May 1-7, 2014

Myanmar Business Today

mmbiztoday.com
mmbiztoday.com May 1-7, 2014| Vol 2, Issue 17 MYANMARS FIRST BILINGUAL BUSINESS JOURNAL
Myanmar Summary
Myanmar Summary
Contd. P 6...(Hydrocarbon) Contd. P 6...(Hydrocarbon)
Inside MBT
National Export Strategy to Be Ready
by 2014 .. p-4
Myanmars Palm Oil Industry: Chal-
lenges and Way Forward .. P-9
Myanmars Economic Prospects And
Its Real Potential .. P-21
Securing Myanmar
Hydrocarbon Investments
M
yanmars hydro-
carbon sector
is an attractive
target for foreign inves-
tors. Three major issues,
however, present a signif-
icant challenge to foreign
companies planning to
invest in Myanmar: oner-
ous government policies,
community resistance to
infrastructure projects,
and security concerns.
Companies are rela-
tively powerless to af-
fect government policy,
but by employing com-
munity engagement pro-
grams, they can mitigate
community resistance
and security concerns.
As shown by the experi-
ence of the Sino-Burmese
pipeline project, energy
sector investors should
engage with local com-
munities when carrying
out such programs, and
they should not rely sole-
ly upon interfacing with
government entities.
Hydr ocar bon pr os-
pects
As Myanmar continues
Nicholas Borroz its dramatic opening to
international markets, oil
and gas projects will be an
attractive investment tar-
get. There are numerous
media articles speculating
that Myanmar contains
vast oil reserves, with a
recent estimate that My-
anmar has potential re-
serves on par with Brazil.
There are also reports of
small-scale homegrown
oil extraction projects
that have transformed
local communities. The
country has yet to un-
dergo rigorous testing to
determine the exact size
of its reserves, but such
speculation and anecdo-
tal evidence is a tantalis-
ing prospect for foreign
businesses.
Chinas development
oI LIe osIore SIwe
gus heId und LIe uccom-
panying Sino-Burmese
pipelines are the most
IIgI-prohIe Iydrocur-
bon projects currently
underway in Myanmar.
After China, Thailand is
the most active player in
Myanmars hydrocarbon
sector. It is engaged in the
Yudunu und YeLugun o-
sIore heIds, und IL IoIds u
licence that covers much
oI LIe ZuwLIku heId In LIe
Gulf of Martaban. Opera-
tions in Zawtika are due
to start shortly, with two
thirds of gas production
destined for the Thai mar-
ket. In March 2014, sever-
al Western majors joined
Myunmur`s osIore
game; Shell, Chevron,
and Statoil all acquired
acreage in a highly publi-
cIsed osIore bId round.
I nvestment chal-
lenges
Despite the appeal of
Myanmars hydrocarbon
sector, government poli-
cies could decrease oil
and gas companies de-
sire to invest. There are
reports, for instance, that
Nay Pyi Taw will impose
onerous revenue-sharing
requirements well above
the international average,
channelling up to 85 per-
cent of earnings to gov-
ernmenL coers. Burmese
om cIuIs Iuve uIso become
more vocal about the
need to reserve some gas
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FDI Almost Triples to
$4.1b in FY2013-14
M
yanmar bagged
$4.1 billion in
foreign direct in-
vestments in the 2013-14
hscuI yeur wIIcI ended
in March, almost tripling
from $1.4 billion it re-
ceived in FY2012-13, the
Directorate of Investment
and Companies Admin-
istrations (DICA) recent
data shows.
Injected by 34 countries,
the foreign investment
Pann Nu In zo1-1q owed mosLIy
into manufacturing, en-
ergy, oil and gas, mining,
hotels and tourism, real
esLuLe, IIvesLock, hsIery
and agriculture.
Total FDI from 34 coun-
tries in Myanmar now
stands at $46 billion, ac-
cording to DICA statistics.
China still stands as the
largest investor with $14
billion in investments in
the Southeast Asian coun-
try, followed by Thailand
($10 billion) and Hong
Kong ($6 billion).
The 71 foreign-invested
projects in 2013-14 up to
December last year has
created over 50,000 jobs
for local people, accord-
ing to DICA.
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May 1-7, 2014
Myanmar Business Today
mmbiztoday.com
2
LOCAL BIZ
MYANMARS FIRST BILINGUAL BUSINESS JOURNAL
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Business News in Brief
Myanmar I nvestment Commi ssi on to become
i ndependent
Arrangements are underway to make Myanmar In-
vestment Commission (MIC) an independent body,
local media reported, citing Aung Naing Oo, director
general of the Directorate of Investment and Company
Administration. Set up by former military government
in 1989 with intent to encourage local and foreign pri-
vate investment, the MIC is currently chaired by Win
Shein, minister for Finance and National Planning, and
based in capital Nay Pyi Taw. Another senior MIC of-
hcIuI suId LIe IeudquurLers oI LIe reIormed MC wIII be
based in Yangon.
Fi ve new tax laws enacted
Myunmur Ius enucLed hve new Lux-reIuLed Iuws In-
cluding Revenue Law 2014, Income Tax Law, Commer-
cial Tax Law, Stamp Duty Law and Court Fee Act. For
personal taxes, top rate was increased from 20 percent
to 25 percent, while the income band was set higher
from K500,000 ($520) to K2 million ($2,080). Corpo-
rate income tax rate was unchanged at 25 percent.
Health mi ni str y plans labs at bor der gates to
check i mpor ts
The Food and Drugs Administration department un-
der the Ministry of Health will open laboratories at all
15 border-trade gates to inspect food and goods legally
and illegally imported into the country, local media re-
ported, quoting Khin Chit, a director from the ministry.
Khin Chit said the general public would be informed
about unhealthy food and goods imported into the
country. In 2013, consumer rights activists demanded
a close and thorough inspection of ready-made snacks
illegally imported through the Chinese border.
Air Chino to g hetueen Kunming, Nog Pgi
Taw
AIr CIInu pIuns Lo y beLween KunmIng, u cILy In CII-
nas Yunnan Province, and Myanmars capital Nay Pyi
Taw twice a week, on Tuesdays and Thursdays, from
AprII zq, IocuI medIu reporLed, quoLIng un om cIuI uL Nuy
Pyi Taw airport. Currently, there are four local airlines
yIng Lo LIe cILy Irom domesLIc desLInuLIons. Bungkok
AIrwuys, wIIcI Ies Lo Nuy PyI Tuw Irom Bungkok, Is
the only foreign airline. Air Asia suspended its sched-
uIed IgILs Irom Bungkok Lo Nuy PyI Tuw LemporurIIy
due to low seat occupancy.
Consumer prices up zg-1oopc since Mgonmor
Neu Yeor
Consumer prices have risen by 25 to 100 percent af-
ter a hike in power supply fees and salary increases for
governmenL empIoyees Irom AprII 1, LIe sLurL oI LIe h-
nancial year, making it harder for those who live from
hand to mouth, local media reported, citing data from
wholesale and retail outlets. Consumer prices normally
climb around the Myanmar New Year, which falls in the
middle of April, and then decline a few days later. But
prices of some consumer items remain high while oth-
ers are still rising.
Defor estati on far hi gher than r efor estati on
Over 900,000 acres of forests are destroyed in Myan-
mar every year while only over 150,000 acres of forests
have been grown by private companies since private
IoresLs were uIIowed In zoo6, om cIuI duLu sIowed. TIe
forests grown by private companies include 107,543
acres of teak and 46,180 acres of hardwood, data re-
leased by the Ministry of Forest said.
EU extends ar ms embar go
TIe EU oreIgn AuIrs CouncII Monduy exLended LIe
EUs sanctions against Myanmar by one year, until 30
April 2015. The sanctions comprise an arms embargo
and an embargo on equipment that may be used for in-
ternal repression, said the Council in a statement after
the end of its meeting in Luxembourg last month.
Mgonmor's notionuide census cooers neorlg
11 million households
Myanmars 2014 nationwide census covered 10.719
million households except some restive areas in north-
ernmost Kachin state and western Rakhine state, said
a statement of the Ministry of Immigration and Popu-
lation. Myanmars national census from March 30 to
AprII 1o, LIe hrsL In LIree decudes, coIIecLed popuIuLIon,
economic and social data, aimed at working out a na-
tional development plan.
Myanmar Summary
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May 1-7, 2014
Myanmar Business Today
mmbiztoday.com
3
LOCAL BIZ
Myanmar Summary
Myanmar Summary
Energy Contracts Signing This Month
Govt says it will sign production sharing contracts for onshore energy exploration in mid-May
P
roduction sharing con-
tracts for energy compa-
nies tasked with exploring
Myanmars onshore reserves is
expected to be signed in May, a
mInIsLry oI energy om cIuI suId
last week.
This is later than an earlier
timeline planned for January.
The Ministry of Energy award-
ed 16 of the 18 onshore blocks
oered In LIe Lender In mId-Oc-
tober. Italys Eni, Indias ONGC
Videsh Ltd., Malaysias Petro-
nus CurIguII, Cunudu`s PucIhc
Energy Hunt Corp., Pakistans
Petroleum Exploration (PVT)
Ltd and British Virgin Islands-
registered MRPL E&P Pte Ltd.
were each awarded 2 blocks.
The government also awarded
one block each to Thailands
PTTEP, Brunei National Petro-
leum Co, Luxembourgs CAOG
and Russias JSOC Bashneft.
A total of 26 foreign compa-
nies bid for the onshore blocks,
wILI 1o hrms seIecLed Lo sIgn
the production sharing con-
tracts.
Khin Khin Aye, director of en-
ergy planning at the Ministry
Kyaw Min of Energy, said the government
was working according to nor-
mal procedures.
We will sign the production
sharing contracts in the mid-
dle of May, he told the energy
news website Rigzone.
International investors have
moved into the wake created
when Myanmar earned relief
from economic sanctions when
in 2010 it ended a long period
of military rule through general
elections.
Last month, the government
awarded some of the biggest
energy companies in the world
with exploration contracts for
IronLIer LerrILory o LIe Myun-
mar coast.
TIe hrsL burreI oI oII wus ex-
ported from Myanmar in 1853,
though the countrys energy
sector was largely idled during
the long period of military rule.
French energy company Total, a
pioneer developer in Myanmar,
estimates the country produces
about 180,000 barrels of oil
equivalent per day and nearly
all of that is in the form of natu-
ral gas.
Investors Invited to Develop Yangon
Railway Station Complex
M
yanmars rail trans-
port authorities are
working on a massive
plan to transform the Yangon
Central Railway Station into
one of the citys most sparkling
new projects, and are inviting
ideas and expression of interest
from local and international in-
vestors for the move.
The state-run Myanmar
Railways said it intends the
investors to undertake de-
sign-and-build work for the
comprehensive development of
the largest railway station in the
country, according to state-run
media.
The department called for de-
velopment of the colonial-era-
left station on 25.3 hectares of
land plot as a rail concerned
business including high-rise
buildings and hotels up to in-
ternational standards.
The authorities have set May
6 as the deadline for submission
of the expression of interest.
The rail transport authorities
have also planned to privatise
Yangon city circular trains as
purL oI ILs eorLs Lo eecLIveIy
run the rail transport busi-
Phyu THit Lwin ness under a build, operate and
transfer (BOT) system.
About 130,000 passengers
depend on rail transport in
Yangon daily, according to gov-
ernment estimates.
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May 1-7, 2014
Myanmar Business Today
mmbiztoday.com
LOCAL BIZ
4
Myanmar Summary
Myanmar Summary
National Export Strategy to Be Ready by 2014
T
he National Export Strat-
egy (NES) will be drafted
by this year in a bid to im-
prove trade and attract foreign
investments, according to U
Aung Min, in-charge of coordi-
nation of the NES.
Previously, the government
pIunned Lo hnIsI druILIng LIe
strategy by December last year,
but the Ministry of Commerce
later asked to include the trade
and commerce sectors along-
side export in the strategy.
TIuL`s wIy IL cun onIy be hnuI-
ised by 2014. There are a total of
11 sectors in the draft and most
of them have been completed,
he said.
Both foreign investment and
trade will become more conven-
ient after we develop this plan.
So, we wIII pusI Lo hnIsI LIe
drafting by this year.
The UNs World Food Pro-
gram (WFP) is assisting in the
drafting process with regards to
exporLs oI rIce, beuns und hsI-
ery products. Operations such
as data sourcing, collecting
Htun Htun Min and processing are carried out
by separate teams and the in-
charge of trade information of
the NES, U Aung Min said.
He said the comprehensive
duLu und hgures Ior dIerenL
sectors will help foreign in-
vestors during their research.
However, LIere ure sLIII dImcuI-
ties in terms of gathering illegal
border trade data, he added. In
March, London-based Environ-
mental Investigation Agency
(EIA) said that Myanmar had
lost over $6 billion because of
illegal logging during 2000 to
2013.
President U Thein Sein initi-
ated the NES in 2012. At that
time, the plan focussed on rice,
beun, processed Iood, hsIery
und Leuk us hrsL prIorILy wILI
rubber and tourism sectors on
the sidelines.
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MAPCO, Mitsui to Form Irrigated
Rice Complex Product JV
M
yanmar Agribusiness
Public Corp (MAPCO)
and Japanese con-
glomerate Mitsui Co will form
a joint venture in a bid to de-
velop Myanmars rice industry,
according to the Myanmar Rice
Federation (MRF).
According to the deal, MAP-
CO and Mitsui will establish
Myanmar-Japan Rice Industry
Co Ltd and start the initial im-
plementation of the Irrigated
Rice Complex Product (IRCP)
project in Twante township in
Yangon region.
The project, which will con-
tain value-added facilities for
crops including rice, will cost
$6o mIIIIon und wIII be hnuI-
ised by December 2015, MRF
said.
The project will play an im-
portant role in Myanmars
agriculture sector and will ac-
celerate the agricultural de-
velopment of Yangon and Ay-
eyarwaddy regions, MRF said.
The project will also facilitate
sIgnIhcunL LecInIcuI excIunge
between Myanmar and Japan,
Phyu Thit Lwin the foundation added.
The joint venture company
will produce value-added prod-
ucts based on rice, generate
eIecLrIcILy wILI cIus, ImpIe-
ment the production of paddy
seeds and distribute fertilisers,
in collaboration with farmers,
MRF said.
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Rice Complex Product (IRCP)
Project ~ _., .:. - ., ..|...:~
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(IRCP Project) ~ q,~,~....
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May 1-7, 2014
Myanmar Business Today
mmbiztoday.com
LOCAL BIZ
5
Myanmar Summary
G
erman power solutions
provider Heliocentris
Energy Solutions AG has
receIved u hrm purcIuse order
to deliver hybrid power solu-
tions for the ongoing mobile
network rollout in Myanmar,
LIe hrm suId.
This is the largest single pur-
chase order since the compa-
nys foundation in 1995, it said.
The order comprises the de-
livery and installation of hybrid
power solutions for the build-
out of 150 mobile base stations
in Myanmar and has a value of
$4-6 million depending on the
exucL sILe conhguruLIon Lo be
delivered, said the Berlin-based
company, which deals in solu-
tions and services for energy ef-
hcIency und dIsLrIbuLed power
systems.
The orders will be shipped
and installed within the next 3-4
months, Heliocentris said.
The power solutions comprise
Heliocentris proprietary En-
ergy Management System and
Wai Linn Kyaw
also include diesel generators,
batteries, power electronics,
cabinets and peripheral mate-
rial from other power compo-
nents suppliers.
The two foreign mobile opera-
tors, Telenor from Norway and
Ooredoo from Qatar, who were
awarded 15-year-licences to op-
erate mobile phone networks in
Myanmar in June last year have
now started their initial rollout
phases which entail construc-
tion of more than 2,000 mobile
base stations within the next 12
months.
The towers for these mobile
base stations will be installed
and operated by tower compa-
nies such as Apollo Towers and
Irrawaddy Green Towers and
require power solutions for a
vurIeLy oI conhguruLIons reucI-
ing from on-grid to bad-grid
und o-grId sILes.
Participating in
the roll-out from its
initial phase creates
an outstanding op-
portunity for Helio-
centris to gain a sig-
nIhcunL sIure In LIe
coming build-out of the mobile
networks in Myanmar, Ayad
Abul-Ella, CEO of Heliocentris,
said.
Myanmar is one of the few
remaining telecommunications
frontiers, with only 10 percent
of its 60 million people holding
a mobile-phone subscription,
according to industry estimates.
That compares to penetration
rates of 70 percent in Cambo-
dia, 90 percent in Laos and over
100 percent in Thailand.
AccordIng Lo omcIuI sLuLe-
ments, the Myanmar govern-
ment plans to increase the per-
centage of phone owners to 80
percent by 2016.
In order to achieve this ambi-
tious goal, new mobile licences
were awarded to Telenor from
Norway and Qatar Telecom in
June of last year. Both opera-
tors will have to meet popula-
tion and geographical coverage
targets to ensure that the coun-
trys large rural population is
covered.
This is expected to require
more than 18,000 mobile base
stations being erected green-
heId over LIe course oI LIe nexL
three years, with most of them
In bud-grId or o-grId sILuu-
tions.
Ayad said: We have designed
sILe specIhc power soIuLIons
LIuL IuIhI LIe hve muIn requIre-
ments of our customers in an
optimal manner: best energy
emcIency, IowesL LoLuI cosL oI
ownership with maximum up-
time, the security of multiple
sourcing for the key power com-
ponents and seamless upgrad-
ing options to higher capacities
for multi tenant usage.
He said with this order the
IounduLIon Ior IurLIer sIgnIh-
cant business in Myanmar has
been IuId und LIe hrm Iooks
forward to winning additional
multi-million purchase orders
in the coming months.
TIe compuny`s ugsIIp prod-
uct Energy Manager enables
connecLIvILy beLween dIerenL
components in hybrid energy
supply clusters, such as batter-
ies, solar panels, conventional
diesel generators or fuel cells. It
targets primarily base stations
German Firm Receives Major
Myanmar Power Systems Order
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of mobile telecom operators in
world regions with poor and
unreliable grid-coverage such
as the Middle East and South-
east Asia.
Myanmar Summary
NEXI to Insure JFIs
Myanmar venture
N
ippon Export and
Investment In-
surance will pro-
vide up to about 700
million ($6.83 million)
in trade insurance for an
infrastructure construc-
tion joint venture set up
in Myanmar by JFE En-
gIneerIng Corp, omcIuIs
said last week.
TIIs Is LIe hrsL sucI
support project of the
governmenL umIIuLe, beL-
ter known as NEXI, since
it sharply expanded the
scope of insurance for My-
anmar in January 2012 as
part of Japans economic
assistance to the country.
The trade insurance will
cover J&M Steel Solu-
tions Co, the joint venture
JFE Engineering estab-
Aye Myat lished with Myanmars
Construction Ministry in
December 2013 to con-
struct bridges, Jiji Press
reported.
OI LIe hrm`s LoLuI cupI-
tal of 1.2 billion, NEXI
will insure up to about
700 million, or 95 per-
cent of JFE Engineerings
interest of 60 percent.
Myanmar Summary
Nippon Export and Invest-
ment Insurance ..,.~.,
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May 1-7, 2014
Myanmar Business Today
mmbiztoday.com
LOCAL BIZ
6
Myanmar Summary
From page ...(Hydrocarbon)
production for domestic
consumption; the country
suers Irom poor eIec-
tricity access, a dilemma
it wishes to address with
gas-fuelled power plants.
Corporate social respon-
sibility requirements re-
main unclear, but they
will likely be implement-
ed, thereby siphoning fur-
LIer revenue o Lowurds
community development
initiatives.
Another issue that
dampens Myanmars at-
tractiveness to energy
investors is local com-
munity resistance to in-
frastructure projects.
