...:..q.~~~ . ~. ._ ~._.. ~..:~ ~~ . ..,.....:._ ._. .:.~ .e . . . .:.. : ., ._~..:._e.._. ...~ .q . ~. . . -._. ..'~ q .. ._. . . . .:.~~ ~ ~ e . .. .. ._ _..,:.:. ~e.q.,._~~~ _.,.: . ._ ._ . e. ._.. . . . . ._ ~. ..:..q.~|. e .~.. .q:.. :e. e . . ._.e:~.~.q..q:... ~.....:.~~~ ..~ ..~..:. ..:..,q._. .q . e ..'. _~..: ._ .~.q .~: ~: q . .:. ,_ . ~ ._.e:_..,:.:. _~.~.,q _.. .... ....q: _..,:.:.._ _., .:. .:. ~. .q. . _.:..:.q .. ._. . . ..:.~~~ .~~.:...:. _~.:..:.~q._. May 15-21, 2014 Myanmar Business Today mmbiztoday.com AUTOMOBILE 25 Myanmar Summary Myanmar Summary Toyotu Withdruwul A Bombshell, Iconomic Blow to CuliIorniu City Tim Reid T oyota Motor Corps deci- sion to move its North American sales head- quarters from California to Tex- as was met by disbelief in Tor- rance, this Los Angeles exurb where the Japanese car manu- facturer has run its US opera- LIons sInce 1q8z. Torrance Mayor Frank Scotto, looking grim, said outside city hall that he had been blindsid- ed by LIe move. A Iew IeeL uwuy sat Pat Simpson, a Torrance resIdenL Ior over 6o yeurs, wILI Ier Ieud In Ier Iunds. WIy do they want to tear this place upurL? SImpson, ;z, usked. ScoLLo suId IIs hrsL InkIIng of Toyotas decision to move to Plano, Texas, came when he was told by Toyota to expect a pIone cuII uL q.qum - jusL be- fore the company was to make ILs decIsIon omcIuI. AL hrsL LIougIL IL wus ubouL someLIIng eIse, ScoLLo suId. Even this morning, despite all the rumours this weekend, we thought it was only going to be part of Toyota moving not just everyLIIng. TIe decIsIon, Ie suId, wus sud news. The two biggest employers in Torrance, which has a popu- IuLIon oI 1q;,ooo uccordIng Lo cILy hgures, ure ToyoLu und Hondu. BoLI Iuve ubouL q,ooo empIoyees. osIng ToyoLu wIII meun un unnuuI Ioss oI $1.z million in tax revenue, Scotto said, but the emotional toll and wider economic impact will be mucI bIgger, Ie suId. Scottos son-in-law works for Toyota so the mayor faces the prospect of his daughter and grundcIIIdren movIng Lo Texus. L`s goIng Lo uecL Lens oI LIou- sunds oI peopIe, Ie suId. AbouL hve percenL oI LIe cILy`s workforce is employed by Toy- oLu. usL yeur LIe cILy Iud un unnuuI budgeL oI $z;1 mIIIIon, und $1z1 mIIIIon oI Iong-Lerm debL. ScoLLo, muyor sInce zoo6, thanked Toyota for all it had contributed to the city, includ- Ing u recenL $oo,ooo donu- tion to help build a new sports complex a few blocks from city IuII. ScoLLo suId IL Is Lo be cuIIed the Toyota Sports Complex, al- though the sign hasnt been put up yeL. Whether the city can replace ToyoLu, und hII LIe 1o1-ucre business park and headquarters it will leave behind, remains to be seen. ScoLLo suId LIe cILy Iud a short list of companies similar to Toyota that are being court- ed to replace the Japanese car muker. But conceding that the battle to keep Toyota was lost before it had even begun the train has already left the station, Scotto said he also said it takes the state of California, not a small city such as Torrance, to stop large manufacturers from leav- Ing LIe GoIden SLuLe. Frank Portillo, a co-owner of Los Chilaquiles Mexican Grill next to the Toyota headquarters said he did not blame Toyota, although he might lose business IImseII. TIe Luxes ure Iower In Texus. TIere ure Iewer reguIu- T o m o h ir o
O h s u m i/ B lo o m b e r g ~ .....~_ ~..q~~ ..: .~: ~:..:. ~ . . .q: ...,._ Toyota Motor Corp ._ ,.- .~: ~..q ~~.q: ._:,.. ~:. ~e.e.,.e:._._,e. ~~.~ _._ ,e . ._.: ..q q, . ._e~ . ~ _. . ~..' Torrance _.~.,_e .e. eeq:_e..._~:. .q._. ...q ~,,~~~ q._ Torrance _.~ ~_~.....,..:.~.,_e Toyota . Honda ~.~~. ~.. ..:. ,~~~ ._e q.~_.,_.._e. ._.._~: Toyota .: ~.: . :..|~ ~. .|_. ~.,_e . . . ~. , . ~..q ~, ..'.: ~ ... ., . ..,..__e.._. ~..|_.q ~....:.....|.- q:..,..: Toyota ._e._.. e., . . ~ _. -. . . ~ ~ ~..q ~, ..'.: ~ .,.. ..q_~._~. ~..q~,..'.: ~~ .,.q.,._ e .q._. ~~e_ Toyota .:~.:.:. .|~ ~. .|.,q:~ ~~~ -~ ~~e ~~,.q._ ...:..q.e:. ,... .:. ~, q. ._ _e. _. .~. .|_. -_. .~: ~,. Toyota . .~._ ~.~ ~. ._ ~. .|.,q:~ ~ .q:~ q, ~q:.,.. ..:~:...:. _... :.._~:. ._.:_~:.:.._ . LIons. L`s cIeuper Ior u com- puny LIere. WIy wouIdn`L LIey leave California? Ford's state-of-the-art plant in Thailand. Thai Auto Sector Slams on Brakes As Political Crisis Rumbles On More than 30,000 subcontracted workers laid of this year Khettiya Jittapong and Pisit Changplayn- gam T hailands auto sector, Southeast Asias big- gesL, Ius hred more LIun o,ooo subconLrucLed work- ers this year and slashed pro- duction, as sales plunge after months of political unrest that threatens to drive some manu- IucLurers osIore. TIe Iuy-os ure LIe IuLesL sIgn that the auto industry, account- Ing Ior ubouL 11 percenL oI TIuI economic output, is being hit hard by the prolonged power- struggle between the Bangkok- based royalist establishment and the mainly rural supporters of ousted former Prime Minis- Ler TIuksIn SIInuwuLru. The crisis deepened last week, when a court ordered Prime Minister Yingluck Shinawatra, Thaksins sister, to step down uILer hndIng Ier guIILy oI ubuse of power, leaving a caretaker government to press ahead with pIuns Ior u JuIy eIecLIon. As a regional production and export base, Thailands troubles have major implications