By Kyaw Htike Soe
In the financial year 2019-2020 which ends on September 30, US$5.689 billion of foreign direct investment has been pumped into Myanmar which is considered by many countries as the last frontier economy in Southeast Asia region, an increase of more than US$1 billion when compared to the same period last year, according to the latest figures updated by the country’s Ministry of Investment and Foreign Economic Relations.
The Myanmar Investment Commission (MIC) tasked with evaluating, assessing and permitting the investment projects proposed by foreign firms and domestic companies gave the nod to 11 foreign investment projects in industry and real estate sector on September 29. The foreign investment proposals approved by the MIC are valued at over US$290 million and expected to create up to 8,744 job opportunities for Myanmar citizens. The foreign investment projects approved by the MIC from October 1 last year to September 30 this year under the Special Economic Zone Law were US$163.27 million. The MIC also gave the green light to 130 Myanmar citizen-invested projects valued at more than Ks1,535,075 million and US$267 million in the same period.
Investment projects by Myanmar citizens under the Special Economic Zone during the same period were US$413.618 million and Ks1881459 million. The MIC set a target to lure US$5.8 billion of FDI set under the Myanmar Investment Promotion Plan (MIPP) in the financial year 2019-2020. But the country has only received US$5.689 billion of FDI, a decrease of around US$110 million to meet its target. The Southeast Asian country received an average of US$500 million per month in foreign direct investment in the current financial year. The foreign direct investment inflow into Myanmar attributes to the government’s steps to ease regulations in an attempt to attract more foreign direct investment into the country. The MIFER is also inviting only responsible businesses to benefit the country.
Myanmar drew up the MIPP in order to attract US$221 billion of FDI within 20 years from 2016-2017FY to 2035-2036FY to become a middle-income country by 2036. Foreign investor’s interest in Myanmar’s much-needed infrastructure projects such as construction, real estate, tourism, telecommunications, and industry sector is rising. Myanmar is believed to be a key overseas emerging investment market for foreign investors around the world due to its consumption trends, abundant young workforce and relaxed export & import related policies. Myanmar has great economic potential and several investment opportunities for local and foreign investors in various sectors. There is still a lot of room for growth in Myanmar for foreign investors and FDI is a key part of the country’s growth strategy. The Myanmar Investment Law enacted in late 2016 is making the country a more attractive destination for foreign investors.
Myanmar offers a promising economic environment for foreign investors in many fields especially in construction and real estate sector. Business opportunities in Myanmar for foreign investors include agriculture, livestock breeding, real estate, tourism, manufacturing, energy, and industrial sectors. According to the ministry’s data, Myanmar received FDI worth US$24.7 billion in the time of incumbent government. Singapore topped the list of foreign investors in Myanmar during the period from October last year to date, and followed by China and Thailand. Singapore became the largest foreign investor in Myanmar, pouring over US$22 billion into 312 projects in the country. The power sector topped the FDI line-up in the current financial year, with investments of almost US$1.6 billion, followed by the manufacturing and the real estate sectors.
The largest sector of FDI flowed into oil and gas sector, accounting for 26.32 per cent of the total FDI, followed by oil and gas sector with 26.23 per cent and the manufacturing sector with 14.31 per cent. Myanmar attracted US$ 9.4 billion of foreign direct investment in the financial year 2015-2016, US$6.6 billion of FDI in 2016-2017FY, US$6.11 billion of FDI in 2017-2018FY, and US$4.52 billion in the financial year 2018-2019.