Communities fear los-
ing land, jobs, and liveli-
hoods, and this popular
discontent could pressure
the government to enact
measures against the in-
terests of investors. Chi-
nas turbulent experience
with the Sino-Burmese
pipeline project best illus-
trates vocal community
resistance. There are sev-
eral local interest groups
in Myanmar, most nota-
bly the Shwe Gas Move-
ment, which regularly
demonstrates against the
project. Their discontent
is augmented by reports
that the Burmese govern-
ment has not distributed
funds intended to com-
pensuLe uecLed IocuI
communities.
A third factor that chal-
lenges investment pros-
pects in Myanmar is secu-
rity concerns, once again
illustrated by the Sino-
Burmese pipeline project
experience. In May 2013,
ethnic minority guerril-
las attacked a compound
owned by the Burmese
company involved in that
project, killing two peo-
ple. The compound was
located in Shan State near
the Chinese border, close
to the pipelines route. In
January 2014, clashes be-
tween Burmese and Chi-
nese workers at a work-
site along the pipelines
route reportedly led to the
destruction of an oil stor-
age facility. Such security
concerns are likely at least
partially responsible for
delays in the projects de-
velopment, which was to
become fully operational
in late 2013.
Communitg engoge-
ment
Although energy com-
panies are relatively
powerIess Lo uecL on-
erous government poli-
cies, they could employ
community engagement
programs in Myanmar to
overcome the challenges
of community resistance
and security concerns.
Community engagement
programs are driven by
comprehensive consul-
tations with community
leaders that identify their
concerns and grievances.
Those concerns and griev-
ances are then addressed
through negotiations and
local partnerships. Com-
munity engagement pro-
grams are directly driven
by business concerns;
by including local com-
munities as stakeholders
in an infrastructure pro-
ject, those communities
become invested in the
projects success, thereby
eliminating community
resistance.
Equally important,
community engagement
provides an intangible
layer of security around
large infrastructure pro-
jects. In the chance that
an infrastructure project
is targeted by an impend-
ing attack, community
members will either ac-
tively protect the project,
or at the very least notify
authorities of the danger.
In some ways, commu-
nity engagement is simi-
lar to the strategies used
by development workers
to ensure their own safe-
ty; instead of protecting
themselves with weap-
onry or armed guards,
development workers in-
tegrate themselves into
local communities to en-
sure that other commu-
nity members will assist
them in a dangerous situ-
ation.
Although similar, com-
munity engagement is dis-
tinct from corporate so-
cial responsibility (CSR).
CSR is primarily driven
by a desire to do good, as
well as by an intention to
improve a companys im-
age through community
development work, which
is vaguely expected to
improve the companys
business prospects. The
problem is that, from a
business perspective, CSR
is unsustainable because
it doesnt explicitly align
wILI LIe prohL moLIve oI u
private company.
There are reports, for instance, that Nay
Pyi Taw will impose onerous
revenue-sharing requirements well
above the international average, channel-
ling up to 85 percent of earnings to
government coffers.
Lessons fr om the
Sino-Burmese
pi peli nes
As previously men-
tioned, the Sino-Burmese
pipeline project has faced
community resistance and
security concerns. There
are indications, however,
that the consortium in
charge of the project has
attempted some form of
community engagement;
it has reportedly allotted
$20 million in liveli-
hood security for local
communILIes uecLed by
the project. The money
has been channelled into
numerous projects, in-
cluding schools, kinder-
gartens, hospitals, health
care centres, a reservoir,
and electricity transmis-
sion lines.
The consortiums at-
tempts did not have the
InLended eecL, Iowever,
for two reasons. First, the
consortium directed the
money through the Bur-
mese government, and it
wasnt clear to local com-
munities that the con-
sortium was intending
Lo recompense uecLed
communities. Second,
the Burmese government
reportedly withheld some
of the money and local
communities were there-
fore unaware that they
were intended to receive
any funding at all. This
experience highlights the
need for energy sector in-
vestors to directly engage
with local communities
in Myanmar, rather than
solely rely upon interfac-
ing with government enti-
ties. Investors should ac-
tively engage community
stakeholders and align
infrastructure projects to
meet their needs.
Nicholcs orroz is con-
tributor an independent
analyst of energy geo-
politics with an emphasis
on oil and gas transpor-
tation infrastructure. He
works for a DC-based
risk consultancy and has
three years experiencing
working for the US gov-
ernment in international
cgcirs uhere he jocused
on development, energy,
and macroeconomics.
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From page ...(Hydrocarbon)
The Philippines Sets Air Talks
with Myanmar Eyeing Direct Link
T
he Philippines will hold
air talks with Myanmar
and Canada next month,
followed by talks with Macau,
which could result in increased
IgILs beLween MunIIu und
those destinations and help
bolster the Philippines tourism
goals, according to a Filipino
uvIuLIon omcIuI.
The Philippines Civil Aero-
nautics Board executive direc-
tor Carmelo Arcilla said in an
interview recently that talks
wILI Myunmur were up hrsL,
from May 19 to 20, according to
Filipino media reports.
The move is set to result in the
hrsL dIrecL IgILs beLween PIII-
ippines and Myanmar, often
descrIbed us LIe regIon`s hnuI
frontier, and follows strength-
ened bilateral ties between both
countries late last year.
Kyaw Min There is strong potential for
tourism links with Myanmar
u desLInuLIon LIuL Cebu PucIhc
has expressed interest in serv-
Ing wILI duIIy IgILs Lo Yungon.
Talks with Canada will be held
later in May aimed at expand-
Ing IgILs Lo NorLI AmerIcu.
Arcilla noted that the time
was right for talks with Myan-
mar given the potential for in-
creased tourism and business.
Among local carriers, he said
Cebu PucIhc Ius expressed ILs
interest to operate in Myanmar.
Its a very young emerging
market and there are political
reforms being implemented,
Arcilla was quoted as saying.
For a while, Myanmar was at
the receiving end of economic
sanctions but now, there is rec-
ognition and support coming
from other ASEAN members.
At present Philippines Air-
IInes (PA) cun y duIIy Lo Cun-
udu, buL uvIuLIon omcIuIs ure
looking at doubling the maxi-
mum uIIowed IgILs Lo 1q u
week, in the aviation agreement
to give more scope for growth in
the long-term.
Talks with Macau are set for
17 to 18 June, also to cater to
growIng Lwo-wuy Lrumc de-
mand.
There is speculation that the
Philippines will seek talks with
Russia and African countries
like Ethiopia, South Africa and
Kenya to create more air links.
So far this year, the Philip-
pines has completed successful
air talks with New Zealand, Sin-
gapore and France.
Talks with France resulted in
permIssIon Lo y up Lo seven
weekIy IgILs up Irom LIe pre-
vious four, which can be used
by Philippine Airlines, and also
Cebu PucIhc cun Luke some oI
the slots following its removal
from a European Union black-
list. However, both airlines
have not indicated if they are
prepared to increase services
to Europe until there are clear
signs of economic recovery to
drIve demund Ior more IgILs
to Southeast Asia.
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Philippine Airlines Airbus A320.
M

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7
LOCAL BIZ
Myanmar Summary
Myanmar Summary
S
ingapore-based Wil-
mar International
Ltd announced last
week ILs hrsL mujor Ioruy
into Myanmars sugar
market, forming a joint
venture with a local pro-
ducer.
The company said it
Wilmar Seeks Myanmar Sugar Market Entry Through JV
Phyu Thit Lwin has signed a joint ven-
ture agreement with My-
anmars Great Wall Food
SLu ndusLry Lo produce
and sell sugar and its by-
products in the emerging
Southeast Asian market.
Wilmar will hold a 55
percent stake in the joint
venture company, Great
Wall-Wilmar Holdings.
The deal will see the new
joint venture company
buying all of the existing
sugar-related business,
mills and plants Great
Wall and its associates.
That includes two sugar
mills with a total milling
capacity of 4,000 metric
tonnes of sugarcane per
day and a total production
capacity of 65,000 metric
tonnes of sugar per year, a
bio-ethanol plant and one
organic compound ferti-
liser plant.
Wilmar is the worlds
top palm oil processor,
but it has been steadily
growing its sugar busi-
ness through a series of
deals over the past four
years. In February it an-
nounced it was buying
a major stake in Indias
Shree Renuka Sugars for
up to $145 million.
Financial terms of the
deal were not announced
and Wilmar says it does
not expect the investment
to have a material impact
on its earnings for the
currenL hnuncIuI yeur.
The joint venture is still
subject to regulatory ap-
proval.
Bags of sugar. Singapores Wilmar said it has signed a joint venture
agreement with Myanmars Great Wall Food Stuff Industry to pro-
duce and sell sugar and its by-products in the emerging Southeast
Asian market.
J
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P
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.~:.~._..~ Wilmar
International Ltd ~.,_e
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.~: ._ _e. ._~: . e. ~.~
~ ._~_:.._.
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~.,_e _.,.:.. Great
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.....|.~: ._~:.. .~
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~. .| ....| ...: q ~ . ~
~~ Great Wall-Wilmar
Holdings ~:. e ._ .._ _e. _. .
Wilmar . q:. . , . q e e:
_~._e .q._.
Great Wall-Wilmar Holdings
~ . ~ ~.,_e ._~:.. .~ ..
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Investors Eye Fish
Feed Production
J
upun, SouLI Koreu und Denmurk ure oerIng Lo
produce hsI Ioods In Myunmur, suId U Bu TIuw,
chairman of Myanmar Eel Farming Entrepreneur
Association.
He suId Denmurk sIowed InLeresL In producIng hsI
Ioods Ior reguIur und Iong-hnned eeI und Jupun uIso
showed similar interest.
TIe counLrIes uIso oered LecInIcuI ussIsLunce In LIe
ureus oI eeI IurmIng und hsI IeedIng.
According to the Myanmar Fisheries Federation
(MFF), those countries want to invest in the sector as
LIey InLend Lo produce eeIs und commercIuI hsI Ieed
that can guarantee international standards.
SouLI Koreu uIso oered LecInIcuI ussIsLunce Ior Iong-
hnned eeI IurmIng, LIe IederuLIon sources suId.
n Myunmur, Iong-hnned eeI IurmIng ure mosLIy done
in Phyapon district of Ayeyarwaddy region and some
farming is done in Rakhine state.
I IoreIgn counLrIes geL InvoIved In hsI Ieed produc-
LIon Myunmur hsIerIes secLor wIII be ubIe Lo rump up
its growth, exporters said.
AIso, Norwuy suId IL wIII supporL hsIerIes enLrepre-
neurs Lo deveIop Myunmur`s hsI und sIrImp IurmIng
sector, according to MFF.
Norwuy`s hsIery und cosLuI deveIopmenL mInIsLry
wIII gIve heId LruInIng Lo hsI und sIrImp Iurmers In LIe
coming months, and also arrange technical training,
the federation said.
Recently, MFF also invited experts from the United
States to provide technical assistant for the improve-
menL oI hsI IurmIng ponds und crub breedIng.
Kyaw Min
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._.
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~~.~.,_ ..:.. .. ._..q.,_ .._:.:.~......q,~.~.
.:.q._~:.._..q._.~..|..:.~.,_e|.q |..
-,..:.~..._._..~.:~.,.~~.~.....:..__e._. . ~ q. :,
~.:.:.~~~._.~...q:..._~._~:. ~.:..~
.~_.. .~~:~.. ~q_~...q ._ _e. ._~: .~ ._ .
~:.. ._~: . _., .:. |.. . , .~e .. . . q._ .
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Foreign investors are getting increasingly interested in investing in
Myanmar`s Iucrative marine and sheries sector.
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LOCAL BIZ
8
Myanmar Summary
ADB, Japan to Give $2m to Upgrade Youth Skills to Lift Economy
Grant to develop three month-long courses in construction, welding, and use and repair of rural machinery
T
he Asian Development
Bank (ADB) and Japan
are to help Myanmar
upgrade and modernise tech-
nical and vocational training
programs to meet the countrys
pressing need for skilled young
workers.
A $2 million Japan Fund for
Poverty Reduction grant, ad-
ministered by ADB, will be
used to develop and pilot three
month-long competency-based
courses in skills such as con-
struction, welding, and use and
repair of rural machinery, the
Manila-based lender said.
Overhauling technical and
vocational training to make
them more relevant, modern
and accessible is critical for de-
veloping the foundational skills
needed to support Myanmars
economic transformation and
help cut poverty, said Chris-
topher Spohr, senior education
economist based in Myanmar.
ADB said the target is to train
at least 1,000 young people,
and steps will be taken to en-
sure that places are reserved for
women and young adults from
Pann Nu poor and disadvantaged fami-
lies.
Courses will be launched in
hve LruInIng cenLers IocuLed In
Yangon, Mandalay, and Pakok-
ku starting this November, and
will be free of charge.
TIe grunL buIIds on eurIy hnd-
ings from Myanmars forth-
coming costed education sector
plan, which is helping pinpoint
gaps and quick win opportu-
nities in the countrys education
sector, ADB said.
Myanmars workforce lacks
well-trained workers to im-
mediately step into positions
opening up as a result of re-
cent reforms. Existing technical
training is focused on long-term
programs in urban niche skills,
such as operating computers,
with less than 2 percent of 16-
19 year olds engaged in skills
training courses.
In rural areas the situation is
even worse, ADB said, with less
than 0.5 percent of rural males
and females enrolled in technical
or vocational training programs.
The lender said as well as set-
ting up short courses, the tech-
nical assistance project will
help relevant government agen-
cies gain the necessary capacity
to develop and oversee youth
skills training programs.
ADB said the course outcomes
will also be assessed to provide
a potential model for replica-
tion in future.
Along with the grant sup-
port from Japan, Myanmar will
provide counterpart assistance
equivalent to $500,000 for a to-
tal project cost of $2.5 million.
DefTech Targets Myanmar Projects
M
alaysias leading ar-
moured vehicle maker
DRB-Hicom Defence
Technologies Sdn Bhd (DefT-
ech) is in talks about new pro-
jects with the relevant authori-
ties in Myanmar, a top company
omcIuI suId.
TIe compuny Is uIso hnuIIs-
ing a deal with the Cambodian
government for a new main-
tenance, repair and overhaul
(MRO) contract for T-55 tanks,
cIIeI execuLIve omcer AmrII
Samsudin told Malaysias na-
tional news agency Bernama.
The project, which has an es-
timated worth of $50-$60 mil-
IIon Ior u hve-yeur perIod, wus
set to commence by October,
he said on the sidelines of the
Defence Services Asia Exhibi-
tion and Conference 2014 (DSA
2014).
DefTech was also in talks with
the authorities in Myanmar for
similar MRO contracts, he add-
ed.
Another Malaysia defence
hrm Supuru Secured TecInoIo-
gies Sdn Bhd is also reportedly
planning to make an overseas
foray this year.
AnoLIer hrm ZeLro Aerospuce
Corporation Sdn Bhd has set its
sights closer to Malaysia, eye-
Kyaw Min ing ASEAN countries such as
Indonesia, Thailand and Brunei
for a further growth, Bernama
reported.
The four-day biennial DSA
2014 ushered in a total of
33,544 trade visitors from 77
countries and regions, up from
26,980 two years ago. A total of
1,000 companies from 60 coun-
LrIes uunLed LIeIr IuLesL oer-
ings at the exposition this year.
Myanmar Summary
Myanmar Summary
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Yongmao Bags $2.4-m Myanmar Cranes Order
C
hinese tower crane man-
ufacturer Yongmao has
sold ten cranes to Sin-
gapore crane sales and rental
house Erect Group, for an end
user in Myanmar.
The $2.39-million deal will
see Yongmao deliver 10 of its
STT cranes through 2014-2015.
It follows the manufacturers
hrsL suIe In Myunmur uL LIe
start of this year.
As Myanmar democratises
and its economy opens up from
years of sanctions and restric-
tion, companies like Yongmao
are seeing new opportunities.
Yongmao executive director
and group general manager Sun
Tian said deals like this are an
important part of his companys
export strategy.
oIIowIng our hrsL Ioruy InLo
the Myanmar market, we are
expanding our foothold in this
region. We foresee that urbani-
sation and economic develop-
ment will drive higher con-
struction activities to support
this progression.
Eyeing the potential demand
for infrastructure across Asia,
we hope to continue to pro-
mote the Yongmao brand, qual-
ity and service in order to cater
to the need for quality tower
Aye Myat cranes. We believe our competi-
tive edge lies in our product and
service: our tower cranes have
obtained the relevant product
safety and design approval of
various countries and we pro-
vide premium after-sales ser-
vice.
Moving ahead, we hope to
continue our push into Myan-
mar by securing more contract
wins with well-established tow-
er crune renLuI hrms LIere.
Revenue from Asia, besides
China, contributes 25.1 percent
of Yongmaos turnover for its
nine months ended 31 Decem-
ber 2013. Revenue from this
geographical segment has in-
creased 11.6 percent during this
time.
Yongmao is on the lookout
for collaborations with existing
customers who have plans to
enter the Southeast Asian mar-
ket. Such partnerships include
working with Singapore rental
companies and contractors to
provide towercranes in Myan-
mar, Vietnam and Indonesia.
The company also aims to par-
ticipate actively in various trade
fair and exhibition in Southeast
Asia.
Tower cranes from Yongmao are seen. Yongmao foresees that urbanisation and
economic development will drive higher construction activities in Myanmar, hence
the demand for its cranes.
A $2 million Japan Fund for Poverty Reduction grant, administered by ADB, will be used to develop and pilot three month-long
competency-based courses in skills such as construction, welding, and use and repair of rural machiner.
S
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May 1-7, 2014
Myanmar Business Today
mmbiztoday.com
LOCAL BIZ
9
Myanmar Summary
Myanmars Palm Oil Industry: Challenges and Way Forward
P
alm oil as edible oil is the
second biggest important
food item after rice in an
average Myanmar household.
However, Myanmars domes-
tic edible oil production is not
enough to meet the demand, so
it imports palm oil from some
of the worlds largest palm oil
producing nations like Indone-
sia and Malaysia.
During the military rule palm
oil import was controlled by
state enterprises. But the recent
economic and democratic tran-
sition has resulted in a market-
based economy, which resulted
in the Ministry of Commerce
opening up the previously-re-
stricted palm oil import market
to local private players in April
zo11. Myunmur ImporLs rehned
palm olein, which is the liquid
form of palm kernel oil after a
process called fractionation,
Vijay Dhayal
and is used for cooking and fry-
ing.
In Year 2012 Myanmar im-
ported 400,000 tonnes of palm
Oil and which has grown to
485,000 tonnes in 2013. Market
is expected to expand further to
700,000 tonnes by 2017-18 due
to growing demand, rising in-
come of Myanmar households
and shifting from costlier pea-
nut oil.
One of the biggest challenges
for palm oil trade is the cargo
storage facility at Yangon port,
which results into long waiting
period for vessels at the port
to discharge the cargo, leading
majority of importers to face
demurrage claims from their
suppliers.
Due to shortage of storage
space, importers are pushed to
liquidate the cargo as soon as
possible. Another concern is
usage of delivery order mecha-
nism in the local market where
speculators and distributors
play with forward contracts,
creating speculation and de-
faults. Road infrastructure is
also underdeveloped in My-
anmar, so transportation cost
also becomes very high, hurting
margins and causing delays in
delivery of cargoes to northern
Myanmar.
Another major area of chal-
lenge is illegal border trade of
palm oil from Thailand to Mon
state and Tanintharyi region
which impacts importers who
are brining cargoes to Yangon
legally after paying customs
duty, commercial tax and in-
come tax.
Private players have invested
in palm plantation in southern
Myanmar to increase domes-
tic production but it will take
at least two to three years to
muke uny sIgnIhcunL ImpucL
on the palm oil trade. Various
stake holders from government
and industry can pursue the
idea of promoting manufac-
turing industry for converting
crude puIm oII Lo rehned puIm
oil which could create technical
know-how and employment.
