Last month we reported that Myanmar is gunning for more foreign direct investment under a new plan under the Myanmar Investment Promotion Plan MIPP. As part of that plan the country will also aim to strengthen ties with neighbouring countries. 

Related reading: Myanmar gunning for more foreign direct investment under new plan

MIPP was jointly formulated by the Myanmar Investment Commission (MIC) and Japan International Cooperation Agency (JICA) to implement the objectives of MIPP by adopting strategies and setting up the Task Force and a total of 200 representatives from JICA, Deutsche Gesellschaftfür Internationale Zusammenarbeit GmbH (GIZ), relevant ministries, Directorate of Investment and Company Administration (DICA) and media attended the ceremony. 

According to the DICA - H.E U Myo Thit, Mandalay regional minister for forestry, natural resources and environmental conservation,  U Aung Naing Oo, Director General of Directorate of Investment and Company Administration (DICA) and Secretary of MIC said that MIPP can more benefit not only government but also local businessmen and also to cooperate the stakeholders for successful plan.

MIC's 20 year plan is to attract over $200 billion in foreign direct investment through the MIPP and has presented three phases in which this will aim to be achieved.

1. $8.5 billion in the first four-year phase starting from 2021-2025
2. $12.3 billion in 2026-2030
3. $17.6 billion in the 2031-2035

According to Colliers International Myanmar, the new investment law has been well received, especially by foreign investors who account for up to a fifth of exports and of formal employment, but more needs to be done to raise awareness and build capacity for implementation and coordination.

The main changes to the investment regime include lower entry barriers, more streamlined procedures, a dedicated mechanism to mediate investor disputes, and more selective investment incentives.

The World Bank Enterprise Survey (WBES) conducted in 2016 with an extension in 2017 suggests that foreign firms account for about 20 percent of all exports and 18 percent of formal employment. They are also more productive and more likely to train workers.

Colliers report that "Most firms aware of the new law think it will positively impact their sector through better access to input/output markets and technology transfers associated with increased FDI. Foreign firms spent significant management time to deal with regulations under the old investment regime and consider the process as favoring those with government connections. To successfully attract and maximize the impact of FDI, the government needs to raise awareness of the new law and regulations, build staff capacity at the regional level, and clarify the setup of the Investor Assistance Committee. Complementary reforms should also be accelerated to improve investors’ access to land, infrastructure, skilled labor, and quality domestic inputs."

Source: Colliers International Myanmar, Investvine, 

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