for top manufacturers such as Toyota Motor Corp, Nissan Motor Co and Ford Motor Co, which may be forced to shift some produc- tion to cheaper bases such as Indonesia, the regions second- bIggesL uuLo murkeL. As political instability con- tinues, we are concerned that automakers may reduce their exposure to Thailand to diversi- fy their risk, said Kovit Wong- kolkitsilp, chairman of the auto parts group of the Federation of TIuI ndusLrIes (T). Honda Motor Co said it was considering delaying the start- up oI u new $o mIIIIon mun- ufacturing plant in Thailand by six months to a year, as the economy teeters on the brink of recession and political turmoil prompts automakers to rethink LIeIr InvesLmenLs. Its critical especially in the uuLo secLor. We Iuve seen u bIg IoL oI Iuyos, ubouL oo Lo ;oo sLu, severuI LImes In recenL months, National Congress of Thai Labour President Panus TIuIIuun suId. Toru Hasegawa, Nissans In- donesia chief, said that be- cause of the political uncertain- ty, total industry volume is a bIL uecLed, buL Ie udded LIuL Thailand remained a key mar- keL Ior LIe compuny. They are also a big market und sLIII growIng. or NIssun, Southeast Asia is very much im- porLunL, Huseguwu suId. Rival Toyota said at the start of the year it planned to sell qoo,ooo veIIcIes In TIuI- land this year, but in the three months to March saw sales there R e u t e r s drop percenL Lo 8q,ooo. Toyota Executive Vice Presi- dent Nobuyori Kodaira told re- porters in Tokyo on Thursday that the car maker might have to consider cutting its sales out- Iook Ior TIuIIund us u resuIL. Thailand is one of our very important strongholds glob- ally and we have no change in our stance to make vehicles and conduct business there, he suId. Domestic soles plunge TIe rougIIy o,ooo mosLIy low-skilled sub-contractors who Panus said had been laid o LIIs yeur represenL ubouL percenL oI LIe uuLo secLor`s workIorce. TIe Iuyos reecL u yeur oI sliding domestic sales that has sucked the life out of an auto in- dustry that relies on local buy- ers to consume about half of its ouLpuL. Reuters ~.q.~:~:q~ ~_~..._e. ._ ..~:...,._~ ~. . . .:. . _ e . . ~ . ~ q ._ ...:...|. , ..:.~:. e... ~~ . ~ .e . ._~: . . q_. . ~ . . . . :.. .q: .~:.. :.. :._ . ..q..~__...:.._~: ~.. .~q._~:. .q._. May 15-21, 2014 Myanmar Business Today mmbiztoday.com 26 INTERNATIONAL AND DOMESTIC FLIGHT SCHEDULE Fliggh htss ffroom Yanggon (RGNN) to Bangkok ((BKK) Fliggh htss ffroom Banggkok (BKKK) to Yaangon (RGN) Flight No. DDayss From To ETD ETA Operated by: Flight No. DDayss From To ETD ETA Operated by: PG 706 1 2 3 4 5 6 7 RGN BKK 7:15 9:30 Bangkok Airways DD4230 1 2 3 4 5 6 7 DMK RGN 06:30 07:55 NOK Airlines DD4231 1 2 3 4 5 6 7 RGN DMK 8:00 9:45 NOK Airlines 8M336 1 2 3 4 5 6 7 BKK RGN 6:40 7:25 MAI FD2752 1 2 3 4 5 6 7 RGN DMK 8:30 10:15 Thai AirAsia FD2751 1 2 3 4 5 6 7 DMK RGN 7:15 8:00 Thai AirAsia 8M335 1 2 3 4 5 6 7 RGN BKK 8:40 10:25 MAI TG303 1 2 3 4 5 6 7 BKK RGN 8:00 8:45 Thai Airways TG304 1 2 3 4 5 6 7 RGN BKK 9:50 11:45 Thai Airways PG701 1 2 3 4 5 6 7 BKK RGN 8:50 9:40 Bangkok Airways PG702 1 2 3 4 5 6 7 RGN BKK 10:45 12:40 Bangkok Airways FD2755 1 2 3 4 5 6 7 DMK RGN 11:35 12:20 Thai AirAsia Y5-237 1 2 3 4 5 6 7 RGN BKK 18:05 19:50 Golden Myanmar Airlines PG707 1 2 3 4 5 6 7 BKK RGN 13:40 14:30 Bangkok Airways TG302 1 2 3 4 5 6 7 RGN BKK 14:45 16:40 Thai Airways Y5-238 1 2 3 4 5 6 7 BKK RGN 21:10 21:55 Golden Myanmar Airlines PG703 1 2 3 4 5 6 7 RGN BKK 15:20 17:15 Bangkok Airways FD2753 1 2 3 4 5 6 7 DMK RGN 16:35 17:20 Thai AirAsia 8M331 1 2 3 4 5 6 7 RGN BKK 16:30 18:15 MAI PG703 1 2 3 4 5 6 7 BKK RGN 16:45 17:35 Bangkok Airways FD2754 1 2 3 4 5 6 7 RGN DMK 17:50 19:35 Thai AirAsia TG305 1 2 3 4 5 6 7 BKK RGN 17:55 18:40 Thai Airways PG704 1 2 3 4 5 6 7 RGN BKK 18:25 20:20 Bangkok Airways DD4238 1 2 3 4 5 6 7 BKK RGN 19:30 20:15 NOK Airlines TG306 1 2 3 4 5 6 7 RGN BKK 19:40 21:35 Thai Airways 8M332 1 2 3 4 5 6 7 BKK RGN 19:20 20:05 MAI DD4239 1 2 3 4 5 6 7 RGN DMK 21:00 22:45 NOK Airlines PG705 1 2 3 4 5 6 7 BKK RGN 20:00 21:15 Bangkok Airways FFliggh htss ffroom m Yangoon (RGN)) to Chiaang Maii (CNX) FFliggh htss ffroom m Chiangg Mai (CCNX) to YYangon (RGN) W9-9607 4 7 RGN CNX 14:50 16:20 Air Bagan W9-9608 4 7 CNX RGN 17:20 17:50 Air Bagan Flligghtss ffroom Yanggon (RGNN) to Sinngapore (SIN) Flligghtss ffroom Singaapore (SIN) to Yangon ((RGN) Y5-233 1 2 3 4 5 6 7 RGN SIN 10:10 14:40 Golden Myanmar Airlines Y5-234 1 2 3 4 5 6 7 SIN RGN 15:35 17:05 Golden Myanmar Airlines MI509 1 6 RGN SIN 0:25 5;00 SilkAir SQ998 1 2 3 4 5 6 7 SIN RGN 7:55 9:20 Singapore Airline 8M231 1 2 3 4 5 6 7 RGN SIN 8:30 13:00 MAI 8M6231/3K585 1 3 4 5 6 SIN RGN 9:10 10:40 Jetstar Asia SQ997 1 2 3 4 5 6 7 RGN SIN 10:25 14:45 Singapore Airline 8M232 1 2 3 4 5 6 7 SIN RGN 14:10 15:40 MAI 8M6232/3K586 1 3 4 5 6 RGN SIN 11:30 16:05 Jetstar Asia MI518 1 2 3 4 5 6 7 SIN RGN 14:20 15:45 SilkAir 8M233 5 6 7 RGN SIN 13:45 18:15 MAI 8M235 5 6 7 SIN RGN 19:15 20:45 MAI TR2827 1 6 7 RGN SIN 15:10 19:35 TigerAir TR2826 1 6 7 SIN RGN 13:00 14:30 TigerAir TR2827 2 3 4 5 RGN SIN 17:10 21:35 TigerAir TR2826 2 3 4 5 SIN RGN 15:00 16:30 TigerAir MI517 1 2 3 4 5 6 7 RGN SIN 16:40 21:15 SilkAir MI520 5 7 SIN RGN 