Currently in the local mar-
ket palm oil is traded in loose
which results into quantity loss
and quality deterioration. How-
ever, that also provides great
opportunity for investors to set
up blowing units for jerry can
production and packaging and
distribution with right quantity
and quality.
Vijc is uorlin cs usiness
Mcncer in Mcnmcr com-
modities market for more than
two years. He is an agri com-
modity trader by profession.
He can be contacted at vijay-
[email protected]. This
Article ucs cccomplished b
the author in his own person-
al capacity. The opinions and
views expressed here are his
own.
A worker unloads palm fruit at a local palm oil factory in Langkat of Indonesias north Sumatra province.
R
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May 1-7, 2014
Myanmar Business Today
mmbiztoday.com
LOCAL BIZ
10
Myanmar Summary
Contd. P z...(Lconomic)
Contd. P z...(Lconomic)
Economic Opportunities Continue to Grow in Myanmar
Tis bulletin by Canadian law frm Davis LLP provides an update on the signifcant changes Myanmar is experiencing in government, legislation, trade and tourism
and outlines the opportunities in this growing country.
W
ith a population of
more than 60 million
people, opportunities
in Myanmar are not limited to
extractive industries, but also
exist in manufacturing and the
domestic market for consumer
goods. Even so, Myanmars
natural resources should not
be underestimated: natural gas,
petroleum, timber, zinc, cop-
per, lead, coal, precious stones,
and agricultural land exist in
abundance.
Politicol ond legol reforms
could open more doors for
for ei gn i nvestor s
A general election is set to be
held in Myanmar in November
2015. These elections could see
Aung San Suu Kyi, Nobel lau-
reate and leader of Myanmars
main opposition party, the Na-
tional League for Democracy
(NLD), brought to power. Her
release in 2010 after almost
eleven years of house arrest
imposed by the previous mili-
tary regime, was instrumental
in opening up trade relations
with the West. Regardless of
whether the current ruling
Union Solidarity and Develop-
ment Party (USDP) or the NLD
forms a government next year,
it is expected that political and
economIc modernIsuLIon eorLs
begun in 2010 by current Presi-
dent, Thein Sein, will continue.
However, it is important to
note that at this time, Aung San
Suu Kyi is barred from becom-
ing President of Myanmar by
virtue of the countrys Consti-
tution, which prohibits anyone
with family members who are
citizens of another country from
holding the countrys highest
omce. TIIs provIsIon dId noL
prevent her from being elected
to Parliament in 2012, when
vacancies in 8 percent of the
seuLs (q6 ouL oI 66q) were hIIed
following by-elections, with
the NLD capturing all 43 seats
in which they ran candidates.
Another round of by-elections
is anticipated late in 2014, to
hII upproxImuLeIy o more vu-
cancies. It remains to be seen
whether the Constitution will
be amended to enable Suu Kyis
candidacy for President prior to
the general election expected in
late 2015.
Other legal reform is ongo-
ing, making it more practical
for multi-national companies
to invest in Myanmar. It is an-
ticipated that a new Companies
Law will be introduced in 2014,
to replace the current law that
dates back 100 years. A draft
Trademark Law is before Par-
liament and a proposed Con-
dominium Law, that will allow
foreign citizens to own a form of
properLy Ior LIe hrsL LIme, wus
also placed before Parliament
in November 2013.
New incentives draw foreign
investment despite trade re-
strictions
The government of Myanmar
places restrictions on foreign
investment within the country.
The State-Owned Economic En-
terprises Law (1989), Foreign
Investment Law (2012) and
the Foreign Investment Rules
(January 2013) restrict certain
types of business activities from
occurring without government
approval. Foreign investment is
monitored and approved by the
Myanmar Investment Commis-
sion (MIC) which has published
a list of activities in which for-
eign investors are prohibited
from participating or which re-
quire a joint venture with a local
business.
At the same time, the country
is also providing incentives to
foreign investors. In January,
2014 a new Myanmar Special
Economic Zone Law (MSEZL)
was enacted, repealing earlier
legislation regarding special
economic zones. The MSEZL of-
fers up to seven years of income
tax exemptions for foreign in-
vestors, with further 50 percent
discounts on income tax for an-
oLIer hve yeurs. CurrenLIy, LIIs
law applies in Myanmars three
Special Economic Zones: Kyauk
Phyu, Dawei and Thilawa. The
MSELZ provides for the estab-
lishment of additional zones
and contains dispute resolution
procedures.
Economi c sancti ons
Domestic strife and ongoing
corruption issues have certainly
not disappeared. While Cana-
das Special Economic Measure
Regulations (sanctions) have
been relaxed in recent years,
Canadians are still prohibited
from dealing with certain busi-
nesses and individuals, includ-
ing the state banks of Myanmar.
Military shipments are also
prohibited. These sanctions are
enforced by the Export Controls
DIvIsIon oI oreIgn AuIrs und
International Trade Canada,
LIe equIvuIenL oI LIe US Omce
of Foreign Assets Control. It is
worth noting, however, that the
Canadian list of restricted per-
sons is more limited than com-
parable US prohibitions.
While Japan did not impose
economic sanctions against My-
anmar, there was a pronounced
slowdown in government aid
and private sector investment
during the years that Aung San
Suu Kyi was under house arrest.
China expanded its economic
und poIILIcuI Inuence durIng
this period, but faces greater
competition now that other
countries, including Japan, are
investing heavily. The Japanese
government has pledged almost
$2 billion in loans and grants
since Prime Minister Shinzo
Abe was elected in December
2012.
Japan and Myanmar are
jointly developing the ambi-
tious Thilawa special economic
zone just outside of Yangon,
the countrys largest city. Plans
call for a deep sea port, a power
plant and waste water treat-
ment facility, all in support of a
2,400 hectare industrial park.
Construction began in Novem-
ber, 2013 and commercial op-
erations are expected to start in
mid-2015.
Fi nanci al gr owth: for ei gn
banks i ncr ease pr esence
i n Myanmar
Despite some remaining trade
restrictions imposed by vari-
ous countries, growth of for-
eign investment in Myanmar
has been substantial. At least
14 banks in Myanmar now per-
mit foreign currency accounts.
Even though foreign banks are
currently permitted to only
conduct research in Myanmar,
35 foreign banks have opened
represenLuLIve omces und IL Is
expected that some licences for
foreign branches may be ten-
dered within the year. Daiwa
Securities from Japan is one of
LIe InLeresLed IoreIgn hnuncIuI
hrms.
In late 2012, automated tell-
er machines (ATMs) linked to
the international payment sys-
tem were introduced in Myan-
mar. There are now hundreds
of ATMs around the country,
and while not as reliable as
similar-looking ATMs in North
America, they are providing
much needed convenience and
liquidity. On a visit this year,
one of the authors of this bul-
letin found its possible to ac-
cess funds held in Canadian ac-
counts using some ATMs.
Further bank reform is needed
and is on the way, with the IMF
assisting in changes to the cen-
tral bank and the launch of the
Yangon stock exchange planned
for 2015. Myanmar has also ac-
ceded to the New York Conven-
tion on the Recognition and
Enforcement of Foreign Arbi-
tral Awards, as of July 15, 2013.
This will allow multi-national
companies to settle commercial
disputes outside the domestic
legal system. Myanmar has also
drafted a new arbitration law,
expected to be enacted in 2014,
which is required to allow for
the enforcement of foreign ar-
bitration awards by the courts
of Myanmar.
At the end of 2013, Myanmar
became the 180th member of
the Multilateral Investment
Guarantee Agency (MIGA),
meaning MIGA guarantees are
now available for foreign direct
investments. The US Ex-Im
Bank also opened in Myanmar
on ebruury, oerIng hnuncIuI
support for short and medium-
term US export sales to Myan-
mar.
The electricity grid is inadequate by western
standards. Companies offering a distributed
power generation model are taking up the chal-
lenge, particularly outside Yangon. Large scale
thermal and clean energy projects are also ex-
pected over in next few years.
Reforms initiated by Myanmars quasi-civilian government have sparked growth in the poor Southeast Asian nations economy.
S
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~ ~.~....:.._ .:~~.
~ .:.~~ ~ ~, .~ . .q ..: ._ .
.:...:~ ~ , ~ . . .q.. _._ ~ .
...~ ~ ~~ .~ ~_ q .,._ .
_.,.:.._ .:~.:~. .q,
.. ~ ._~., .~:~ . ... . .~:~
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May 1-7, 2014
Myanmar Business Today
mmbiztoday.com
LOCAL BIZ
11
Myanmar Summary
L
iu

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T
Chinas Backyard Platform for Cooperation
W
hile Chinese enter-
prises are entering
the US backyard,
Latin America and the Carib-
bean, one after another and set-
tling down, the US also acceler-
ates its entrance into Chinas
backyard.
Right before US President Ba-
rack Obamas Asia trip, the US
Department of State announced
IL wouId open ILs hrsL commer-
cIuI servIce omce In Myunmur.
It has been widely noticed
that the US is back. However,
it isnt back just for a new mar-
keL. TIe sILuuLIon Is dIerenL
from Chinas seeking develop-
ment drives across the world
or transferring competitive in-
dustries to other countries and
regions.
In January, the US embassy
in Myanmar provided techno-
logical training for 150 civil so-
ciety activists in Myanmar. And
in February, the US funded the
social activities of BarCamp, an
international network of open
online workshops, which has
attracted more than 5,000 par-
ticipants.
These moves have naturally
triggered Chinas worries, and
some media outlets exclaimed
that Washington is nosing
around Chinas backyard.
Ding Gang This is reminiscent of simi-
lar arguments from some US
media outlets during Chinese
President Xi Jinpings Latin
America visit last year that Chi-
na was entering the backyard of
the US.
Certainly, compared with the
US, China is still a latecomer
and is way behind in terms of
soft power. Even with close
neighbours like Myanmar, Chi-
na still faces the challenge of
winning more trust from them.
In a recent interview with the
Beijing-based Caijing magazine,
Elizabeth Economy, director for
Asia studies at the Council on
Foreign Relations, said that ul-
timately who would lead Asia
would depend on the countrys
development route and its dip-
lomatic attitude in wider areas.
According to the historic logic
of a great powers rise and espe-
cially when a new order is still
IuckIng In AsIu, LIe hgIL Ior
leadership may provide more
room for speculation about Si-
no-US conIcL.
BuL wIII LIIngs end dIerenL-
ly? Just as a Chinese poem once
quoted by Hillary Clinton goes,
After endless mountains and
rivers that leave doubt whether
there is a path out, suddenly
one encounters the shade of
u wIIIow, brIgIL owers und u
lovely village.
If we see each others back-
yard as a platform to know
more about each other and con-
tribute more to that region, we
muy hnd u wuy Lo esLubIIsI u
new order in the future.
Take Myanmar. Currently
whats most urgently needed in
this country is to boost ethnic
reconciliation, without which
further realization of democrat-
ic politics and stable develop-
ment will be unlikely.
The stability of northern My-
anmar is very important for
China, and it is not meaningless
for Washingtons promotion of
its own human rights values in
Myanmar.
This is where the two sides in-
terests converge, and coopera-
tion on this point will enhance
mutual trust.
So far the US has started to
promote some activities facili-
tating the fostering of civil soci-
ety, which is helpful for Myan-
mars good governance in the
future. However, the arrange-
ment of similar projects should
Ieun more Lo specIhc Issues oI
ethnic reconciliation.
CIInu Ius mude some eorLs
in this regard, such as collabo-
rating and arranging nego-
tiations between the Myanmar
government and ethnic minor-
ity independent armed forces
in northern Myanmar. It needs
to consider how to also bring
Washington in to promote such
negotiations.
If China and the US can
strengthen collaboration, com-
municate on these issues and
accumulate experience of co-
operation, this will be more im-
portant than increasing invest-
ment in Myanmar in the short
term.
There are more than a few
similarly thorny issues in the
AsIu-PucIhc regIon, especIuIIy In
Chinas neighbourhood. If the
two powers can cooperate over
LIese specIhc Issues LIuL concern
third parties in this region and
Inuence LIe peuce und sLubIIILy
oI LIe enLIre ureu, IL wIII benehL
the construction of the future re-
gional order, and will provide a
peuceIuI wuy ouL oI LIe hgIL Ior
future leadership.
China and the US have already
established diplomatic mecha-
nIsms Ior AsIu-PucIhc uuIrs,
and the situation in Myanmar
has been on the agenda. None-
theless, the two should not just
exchange information, but also
soIIdIy cooperuLe over specIhc
issues.
The author is a senior editor
uith People's Dcil. He is nou
stctioned in rczil.
~,~...:..q...,..:.~.,_e
~..q~,.~.,:~~q Latin
America . Caribbean ~~
~ .q:~ . . ~ .:._ ,_ .~
~..q~,.._._. ~,~-
~.,:~~.... ~q,~e,_e
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~..q ~, .. ~ Barack Obama-
~:q.q .. .~ . . :. US Department
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..: . .. :..q.~, ..: . , .e . . .~:
._ _e. ._~: . ._~_:. ._ .~, ,~|q .
~ _., .:. q ~..q ~, . , .. . .
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.:......_..e.e:~|q.~._.
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_e.._ BarCamp ~:. q,..
.:~......_.
. ..: q~ . .:.._ ~, ~ .
~:. ..q...:._e...'..._.. ~.
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~.,:~~..~:. .q.,.,._~:.
~.e:.q..:..:_~._.
_., .:. ._.:~ . ....- ~_ _ .
.~.....q.._ ~,~.~~~
~.q..|.~ . ~|q ~, - _., .:.
~. .~.~.q. _.~.~~~
._ . ~.q..|.~ q ._ .
US President Barack Obama (L) shakes hands with Japanese Prime Minister Shinzo
Abe (R) at the Akasaka guesthouse in Tokyo. Obamas Asia Pivot is widely seen
as an American move to diIute China`s power in the region.
X
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Myanmar Business Today
mmbiztoday.com
LOCAL BIZ
12
From page o...(Lconomic)
From page o...(Lconomic)
1ndustriol grouth: glohol
hronds ege untopped po-
tenti al
The country is endowed with
Iydrocurbons. TIe hrsL burreI
of oil was exported in 1853 but
little production or explora-
tion took place during the past
50 years of military rule. How-
ever, Myanmar has 50 million
barrels of proven oil reserves
and 280 billion cubic meters of
natural gas. This is expected to
increase with the recent arrival
of foreign oil and gas compa-
nies. After a tender process for
16 on-shore blocks, Canadian
compuny PucIhc HunL Energy
won two oil concessions in My-
anmar last year.
Even more recently, in March
the government announced
LIe uwurdIng oI zo osIore oII
and gas blocks. Majors such as
Shell (in partnership with Mit-
sui) British Gas (with partner
Woodside Petroleum), Total,
Chevron and Statoil (in part-
nership with ConocoPhillips)
were among the successful bid-
ders.
In the manufacturing sector,
GM and Ford have both entered
Myanmar. Coca-Cola re-en-
tered the country in September
2013 after an absence of more
than 60 years. GE, VISA, and
MasterCard are all increasing
their presence in Myanmar.
Telenor (Norway) and Oore-
doo (Qatar) both received in-
vestment permits after winning
a tender in June 2013 for pro-
vision of telecom services. Sig-
nIhcunL InvesLmenL und rupId
growth is expected in the wire-
less sector.
In the garment industry,
H&M has started placing test
orders to explore possibilities,
and a group of 12 Hong Kong
garment manufacturers look to
be LIe hrsL Lo InvesL In LIe TIII-
awa special economic zone.
To sustain ongoing investment
in Myanmar, parallel growth
in infrastructure is required.
In addition to the ambitious
Thilawa special economic zone
project already mentioned, two
other major port development
projects are planned: a deep
sea port at Dawei, 300km west
of Bangkok, supported by Thai-
land and a smaller port on the
Bay of Bengal, a joint project
between India and Myanmar.
Completion of these projects
may not be imminent, but the
need for related bridges, roads,
highways and water systems
are major opportunities.
The electricity grid is inad-
equate by western standards.
CompunIes oerIng u dIsLrIbuL-
ed power generation model are
taking up the challenge, par-
ticularly outside Yangon. Large
scale thermal and clean energy
projects are also expected over
in next few years. In March,
2014 the Japanese government
pledged approximately $450
mIIIIon In new Iouns Lo IeIp h-
nance additions to Myanmars
electrical system. Mitsubishi,
Marubeni, Fuji Electric, Toshi-
ba and Hitachi are among the
IoreIgn hrms uIreudy InvoIved
or actively pursuing involve-
ment in this sector.
The Environmental Conser-
vation Law was passed in 2012,
but implementing rules to gov-
ern environmental impact as-
sessments are still being draft-
ed. More specIhc crILerIu Irom
the government are eagerly
awaited.
Tourism grouth: inux of
tr aveller s br i ng economi c
opportunities
The tourism industry is grow-
ing at a rapid pace. Myanmar is
welcoming almost two million
tourists each year. While this is
less than 10 percent of the num-
ber of visits to neighbouring
Thailand, this gap is starting to
narrow. Those plane loads of
tourists are looking for a place
to stay, and hotel chains such as
HIILon, Pun PucIhc, PenInsuIu,
Accor and Best Western are
responding to the opportunity
presented by nightly rates that
have tripled in recent years.
This also creates strong op-
porLunILIes Ior uIrIInes yIng
into Myanmar. Expansion of
the countrys largest airport,
Yangon International, has
been announced, with a goal to
handle 3.3 million passengers
per year. A new international
airport is expected to open in
Bago in 2018, and expansion
projects at other airports are
expected. The private sector has
been encouraged to participate
but delays have hit some pro-
jects, particularly the planned
new $1.1 billion Hanthawaddy
International Airport, 100km
from Yangon International Air-
port.
There are eight domestic air
carriers operating in Myanmar,
with at least four more prepar-
ing to launch. However, these
carriers only operate a com-
bined total of 40 aircraft and
only two, Myanma Airways and
AIr KBZ, operuLe more LIun hve
aircraft. Consolidation of do-
mestic airlines seems probable,
even as growth in domestic air
travel continues.
Myanmar is also looking out-
wards and is playing a more
active role in the international
economy. The country hosted
the East Asia World Economic
Forum in its new capital city,
Nay Pyi Taw, in June 2013. My-
anmar also hosted the Foreign
Ministers Meeting of the Asso-
ciation of Southeast Asian Na-
tions (ASEAN) in January 2014,
und Ior LIe hrsL LIme ever My-
anmar is now chair of ASEAN.
The biggest newsmaker, how-
ever, was when the 27th South-
east Asian Games were held in
Myanmar just before Christmas
2013.
Other i nfor mati on to con-
si der
For those considering doing
business in Myanmar, the cost
oI IeusIng omce spuce or renLIng
reasonable accommodation in
Yangon can be daunting. Rents
currently surpass $100/square
foot, which is higher than the
average rental rate in Manhat-
tan. Relief may be on the way,
however, as construction cranes
are sprouting across the city.
Although the tight real estate
market seems to have delayed
the promised opening of Cana-
du`s hrsL embussy In Myunmur
(it was intended to open in mid-
2013), Mark McDowell was
named last year as Canadas
hrsL umbussudor Lo Myunmur.
He and a small contingent of
sLu ure currenLIy workIng ouL
of the British Embassy, but for
now Canadian citizens requir-
ing consular services are still
required to seek assistance at
the Australian Embassy. Cana-
das Embassy is now expected
to open in mid-2014.
Myanmars rich resources and
untapped market and labour
potential have made it a hot bed
of new international economic
development. Still, there re-
muIn sIgnIhcunL cIuIIenges In
nuvIguLIng LIe emergIng hnun-
cial and legal systems. Caution
and careful planning is recom-
mended.
Authors: rcn Dunn, 1o-
hcnnc Goosen, Anthon P
McArthur, 1ohn Munnis cnd
crr Penner
Legal reform is ongoing, making it more
practical for multinational companies to invest in
Myanmar. It is anticipated that a new Companies
Law will be introduced in 2014, to replace the
current law that dates back 100 years.
Chief Executive Ufcer and Chairman of Board of the Coca CoIa Company Muhtar Kent hoIds a Coca-CoIa bottIe that is made
in a Coca-CoIa factory in Myanmar, during the factory`s opening ceremony, outside of Yangon. The new faciIity is the rst to
IocaIIy bottIe Coca-CoIa in more than six decades. SimiIar steps by gIobaI brands Iike UniIever, Pepsi, Ford and Nissan have
boosted Myanmar`s FBI proIe dramaticaIIy.
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Myanmar opposition leader Aung San Suu Kyi smiles after signing on the guest-
book at the PresidentiaI PaIace in BerIin, Cermany. Her reIease in 2U1U after aI-
most eleven years of house arrest imposed by the previous military regime, was
instrumental in opening up trade relations with the West.
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May 1-7, 2014
Myanmar Business Today
mmbiztoday.com
REGIONAL BIZ
13
Myanmar Summary
Myanmar Summary
With an Eye on TPP, Garment Companies Flock to Vietnam
Lien Hoang
A
s China and its work-
ers get wealthier, glob-
al manufacturers are
looking south for less expen-
sive places to do business. But
Cambodia faces labour strikes.
TIe TIuI governmenL suers
endless protests and Myanmar
needs infrastructure updates.
As a result, many companies
are setting their sights on Viet-
nam.
Hundreds of them, in fact, de-
scended on Ho Chi Minh City
last month for Saigon Tex, a gar-
ment and textile expo. Sharing
a border with China, Vietnam
boasts geographic convenience,
as well as political stability and
low costs. Those attract compa-
nies like Spain-based Jeanolo-
gIu, wIIcI sIowed o ILs Iuser-
on-denim technology at the
expo.
It is becoming such an im-
portant hub for American and
European brands, Jeanolo-
gia area manager Borja Trenor
Casanova said of Vietnam.
TIe Truns-PucIhc PurLnersIIp
(TPP) helps, too. As one of 12
countries negotiating the trade
pucL, VIeLnum sLunds Lo benehL
most from a clause that would
cuL LurIs on LexLIIes und up-
parel, which are among the na-
tions top exports.
To take advantage of the tax
reduction, foreign companies
are shifting their factories to
Vietnam. Nguyen Thi Cam Tu
is general manager at Thach
Anh Vang, which represents
manufacturers from Germany,
Turkey, the United States, and
others. She said the TPP is part
of the reason her company saw
a 50 percent increase in annual
turnover in 2013,
I see a lot of investment go-
ing on, because we see quite a
lot of inquiries recently, Cam
Tu said, as a giant yarn spinner
roared at the vendor slot next to
hers at the expo.
TIe growLI Is reecLed ucross
the country. Textile exports in-
creused zo percenL In LIe hrsL
quarter of 2014, compared with
the same period last year, ac-
cording to the General Statistics
Omce.
While production and rev-
enues have risen steadily, Viet-
numese compunIes und omcIuIs
recognise a gaping weakness in
the garment industry: It buys
most of its materials from other
countries. The Vice Minister of
Industry and Trade Ho Thi Kim
Thoa told an audience at the
expo that Vietnam must set tar-
gets to produce more fabrics on
its own.
These targets demonstrate
an urgent need for technologi-
cal innovation, improvement of
quality control, labour manage-
ment, environmental manage-
ment, as well as improvement
in the textile and garment sup-
ply chain in accordance with
international standards, Kim
Thoa said.
If it doesnt develop more lo-
cal suppliers, Vietnam wont
be able to tap the full potential
oI LIe Truns-PucIhc PurLner-
ship. The agreement is likely
to include a yarn-forward rule,
which requires Vietnam to
make clothes with materials
from TPP member countries in
order to receive tax-free import
benehLs.
But people are looking to im-
prove the garment sector in
other ways, too. Casanova said
Jeanologias laser-printing is
one of the technologies that
could help Vietnam become a
value-adding step in the pro-
duction chain. The country,
which achieved lower middle
income status in2010, is still
very dependent on cheap la-
bour. But to avoid the middle-
Income Lrup, IL needs Lo hnd
ways to add value to its exports.
Casanova said it seems to want
technology for that purpose, as
well as to promote environmen-
tal sustainability in business.
Vietnam is showing interest
in a change in the industry, he
said. VDA
Airasia to Launch Long-Haul Services to Thailand
John Ruwitch
T
hai AirAsia X, Thailands
hrsL Iong-IuuI Iow-cosL
airline, will take to the
skies in June despite the tour-
ism market being dragged
down by the countrys political
turmoil.
The new long-haul low-cost
currIer wus omcIuIIy unveIIed uL
an event in Bangkok last week,
with CEO Nadda Buranasiri
unnouncIng LIe uIrIIne`s hrsL
rouLes und In-IgIL producLs.
Operating from its home base
at Bangkok Don Mueang Inter-
national Airport, Thai AirAsia X
wIII sLurL yIng on June 1; wILI
daily services to Seoul. It will
then expand its operations with
IgILs Lo LIe Jupunese cILIes oI
Tokyo and Osaka commencing
later in the year.
We are absolutely thrilled
Lo be TIuIIund`s hrsL Iow-cosL
long-haul carrier, said Nadda.
While Thai AirAsias Airbus
Azo pIunes conLInue Lo oer
the best connectivity for short-
haul destinations, Thai AirA-
sia X will be operating Airbus
A330-300 wide-body aircraft
to destinations that are further
LIun u Iour-Iour IgIL LIme
from Bangkok.
Nadda revealed that future
destinations could include Aus-
tralia and China, as long as the
IgIL LImes hLLed In wILI LIe
airlines strategy.
We know that Thailand is a
preferred destination for Aus-
tralians, Nadda told Travel
DuIIy uL u medIu brIehng. We
would [also] consider Chinese
destinations over four hours in
length.
Thai AirA-
sia has already
established a
strong presence
in China, with
IgILs Lo nIne
mainland cities.
And while Tas-
sapon Bijleveld,
CEO of Thai
AIrAsIu, conhrmed LIuL TIuI
AirAsia X will not take over any
routes from Thai AirAsia, the
new airlines four-to-nine-hour
IgIL LImes couId open up sucI
destinations as Beijing.
Thai AirAsia X will also be
looking to use Thai AirAsias
network of short-haul routes to
oer u greuLer runge oI desLInu-
tions for its passengers. For ex-
ample, passengers on inbound
IgILs Irom SeouI, Tokyo und
Osaka will be able to connect to
a range of Thai domestic desti-
nations such as Phuket, Krabi
and Chiang Mai, or regional
hubs like Siem Reap and Yan-
gon, via Bangkok.
Thai AirAsia X will initially
operate two Airbus A330-300
uIrcruIL, eucI oerIng ;; seuLs
12 in business class and 365
in economy.
Thai AirAsia X received its
AIr OperuLor`s CerLIhcuLe IuLe
last year, but delayed its launch
initially planned for Febru-
ary 2014 due to the impact of
Bangkoks political protests on
the countrys travel industry.
But Nadda said he remained
conhdenL LIe uIrIIne wouId re-
cord load factors of up to 80
percent on both its new routes.
The CEO also predicted that
Lrumc on boLI Koreun und
Japanese services would be a
50-50 mix between Thai and
international. The destinations
were selected in part due to the
fact that South Korea and Japan
boLI oer vIsu-Iree LruveI Ior
Thai nationals.
Thai AirAsia X becomes the
seventh branch of the AirAsia
group, following AirAsia Malay-
sia, Indonesia, Thailand, Phil-
ippines and India, and AirAsia
X in Malaysia.
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May 1-7, 2014
Myanmar Business Today
mmbiztoday.com
REGIONAL BIZ
14
Myanmar Summary
Myanmar Summary
Myanmar Summary
IFC Probes HAGL Investment Linked to Land-Grabbing
Aye Myat
T
he International Finance
Corporation (IFC), the
World Banks private sec-
tor lending arm, has launched
an internal investigation into a
complaint lodged against the in-
stitution for investing in a Viet-
numese rubber hrm uccused oI
illegal logging and land grabbing
in Ratanakkiri, an NGO and a vil-
lager said last week, according to
Cambodian media reports.
Earlier in April, representa-
tives of the IFCs Compliance
Advisor Ombudsman (CAO)
met with leaders from 17 indig-
enous communities in Andong
Meas and OChum districts,
along with representatives of
Vietnam-based Hoang Anh Gia
Lai (HAGL), which operates
rubber plantations on econom-
ic land concessions in the King-
doms northeast, according to
Eang Vuthy, executive director
at NGO Equitable Cambodia.
The IFC is accused of support-
ing HAGLs actions by investing
millions through an intermedi-
ary fund called Dragon Capital
Group since 2002.
Last year, HAGL came under
hre uILer UK-bused NGO GIobuI
Witness published a report ac-
cusing the rubber giant of ille-
gally logging outside concession
areas and being in possession of
at least 47,000 hectares of eco-
nomic land concessions al-
mosL hve LImes LIe IeguI IImIL.
China Activist Missing After Trying to Help Striking Workers
John Ruwitch
A
prominent Chinese la-
bour activist has been
missing and his wife
suspects he was detained by
state security agents after try-
ing to help workers involved in
Chinas biggest strike in years
organise their case.
Zhang Zhiru was last heard
from when he spoke to his wife,
Xiao Hongxia, by telephone
at around noon on April 22.
He told her he had been sum-
moned to a meeting with state
security agents from the indus-
trial southern city of Dongguan.
Workers at a Yue Yuen Indus-
trial Holdings Ltd shoe factory
complex with about 40,000
employees have been on strike
since April 14 over social insur-
ance payments.
Labour activists say the strike,
in the Dongguan town of Ga-
obu, is one of Chinas biggest
since market reforms started in
the late 1970s.
When he went out in the
morning he said he was meet-
ing Dongguan state security,
Xiao said by telephone from
Shenzhen, where Zhang lives.
Yesterday afternoon, and at
night when it was very late and
he had not come home, a lot of
us tried to call him, but couldnt
get through.
Zhangs mobile telephone ap-
peured Lo be o wIen ReuLers
tried to call him.
The Ministry of State Security
(MSS) is the Chinese equivalent
of the KGB in the former Soviet
Union, an intelligence-gather-
ing agency that also suppresses
dissent and other activities it
deems threats to Communist
Party rule.
A man surnamed Wang who
answered the telephone at the
Dongguan branch of the MSS
said he had not heard of Zhangs
possible detention.
Nothing wrong
Zhang had been closely fol-
lowing the Yue Yuen strike and
was working with other activ-
ists and lawyers to try to help
the workers organise to press
their demands.
Lin Dong, a colleague of
Zhangs at the Shenzhen Chun-
feng Labour Dispute Service
Center, may also have been de-
tained, Xiao said. Calls to the
centre went unanswered.
On April 21, however, Zhang
and a lawyer involved in la-
bour issues went to Gaobu and
met several workers to discuss
their options, said Wang Jiang-
song, a Beijing-based labour re-
searcher.
Thats why this has hap-
pened, said Wang, referring to
Zhangs possible detention.
But there was nothing wrong
with what they did, trying to
help the workers.
Jupun Inution
May Have Beat
BOJ: Kuroda
Deputy governor says Japan
can withstand tax hike pain
Leika Kihara
B
ank of Japan Governor
Haruhiko Kuroda said
consumer InuLIon muy
exceed the central banks pro-
jecLIon In LIe hscuI yeur LIuL
ended In MurcI, voIcIng conh-
dence the worlds third-largest
economy continues to make
headway in meeting its price
target.
Deputy Governor Hiroshi Na-
kaso added to the optimism,
stressing that Japan can with-
stand the pain from a sales tax
IIke LIuL kIcked o LIIs monLI
as companies are increasing
hiring and wages due to bright-
er prospects for the economy.
LIInk consumer InuLIon
was actually slightly higher
In hscuI zo1 LIun our cur-
rent projection of 0.7 percent,
Kuroda told a parliamentary
session last week.
For now, we can say Japan is
making steady progress toward
ucIIevIng z percenL InuLIon.
His remarks suggest the BOJ
wIII revIse up LIe prevIous hscuI
years price forecast and main-
tain its bullish projections for
subsequent years in its twice-
yearly outlook report due this
week.
But both Kuroda and Nakaso
reiterated the BOJs readiness
to adjust policy with addition-
al monetary stimulus should
risks threaten achievement of
the price target.
There are various ways to
adjust policy. We will decide
what among these measures is
appropriate depending on eco-
nomic and price developments
at the time, Kuroda said.
Reuters
~,~.~ q:.._ ~..
..:. ~.q. . . q :.. ~. . _ e. .
Zhang Zhiru ._ ..:~ . ..~ q _. .
,.- ~,._e..~ ~:~:..:.-
, .. . ._. .. q. _. .q ._~: . . .e
q.,._.
Zhang Zhiru ._ -_. q~.,
.,.e.. ~,._e.. Xiao Hongxia
~:. . .~: . _. .q..~. . .~ .
.,._~:. e,..~._.:_~:.~_..~
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._. ,.._ Yue Yuen Industrial
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..:...|. ,~,~~~ .|~._ -_.
~, q~ ..~:......_...._..~:.
~_.....~.._e.._.
~, ~ . Gaobu ...q Dongguan
_. ~ _.. . . ._ ~. .|.. _.. ._
~~ .,:~ . .~ _.. . . ._ .. _.
..:.~ ~_~..._e.._~:. ~..
..:. ~.q...q:...:.~ ._.:_~:.
._.
Japan ~ ~ _ Haruhiko Kuroda
. .~ .~ _. .. .. ._ _:.q.. .
~~. .._~..e:...~.,_e -e
~- .,.,..~~ .~:.,.
._~:. ._.:_~:..._.
.~e~~_ Hiroshi Nakaso
. ~ . ~ .:.- _. ~~ .:._ ~. .
.,:... ...~._..:.~._
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~. .. ._~: . . ... . .:.~ .~
...:.._.
Workers protest during a strike as police stand guard at the factory area of Yue Yuen Industrial, in Dongguan, Guangdong
province, China. The strike at Yue Yuen - which says it is the worId`s Iargest branded footwear manufacturer, making over
3UU miIIion pairs of shoes Iast year - is not just one of China`s biggest in recent years, it`s aIso more cIearIy driven by workers`
fears that they have been scammed by an opaque and convoluted welfare payment system.
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A worker coIIects Iatex from a rubber tree in Kampong Cham province, Cambodia.
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._._..~~~~ ......,q._
-e~,.q::~.~~ q..._...
:.._ ~e~._.~.q.~:. ....
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.~...~~~ ..,~q:.~ .~
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.. ._. ,~~~ e~~: ...e.
._~:. NGO ~.._e.._ Global
Witness ~ ~.q..q..:..._.
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~ q..._....._ HAGL ~:.
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May 1-7, 2014
Myanmar Business Today
mmbiztoday.com
REGIONAL BIZ
15
Myanmar Summary
Indonesia to Make It Even Harder for Foreign Miners
Clyde Russell
I
ndonesias decision to start
cancelling investment trea-
ties with 62 countries has
passed with little comment, but
the move may have a greater
impact than the recent banning
of mineral ore exports.
Indonesia in March kick-
started the process of terminat-
ing all of its bilateral treaties by
notifying the Netherlands that
its agreement to protect and
promote investment would end
in 2015, and signalling that the
others would end as soon as
possible.
The agreements, which are
common between states, pro-
tect the rights of investors in
each others country, and typi-
cally include clauses about fair
treatment, no expropriation
und guurunLees LIuL prohLs cun
be repatriated.
Most importantly for many
investors in countries like In-
donesia, with its patchy record
on legal certainty, is the right
of appeal to the Washington-
based International Centre for
Settlement of Investment Dis-
putes (ICSID).
Among the countries that
have treaties with Indonesia
are major foreign investors in-
cluding China, India, Australia,
Britain, Singapore and Russia.
However, the United States and
Japan are among nations that
dont have agreements.
Why would the Indonesian
government seek to end agree-
ments that were designed to
foster foreign investment and
economic development, as well
as protect Indonesian invest-
ments abroad?
The main argument seems to
be that their time has passed
and they belong to an earlier
era when foreigners feared as-
sets would be nationalised.
The treaties are seen favour-
ing foreigners over domestic
investors, something at odds
with the governments drive to
ensure greater control of Indo-
nesias mineral resources.
This can be seen against the
backdrop of a raft of changes to
Indonesian law and regulations,
which among others enforced a
ban on exporting unprocessed
ores, mandated the building of
smelters and introduced laws to
force the sale of stakes to locals
of foreign-owned mines.
Indonesia is the worlds big-
gest exporter of nickel ore and
supplies about two-thirds of top
buyer Chinas imported baux-
ite, the raw ingredient for mak-
ing aluminium.
London-traded nickel has
gained almost 32 percent so
far this year after the export
ban came into force in January,
with Chinas imports of nickel
ore from Indonesia plunging 79
percent in March from a year
earlier and bauxite slumping 86
percent.
Indonesia is also the worlds
biggest exporter of thermal coal
used in power-stations, but the
impact on coal has been mut-
ed so far as it isnt subject to a
ban, but foreign owners will be
caught by the need to divest.
The problem for many foreign
investors is that they will doubt
whether the need for invest-
ment protection has passed.
I doubt that any investor in
the Southeast Asian nation
would privately agree that his
company would get a fair hear-
ing in the legislative and court
processes, especially if the op-
ponent was the government or
a well-connected local.
It seems that the decision to
end investment treaties is part
of the ongoing process to ensure
that Indonesias resources are
controlled by the government,
and/or domestic investors.
Churcill dispute o trigger?
The dispute between the gov-
ernment and London-listed
Churchill Mining provides a
short-term impetus for the end
of investment treaties.
TIe mIner won LIe hrsL round
of its dispute over coal assets
with the Indonesian govern-
ment in February at an ICSID
tribunal.
The Jakarta Globe reported
on February 28 that the govern-
ment will appeal the decision
and it doesnt want to face the
risk of paying compensation to
Churchill, which the newspaper
said could be as much as $1.05
billion.
The risk for the Indonesian
government is that it could be
hit with dozens of cases in the
ICSID from disgruntled foreign
investors.
Its not hard to imagine In-
dian or Australian coal miners
challenging the rule that they
have to sell half of their stake in
a mine once it has been produc-
ing for 10 years.
Ending the investment agree-
ments will mean foreign com-
panies having to take their
chances in Indonesian courts, a
far better prospect for the gov-
ernment.
However, cancelling the trea-
ties will take time, as some run
for extended periods and have
additional protection clauses
once notice of termination is
served.
This means the Indonesian
government may well have to
deal with foreigners in an inter-
national tribunal, but its a safe
bet they will play for time if this
is the case.
The trend still appears clear,
Indonesia is doing all it can to
get control of its natural re-
sources from foreign investors.
Clyde Russell is a Reuters col-
umnist. The views expressed
are his own.
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A miner carries baskets of sulphur stones out of the crater at the Kawan Ijen volcano, Indonesia.
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May 1-7, 2014
Myanmar Business Today
mmbiztoday.com
INTERNATIONAL BIZ
16
Myanmar Summary
Myanmar Summary
Aostruliu Inution Lower Thun Ieured, Lessens Rute Hike Risk
Underlying infation surprisingly restrained in Q1 at 2.6pc
A
usLruIIun InuLIon
was surprisingly
tame last quar-
ter showing a modera-
tion that greatly lessened
the pressure for a hike in
interest rates this year
and sent the local dollar
sharply lower.