22:10 23:35 SilkAir FFliightts frromm Yangonn (RGN) tto Kualaa Lumpuur (KUL) Fligghtts frro om m Kuala LLumpur (KUL)too Yangonn (RGN) AK1427 1 2 3 4 5 6 7 RGN KUL 8:30 12:50 AirAsia AK1426 1 2 3 4 5 6 7 KUL RGN 6:55 8:00 AirAsia 8M501 1 2 3 4 5 6 7 RGN KUL 8:55 12:55 MAI MH740 1 2 3 4 5 6 7 KUL RGN 10:05 11:15 Malaysia Airlines MH741 1 2 3 4 5 6 7 RGN KUL 12:15 16:30 Malaysia Airlines 8M502 1 2 3 4 5 6 7 KUL RGN 14:00 15:00 MAI Fligghtts frrom Yanngon (RGGN) to HHanoi (HHAN) Fligghtts frrom Hannoi (HANN) to Yanngon (RRGN) VN956 1 3 5 6 7 RGN HAN 19:10 21:30 Vietnam Airlines VN957 1 3 5 6 7 HAN RGN 16:35 18:10 Vietnam Airlines Flliggh htss ffroom m Yangon (RGN) to Ho CChi Minhh (SGN) Flliggh htss ffroom m Ho Chii Minh (SSGN) to Yangonn (RGN) VN942 2 4 7 RGN SGN 14:25 17:10 Vietnam Airlines VN943 2 4 7 SGN RGN 11:40 13:25 Vietnam Airlines Flligghtss ffrom Yanngon (RGGN) to TTaipei (TTPE) Flligghtss ffrom Taipei (TPEE) to Yanngon (RGN) CI7916 1 2 3 4 5 6 RGN TPE 10:50 16:10 China Airline CI7915 1 2 3 4 5 6 7 TPE RGN 7:15 10:05 China Airline BR288 2 5 6 RGN TPE 11:35 17:20 EVA Air BR287 2 5 6 TPE RGN 7:30 10:35 EVA Air Flliggh htss ffroom Yanggon (RGNN) to Kunming(KMG) Flliggh htss ffroom Kunmming(KMMG) to Yangon ((RGN) CA906 2 3 4 6 7 RGN KMG 14:15 17:35 Air China CA905 2 3 4 6 7 KMG RGN 12:40 13:15 Air China MU2032 1 2 3 4 5 6 7 RGN KMG 14:40 17:55 China Eastern MU2031 1 2 3 4 5 6 7 KMG RGN 13:30 14:00 China Eastern MU2012 3 6 RGN KMG 12:20 18:10 China Eastern (via NNG) MU2011 3 6 KMG RGN 8:25 11:30 China Eastern (via NNG) Flligghtss from Yanngon (RGGN) to BBeijing (BJS) Flligghtss from Beijjing (BJSS) to Yanngon (RRGN) CA906 2 3 4 6 7 RGN BJS 14:15 21:55 Air China (via KMG) CA905 2 3 4 6 7 BJS RGN 8:05 13:15 Air China (via KMG) Fliggh htss ffroom Yanggon (RGNN) to Naanning (NNG) Fliggh htss ffroom Nannning (NNNG) to Yaangon ((RGN) Flight No. DDayss From To ETD ETA Operated by: Flight No. DDayss From To ETD ETA Operated by: MU2012 3 6 RGN NNG 12:20 16:25 China Eastern MU2011 3 6 NNG RGN 10:15 11:30 China Eastern FFliggh htss ffroom m Yangoon (RGN)) to Honng Kong (HKG) HHonng g KKoong (HKG) Flights from Yaangon ((RGN) KA251 1 2 4 6 RGN HKG 1:10 5:35 Dragon Air KA250 1 3 5 7 HKG RGN 21:50 23:45 Dragon Air *PPleaasee noote thee dday change for the deparrture time too Hong Kongg. Flliggh htss ffroom m Yangon (RGN) to Guanng Zhouu (CAN) Flliggh htss ffroom m Guang Zhou (CCAN) to Yangonn (RGN) 8M711 2 4 7 RGN CAN 8:40 13:15 MAI CZ3055 3 6 CAN RGN 8:40 10:30 China Southern Airlines CZ3056 3 6 RGN CAN 11:20 15:50 China Southern Airline 8M712 2 4 7 CAN RGN 14:15 15:45 MAI CZ3056 1 5 RGN CAN 17:40 22:15 China Southern Airline CZ3055 1 5 CAN RGN 14:45 16:35 China Southern Airlines FFlighhts ffroom Yanggon (RGN) to Koolkata (CCCU) FFlighhts ffroom Kolkkata (CCUU) to Yaangon (RRGN) Flight No. DDayss From To ETD ETA Operated by: Flight No. DDayss From To ETD ETA Operated by: AI228 5 RGN CCU 18:45 19:45 Air India AI227 1 5 CCU RGN 10:35 13:20 Air India AI234 1 5 RGN CCU 13:40 16:55 Air India (via GAY) AI233 5 CCU RGN 13:30 18:00 Air India (via GAY) Fliggh htss ffrom Yanngon (RGGN) to GGaya (GAAY) Fliggh htss ffrom Gayya (GAY) to Yanngon (RGGN) 8M 601 1 3 5 6 RGN GAY 10:30 11:50 MAI 8M 602 1 3 5 6 GAY RGN 12:50 16:00 MAI AI234 1 5 RGN GAY 13:40 15:00 Air India AI233 5 GAY RGN 15:00 18:00 Air India Fligghtts frrom Yanngon (RGGN) to TTokyo (NNRT) FFliightts frrom Tokkyo (NRTT) to Yaangon (RRGN) NH914 1 3 6 RGN NRT 22:00 06:40+1 ALL NIPPON Airways NH913 1 3 6 NRT RGN 11:10 17:05 ALL NIPPON Airways FFliggh htss ffrom Yanngon (RGGN) to SSeoul (ICCN) FFliggh htss ffrom Seooul (ICN)) to Yanngon (RGGN) KE472 1 3 5 7 RGN ICN 0:05 8:00 Korean Air KE471 1 2 3 4 5 6 7 ICN RGN 18:40 22:55 Korean Air OZ7463 4 7 RGN ICN 0:50 8:50 Asiana OZ4753 3 6 ICN RGN 19:30 23:40 Asiana Flligghtss ffrom Yanngon (RGGN) to DDoha (DOOH) Flightts frrom Dohha (DOH) to Yangon (RRGN) QR619 1 2 3 4 5 6 7 RGN DOH 8:00 11:45 Qatar Airways QR618 1 2 3 4 5 6 7 DOH RGN 21:05 06:29+1 Qatar Airways Flliggh htss ffroom m Yangon (RGN) to Nay Pyi Taww (NYT) Flliggh htss ffroom m Nay Pyyi Taw (NNYT) to Yangonn (RGN) Flight No. DDayss From To ETD ETA Operated by: Flight No. DDayss From To ETD ETA Operated by: FMI-A1 1 2 3 4 5 RGN NYT 7:30 8:30 FMI Air Charter FMI-A2 1 2 3 4 5 NYT RGN 8:50 9:50 FMI Air Charter FMI-B1 1 2 3 4 5 RGN NYT 11:30 12:30 FMI Air Charter FMI-B2 1 2 3 4 5 NYT RGN 13:00 14:00 FMI Air Charter FMI-C1 1 2 3 4 5 RGN NYT 16:30 17:30 FMI Air Charter FMI-C2 1 2 3 4 5 NYT RGN 18:00 19:00 FMI Air Charter FMI-A1 6 RGN NYT 8:00 9:00 FMI Air Charter FMI-A2 6 NYT RGN 10:00 11:00 FMI Air Charter FMI-A1 7 RGN NYT 15:30 16:30 FMI Air Charter FMI-A2 7 NYT RGN 17:00 18:00 FMI Air Charter FFliightts frrom Yangoon (RGN) to Manndalay ((MDY) FFliightts frrom Manddalay (MDDY) to YYangon (RGN) Y5-234 1 2 3 4 5 6 7 RGN MDY 6:15 7:30 Golden Myanmar Airlines Y5-233 1 2 3 4 5 6 7 MDY RGN 8:10 9:25 Golden Myanmar Airlines YH 909 2 4 6 7 RGN MDY 6:30 8:10 Yangon Airways YH 910 1 3 MDY RGN 7:40 10:30 Yangon Airways YH 917 1 2 3 4 5 6 7 RGN MDY 6:10 8:30 Yangon Airways YH 918 1 2 3 4 6 7 MDY RGN 8:30 10:25 Yangon Airways YH 727 1 5 RGN MDY 11:15 13:25 Yangon Airways YH 728 1 5 MDY RGN 9:10 11:05 