A key measure of un-
derIyIng InuLIon rose
by only 0.5 percent in
LIe hrsL quurLer und z.6
percent for the year, well
below forecasts of 0.7 per-
cent and 2.9 percent re-
spectively.
That was a big relief fol-
lowing a high reading the
previous quarter and sup-
ported the Reserve Bank
oI AusLruIIu`s (RBA) conh-
dence LIuL InuLIon wouId
stay consistent with its
long-term target of 2 to 3
percent.
The coast is relatively
cIeur on LIe InuLIon IronL
for the RBA to keep rates
low, said Ben Jarman,
and economist at JPMor-
gun. On LIe InuLIon
Wayne Cole
front itself, things look
relatively benign still.
Investors reacted by
paring back the risk of a
hike in the 2.5 percent
cash rate at least until
very late in the year. That
in turn knocked the Aus-
tralian dollar down over
half a US cent to $0.9303,
though local yields still
remain high by rich-world
standards.
The anxiously awaited
report from the Austral-
ian Bureau of Statistics
showed the headline con-
sumer price index (CPI)
rose 0.6 percent in the
hrsL quurLer, Irom LIe
previous quarter when it
climbed 0.8 percent.
The annual pace did
edge up to 2.9 percent, the
highest since late 2011,
but that was well below
forecasts of 3.2 percent.
The quarterly increase
was driven in part by sea-
sonal increases in some
sectors such as health-
care, transport and school
fees, and by a large hike in
tobacco duties.
Education costs have
been one of the main driv-
ers oI InuLIon, cIImbIng
by 5.1 percent in the year
to March.
That was balanced by
falls in the cost of cloth-
ing, furniture, holiday
travel and car mainte-
nance.
The RBA had argued the
pIckup In InuLIon seen
last year was temporary
and that sluggish wage
growth would keep it
consistent with the target
band over time.
That high Q4 reading
jusL never hL wILI weuk
wage growth and rising
unemployment, said Mi-
chael Turner, a strategist
at RBC Capital Markets.
Todays data show the
underlying pulse of in-
uLIon Is noL LIuL sLrong.
Market prices ex-volatiles
were ucLuuIIy uL In LIe
quurLer und InuLIon In
services moderated.
Reuters
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Obumu Reumrms Commitment to Jupun on Toor oI Asiu Allies
Mark Felsenthal and
Linda Sieg
U
S President Ba-
rack Obama as-
sured ally Japan
last week that Washing-
ton was committed to its
defence, including of tiny
isles at the heart of a row
with China, but denied he
had drawn any new red
line and urged peaceful
dialogue over the islands.
Obama also urged Ja-
pan to take bold steps
to clinch a two-way trade
pact seen as crucial to a
broad regional agreement
that is a central part of the
US leaders pivot of mil-
itary, diplomatic and eco-
nomic resources towards
AsIu und LIe PucIhc.
US and Japanese trade
negotiators failed to re-
soIve dIerences In LIme
for Obama and Prime
Minister Shinzo Abe to
shake hands on a deal at
the summit, but the two
leaders reported progress
and ordered their teams
to keep working.
Obama, on the start of
a four-nation tour, is be-
ing treated to a display
of pomp and ceremony
meant to show that the
US-Japan alliance, the
main pillar of Americas
security strategy in Asia,
is solid at a time of ris-
ing tensions over growing
Chinese assertiveness and
North Korean nuclear
threats.
We dont take a posi-
LIon on hnuI sovereIgnLy
determinations with re-
spect to Senkaku, but his-
torically they have been
administered by Japan
and we do not believe that
they should be subject to
change unilaterally and
what is a consistent part
of the alliance is that the
treaty covers all territo-
ries administered by Ja-
pan, Obama said.
This is not a new posi-
tion, this is a consistent
one, he told a joint news
conference after his sum-
mit with Abe, using the
Japanese name for the
islands that China, which
also claims sovereignty
over them, calls the Di-
aoyu.
In our discussions, I em-
phasized with Prime Min-
ister Abe the importance of
resolving this issue peace-
fully, Obama added.
1nternotionol rules
Obama also said there
were opportunities to
work with China which
complains that his real
aim is to contain its rise
but called on the Asian
power to stick to interna-
tional rules.
What weve also empha-
sised, and I will continue
to emphasise throughout
this trip, is that all of us
have responsibilities to
help maintain basic rules
of the world and interna-
tional order, so that large
countries, small countries,
all have to abide by what is
considered just and fair,
he said.
Some of Chinas neigh-
bours with territorial dis-
putes with Beijing worry
that Obamas apparent
inability to rein in Russia,
which annexed Crimea
last month, could send a
message of weakness to
China.
Obama told the news
conference that additional
sanctions were teed up
against Russia if it does
not deliver on promises in
an agreement reached in
Geneva last week to ease
tensions in Ukraine.
The two leaders also
agreed that their top
trade aides, US Trade
Representative Michael
Froman and Japanese
Economy Minister Akira
Amari would keep trying
to narrow gaps in their
trade talks.
Abe has touted the TPP
as key to Third Arrow
reforms needed to gener-
ate growth in the worlds
third-biggest economy,
along with hyper-easy
moneLury poIIcy und hs-
cal spending.
Both sides have also
stressed that the TPP
would have strategic im-
plications by creating a
framework for business
that could entice China to
play by global rules.
But the talks have been
sLymIed by Jupun`s eorLs
to protect politically pow-
erful agriculture sectors
such as beef, and disputes
over both countries auto
markets.
Pointing to restrictions
on access to Japans farm
and auto sectors, Obama
said: Those are all issues
that people are all famil-
iar with and at some point
have to be resolved. I be-
lieve that point is now.
Reuters
Pedestrians walk through a laneway lined with boutiques and street cafes in central Melbourne, Aus-
tralia.
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A man with a mask of US President Barack Obama attends a protest against Obamas visit to Japan, in
Tokyo. Obama assured ally Japan last week that Washington was committed to its defence, including of
tiny isIes at the heart of a row with China.
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May 1-7, 2014
Myanmar Business Today
mmbiztoday.com
INTERNATIONAL BIZ
17
Myanmar Summary
GM Seeks US Court Protection Against Ignition Lawsuits
Supriya Kurane and
Arnab Sen
G
eneral Motors Co
hIed u moLIon In
a US court to en-
force a bar on lawsuits
stemming from ignition
defects in cars sold before
its 2009 bankruptcy as it
hgILs proposed cIuss uc-
tion litigation that seeks
to set aside the restriction.
PIuInLIs suIng LIe com-
puny uIso hIed u proposed
class action lawsuit in
Manhattan bankruptcy
court last week, seeking
an order declaring that
GM cannot use the bank-
ruptcy protection to ab-
solve itself from liabilities.
The faulty ignition
switch has been linked to
at least 13 deaths and the
recall of 2.6 million GM
vehicles.
GM emerged from bank-
ruptcy protection in 2009
us u dIerenL IeguI en-
tity from the so-called old
GM. Under those terms,
the new GM shed liabil-
ity for incidents predating
its exit from bankruptcy,
and any lawsuit involv-
ing pre-bankruptcy issues
must be brought against
what remains of old GM.
New GMs recall cov-
enant does not create a
busIs Ior LIe pIuInLIs Lo
sue new GM for economic
damages relating to a ve-
hicle or part sold by old
GM, the company said in
u hIIng In LIe BunkrupLcy
Court for the Southern
District of New York.
The motion did not ad-
dress claims stemming
from accidents, includ-
ing personal injury and
wrongful death. GM has
said it is committed to
replacing the defective
switches in cars.
GM has taken respon-
sibility for its actions
and will keep doing so,
spokesman Jim Cain said
in an emailed statement.
The company recognises
its civil and legal obliga-
tions relating to injuries
tied to the recall cars,
Cain said, adding that GM
has retained lawyer Ken-
neth Feinberg to advise it
of its legal options.
Feinberg is known for
his work in administering
special payment funds for
IIgI-prohIe cuLusLropIes
like the September 11,
2001 attacks and the BP
Plc oil spill.
Late last Tuesday, US
Bankruptcy Judge Rob-
ert Gerber in New York
issued an order setting
a procedural conference
for May 2 to determine
how the case should move
forward, saying that no
substantive matters will
be decided.
Also last Tuesday, GM
said it was restructuring
its engineering operations
to improve the quality
and safety of its vehicles.
Since it began to recall
vehicles in February, GM
has been hit by dozens of
lawsuits on behalf of indi-
viduals injured or killed in
crashes involving recalled
cars, as well as customers
who said their vehicles
had lost value as a result
of the companys actions.
TIe pIuInLIs Iuve suId
they bought or leased ve-
hicles that had the defec-
tive ignition switch and ac-
cused GM of fraudulently
concealing its knowledge
of the defect. As a result,
they said, the company was
not entitled to protection
from liability.
GMs argument sug-
gests that the US Govern-
ment would have agreed
to extend $40 billion of
taxpayer money for GMs
restructuring, and sup-
ported shielding it from
liability through the sale
order, had it known of
GMs intentional miscon-
ducL, LIe pIuInLIs suId
in their lawsuit.
n ILs hIIng, GM usked
the court to direct the
pIuInLIs Lo sLop suIng
new GM for claims that
are barred by the bank-
ruptcy sale order and the
injunction, and to dismiss
the earlier claims.
GM`s hIIng IusL nIgIL
was a pre-emptive at-
tempt to dominate the
discussion about its so-
called concern for the
damages caused by de-
fects it has been aware
of for nearly ten years,
Mark Robinson, a lawyer
Ior LIe pIuInLIs, suId In u
statement. Reuters
FDA Moves to Ban Sales
of E-Cigarettes to Minors
T
he US Food and
Drug Adminis-
tration proposed
measures last week that
would ban the sale of
e-cigarettes to consum-
ers younger than 18, but
wouId noL resLrIcL u-
voured products, online
sales or TV advertising,
likely disappointing some
public health advocates.
Electronic cigarette ad-
vocates lobbied against
resLrIcLIons on uvours
and advertising, saying
LIey wouId sLIe Inno-
vuLIon. CrILIcs urgue u-
vours such as strawberry
and butterscotch appeal
to youngsters, while un-
restricted advertising
threatens to make the
products glamorous and
could act as a gateway to
traditional cigarettes.
I hnuIIsed, LIe Iong-
awaited proposal would
subject the $2 billion e-
cigarette industry to fed-
eral regulation for the
Toni Clarke hrsL LIme. A Iuw pussed
in 2009 gave the FDA
authority to regulate ciga-
rettes, smokeless tobacco
and roll-your-own to-
bacco and stipulated the
agency could extend its
jurisdiction to other nico-
tine products after issuing
u ruIe Lo LIuL eecL.
Reuters
CeneraI Motors Co (CM) is hit by civiI Iawsuits as angry customers prepare to take on the automaker
for its negligent role that has led to accidents, injuries and also a diminution in value of the vehicles.
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Myanmar Summary
May 1-7, 2014
Myanmar Business Today
mmbiztoday.com
INVESTMENT & FINANCE
18
Myanmar Summary
David Mayes
I
know that winter is not actu-
ally coming to Myanmar, lit-
erally speaking. Not now or
ever. However, the recent pre-
mier of that bloody soap opera
for men that, I waited so long
for, reminds me of the need to
be forward thinking even in an
age where winter is not the life
threatening yearly event it used
to be. It also reminds me that
the great oversized returns the
market has recently delivered
will not go on forever, as this
cycle will eventually come full
circle.
In colder climates than South-
east Asia, people used to have to
spend most of the nice months
of the year working very hard
to try and prepare for the brutal
winters that came every year re-
lentlessly. One never knew what
kind of winter was coming, so
every year they had to get ready
for the worst and hope for the
best. Being ill prepared meant
deuLI, so LIIs wuy oI IIIe deh-
nitely fostered a forward look-
ing way of thinking.
Is Winter Coming?
Nowadays however, the only
winter most of us have to deal
with is the winter of our lives.
This modern winter is a time
wIen our hnuncIuI demunds
outpace our ability to earn.
Finding a balance in life during
our working summer between
preparing for a future that isnt
even guaranteed to come, and
enjoying our lives in the here
und now Is u dImcuIL LIIng.
Many say there is only one here
and now so live for today, and
there is a lot of truth in it. Yet
the future can be a long and tir-
ing slog if you arent prepared
Ior IL hnuncIuIIy.
When I look at the state of the
worId und LIe umounL oI hnun-
cial life support the printing
presses of the central bankers
Iuve gIven LIe hnuncIuI mur-
kets, one thing becomes very
clear to me. Winter is coming. It
is not a question of if, but when.
All Yellen has to do is open
her mouth and if market par-
ticipants view her comments as
dovish, markets go up. If they
view them as an indication in-
terest rates could rise sooner
rather than later, the markets
go down. Since we know how
this will eventually have to go
(interest rates cannot remain
low forever), many of those out
there making the quick gains
while this market pushes on to
new highs on a less than stable
world economy and political
scene are certainly living for the
day. We dont know what kind
of winter the next crisis will be,
but one thing that is historically
certain is that it will come.
So yes, winter is coming. Your
earning potential will eventual-
ly wither and die and you need
to be spending some of your
earnings saving for what could
be a very long winter with all of
the advancements we are likely
Lo conLInue Lo muke In LIe heId
of increasing human longevity.
Winter is also coming on this
six-year-old bull market, but it
is going to be the central bank-
ers who determine when it is
time to set the clocks back.
Dctid Mces MA protides
wealth management servic-
Myanmar Summary
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es to expatriates throughout
Southecst Asic, jocusin on
UK Pension Trcnsjers. He ccn
be reached at david.m@fara-
mond.com. Faramond UK is
reulcted b the ICA cnd pro-
vides advice on pensions and
taxation.
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Amazons Revenue Increases Even As Spending Rises
Deepa Seetharaman
A
mazon.com Incs
revenue grew more
than expected for
LIe hrsL quurLer, IurgeIy
oseL by u sIurp Increuse
in spending on technolo-
gy, content and new ware-
houses as the e-commerce
company branches into
new businesses.
Amazons international
unit, which accounts for
40 percent of sales, con-
tinued to be a drag as sales
growth slowed to 18 per-
cent during the quarter.
Global unit sales, a closely
watched measure of how
many items Amazon has
sold, also decelerated, ris-
ing only 23 percent.
The company is invest-
ing heavily in new mar-
kets abroad, particularly
China, where it faces
tough competition with
Chinese e-commerce
company Alibaba.
A lot of the things that
weve done - making sure
that we have the right
pricing in place on behalf
of the customers, mak-
ing sure that our service
levels are where we need
them to be those are
the things we continue to
work on in China, Chief
InuncIuI Omcer Tom Sz-
kutak said during a con-
ference call.
Is it a large investment?
Yes, it is. And that invest-
ment has increased over
the past several years.
Szkutak added that Am-
azon was encouraged
by the weekly growth in
Prime users, even after
the company increased
the price of the service by
$20 last month.
Shares of Amazon,
which is also aggressive-
ly expanding its lineup
of devices and comput-
ing services to sustain its
growth pace, were little
changed in after-hours
trading. Reuters
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May 1-7, 2014
Myanmar Business Today
mmbiztoday.com
INVESTMENT & FINANCE
19
Myanmar Tourism Boom A Magnet for Gulf Investors
Arno Maierbrugger
T
ourism in Myan-
mar, the former-
ly most isolated
Southeast Asian country,
is witnessing an unprec-
edented boom with an
astounding surge in inter-
national tourist arrivals,
up 93 percent since 2012
as compared to 2013.
Tourism receipts were
also skyrocketing and
reached $926 million in
2013 against some $400
million in 2012, according
Lo omcIuI governmenL hg-
ures. TIe counLry Is conh-
dent that visitor numbers
will more than double,
from 2 million in 2012
when the reclusive nation
started to make it gener-
ally easier for tourists to
visit and move around,
to 5 million by 2015, said
Myanmars President
Thein Sein at a speech
he gave earlier in April to
tourism organisations in
Yangon.
This is the upside of the
development. The down-
side is that the country
is in dire need of tour-
ism and hospitality infra-
structure and depends to
a great extent on foreign
investors to build enough
hotels, resorts and roads,
as well as develop for-
merly almost inaccessible
areas that hold enormous
potential for tourism such
as the southern island
in the Andaman Sea and
the northern mountain-
ous regions which boast
Southeast Asias highest
mountains but are practi-
cally out of reach for tour-
ists due to non-existing
roads or airports.
Thein Sein mentioned
that the Myanmar Tour-
ism Master Plan 2013
Lo zozo Ius IdenLIhed
38 projects that require
$486 million of funding
to bring tourist attrac-
tions up to an interna-
tional standard, and this
is only the beginning.
Tourist arrivals are ex-
pected to reach over 7
million in 2020, and rev-
enue from the tourism
industry should reach
$10.18 billion in the same
year, which indeed indi-
cates explosive growth.
This is a window of op-
portunity for investors
and tourism developers
from the Gulf, as compa-
nIes IeeI dehnILeIy enLIced
by the new open access
to the country, with the
two most remarkable de-
velopments being Qatars
Ooredoo investing bil-
lions of dollars in Myan-
mars telecom infrastruc-
ture and Qatar Airways
having opened direct
IgILs Irom DoIu Lo Yun-
gon in October 2012.
Another Gulf company
that has already set up
shop in Myanmar is UAE
industrial group Al Mar-
wan, which wants to build
road infrastructure and
hotels and also set up
trade and marine services
in the country.
In the tourism segment,
basically everything is
needed, most of all, ho-
tels and related leisure
facilities, together with
appropriate infrastruc-
ture. Yangon, for exam-
pIe, Is suerIng Irom u
strong undersupply in ho-
tel rooms which has led to
extreme price distortions
in the hospitality market.
Meanwhile, Novotel,
Best Western, Hilton,
Shangri-La and other
chains have already en-
tered Myanmar or have
signed agreements with
local partners.
What will also be needed
are resort developers for
high-end tourism project
on Myanmars southern
islands, which have been
uImosL compIeLeIy o LIe
beaten tourist track up to
now apart from a few
diving sites accessible by
boat and special permit
but are part of Myanmars
tourism master plan with
which is obviously wants
to compete with Thailand.
And the comparison is
not far-fetched: Experts
see Myanmar similar to
Thailand 30 years ago
with regards to tourism
development, and hav-
ing the same if not a bet-
ter potential. And it could
close up fast to its wealth-
ier neighbour. Gulf Times
Myanmar Summary
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Tourists are seen at Myanmars ancient city of Bagan.
S
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May 1-7, 2014
Myanmar Business Today
mmbiztoday.com
INVESTMENT & FINANCE
20
Myanmar Summary
Myanmars Financial Opening: No Shock Therapy Please
M
yanmar, as
ASEAN Chair,
has done well
to ensure that achieving
the AEC 2015 goal has
remained a top priority
on the regions agenda.
At the 18th ASEAN Fi-
nance Ministers Meeting
in Nay Pyi Taw recently,
MInIsLers reumrmed LIeIr
commitment to realising
the goals of the ASEAN
Economic Community
(AEC). They also pledged
to maintain the stability
oI LIe regIon`s hnuncIuI
markets.
With the AEC deadline
looming, Myanmar is
LIrowIng uII ILs eorLs InLo
modernising its economy.
The results have been
positive. For the previous
zo1J1q hnuncIuI yeur,
Myanmars economy at-
tracted $3.5 billion in
foreign direct investment,
and a GDP growth rate of
an estimated 7.5 percent.
The country expects to
receive $4 billion in FDI
In LIe zo1qJ1 hnuncIuI
year, and for its GDP to
hit 7.75 percent.