Yangon Airways YH 731 1 2 3 4 5 6 7 RGN MDY 15:00 17:10 Yangon Airways YH 732 1 2 3 4 5 6 MDY RGN 17:10 19:15 Yangon Airways W9 501 1 2 3 4 RGN MDY 6:00 7:25 Air Bagan W9 502 1 2 3 4 MDY RGN 16:10 18:15 Air Bagan K7 222 1 2 3 4 5 6 7 RGN MDY 6:30 8:40 Air KBZ K7 223 1 2 3 4 5 6 7 MDY RGN 9:00 11:05 Air KBZ YJ 201 1 2 3 4 5 6 7 RGN MDY 11:30 12:55 Asian Wings YJ 202 1 2 3 4 5 6 7 MDY RGN 16:00 17:25 Asian Wings Days - (1) Monday (2) TTueesdaay (33) WWeddnessdaay (4) Thursdayy (5) Friday (6) SSaturday (7) Suunday Days - (1) Monday (2) TTueesdaay (33) WWeddnessdaay (4) Thursdayy (5) Friday (6) SSaturday (7) Suunday May 15-21, 2014 Myanmar Business Today mmbiztoday.com IT & TELECOM 27 Myanmar Summary Myanmar Summary Ooredoo and Rocket Internet Join Hands to Tap Online Businesses O oredoo Myanmar has formed a partnership with German internet incubator Rocket Internet to jointly develop eCommerce and other digital services in Asia, LIe QuLurI LeIecoms hrm suId. Ooredoo and Rocket Internet will become equal partners in Asia Internet Holding, a joint venture that will create and de- velop online businesses in the region, Ooredoo said, adding that eCommerce is part of the hrm`s sLruLegy Lo InvesL In new businesses that provide growth opportunities and develop new revenue sLreums. Ooredoo and Rocket said both the companies are keen to ben- ehL Irom LIe Lrend oI IncreusIng disposable income and internet penetration in Asia, which are seen as key drivers for eCom- merce growLI In LIe regIon. Growing smartphone pen- eLruLIon und IImILed hxed IIne infrastructure are reinforcing mobile as the preferred medi- um Ior eCommerce In AsIu. Ross Cormack, CEO of Oore- doo Myanmar said, A fun- damental shift is happening across our markets especially in Myanmar and more people would buy goods and services online through their mobile pIones. He said Ooredoo aims to har- ness Rockets knowledge and experience gained elsewhere into making the joint venture an eCommerce market leader ucross AsIu. Asia Internet Holding will cov- er 1 murkeLs In AsIu IncIudIng Myanmar, Thailand, Singapore, Vietnam, the Philippines and Htun Htun Minn Australia, with ventures ranging from online retail and market- pIuces Lo puymenL servIces. Several ventures were launched over the last two years IncIudIng Duruz.pk, umudI. com, CurmudI.com, Kuymu. com, PrIcepundu.com und EusyTuxI.com. Oliver Samwer, co-founder of Rocket Internet, said, By bringing ecommerce models that have worked well else- wIere In LIe worId Lo AsIu ... we can jointly bring better services Lo cusLomers. Our partnership will accel- erate the development of Asia Internet Holding in the region and help our businesses suc- ceed. This investment is subject to the approval of the regula- tory authorities in the countries where the service will be pro- vided, and it is expected to be concluded in the second quarter oI zo1q, LIe hrms suId. Ooredoo, after winning its bid for one of the two telecom licences in Myanmar in June last year, is currently rolling out telecoms infrastructure in the SouLIeusL AsIun counLry. On- IIne reuI esLuLe pIuLIorm House. com.mm, u purL oI RockeL n- ternet, recently claimed that it is now the leader in Myanmars onIIne reuI esLuLe murkeLpIuce. S h u t t e r s t o c k / P r e s s m a s t e r ~:q ~ ~ ~ eCommerce . . . ~e~,..:..:. ..~..:q~q, ~~ ~ Rocket Internet . . ...|.. ._~:. Ooredoo ~ ._~_:.._. Ooredoo . RocketInternet ~ ._ AsiaInternetHolding ~ ~~ . ~...:.e~.:._e..:.__e._.. ,. ~ . ~ ._ ...~ .~ , . .. . , . .:. e, ~ ...: q ~ ._ e~ .. . . , . _e.._. Ooredoo Myanmar - CEO Ross Cormack ~ ~._.. ~~ ._.: .. ~: .~e: ~,.~:~ ...~~~..:. .: ~.._e _.,.:_._.:_e..,_.. . .~ e: . ~ . .e , ..~ ~~. . ~,.._..~, ~,..:..~~ ~e .:_~. . .e ..|e: ~, .~: ~ q ~:q ...~ ~ .~ . :. _. .. .:~e .~, .~: ~ ~.,, eCommerce ~, ..: . .~ ~ ...~:e: . q ~.~ ~ _~e ~ .._. .. ~ ~, .~: ~ q q_ . , ..~ ~ . _. .~.:~ ~~ _.. :_e. .|~e .Rocket , . ...| ...: q ~ . .~ .~ . . . ~,.~:~~.,, ~.~, ~...:.| ~e ._. ..~: . ~ q ~. ._:, ~.~ ~_~.~~ ..|..._.. ~,.~:~q e~ .. . . , . ~ ~:q ~. . :. . : eCommerce ...~~...:._e. .:e ..:..|~e''e ._.:.|._. Huawei Seeks to Move Up Smartphone Food Chain With New Ascend P7 C hinas Huawei Technolo- gies launched its second ugsIIp smurLpIone, LIe Ascend P7, last week as part of ILs eorL Lo cruck LIe upper LIer of the mobile market where Ap- pIe und Sumsung sLIII ruIe. The mobile billed as the worId`s sIImmesL pIone uL 6. mm LIIck - wIII go on suIe In 1 markets, including Britain, Ger- many and China, starting this monLI Ior Cqqq ($6o). Huawei, best known as a maker of telecom network gear where it competes with Swe- dens Ericsson, has become the worlds third-biggest smart- phone manufacturer behind Samsung and Apple only three years after launching its own brunded mobIIes und LubIeLs. Its global smartphone market sIure grew Lo q.q percenL Irom q percenL In zo1z, buL sLIII Iugs Iur beIInd Sumsung`s 1. percenL und AppIe`s 1. percenL, suId murkeL reseurcI hrm DC. TIe P; Ius u hve-IncI LoucI- screen, us weII us un 8 megupIx- eI IronL-IucIng cumeru und u 1 megapixel rear-facing camera designed for low-light condi- LIons. Kyaw Min ~, ~ . - Huawei Technologies ~.,_e , .~ -. ~ e._.:~ ~.~: . ..e,.~_e. Ascend P7 ~:. e. ~.~~ .q:..._.. Apple . Samsung ~ _~ .. ..,._ e , ....~ ~ ~ ~.q:~.,q:e.q, _~.... .~q._. ~.:~.|.~.:..e,.~_e. ~ '.... . . ~:q ..:~. .|e , .~:. e. .~~ ..q: ... :.._ _e. ._ . May 15-21, 2014 Myanmar Business Today mmbiztoday.com 28 IT & TELECOM Chinu's Alibubu Iiles in LS Ior Whut Muy Be Biggest Tech IPO A libaba gave investors a closer look at the scale and growth of the Chinese e-commerce juggernaut in an InILIuI pubIIc oerIng (PO) pro- specLus hIed IusL week, LIe hrsL step in what could be the largest LecInoIogy debuL In IIsLory. Alibaba Group Holding Ltd, wIIcI powers 8o percenL oI uII online commerce in the worlds second-largest economy, is ex- pecLed Lo ruIse more LIun $1 bIIIIon, und couId Lop LIe $16 billion pulled in by Facebook nc wIen IL IIsLed In zo1z. The bulk of the proceeds will go Lo YuIoo nc - wIIcI bougIL u qo percenL sLuke In AIIbubu In zoo Ior $1 bIIIIon und wIIcI musL seII more than a third of its current zz.6 percenL sLuke LIrougI LIe PO. AIIbubu uIso pIuns Lo seII new shares, people familiar with the plans have said, to bulk up a cash war chest depleted by a rash oI recenL ucquIsILIons. While the Alibaba brand is less well known in the United States than internet companies sucI us Amuzon.com und u- cebook, the Chinese companys listing has stirred the most ex- citement in Silicon Valley and Wall Street since Facebooks re- cord PO. AIIbubu wIII become the largest Chinese corporation to list in the US on either the New York Stock Exchange or LIe Nusduq. Alibaba will debut later this year in a market where high- yIng LecI sLocks IIke TwILLer and Amazon have fallen in re- cenL weeks In u seII-o LIuL Ius divided analysts and investors, reviving doubts about soaring LecI vuIuuLIons. Still, estimates of Alibabas market value have soared in recent months, to even beyond $zoo bIIIIon, underscorIng Alexei Oreskovic and Deepa Seetharaman Wall Streets eagerness to take a crack at a massive Chinese com- puny wILI robusL growLI. AIIbubu IundIed more LIun 1. LrIIIIon yuun - ubouL $zq8 bIIIIon - oI LrunsucLIons Ior z1 mIIIIon active users across its three main Chinese online marketplaces in zo1, more LIun Amuzon und eBuy nc combIned. L dId so wILI zo,88q IuII-LIme workers, Iewer LIun eBuy. If its able to transport that kind of power to outside China, it has the potential to become a true global e-commerce power- house, said Roger Entner, lead analyst and founder of Recon AnuIyLIcs. Everybody LIougIL Amazon could do it, but now we have to re-think Amazon in the light of being the most success- IuI compuny In LIuL heId In LIe US - buL noL In LIe worId. Alibaba did not give any hints in its IPO prospectus about po- tential plans for the US e-com- merce murkeL. AnuIysLs suId IL was unlikely Alibaba would adopt the model favoured by Amazon, which sells goods directly to con- sumers using a sprawling net- work oI wureIouses. At least 102 years AIIbubu, Iounded 1 yeurs ugo in a one-room apartment in Hangzhou and controlled by a z8-member purLnersIIp, bousLs of building a company that will IusL uL IeusL 1oz yeurs. After the IPO, Alibaba said, the partnership will have the exclusive right to nominate a simple majority of the members oI ILs bourd oI dIrecLors. Alibaba operates an online messaging service as well as a cloud computing business, but more LIun 8o percenL oI ILs revenue comes from its Tao- bao, Tmall and Juhuasuan on- IIne murkeLpIuces. Top ILems sold on Taobao include prepaid phone and game cards as well as lottery tickets, home furni- ture and baby products, the compuny suId. ToLuI revenue Increused 6z per- cenL Lo 18.; bIIIIon yuun ($.o1 bIIIIon) In OcLober-December oI zo1 Irom u yeur eurIIer, wIIIe net income more than doubled Lo 8.z; bIIIIon yuun, uccordIng Lo LIe prospecLus. Some analysts say Alibabas rapid pace of revenue growth muy be unsusLuInubIe. They got into the e-commerce space when there werent any other players in China, said Forrester analyst Kelland Willis, adding Alibaba has been losing murkeL sIure yeur over yeur. By zozo, onIIne reLuII suIes In CIInu wIII reucI $qzo-$6o billion, as much as the United States, Japanese, UK, German and French markets combined, according to a recent analysis by McKInsey GIobuI nsLILuLe. Mohile future Alibaba said Chinas mobile Internet arena, where it is bat- tling Tencent Holdings for su- premacy, is the next growth IndusLry. CIInu wIII Iuve un esLImuLed ;o mIIIIon mobIIe nLerneL users by zo1;, uccord- ing to data from China-based consuILuncy IReseurcI. RougIIy one-hILI oI uII pur- chases in the last quarter of zo1 were mude on mobIIe de- vIces, up Irom ;.q percenL u yeur eurIIer. BuL AIIbubu udded LIuL for now these sales were less prohLubIe LIun LIose mude on ILs websILe. Already this year, Ma has been involved in acquisitions worLI more LIun $. bIIIIon buying a stake in department store operator Intime; a ma- jority shareholding in movie producer ChinaVision Media; conLroI oI onIIne muppIng hrm Autonavi; a stake in Chinas Wasu Media Holding Co Ltd for online content and internet TV; and a stake in Youku Tudou Inc, an online video business akin to GoogIe nc`s YouTube. Alibaba is also launching a US e-commerce websILe, 11 MuIn, and has taken stakes in US