Ooerhoul of Mgon-
mar s economy
The Myanmar govern-
ment has embarked on a
roadmap of speedy eco-
nomic reforms, starting
with the adoption of a
new ouLIng Myunmur
Kyat/US Dollar exchange
rate in April 2012.
Plans to liberalise and
modernise the countrys
banking sector have also
sped up. The Central Bank
of Myanmar announced
at the end of last year that
IL wIII permIL beLween hve
and 10 banks to enter the
market as wholly foreign-
owned entities. This latest
decision leapfrogs over its
original tiered plan that
required foreign banks to
enter into a joint venture
with local banks in 2014.
EorLs Iuve uIso been
made to supervise and
sLubIIIse LIe counLry`s h-
nancial sector. The Cen-
tral Bank of Myanmar
is now an independent
body. This allows Myan-
mar to isolate monetary
policy from political in-
terference and electoral
pressure to deliver short-
term economic results at
the expense of the econ-
omy.
On the legal front, My-
anmars foreign invest-
menL, hnuncIuI InsLILuLIon
and company adminis-
tration laws have been
dragged out of antiquity
into modernity.
1ost hut steodg
gr owth
But in reality, the
country is experiencing
fundamental economic
challenges that could
hamper long-term posi-
A man waIks on a pedestrian bridge in Yangon, Myanmar. Myanmar couId become one of the next rising stars in Asia if it can successfuIIy
leverage its rich endowments, the Asian Development Bank said.
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R
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tive growth. Structurally,
Myanmars economy is
still inadequate to sup-
port Myanmars growth
ideals. Aware of the limi-
tations of their country,
many government of-
hcIuIs Iuve expressed
a desire to avoid giving
Myanmars economy
shock therapy, adopting
instead, a framework of
reforms supporting fast
but steady growth.
A measured opening
will thus, give Myanmar
time to develop sectors
that have lagged behind
the countrys fast pace of
liberalisation. This means
getting the countrys ba-
sic infrastructure up to
speed, putting in place
proper regulation meas-
ures, and providing train-
ing and capacity building
programmes to develop a
skilled pool of human re-
sources to support Myan-
mur`s hnuncIuI secLor.
A Sincpore Institute
oj Internctioncl Agcirs
(SIIA) resecrch tecm
was in Yangon and
Nc Pi Tcu in 1cnu-
cr cnd Mcrch to con-
duct research interviews
on Mcnmcr's politiccl
opening, economic de-
telopment cnd jncncicl
sector reforms. The ar-
ticle ucs jrst published
on SIIA Insihts. The
Singapore Institute of In-
ternctioncl Agcirs is Sin-
gapores only independ-
ent and oldest think tank
founded in 1961, and is
dedicated to the research,
analysis and discussion
of international and re-
ioncl cgcirs.
May 1-7, 2014
Myanmar Business Today
mmbiztoday.com
INVESTMENT & FINANCE
21
Myanmar Summary
Myanmars Economic Prospects And Its Real Potential
M
yanmars economic
potential has been
vastly enhanced by the
access to foreign resources in
the form of new trading oppor-
LunILIes, LIe Inow oI IoreIgn
investment, elevated levels of
bilateral and multilateral assis-
tance that President U Thein
Seins commitment to political,
social and economic reform has
unleashed.
The relaxation of sanctions
and improved relations with the
major powers have both opened
a new opportunity for develop-
ment after years of economic
isolation and consequent eco-
nomic stagnation.
Already, over the past few
years, real growth has been
strong, but how strong is not
exactly clear. If one believed the
omcIuI sLuLIsLIcs, LIe economy
has been growing in excess of
10 percent per year for more
LIun u decude, buL IL Is dImcuIL
to reconcile the statistics with
the real world in which the peo-
ple of Myanmar live day by day.
The government has acknowl-
edged as much by winding back
the growth goal to a more real-
istic and achievable 7.7 percent
per annum in the current Five
Year Plan.
But how should Myanmar
set its development ambitions
now? By what standards should
we measure success in econom-
ic reform? And what are the key
ingredients to achieving Myan-
mars national growth poten-
tial?
Myanmar is still a very poor
country. Though the range of
error in the estimation may be
large, Myanmars per capita
GDP remains at only around
$850 a head, the poorest coun-
try in ASEAN poorer even
than its neighbours in Laos and
Cambodia.
U Myint
The Asian Development Bank
(ADB) reckons that Myanmar,
on its current development
path can grow at 7 to 8 percent
a year and that it could main-
tain that growth rate at least
over the next couple of decades.
If it were to do that, GDP per
capita would reach $2,000 to
$3,000 by 2030 more than
three times the current level
propelling Myanmar comfort-
ably into the ranks of the mid-
dle-income countries. Even so,
if Myanmar more than trebled
its per capita income through
to 2030 as the ADB suggests,
it will hardly change its rank as
the poorest country in ASEAN.
And the bar to middle income
status keeps being raised. Per-
haps it could aim to replicate
Chinas past long term 10.4 per-
cent growth (9.4 percent in per
capita terms) and thereby lift its
per capita income to $4,724 by
2030. That would still be lower
than per capita income in Sin-
gapore, Thailand, Malaysia and
Brunei two years ago.
Coming from behind, as it is,
Myanmar should have a bright-
er future, and a bolder ambition
for development. Its growth po-
tential is enormous as it sheds
the shackles of policies that
have condemned it to poverty
over LIe pusL hILy yeurs. L Ius u
rich resource base that, properly
husbanded, can launch the mo-
bilisation of international and
domestic resources for catching
up with its neighbours in ASE-
AN. It has the population, prop-
erly invested with skills and
human capital, to upgrade its
trade and industrial structure.
And it is strategically located on
the land-bridge of Asia between
the emerging giants of China
and India, in a more and more
deeply integrated ASEAN eco-
nomic community. With these
advantages, Myanmar will need
to strive not only for growth in
the quantity of per capita GDP
but also to improve its quality,
as the overriding goals of the
economic and social reform to
which President U Thein Sein
has committed.
Foreign investment will,
of course, play a critical role
in achieving Myanmars real
growth potential, as it has in
China and elsewhere through-
out the East and Southeast
Asian region. But without fun-
damental reforms in the do-
mestic economy, foreign in-
vestment cannot be expected to
bring about economic miracles
independently of good policy at
home.
Unless Myanmars own policy
frameworks are robust and re-
liable, how will foreign inves-
tors be persuaded to put con-
hdence, und brIng murkeLs,
know-how and capital, into the
country? Without stable macro-
economic policies and policy
InsLILuLIons, un eecLIve Luxu-
tion regime and soundly based
social and capital expenditure
programs, why wont foreign in-
vestors choose to go elsewhere?
And why would the ordinary
people of Myanmar be happy
II LIe benehLs oI IoreIgn InvesL-
ment are not spread widely via
sound hscuI, Iund, envIronmen-
tal and labour policies and in-
stitutions but rather captured
narrowly by special dealing and
the privileged few.
L wIII be dImcuIL Lo esLubIIsI
quickly the policy and legal
frameworks and an environ-
ment right across the country in
which foreign investors or the
people of Myanmar can have
ImmedIuLe und LoLuI conhdence.
That is why other economies,
like Singapore, China, Taiwan,
Malaysia and Vietnam estab-
lished special economic zones in
which trade could be freed up,
legal frameworks established,
and infrastructure developed
that were beachheads for test-
ing and demonstrating the path
to development more broadly.
Moving to establish special eco-
nomic zones near major centres
such as Yangon and Mandalay
is now an urgent national pri-
ority. Special economic zones
such as the Thilawa project
near Yangon will serve to boost
economic growth dramatically;
though they will not be the end
of the process which will come
Irom exLendIng LIeIr benehLs
across the country. With its
highly mobile population and
workforce, Myanmar is likely to
achieve this more rapidly than
have many other countries in
the region have before it.
Getting all this right is an
enormous challenge for poli-
cymakers and legislators in a
newly opened economy and so-
ciety. Getting it more right than
wrong is a realistic ambition
that will lift economic perfor-
mance and social welfare to its
real potential and see the birth
of another Asian tiger.
U Mint is Chiej Economic
Adtiser to the President cnd
Chief, Centre for Economic and
Socicl Detelopment oj the M-
anmar Development Resource
Institute.
Even so, if Myanmar more than trebled its
per capita income through to 2030
as the ADB suggests, it will hardly change its
rank as the poorest country in ASEAN.
And the bar to middle income status
keeps being raised.
Coming from behind, as it is, Myanmar shouId have a brighter future, and a boIder ambition for deveIopment. Its growth po-
tentiaI is enormous as it sheds the shackIes of poIicies that have condemned it to poverty over the past fty years.
S
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q:..,.~ ~.~~q, .,.,.
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~ .q:~q..__e._.. .~q
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q: ~.e~.~~.q._ .
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. ADB . ~_~_.:.._
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May 1-7, 2014
Myanmar Business Today
mmbiztoday.com
INVESTMENT & FINANCE
22
Pirates Raid Oil Tanker Sailing from Spore to Myanmar
Fears of piracy could drive up ship insurance premiums
A
rmed pirates raided an
oII Lunker o LIe cousL oI
Malaysia and took three
crew members with them, Ma-
IuysIun murILIme omcIuIs suId
on Wednesday last week, un-
derscoring increasing threats to
shipping in one of the worlds
busiest waterways.
The incident in the Malacca
Strait, a route for about a quar-
ter of the worlds seaborne oil
trade, has fuelled fears piracy
could be on the rise in the area
and drive up ship insurance
premiums.
Eight Indonesian pirates in
u hsIIng vesseI bourded LIe
Naniwa Maru No.1 at 1am local
LIme IusL Tuesduy o LIe cousL
of west Malaysia while the ship
was sailing from Singapore to
Myanmar, the Malaysian Mari-
time Enforcement Agency said.
We are very concerned, said
Noel Choong, head of the In-
ternational Maritime Bureaus
Malaysia-based Piracy Report-
ing Centre, who added the
ship was hijacked while sailing
near the Malaysia town of Port
Klang.
L`s LIe hrsL LIme LIIs Ius
happened so far north in the
MuIuccu SLruIL, und LIe hrsL
time they have kidnapped the
crew. Its not an area where we
have seen the modus operandi
of ships hijacked for their car-
go, he told Reuters.
The pirates pumped out about
3 million litres of the 4.5 million
Al-Zaquan Amer Hamzah
and Keith Wallis
litres of diesel carried by the
tanker into two waiting vessels
und mude o wILI LIree ndo-
nesian crew members, includ-
ing the captain and chief engi-
neer, the agency said.
There is a possibility that the
abducted crew was involved in
the hijack based on new leads
and that their personal docu-
ments, clothes and belongings
were taken along with then,
the agency said in a statement.
The Saint Kitts and Nevis
registered oil tanker had been
towed to Malaysias Port Klang
for further investigations.
Malaysian authorities are now
working closely with their In-
donesian counterparts to track
down the two vessels and locate
the missing crew.
Coing North
RegIonuI securILy omcIuIs
have previously told Reuters
that armed gangs prowling
the Malacca Strait may be part
of a syndicate that can either
have links to the crew on board
the hijacking target or inside
knowledge about the ship and
cargo.
Such intelligence-led hijacks
have involved seizing tankers so
that gasoil cargoes can be trans-
ferred and sold on the black
murkeL, LIe omcIuIs, wIo de-
cIIned Lo be IdenLIhed becuuse
they are not authorised to speak
to the media, have said.
The stolen cargo is worth
about $2.5 million, based on
the average price of diesel this
year in Singapore, data from
BrILIsI sIIppIng servIces hrm
Clarkson shows.
The tanker is managed by
Singapore company Pantec
Chartering which was unable
to comment when contacted by
Reuters. The 4,999-deadweight
tonne vessel had an 18 member
crew of Indonesian, Thai, My-
anmar and Indian nationals.
Insurance sources said the
incident was unlikely to spark
an immediate increase in pre-
miums, but insurers would be
concerned if there were several
more hijackings.
Previous tanker hijackings
and cargo thefts have taken
place closer to Singapore, with
hve sucI IncIdenLs beLween
2011 and 2013, according to
the government-to-government
body Regional Co-operation
Agreement on Combating Pira-
cy and Armed Robbery against
Ships in Asia (ReCAAP).
There were eight armed rob-
bery attacks in the Malacca
Strait and around Singapore
In LIe hrsL quurLer LIIs yeur,
compared with one in the same
period last year, Singapore-
headquartered ReCAAP said,
although most were small
thefts. Reuters
Myanmar Summary
Myanmar Summary
Mitsubishi Teams Up With FMI, Yoma for Elevator Business
M
itsubishi Corp (MC)
has struck a deal with
First Myanmar Invest-
ment Co Ltd (FMI) and Yoma
Strategic Investments Ltd (YSI)
to venture into elevator busi-
ness in Myanmar in a bid to tap
the countrys booming housing
construction market, the Japa-
nese conglomerate said.
The companies established a
joint venture company, MC El-
evator (Myanmar) Ltd (MC El-
evator), where MC will hold 60
percent of shares, with FMI and
YSI holding 20 percent each.
Through the new company
MC will provide technical ser-
vices and solutions, installation,
testing and commissioning and
import and supply of elevators,
escalators and related products
in Myanmar, Mitsubishi said.
Urban development in My-
anmar has gained remarkable
Htun Htun Min momentum in recent years, fol-
lowing the governments moves
towards democratisation.
This has led to increased for-
eign investment, particularly in
the construction and real estate
development sectors, where de-
mands for elevators and escala-
tors are projected to also grow.
MC Elevator is scheduled to
start operations this summer
after it completes setting up the
company according to Myan-
mar procedures.
MC has been applying its
trading functions in collabora-
tion with SPA group companies
for the distribution of Mitsubi-
shi Electric elevators, escalators
and related products in Myan-
mar since 1998.
Mitsubishi said the aim of
establishing MC Elevator is to
further expand this business
by strengthening capabilities
Ior more eecLIve cusLomer
support and maintenance ser-
vices on the ground.
FMI and YSI are part of the
enlarged group of one of My-
anmars leading corporations,
Serge Pun & Associates (Myan-
mar) Ltd (SPA).
Mitsubishi said it will continue
collaborating with Mitsubishi
Electric in the elevator and escala-
tor business, particularly in devel-
oping countries with high growth
potential such as Myanmar.
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A maritime police approaches the Japanese oil tanker which was raided by armed pirates at Port Klang, outside Kuala Lumpur.
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May 1-7, 2014
Myanmar Business Today
mmbiztoday.com
PROPERTY & REAL ESTATE
23
Myanmar Summary
Myanmar Construction Growth Potential
Needs Special Attention: Report
W
hile some of the
c ons t r uc t i on
industry has
tempered in parts of Asia,
special attention should be
made of the growth poten-
tial in Myanmar, UK-based
construction consultancy
company AECOM and its
Davis Langdon KPK group
said in a report.
The half-yearly Asia
Construction Outlook
2014 report, which pro-
vides review of, and fore-
cast for, the construction
markets in Asia, said in
the medium-term Myan-
mur Ius been IdenLIhed
as a country with poten-
LIuI Ior sIgnIhcunL IuLure
growth in construction,
along with the Philippines
in the near-term.
Although construction
spending growth in Indo-
nesia and China will re-
main the strongest in the
region, the report added.
TIe hndIngs, wIIcI were
Phyu Thit Lwin based on an analysis of
sector statistics combined
with the results of market
sentiment, showed the
residential sector in Asia
appears to be gathering
some momentum.
However, respondents
were slightly less opti-
mistic regarding the fu-
ture prospects for con-
struction in Asia, with
Indonesia being the top-
rated country in terms
of potential construction
spending growth in the
medium term.
A lack of investor con-
hdence In TIuIIund Is ex-
pecLed Lo uecL consLruc-
tion spending in the near
term, the report said.
There is an increasing
downside risk shown in
our forecasts based on the
level of credit availability
in the region, said Dato
Sri Kandan, chairman,
Davis Langdon KPK.
The report said inte-
grated planning, design
and engineering solutions
will be the key to advance
the value of the project. As
market pressures mount
on projecLs` hnuncIuI vI-
ability due to higher costs
and lower margins, in-
novation in procurement
such as the Integrated
Project Delivery process
should be considered, it
added.
This, coupled with the
principles of Lean, such
as improving quality and
productivity, would seek
to deliver maximum value
to the owner, reduce waste
und muxImIse emcIency
through all phases of de-
sign and construction.
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Myanmars Hotel Industry:
The Reality
I
n the past three years,
Myanmar has been
enjoying a hotel boom,
driven by surging tour-
ist arrivals as the country
opens up to economic and
political reforms. Tour-
ist arrivals to the Golden
Land increased by 160
percent, from 790,000 in
2010 to 2.04 million in
2013.
In Yangon, the limited
stock of international-
grade hotel rooms has
resulted in huge increases
in room rates and occu-
pancy levels and interna-
tional hotel chains such
as Best Western, Shangri-
La and Hilton are eyeing
Myanmar as the next eco-
nomic frontier in Asia for
expansion.
As with many emerging
markets, however, foreign
investors and developers
need to understand the
complexities and realities
of Myanmars real-estate
and hotel investment are-
na before jumping on the
bandwagon.
Wai Linn Kyaw Recently, London-based
Iuw hrm DA PIper ouL-
lined some of the chal-
lenges in entering Myan-
mars hotel market. There
are many complexities
in the process from land
acquisition to hotel open-
Ing, LIe Iuw hrm suId.
Foreign-owned entities
are not allowed to own
land, condos, apartments
or any type of property in
Myanmar under the cur-
rent law. However, they
are allowed to lease land
from the state or from
private land owners for an
initial period of 50 years
plus two 10-year exten-
sions, depending on the
business, industry and
the amount invested upon
approval from the Myan-
mar Investment Commis-
sion (MIC), DLA Piper
suId In u brIehng noLe.
When we say that a
property or land is for-
eign owned, it means
that the foreign entity has
been granted the right to
use the land according to
a build, operate, trans-
fer (BOT) agreement, it
added.
In central Yangon, land
plots are said to be scarce
and expensive, with some
reaching $1,000 per
squure IeeL. n ILs eorL Lo
increase the supply of ho-
tel rooms, the Myanmar
government is allocating
purpose-built hotel zones
with roads and infrastruc-
ture in areas such as Yan-
gon, Nay Pyi Taw, Man-
dalay, Bago and other
tourist destinations.
L Is oerIng Iund pIoLs
for investors to bid for
hotel developments, but
given the strong bidder
interest, prices have also
been high.
Foreign investors have
called for land price regu-
lation and limits; howev-
er, to date the regime has
yet to come up with a na-
tional land-use plan and
strategy.
Developers looking for
LIe greenheId rouLe musL
be prepared to negoti-
ate, wait and hold or walk
away if they perceive land
plot values to be unrealis-
tic.
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Myanmar Summary
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Western, Shangri-La .
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Sedona Hotel in Mandalay.
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A hotel under construction in Mawlamyine.
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May 1-7, 2014
Myanmar Business Today
mmbiztoday.com
24
Myanmar Summary
PROPERTY & REAL ESTATE
Amid Construction Boom, Myanmar Starts to Build Disaster Resilience
T
he Sule Pagoda Road in
downtown Yangon is fa-
mous for its role in Myan-
mars turbulent recent history.
With its golden pagoda rising
at one end, it has always served
as a popular gathering point for
street protests.
These days the road is draw-
ing attention as the location
of some of the hottest proper-
ties in Yangon. According to
local businessmen and build-
ing owners, the cost of land
here has shot up to as much as
$1,500 per square foot (around
$16,000 per square metre).
This is roughly six times the
price of similar plots in the Thai
capital, Bangkok.
But experts warn that in the
midst of its boom, Myanmar
must build resiliently, with an
eye on the countrys vulnerabil-
ity to natural disasters.