re- tail site ShopRunner Inc, Lyft, a US ridesharing service, and 1sLdIbs, un onIIne murkeL pIuce Ior unLIques und IuxurIes. Also this year, Ma has set up a charitable trust estimated to be worLI $ bIIIIon, poLenLIuIIy Asias biggest, focusing on the envIronmenL und IeuILI. L`s impossible for me to be a doc- tor, but I can have my own way to save lives, Xinhua quoted Mu us suyIng. Ounership ond risks Some analysts have pointed to a less-than-transparent decision- making process after Alibaba spun o IusL-growIng AIIpuy In zo1o - u move LIuL cuused con- sternation at major shareholders Yahoo and Japanese telecoms hrm SoILBunk Corp. Alibabas prospectus also laid out a raft of regulatory risks it Iuces uL Iome. TIe compuny stressed that Beijing could im- pose additional restrictions on the use of Alipay, the payment service that powers the majority oI ILs onIIne LrunsucLIons. Unlike many prominent US tech IPOs of recent years, Ali- bubu`s IIsL oI sIgnIhcunL sIure- IoIders Is sIorL. By conLrusL, Facebook and Twitter each broke out shareholdings from more than a half dozen individ- uuI prIncIpuI sIureIoIders. Former English schoolteach- er and lead founder Jack Ma owns 8.q percenL oI AIIbubu. Joseph Tsai, a co-founder and executive vice-chairman, is the only other individual with a dIscIosed sIureIoIdIng, oI .6 percenL. YuIoo und SoILBunk, respecLIveIy, own zz.6 percenL und q.q percenL oI AIIbubu on u IuIIy dIIuLed busIs. Fai r value Alibaba estimated its fair val- ue as of this month could reach $o per sIure, un Increuse oI more than six times from the $8 u sIure vuIue esLImuLed In June zo11, uccordIng Lo LIe pro- specLus. TIIs cuIcuIuLIon IeIps determine employee compen- sation and does not necessarily represenL u IIkeIy PO prIce. At the most recent fair val- ue estimate, Yahoos stake in AIIbubu Is worLI $z6.z bIIIIon und SoILBunk`s uImosL $qo bII- IIon. Mu`s sLuke wouId be worLI $1o. bIIIIon. The fair value estimate puts AIIbubu`s sIze uL $116.1 bIIIIon, weII beIow LIe $1z bIIIIon uv- eruge Irom z unuIysLs In u Reu- Lers survey. While Yahoo and SoftBank may be among the biggest bene- hcIurIes oI LIe PO, neILIer wIII exercise much control of Aliba- bu. L Ius uIreudy been ugreed that Yahoo Chief Development Omcer JucqueIIne Reses wIII re- sign from Alibabas board upon the listing, while SoftBank will have the right to nominate just a single director to a new, nine- member bourd. Alibabas decision to list in the United States was a blow to the Hong Kong stock exchange, which was initially its preferred IPO venue, but the citys regu- lators balked at any potential violation of the one-share-one- voLe prIncIpIe. Citigroup, Credit Suisse, Deutsche Bank , Goldman Sachs, JP Morgan, and Morgan Stanley wIII underwrILe LIe AIIbubu PO. Reuters AIibaba headquarters in Hangzhou, Zhejiang province.AIibaba Croup HoIding Itd, which powers 8U percent of aII onIine com- merce in the worId`s second-Iargest economy, China, is expected to raise more than $15 biIIion, and couId top the $1 biIIion pulled in by Facebook Inc when it listed in 2012. B lo o m b e r g
If its able to transport that kind of power
to outside China, it has the potential to become a true global e-commerce power- house. Everybody thought Amazon could do it, but now we have to re-think Amazon in the light of being the most successful company in that field in the US but not in the world. Alibaba ~.,_e q..._.....:. ~:. ~,~.- ~,.....~~ _~. :..:. ~ _..._ ~.,_e Initial Public Offering (IPO) ._~_:.~ ~:. e.~.~~ ~_.,.._. ~.:.~e~_~... ~,.....:. .q..q:.~e.- ~ q:..,.~:. . . :.._ AlibabaGroupHolding Ltd ~.,_e ~..q~,..'.: ~ . e qq q, ..: . , .:.._~: .._ . .q._. .....:q:~ Alibaba - qee: ,~ q:..,.~:. ~~ ... ~ ~..q~,..'.: ~ .e_e ~ee.._ Yahoo Inc ._._. ~.q..|._ .,q:~ q .,_. . IPO . . ..:.|~ .~qqee: ... ' q:..,.- ....~:~:. .q:..q ._ _e. ._ . Myanmar Summary May 15-21, 2014 Myanmar Business Today mmbiztoday.com IT & TELECOM 29 Myanmar Summary Myanmar Summary An attendee hoIds a Samsung EIectronics Co CaIaxy S4 smartphone, Ieft, next to an AppIe Inc iPhone 5 during an event at Radio City Music HaII in New York. A US jury last week left the total damages Samsung Electronics Co Ltd must pay Apple Inc unchanged at $11q.6 mIIIIon, uILer uddILIonuI deliberations in a trial where the South Korean smartphone maker was found to have in- IrInged LIree AppIe puLenLs. During the month-long trial in a San Jose, California federal court, Apple accused Samsung of violating patents on smart- phone features including uni- versal search, while Samsung denIed wrongdoIng. The jury ordered Samsung to puy AppIe $11q.6 mIIIIon Ior infringing the iPhone makers puLenLs. BuL AppIe uLLorneys argued at the time that the ju- rors made a technical mistake in awarding Apple damages on a patent covering one of Sam- sung`s pIones. TIe jury wus ordered back to court to resolve LIuL Issue. Juror Margarita Palmada, a 6q-yeur-oId reLIred IIgI-scIooI Spanish teacher, said she wished the two sides had been able to work out their issues wILIouL resorLIng Lo IILIguLIon. It would have been so much simpler for all involved, she said in an interview after the jury wrupped. Some of the jurors had initial- ly been in favour of awarding Apple more but eventually ar- rived at the consensus verdict, sIe suId, buL decIIned Lo oer more deLuIIs. Apple and Samsung have been litigating around the world for Dan Levine Jury Leaves Damages Samsung Must Pay Apple Unchanged at $119.6m V ic t o r
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B lu e / B lo o m b e r g LIree yeurs. Jurors uwurded LIe IPIone muker ubouL $qo mIIIIon uILer u zo1z LrIuI In Sun Jose, but Apple failed to per- suade US District Judge Lucy Koh to issue a permanent in- junction against the sale of Samsung phones in the United SLuLes. TIe currenL cuse InvoIves hve Apple patents that were not in LIe zo1z LrIuI und LIuL cover IP- hone features such as slide-to- unIock und seurcI LecInoIogy. Tit for tot Apple is seeking to ban sales of several Samsung phones, in- cluding the Galaxy S III, as well us moneLury dumuges. L wIII now be up to Judge Koh to de- cide whether a sales injunction is warranted, though legal ex- perLs deem LIuL unIIkeIy. In the San Jose trial, the jury found that Samsung had in- fringed two patents, and the judge had ruled before trial that Sumsung Iud InIrInged u LIIrd. The jury also found Apple had infringed on one of the Korean compuny`s own puLenLs. Sum- sung, wIIcI usserLed u $6 mII- lion damages claim, was award- ed $18,qoo. During the trial, the two tech leaders also sparred over how Google Incs work on the soft- ware used in Samsung phones uecLs AppIe`s puLenL cIuIms. Samsungs phones run on the Android mobile operating sys- Lem deveIoped by GoogIe. Google was not a defendant in the case, but during the trial Samsung pointed out that some of the features Apple claims to own were actually invented by Google, and called a handful of executives from the internet search company to testify on its beIuII. But last week, jury foreman and International Business Machines Corp executive Tom DunIum, q, suId In un InLer- view that Googles role had not ~..q ~, q .:.~.,_e Samsung Electronics Co Ltd ~:. Apple Inc - ......~..'~ .~~... ~~~ ~..q~,..'.: ~~ ... ' .,. .....:q, .._e~.._~:. .q._. ~e . e ., .e:.e~ .qe ~q:., .~ ...__~:_..._ ~..|~..: Apple . Samsung ~:. ,.- .. .~:.._ q :.e.~.|~~ e,. ....:.~~.~:. ~.e.:. ..:._~: ..: ._~..~: .. :._. . _e._.. Samsung . _..e:.._. ~..q ~, . ..:. . Samsung ~:. Apple -....:.~:. ~.e._ ~~~ ~..q~,..'.: ~~ ... ' .,......:q, .._e~.._. Apple . Samsung ~.~.:.~., _e ~. :~. ~_.:.~ ~q:.. . :. _~._.: ...._~:_._e.._. ~..|~.~~. ~.~.:.~., _e Apple -. . . . ~_ .. :.:. ._ Samsung e,.- ..:e~.~ Google Inc - ....:.~.:.~ ~:. ....,.~:.._. Samsung e,..:.._ Google . e,~._.~ :.._ Androide , ..,. ~..'~ ~._.. e, ~ .:._. ._e. ._ .~_ .. :. .~ Google ~.,_e .|~_...q ..:._. Apple . ..._~:. ...:.._ ~..|....:.~. ~. ~:. Google . e, ~ .:._. ._e. ._~:. Samsung . ._.:_~:.:. ._. factored much in the jurors de- IIberuLIons. Reuters A screenshot of ReadyMyanmar.com website. Thailands ReadyPlanet to Venture into Myanmar Web services T hailands web service provider ReadyPlanet said it will expand its readymade website services InLo Myunmur. TIe hrm uIms Lo grow o per- cent this year by expanding its services in emerging markets, purLIcuIurIy Myunmur. ReadyPlanet provides ser- vices such as readymade web- sites, online ads, training and online marketing, and will launch two more services this year Baidus online ads and Facebooks ads while boost- ing its readymade website ser- Aye Myat vices to help its customers de- sign responsive websites, CEO Songyot Kanthamanon told TIuI medIu. He suId LIe hrm wIII Luke ILs readymade website services to Myanmar, where the online business is expected to grow rupIdIy. L Is now IormIng u team to oversee ReadyMyan- mur.com. TIIs yeur, LIe hrm uIms Lo sign up new customers with more LIun q,ooo new websILes. We uIm Lo Iuve q,ooo new customers in Thailand and get uL IeusL oo cusLomers In My- anmar, Songyot was quoted as suyIng. M B T .. -website~, ..: . . . , . ReadyPlanet ~.,_e ,.~ -~. . . website ~, ..: . . . , .~:. _., .: . . . .~: ._ _e. ._~: . ._~_: :.._. ~..|..,.~.,_e e...~ ~ q:..,. ~.~~q, .::._.. _., .:. ~:. ~. ~:.~: , .~ - ~, ..: . . . , ..:.~:. e _e .....~ ~ .:.~ ..:..__e.._. ReadyPlanet ~.,_e ~... website .:. ~,..._~:_:.:. .~,..:. ~,.. ...~~q:_.. ~_. Baidus online ads ESifh Facebooks ads .._ ~,..:. ....~._. ~..~,..:....:. .__e._.. ,.~- ~... website ~, ..: . ~:. . .. . .:.~_~ ~ . ~ . . . . ..: ...._ _e. ._~: . ._.: _~:.:.._. ~. .|. . , .~.,_e , .~ -~. .. website .:.~:. ~.._._..~:. _e ~,.....:..q..:. ~.~_., ~ .