Since political and economic
reforms were begun in Novem-
ber 2011 by the government of
President Thein Sein, capital
Inows Iuve Ied Lo new om ces,
hotels and apartment complex-
es sprouting in the countrys
largest city.
Elsewhere, new economic
zones are being opened up,
such as the Thilawa Industrial
Zone near Yangon and the Da-
wei Special Economic Zone to
the south, near the border with
Thailand.
We are building everywhere,
said Ko Zaw Zaw, who operates
a vehicle dealership and owns
several buildings on Sule Pa-
goda road.
z.o million people exposed
SLIII, muny oI LIose benehLIng
from these developments have
not forgotten the devastation
that can be wrought on people
and property alike by natural
disasters. Myanmar is extreme-
ly vulnerable to cyclones, in
particular, and the government
is responding with measures to
mitigate their impact.
In the three decades to 2010,
Myanmar experienced 27 natu-
ral disasters, which caused the
deaths of over 140,000 people
und uecLed LIe IIves oI .q mII-
lion, according to an analysis
last year by the Myanmar Dis-
aster Risk Reduction (DRR)
Working Group.
Between 2002 and 2012,
LIree cycIones uecLed over z.6
mIIIIon peopIe, oods sLrunded
more than half a million, and
Amantha Perera
Lwo mujor eurLIquukes uecLed
20,000. The single most devas-
tating event was Cyclone Nargis
in May 2008, with a death toll
of 135,000.
Myanmar ranks close to the
bottom of the Notre Dame-
Global Adaptation Index, which
measures countries climate
vulnerability and readiness to
improve resilience. This is as
mucI u reecLIon oI Myunmur`s
exposure to climate change as it
is of the countrys low capacity
to manage climate risks, ac-
cording to the DRR Working
Group.
It estimated that close to 2.6
million people live in areas vul-
nerable to disasters such as cy-
cIones, eurLIquukes, oods und
droughts.
A new disaster management
law was enacted in June last
year, and a National Natural
Disaster Preparedness Working
Committee was set up under
LIe PresIdenL`s Om ce Lo coordI-
nate disaster preparedness and
mitigation work.
They are taking this very se-
riously, said Helena Mazarro,
who manages disaster risk re-
duction for Myanmar at the UN
Om ce Ior LIe CoordInuLIon oI
HumunILurIun AuIrs (OCHA).
According to Jaiganesh Muru-
gesan, a disaster risk reduction
specialist with the UN Human
Settlements Programme (UN-
Habitat) in Myanmar, the re-
newed attention to disaster risk
reduction was already apparent
in May 2013, when deaths and
damage from Cyclone Mahasen
were less than might have been
expected.
Around 200 lives were report-
ed lost, while over 140,000 peo-
ple living in vulnerable regions
in western Rakhine state were
evacuated before the storm
made landfall. The presence
of UN and other humanitarian
agencies that had worked with
the government to raise aware-
ness helped prepare people for
the storm.
Neu huilding code
The disaster management law
has been followed by a new con-
struction code, which was in-
troduced in March this year but
is still subject to consultation.
It sets standards on building
safety with regard to cyclones,
storms and earthquakes, and
establishes a regulatory body to
ensure standards are met.
The update on the codes for
building construction (takes)
into account new knowledge
on possIbIe eecLs Irom eurLI-
quakes and strong winds in the
country. The key question is
how much these better stand-
ards really get implemented at
the ground level, said Peer-
anan Towashiraporn, director
of the Bangkok-based Asian
Disaster Preparedness Centre.
Another challenge faced by
the government is the range
of disasters that pose a threat.
While Myanmars southern
regions are prone to cyclones,
the northern parts sit on earth-
quake faultlines.
UN-Habitats Murugesan said
disaster preparedness at com-
munity level also needs rein-
forcement. (At the) national
level they are better prepared
than before of course, when
it goes down to (the) local level,
challenges remain.
Given the lack of resources in
the country, disaster prepar-
edness programmes still need
substantial foreign funding and
specialised personnel, he added.
OCHAs Mazarro said the UN
body is working closely with
the government to enhance and
streamline coordination with
foreign donors and aid agen-
cies. In the past, Myanmars
government has resisted wider
cooperation.
But according to Mazarro,
that is changing. They are very
keen on engagement, she said.
Zaw, the car dealer on Sule
Pagoda Road, is happy that at
least some action is being taken
on safety measures.
I was here when Cyclone
Nargis blew over us, (and) it
was terrible. If something simi-
lar happens now, we should be
better prepared, because there
are more buildings, more vehi-
cles and more people here, he
said.
Amcnthc Pererc is c jreelcnce
contributor to the Thomson
Reuters Ioundction. csed in
Colombo, Sri Lanka, he focuses
on conjict cnd post-conjict is-
sues, humanitarian disasters
and climate change. The article
ucs jrst published in Thomson
Reuters Foundations website.
Thomson Reuters Foundation
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The disaster management law has been fol-
lowed by a new construction code, which was
introduced in March this year but is still subject to
consultation. It sets standards on building safety
with regard to cyclones, storms and earthquakes,
and establishes a regulatory body to ensure
standards are met.
Experts warn that in the midst of Myanmar`s construction boom, it must buiId resiIientIy, with an eye on the country`s vuIner-
ability to natural disasters.
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Myanmar Business Today
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AUTOMOBILE
25
Myanmar Summary
Nissun's Myunmur Ventore Reects Openings Beyond BRIC
Nissan chief placing bets on next hot car markets
David Pearson And
Jason Ng
N
issan Motor Co Chief
Executive Carlos Ghosn
said a planned joint
venture in Myanmar is another
step in a strategy to stake out
early market positions in coun-
tries with high-potential econo-
mies.
Nissan unveiled plans last
month to start assembling up
to 10,000 Nissan sedans a year
beginning in 2015 in Myan-
mar in a partnership with Tan
Chong Motor Holdings Bhd.
The investment will make Nis-
sun one oI LIe hrsL gIobuI uuLo
companies to manufacture cars
in one of the worlds poorest
countries.
Tan Chong expects to invest
$o mIIIIon durIng LIe hrsL
three years for construction of
the plant and a showroom, the
company said. Total investment
by both companies is $74 mil-
lion.
Nissan and its French alliance
partner Renault SA are look-
ing beyond the so-called BRIC
countries Brazil, Russia, India
and China that have been the
focus of expansion for the past
decade and are targeting Myan-
mar, Indonesia, and Africa.
The Renault-Nissan alliance
reckons that it is already the
second-largest auto maker in
Africa, after having built up
strong positions in the north
and south of the continent. Sub-
Saharan markets are now on its
radar screen, as well as those
of other manufacturers, Ghosn
said.
Obviously, we have a lot of
projects, but none of them have
materialized yet, Ghosn said
in an interview with The Wall
Street Journal.
Africa without any doubt is
an important prospect for the
future. Today, they are rela-
tively small markets, but with a
IIgI or very sIgnIhcunL growLI
rates, he said.
Demand for automobiles in
markets like India, Russia and
Brazil has sagged over the past
year as signals that the US Fed-
eral Reserve was about to tight-
en its policy siphoned liquidity
away from emerging markets.
um conhdenL LIuL growLI
will resume in these markets,
probably at a lower level, but it
will resume next year, Ghosn
said.
He said the reversal in capital
ows buck Lo LIe US - u Lrend
that he said was widely antici-
pated has reduced the percep-
tion of risk over how emerging
economIes wouId be uecLed by
the removal of excess liquidity.
In a way, its good, because
it eliminates one level of uncer-
tainty from the market today,
which is how much growth in
emerging markets would re-
main after the liquidity is with-
drawn.
New emerging markets like
Indonesia, Mexico, Myanmar
and Africa allow you to spread
your risks, Ghosn said. When
one is slowing down or has a
problem it will be compensated
by others. The overall picture
on emergIng murkeLs jusLIhes
every single investment weve
made, and were going to have
to do more.
The recent depreciation of
emerging market currencies is
encouraging moves to acceler-
ate localization, as this provides
a natural hedge against curren-
cy ucLuuLIons, GIosn suId.
The alliances strategy in
emerging markets is absolutely
not challenged by the current
weakness of these economies,
he said, described the recent
declines as a blip.
Myanmar has high import du-
ties on new cars, making almost
all of the 2.63 million automo-
biles cars on the roads in Myan-
mar today imported used cars,
mainly from Japan, and most of
those are between 10 years and
20 years old.
Apart from the lack of a deal-
ership network for servicing and
maintenance, that can create
other safety problems. In My-
anmar, cars drive on the right
side of the road, while imports
from Japan, where cars drive
on the left, have their steering
wheels on the right side of the
car.
Ghosn said starting local pro-
duction with Tan Chong will
oer Myunmur`s popuIuLIon u
chance to buy a brand-new car
that is cheaper than the vehicles
in the secondhand market.
Why would anyone want to
buy a used car that is more ex-
pensive than a car that is made
in your own country by Myan-
mar people? he asked.
Only seven out of 1,000 house-
holds in Myanmar owns a vehi-
cle, compared with 45 in Indo-
nesia, where Nissan is making a
big manufacturing push.
Its a country that is poten-
tially extremely rich thanks to
its oil, natural gas and agricul-
ture resources, Ghosn said.
A recent study by consultants
Frost & Sullivan predicted that
demand for new cars in Myan-
mar could grow at a compound
annual rate of 7.8 percent
through 2019, reaching 93,300
by LIuL yeur, u LIny hgure com-
pared with other countries with
a population of more than 60
million. Car sales will be driven
by government spending to im-
prove the countrys dilapidated
road infrastructure, and rising
income levels as the economy
opens up to the outside. WSJ
Visitors crowd in front of the Nissan Inniti exhibition booth on the rst pubIic day of Auto China 2U14 in Beijing.
R
e
u
t
e
r
s
/
C
h
in
a

D
a
ily
New emerging markets Iike Indonesia, Mexico, Myanmar and Africa aIIow auto
companies to spread risks, Nissan Chief CarIos Chosn said.
R
e
u
t
e
r
s
Why would anyone want to buy a used car
that is more expensive than
a car that is made in your own country by
Myanmar people?
Nissan Motor ~.~- ~...:
.. Carlos Ghosn . Nissan~.,
_e _., .:. ~ ~~ .~ . . ..:
_..._ ...:..q.~.:.~.:q._
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Bhd . ....|._.. ~~ ..~~:
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~~~~~ ~..._~.~.~:.
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. : ~..q ~, ..'.: , ., ._e. ._ .
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e~._...:.._ q:~. ,q:.
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q, .,.._ .e....:.~ ..
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q :.. ~:eq~. ...~ ~ . .~
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_.,.:.~ ~:.~..~...
~~~ ~.,~.....,..:. _~..:.
.~q._..~q_.,.:.~ ~:.
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.: .,.. ~..:.._ .~
~.. ~~ ... ~.. ~ q._~:.
.:._e. ._ . ~_. ~:. , .. . ._._.
.q.~~~ ~,..:...,..:.~:.
,_..,...._~~~ ._..q..
q: _..,:.:.._. q..,q._.
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._. .,.. ~...:._
~:..:..: e..:..:._e.._.
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~.~.~e~~: _.,.:.~:.
secondhand ~:..:.~ ....,.
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:.._.
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.~q_.. ... ... q:..,.
_e ~~ ...~ ~:...|. ,,~~
. .q:~q.:.._~:. .,.,.:.
._.
May 1-7, 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 1-7, 2014
Myanmar Business Today
mmbiztoday.com
IT & TELECOM
27
Myanmar Summary
Myanmar Summary
TPG Joins Ex-LightSquared CEO in Myanmar Telecom Tower Venture
T
PG Capital and former
LightSquared Inc Chief
ExecuLIve Omcer Sun-
jiv Ahuja are teaming up on a
telecommunications venture
In Myunmur, LIe hrsL Ioruy by
a big-name US private-equity
hrm In LIe counLry sInce IL
emerged from military rule
three years ago.
The growth-equity unit of
Fort Worth, Texas-based TPG
invested about $40 million this
month in Apollo Towers Myan-
mar Ltd, said a person briefed
on the matter, who asked for
anonymity because the trans-
action was private. The money
will help Apollo, which is owned
by a Singapore-based company
Ahuja started last year, build
about 1,000 mobile-phone tow-
ers across Myanmar this year.
Foreign investment in the
former Burmas real estate has
increased since Western gov-
ernments eased sanctions start-
ing in 2012. Corporate private-
equity deals remain rare in the
Southeast Asian country of
David Carey 60 million, which has set out
to modernise and regulate its
economy since President Thein
Sein took over in 2011. Large
US hrms sucI us BIucksLone
Group LP, KKR & Co and Car-
IyIe Group P Iuve IeId o
from investing in the country.
There are very few countries
left in this world where mobile
telecom infrastructure does not
exist or is so sparse and basic
like it is in Myanmar, Ahuja
said in a telephone interview
from Yangon.
This is a society which is
opening up and beginning to
connect with the rest of the
world. There is an insatiable
need for mobile connectivity.
Lisa Baker, a spokeswoman
for TPG at Owen Blicksilver
Public Relations Inc, declined
to comment on the investment.
AIuju conhrmed LIuL Ie`s
working with TPG on the ven-
ture while declining to disclose
terms.
Sever al decades
Ahuja, 57, an Indian-born
entrepreneur who has backed
tower startups in Bangladesh,
Pakistan and Africa since 2007,
called the Myanmar venture a
once-in-a-several-decade op-
portunity.
He resigned as CEO of Light-
Squared, a Reston, Virginia-
based wireless venture, in 2012
sIorLIy beIore IL hIed Ior bunk-
ruptcy after the US govern-
ment blocked its service, saying
it might interfere with civil-
ian and military frequencies.
Hedge-fund manager Philip
Falcone, who in 2013 agreed
to be banned from the securi-
LIes IndusLry Ior hve yeurs over
misdeeds unrelated to the wire-
less company, is LightSquareds
controlling shareholder.
Less than 10 percent of My-
anmars population has mobile
service, according to Ahuja.
That compares with more than
60 percent of the citizens in
Bangladesh, a country with
comparable per-capita income.
Gover nment li cence
Apollo is the only tower owner
to be given a government oper-
ating license to date, according
to Ahuja. Three other approvals
are pending. Ahuja estimated
that as many as 20,000 tow-
ers will go up in Myanmar in
the next few years, at a cost of
$100,000 apiece, or $2 billion.
He expects Apollo to build and
own several thousand of them.
In December, Apollo signed
an agreement with a unit of
Fornebu, Norway-based wire-
less-service giant Telenor ASA
(TEL) to operate its towers as
Telenor moves into Myanmar.
Myanmars economy may
quadruple to about $200 billion
by 2030 if the nation invests
more in technology, accord-
ing to a report last year by the
McKinsey Global Institute. Real
growth in gross domestic prod-
uct will be about 7.8 percent this
year and next, the International
Monetary Fund estimates.
TPG was an early investor in
Russia, Thailand and Indone-
sia. In May 2012, co-founder
David Bonderman met with
Myunmur governmenL omcIuIs,
opposition leader Aung San Suu
Kyi and business executives in
Yangon to size up the invest-
TPG Capital . LightSquared
Inc . ~...:~q:q...e:.
_e.. Sanjiv Ahuja ._ _.,.:
. -.~ . e .q.. . , .~ . . ~
q, ....|..._~:. .q._.
Texas ~._..~ TPG ~.,_e
e..~~ . Apollo Towers Myanmar
Ltd ~ ~..q~,..'.: .,. ,~
q..._....__e.._..~:.~._.
.~ Apollo ~.,_e ~..|q...
_....~:. e...~~. _.,.:.
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~~~~ ~_..:~.q.~ ~.._.
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Apple, Google to Pay $324 Million to Settle Conspiracy Lawsuit
F
our major tech compa-
nies including Apple and
Google have agreed to pay
a total of $324 million to settle
a lawsuit accusing them of con-
spiring to hold down salaries in
Silicon Valley, sources familiar
with the deal said, just weeks
beIore u IIgI prohIe LrIuI Iud
been scheduled to begin.
TecI workers hIed u cIuss uc-
tion lawsuit against Apple Inc,
Google Inc, Intel Inc and Adobe
Systems Inc in 2011, alleging
they conspired to refrain from
soliciting one anothers em-
ployees in order to avert a sal-
ary war. They planned to ask for
$3 billion in damages at trial,
uccordIng Lo courL hIIngs. TIuL
could have tripled to $9 billion
under antitrust law.
The case has been closely
watched due to the potentially
high damages award and the op-
portunity to peek into the world
of Silicon Valleys elite. The case
was based largely on emails in
which Apples late co-founder
Steve Jobs, former Google CEO
Eric Schmidt and some of their
Silicon Valley rivals hatched
plans to avoid poaching each
others prized engineers.
In one email exchange after
a Google recruiter solicited an
Apple employee, Schmidt told
Jobs that the recruiter would
be hred, courL documenLs sIow.
Jobs then forwarded Schmidts
Dan Levine note to a top Apple human re-
sources executive with a smiley
face.
Another exchange shows
Googles human resources di-
rector asking Schmidt about
sharing its no-cold call agree-
ments with competitors.
Schmidt, now the companys
executive chairman, advised
discretion.
Schmidt responded that he
preferred it be shared verbally,
since I dont want to create a pa-
per trail over which we can be
sued later? he said, according
Lo u courL hIIng. TIe HR dIrec-
tor agreed.
The companies had acknowl-
edged entering into some no-
hire agreements but disputed
the allegation that they had
conspired to drive down wages.
Moreover, they argued that the
employees should not be al-
lowed to sue as a group.
Rich Gray, a Silicon Valley an-
titrust expert in private practice,
said the companies had an incen-
tive to avoid trial because their
executives emails would make
them look extremely unsympa-
thetic to a jury. However, the
pIuInLI uLLorneys rIsked un up-
peals court saying the engineers
could not sue as a group at all.
An appellate court could say,
Hey we just dont buy that,
Gray said.
Trial had been scheduled to
begin at the end of May on be-
half of roughly 64,000 workers.
Spokespeople for Apple,
Google and Intel declined to
comment. An Adobe repre-
sentative said that the company
denies it engaged in any wrong-
doing, but settled in order to
avoid the uncertainties, cost
and distraction of litigation.
An uLLorney Ior LIe pIuInLIs,
KeIIy Dermody oI Ie Cubrus-
er Heimann & Bernstein, in a
statement called the deal an
excellent resolution.
Corporate defendants in an-
titrust cases often agree among
themselves what portion each
will contribute towards a set-
tlement, said Daniel Crane,
a professor at the University
of Michigan Law School. One
likely formula would be to di-
vide the damages based on how
many employees each company
has in the class, he said.
Apple, Google, Adobe and Intel
in 2010 settled a U.S. Depart-
ment of Justice probe by agree-
ing not to enter into such no-hire
deals in the future. The four com-
punIes Iud sInce been hgILIng
the civil antitrust class action.
Walt Disney Cos Pixar and
ucushIm unILs und nLuIL nc
had already agreed to a settle-
ment, with Disney paying about
$9 million and Intuit paying $11
million.
Some Silicon Valley compa-
nies refused to enter into no-hire
agreements. Facebook Chief Op-
eruLIng Omcer SIeryI Sundberg,
Ior InsLunce, rebued un enLreuLy
from Google in 2008 that they
refrain from poaching each oth-
ers employees.
Additionally, Apples Jobs
threatened Palm with a patent
lawsuit if Palm didnt agree to
stop soliciting Apple employ-
ees. However, then Palm Chief
Executive Edward Colligan told
Jobs that the plan was likely
illegal, and that Palm was not
intimidated by the threat.
Reuters
ment and political climate.