~~ .:._ e ., . , .q._ . May 15-21, 2014 Myanmar Business Today mmbiztoday.com SOCIAL SCENES 30 Myanmars First Ever K-Pop Concert in Yangon K-Pop stars perform at Tuwunna Indoor Stadium. U Aung/Xinhua K-Pop stars perform at Tuwunna Indoor Stadium at a cultural exchange program between South Korea and Myanmar in Yangon. U Aung/Xinhua K-Pop stars perform. U Aung/Xinhua K-Pop stars perform at Tuwunna Indoor Stadium. U Aung/Xinhua Official Opening of Mercedes-Benz Showroom Delegates pose for a photo. Wai Linn Kyaw Wolfgang Huppenbauer, president & CEO of Daimler South East Asia Pte Ltd, gives his speech at the opening ceremony. Wai Linn Kyaw U Win Myint, U Myint Swe and U Aung Moe Kyaw open the showroom. Wai Linn Kyaw U Aung Moe Kyaw (M) . Wai Linn Kyaw Phyu Phyu Kyaw Tein. Wai Linn Kyaw A model pose for a photo. Wai Linn Kyaw Models pose for a photo. Wai Linn Kyaw U Win Myint, union minister for commerce. Wai Linn Kyaw Tourist Guide Brefng Session of International SOS Dr Tun Tun Lynn gives speech at the event. SOS International SOS International SOS International SOS May 15-21, 2014 Myanmar Business Today mmbiztoday.com CLASSIFIEDS 31 May 15-21, 2014 Myanmar Business Today mmbiztoday.com 32 ENTERTAINMENT Active Travel Asia Introduces Myanmar Adventure Tours Kyaw Min V ietnam-based travel com- pany Active Travel Asia, the adventure brand of Holiday Indochina, has put a new website live on the web focusing on active travel and adventure tours to Myanmar to explore unique activities in the Southeast Asian country and experience Myanmars culture und nuLure, LIe hrm suId. We hope that our travellers will now have more choices of taking part in active adventures in Asia, said Bobby Nguyen, manager of Active Travel Asia and project supervisor of Ac- LIveTruveIMyunmur.com. Myanmar is now a very at- tractive destination in Asia, and with its longstanding history and cultural diversity we believe Myanmar will soon become the top pick for active adventures in AsIu In LIe nexL Iew yeurs. AcLIveTruveIMyunmur.com including a wide range collec- tion of Myanmar adventures such as easy discoveries to div- Ing und ruILIng In u rIver. TIIs will surely bring customers unforgettable experiences of ucLIve udvenLures, Ie suId. The website contains prod- ucLs or ucLIvILIes rungIng In hve main categories: Myanmar Easy Adventures and Beach: This includes tours that require low level of pIysIcuI ucLIvILIes. TIe muIn itineraries allow passengers to explore Myanmar culture as well as nature on good roads and with comfortable accom- moduLIons. MosL oI LIe Lours in this category often end up travellers relaxing at a beach to recoup LIeIr energy. Myanmar Culture Focused AdvenLures: TIIs secLIon oers tours that explore Myanmars thousand-year-old culture and the history of Buddhism ad- ventures designed for history und cuILure Iovers. Myanmar Trek and Hill Tribe Encounters: The great Hima- Czech politician and writer Vaclav Havel. Czech Embassy to Launch Vaclav Havels Childrens Book in Burmese Wai Linn Kyaw T he Embassy of the Czech Republic in Yangon will organise a book launch of the Burmese translation of a childrens book by the former Czech president and playwright VucIuv HuveI. The launching ceremony of Pizhduks will take place at GuIIery SIxLy-hve on 1q Muy, Wednesday from 5 to 7pm, accompanied by picture pres- entation and reading of pas- sage from the book by former Burmese dissident U Min Ko NuIng. TIe book, wIIcI Is sometimes described as for children but not only for chil- dren, was illustrated by U Min Ko NuIng. Vaclav Havel wrote only LIIs one book Ior cIIIdren. He wroLe IL In 1q;, wIen commu- nists ruled Czechoslovakia and many writers were not allowed to publish their books, includ- Ing HuveI. Pizhduks is Havels criti- cism of self seeking people, usuuIIy poIILIcIuns. MuInIy, IL`s criticism of communism, but sensitively written for chil- dren to let them know how the communIsL regIme wus. TIe fairytale has three parts: The Conspiracy, The Telephone and TIe OuLdoorsmun. Vaclav once wrote: Dear children, I dont usually write for children, and that is why I dont know if this tale of mine about the Pizhduks is going to make sense to you, and if you ure goIng Lo IIke IL. I noL, don`L throw it away wait and see Iow IL Is wIen you ure oIder. The Pizhduks is the second book of Vaclav Havel after the book The Power of the Power- less, which was also trans- IuLed InLo Burmese. The book The Pizhduks in Burmese language was pub- lished by Seikku Cho Cho Publishing House and Burmese translation was done by Maung Duy. Vaclav Havel was a Czech playwright, essayist, poet, dis- sIdenL und poIILIcIun. HuveI was the ninth and the last president of Czechoslovakia (1q8q-1qqz) und LIe hrsL president of the Czech Republic (1qq-zoo). He wroLe more LIun zo pIuys und numerous non-hcLIon works, LrunsIuLed InLernuLIonuIIy. Min Ko Naing, a dissident, u Ieuder oI GeneruLIon 88 movement, a poet, a painter, a playwright and one of the most ImporLunL hgures In Loduy`s cIvII socIeLy In Myunmur. W M C layan ranges tail parts are In Myunmur. AcLIve TruveI`s udvenLures In LIIs secLIon oer encounters with ethnic groups and introduce travellers with LIeIr dIerenL IIIesLyIes. MosL of those adventures in this sec- tion will require average physi- cuI hLness, LIe hrm suId. Myanmar Biking Tours: Exploring Myanmar in pedals is a great way to interact with IocuIs. AcLIveTruveIMyunmur. com wIII oer boLI bIkIng Lours overland as well as short biking excursIons uL eucI sILe. Myanmar Cruise and Water activities: Myanmar has one face toward the sea and two gIunL rIvers owIng Irom norLI Lo souLI. Myunmur`s wuLer activities include river cruise journeys, diving or kayaking in ocean or even rafting in moun- LuInous rIvers. AcLIveTruveIMyunmur.com Is a member of Active Travel Asia managed by Holiday Indochina Company, which has been pre- sent at the Myanmar market Ior some yeurs. A screenshot of ActiveTravelMyanmar.com website. M B T