TPGs growth-equity unit, TPG
Growth, oversees about $3.7
bIIIIon oI LIe hrm`s more LIun
$59 billion of total capital.
loomber
,_.._:~.~_~.....~ .|~
._ Apple. Google ~~.,_e
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IT & TELECOM
Myanmar Summary
Internet Freedom in Myanmar: A Curse Or An Opportunity?
With Myanmars recently acquired internet freedom, questions arise about hate speech and incitement to violence online
J
ust before former Tunisian
President Zine El Abidine
Ben AII ed Irom TunIs In
January 2011, he addressed his
citizens one last time in a sev-
en-minute speech in which he
promised rejection of all forms
of censorship. Sure enough,
within just a few hours, the in-
ternet which had long been
heavily censored was open
und Ior LIe hrsL LIme TunIsIuns
were able to access whatever
they wanted to freely.
Such a transition is rare. As
Reporters Without Borders
recent publication on enemies
of the Internet shows, once a
country institutes controls on
the internet, it rarely goes back.
China, Iran, Uzbekistan, and
many other nations on the list
get worse every year, not bet-
ter. But there are exceptions:
The Maldives and Nepal, two of
LIe hrsL counLrIes Lo ever sIuL
down the internet, long before
Egypts Hosni Mubarak did so,
have reversed some controls, as
has Morocco.
Like Tunisia, Myanmar has
recently emerged from the
clutches of dictatorship and is
sIowIy LukIng ILs hrsL sLeps Lo-
ward democracy. Nearly three
years ago, after decades of mili-
tary rule, the country began a
transition toward civilian rule.
A year later, prior restraint of
the media was abolished and
the internet - once among the
most restricted in the world -
opened up.
Today, the Burmese can ac-
cess whatever they want on-
line. Exiled news organisations
have moved into Yangon, their
online presence now accessible
from within the country. Web-
mail and social media, once
blocked, are now increasingly
popular despite low Internet
penetration. Facebook is ex-
tremely popular, home to more
than an estimated 80 percent of
the countrys million or so in-
ternet users.
The trouhle uith hote
speech
But such freedom has come
with a price. Nearly two years
Jillian C York
ago, the New York Times re-
ported that hateful comments
ure . ourIsIIng onIIne ubouL
a Muslim ethnic group, the
Rohingya. Two years later, as
LIe conIcL beLween LIe RoI-
ingya (an ethnic Muslim minor-
ity unrecognised by the state)
and Buddhists has only grown
worse, so too has the rhetoric
online. On social networks, calls
for the Rohingya to be expelled
(or worse) abound.
On Facebook, propaganda
abounds, as do accusations of
hired commenters, paid to sway
opinion on the pages of local
publications. But, as some have
pointed out, so does moder-
ate speech calling for an end to
the violent incitement that has
plagued social networks in My-
anmar.
In a recent speech in Yangon,
opposition leader Aung San Suu
Kyi addressed a crowd of inter-
national journalists, discussing
the countrys media which
she dubbed only partly free
and stressing the responsibility
journalists have towards truth.
At the same time, when asked a
question about the plight of the
Rohingya, she demurred, pivot-
ing to comment on the impor-
tance of the rule of law. She did
not once utter the word Roh-
ingya.
Her comments were part of
what makes discussing free ex-
pression and the media in My-
anmar so complicated. While
it is often argued that the best
response to distasteful speech
is in fact more speech, the fact
that even an opposition leader
cant bypass a strong taboo to
discuss such a controversial is-
sue means that such a strategy
is unlikely to work. And yet,
censorship often has the un-
desIred eecL oI pusIIng dun-
gerous speech underground,
mukIng IL even more dImcuIL Lo
respond to.
Dr Cherian George, a profes-
sor and scholar of journalism,
has written extensively about
the regulation of hate speech.
Looking at the ways in which
many traditional societies in-
cluding Myanmar regulate
speech, he notes that the low
threshold for censorship in
the name of maintaining har-
mony can be used by states
to silence dissent. Laws that
ban the wounding of feelings
also empower the least tolerant
groups to set the tone for the
whole society.
At the same time, notes
George, the failure to protect
minority rights often trans-
lates into impunity for right
wing groups that attack minori-
ties.
It is for this reason that open
discussion, and an open media,
is imperative. If even Aung San
Suu KyI, LIe dehunL opposILIon
leader whose actions and rheto-
ric earned her a Nobel Peace
Prize, is unable to speak openly
about the ongoing violence in
Myanmar, then one cannot ex-
pect the government to do so.
And without strong leadership
Lo mILIguLe LIe conIcL, LIe roIe
falls to the fourth estate.
Agoinst regulotion
At the same event at which
Aung San Suu Kyi spoke, blog-
ger Nay Phone Latt who was
imprisoned for four years under
the military regime drew the
important distinction between
hate speech and incitement to
violence, articulating that while
regulating the latter is reason-
able, the former is more subjec-
tive.
Indeed, what constitutes hate
speecI dIers greuLIy Irom ju-
risdiction to jurisdiction. While
some countries such as Chile,
Canada, and the Netherlands
have enacted broad laws that
criminalise speech that intends
to incite hatred against protect-
ed groups, other countries take
a looser approach. India, for ex-
ample, imposes restrictions on
speech that harms public or-
der, decency or morality, while
Polands laws punish those who
oend reIIgIous senLImenL.
On a global internet, such reg-
ulations silo users. And when
access to information albeit
often undesirable information
varies from country to coun-
try, inequality grows. One might
argue, of course, that access to
hate speech isnt a human right,
and would be correct. However,
IuLe speecI Is mereIy LIe hrsL -
never the only content to fall
to state censors. In any case,
censoring hate speech rather
than solving the underlying
problems that led to its prolif-
eration is unlikely to have a
IusLIng eecL.
Jillian C York is a California-
based writer and free speech
activist, currently serving as
the Director for International
Freedom of Expression at the
Electronic Frontier Foundation
in San Francisco. Her work is
centred on the intersection of
technology and policy. The ar-
ticle ucs jrst published in Al
Jazeera website, and the views
expressed here are the authors
own and do not necessarily
reject Mcnmcr usiness To-
days editorial policy.
Today, the Burmese can access whatever they
want online. Exiled news organisations have
moved into Yangon, their online presence now
accessible from within the country. Webmail and
social media, once blocked, are now increasingly
popular despite low Internet penetration.
People use the internet at an internet cafe in Yangon.
S
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~,.q:...~ Zine El Abidine
Ben Ali ._ ~._._. ~.._...
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.~:..:.~~ ~ ....:. _._:, .:.
._.
May 1-7, 2014
Myanmar Business Today
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IT & TELECOM
29
Myanmar Summary
Myanmar Summary
Myanmar Summary
TIME Joins Consortium for AAE-1
M
uIuysIun LecI hrm
TIME dotCom Bhd
has joined a consor-
tium to build a new submarine
cable system that will link Asia
and Europe via the Middle East.
The Asia-Africa-Europe-1
(AAE-1) cable system will also
pass through Myanmar.
TIIs Is u sIgnIhcunL compo-
nent of our global expansion
plans. Our global network will
span Europe, the Middle East,
Asia, Japan and the United
States, TIME CEO Afzal Abdul
Rahim said.
The allocation of capacity to
Mya nmar, Thailand, Cambodia
and Vietnam will further sup-
port TIMEs regional expansion
InILIuLIves, LIe hrm suId.
Together with 16 interna-
tional service providers, TIME
will construct and maintain
the 25,000km submarine ca-
ble system with landing sta-
tions planned for Hong Kong,
Vietnam, Cambodia, Malaysia,
Thailand, Myanmar, India,
Pakistan, Oman, UAE, Qatar,
Yemen, Djibouti, Saudi Arabia,
Egypt, Greece and France.
Construction is expected to
begin in the second quarter of
2014 and TIMEs gross invest-
ment of $44 million (which
includes the Malaysian cable
Aye Myat landing station) will see it se-
curing 1.88Tbps of capacity
in AAE-1 upon completion in
2016.
The AAE-1 participation
will also provide diversity for
TME`s AsIu PucIhc GuLewuy
(APG) submarine cable system
capacity between Malaysia and
Hong Kong.
TIME expects to fund the in-
vestment in AAE-1 with inter-
nally generated funds and bor-
rowings, if required.
Nokia Solutions Boosts Myanmar Presence
F
inland-based Nokia So-
lutions and Networks
(NSN) has opened two
new omces In Yungon, LIe duLu
networking and telecommu-
nications equipment company
said.
Through the move the com-
pany will be better equipped to
enable domestic operators to
provide network coverage to a
vast majority of users across the
country, NSN said.
With a permanent set-up to
execute its operations, NSN
said it will provide optimum
support to customers in My-
anmar and also support the
growth of the telecommunica-
tions industry here.
Myanmars communications
industry is evolving at a rapid
pace, and NSN remains com-
mitted to hasten this evolution
by providing its technology and
expertise to local operators,
said Raman Vattumalai, coun-
try head of Myanmar at NSN.
The decision to open modern
und IuIIy-equIpped omces In
Yangon underlines our promise
to deliver best-in-class services
Kyaw Min to our customers. This is in line
with our aim to help the govern-
menL IuIhI ILs pIedge Lo provIde
network coverage across 90
percent of Myanmar by 2015.
Ooredoo, one of the two for-
eign winners of coveted Myan-
mar telecoms licence, recently
selected NSN to supply its core
and radio infrastructure for its
3G network in Myanmar, mark-
ing NSNs entry in Myanmars
telecommunications landscape.
In April, Swedish communi-
cations technology and services
hrm ErIcsson unnounced LIuL IL
Ius bugged u hve-yeur conLrucL
for multivendor managed ser-
vices to support the other win-
ner Telenors nationwide roll-
out in the country.
NSNs twin facilities in Myan-
mar will provide employment
opportunities to local youth
and empower the people of the
counLry, LIe hrm suId.
NSN operates in over 120
countries and had net sales of
approximately 11.3 billion in
2013.
NSN, formerly Nokia Siemens
Networks, is a wholly owned
subsidiary of telecommunica-
tions giant Nokia Corp. It was
a joint venture between Nokia
and Siemens of Germany, but
in 2013, Nokia acquired 100
percent of the company, with a
buy-out of Siemens AG.
A view shows the headquarters of Nokia Solutions and Networks (NSN), formerly known as Nokia Siemens Networks, in
Espoo, Finland.
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Asia-Africa-Europe-1 (AAE-1)
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_., .:. ~ ._ . _e~ .~: ~_ ..:~
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and Networks (NSN) ._ q,~,
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~. ., .e . . ~: . . , ..:.. . ..:
.,_. ._e. ._~: .~ ._. NSN . ._.:
_~:.._.
_., .:. ~ .~ . e .q.. . , .
qq ._ _._ .~ . ~ . . . ~,~ . ~. .
_e.._ Ooredoo ._ ._~:....
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....._ 3G ~,q~~~~ .~.
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.~. . ~ .:.~:. .:~ . ...q,
.q..e.~_.._e NSN ~.,_e
_., .: .~ . e .q.. . , .. ~ .q:~
.:_._e.._.
Facebook Courts Journalists With Newswire Tool
F
acebook said last week
that it has created a news-
wire tool tailored to jour-
nuIIsLs, purL oI u brouder eorL
to be the go-to place for conver-
sation for its 1 billion users.
Called FB Newswire, it is de-
signed to help journalists share
and embed newsworthy Face-
book content that is made pub-
lic by its members such as pho-
tos, status updates and videos.
(www.facebook.com/FBNews-
wire)
Facebook is teaming up with
News Corps Storyful, the media
LooI LIuL verIhes und munuges
copyright of news and video
on social media platforms like
Twitter.
News Is hndIng u bIgger uu-
dience on Facebook than ever
before, and journalists and me-
dia organisations have become
an integral part of Facebook,
wrote Andy Mitchell, director of
news and global media partner-
ship at Facebook, in a blog post
announcing FB Newswire.
Social media platforms have
become a gold mine for journal-
ists. Facebook, Twitter, Goog-
les YouTube and others are
rich in source material, as many
people around the world use
them to communicate, includ-
ing during periods of upheaval.
Jennifer Saba
Acknowledging that many
journalists use Twitter to un-
cover material, Facebook is also
providing a Twitter feed, @FB-
Newswire.
We work closely with our
news partners and as we look at
the opportunities clearly Face-
book was being used as a place
to gather news, Mitchell said in
an interview with Reuters.
Facebooks newsfeed, where
people post stories, status up-
dates and photos, is an integral
part of the companys revenue
growth and it injects paid mar-
keting messages straight into
the news stream.
On Wednesday last week, Fa-
cebook reported a 72 percent
increase in revenue to $2.5 bil-
IIon durIng LIe hrsL quurLer be-
cause of a surge in advertising.
Reuters
Facebook ~.,_e .... ~.
. e -.~ . e ._.:. . .:.~:.
~.:~ ~. ...._ ~. ~ ~. .~. .
~_e. :,e...:.~~~ .~.
e, ~ ..q..,. ~. . ~:. e, ~ .. ._~: .
e.~.~~ ~.e:._.:_~:..
._.
FB Newswire e..'.._
~. .| .,. .: :,e .. .:. ~:.
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.: ~_..q, .~.~:._.._e.
._~:. .q._.
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SOCIAL SCENES
30
Pisanu Suvanajata, ambassador of Tailand, gives his speech at the press conference. Phyu Tit
Lwin Chris Herink, national director of World Vision, gives his speech. Phyu Tit Lwin
Speech froman executive. Phyu Tit Lwin Guests at the press conference. Phyu Tit Lwin
Pang Yee Yan, CEO of Surbana International Consultants, speaks at the press conference.
Phyu Tit Lwin
Guests at the press conference. Phyu Tit Lwin
Guests at the press conference. Phyu Tit Lwin
A Surbana of cial speaks. Phyu Tit Lwin
U Khin Maung Tein.Phyu Tit Lwin
Members of the public enjoy the frst day of the
Tingyan festival at the frst ever Coca-Cola Myan-
mar Summer Festival 2014 in Yangon, held at Myan-
mar Event Park.Coca-Cola Myanmar
People enjoying the fun activities and refreshing Coca-Cola on the frst day of the Tingyan
celebrations at the Coca-Cola Myanmar Summer Festival 2014 which was held at Myanmar
Event Park in Yangon. Coca-Cola Myanmar
Te Coca-Cola Happiness Journey kicked of in
Mandalay, between 26
th
& 69
th
Street. Coca-Cola
Myanmar
Revellers sharing happiness and enjoying music
performances, along with refreshing Coca-Cola
as part of the Coca-Cola Happiness Journey in
Mandalay. Coca-Cola Myanmar
Crowds of people enjoyed refreshing Coca-Cola
and fun activities at Myanmar Event Park as
part of the frst ever Coca-Cola Myanmar Sum-
mer Festival in Yangon. Coca-Cola Myanmar
Members of the public enjoying water activities,
adventure games, a foam party, an indoor air-
conditioned rest area, great food and refresh-
ing ice-cold Coca-Cola during the Coca-Cola
Summer Festival 2014 in Yangon. Coca-Cola
Myanmar
Te Coca-Cola Happiness Journey stopped at the
famous U Bein Bridge on the second day of the
Tingyan celebrations, bringing uplifing refresh-
ment and fun experiences to crowds of people.
Coca-Cola Myanmar
Performances by Jet San Tun and Me NMa Girls entertained crowds of people at UBein Bridge as part
of the Coca-Cola Myanmar Happiness Journey in Mandalay. Coca-Cola Myanmar
Performances by Jet San Tun and Me N Ma
Girls entertained crowds of people at U Bein
Bridge as part of the Coca-Cola Myanmar
Happiness Journey in Mandalay. Coca-Cola
Myanmar
Coca-Cola Myanmar brand ambassador Bobby
Soxer performed at the Coca-Cola Myanmar Sum-
mer Festival 2014 in Yangon.Coca-Cola Myanmar
Te Brrr-meter attracted many revelers looking to
win themselves Coca-Cola branded prizes during
the Coca-Cola Myanmar Summer Festival 2014
being held at Myanmar Event Park.Coca-Cola
Myanmar
Members of the public took a break from the Tingyan festival celebrations to refresh themselves with
Coca-Cola at Mandalay Hill. Coca-Cola Myanmar
Coca-Cola Myanmar brought refreshment to thousands of people celebrating the last day of the
Tingyan festival at the Coca-Cola Myanmar Summer Festival 2014 in Yangon. Coca-Cola My-
anmar
Te Coca-Cola Happiness Journey in Manda-
lay treated crowds to a full day of fun at 68th
Street (between 30
th
& 31
st
Street) on the last
day of the Tingyan festival. Coca-Cola My-
anmar
People in Mandalay got the chance to experience the
Coca-Cola Brrr-meter and win themselves Coca-
Cola branded prizes. Coca-Cola Myanmar
Te Coca-Cola Happiness Journey brought
happiness to crowds at Mandalay Hill, in front
of Moehti Taike Monastery, as part of the third
day of Tingyan celebrations. Coca-Cola My-
anmar
Coca-Cola Myanmar Summer Festival 2014 in Yangon & Mandalay
P&G celebrates donating 10 million litres of clean water
Surbana scholarship fund donation. Phyu Tit Lwin
A Surbana of cial gives a presentation. Phyu Tit Lwin
Delegates pose for a photo. Phyu Tit Lwin
Surbana Launching ceremony in Yangon
May 1-7, 2014
Myanmar Business Today
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CLASSIFIEDS
31
May 1-7, 2014
Myanmar Business Today
mmbiztoday.com
32
ENTERTAINMENT
Top Gear Rues Racist Remark in Myanmar Special
Wai Linn Kyaw
B
ritish television series
Top Gears producer has
apologised after broad-
casting a light-hearted joke
by the series presenter Jer-
emy Clarkson that sparked a
complaint of racism against the
BBC show.
The episode, which was
hImed In Myunmur und TIuI-
land and shown in March,
featured a scene where the
motoring shows stars built a
bridge over the River Kwai and
as an Asian man walked over it
Clarkson said: That is a proud
moment, but theres a slope on
it.
The use of the word which
is a derogatory term for peo-
ple of Asian descent led to
complaints and the threat of
legal action from Equal Jus-
LIce, u Iuw hrm specIuIIsIng
in discrimination cases, BBC
reported.
Acting on behalf of actress
SomI GuIu, LIe hrm uccused
Clarkson of clear gross mis-
conduct and said his com-
ments made the BBC appear
institutionally racist.
The BBC2 shows executive
producer, Andy Wilman, said:
When we used the word slope
in the recent Top Gear My-
anmar Special it was a light-
hearted word play joke refer-
encing both the build quality of
the bridge and the local Asian
man who was crossing it.
He said in a statement: We
were not aware at the time,
and it has subsequently been
brought to our attention, that
the word slope is considered
by some Lo be oensIve und
although it might not be widely
recognised in the UK, we ap-
preciate that it can be consid-
ered oensIve Lo some Iere
and overseas, for example in
Australia and the USA.
If we had known that at the
time we would not have broad-
cast the word in this context
und regreL uny oence cuused.
Clarkson is well known for
courting controversy in re-
cent years he has been cleared
of breaching the broadcasting
code by watchdog Ofcom after
comparing a Japanese car to
people with growths on their
faces.
He previously faced a storm
of protest from mental health
charities after he branded
people who throw themselves
under LruIns us seIhsI und
was forced to apologise for
telling BBC1s The One Show
that striking workers should be
shot.
The motoring show has also
faced complaints from Indian
and Mexican politicians over
remarks made about their
counLrIes wIIIe hImIng on
location. In 2011, the BBC
apologised for remarks on the
programme that characterised
Mexicans as lazy and feckless.
Comments likening the de-
sign of a camper van to people
wILI IucIuI dIshguremenLs LIe
following year, meanwhile,
were later found to be not
edILorIuIIy jusLIhed by LIe BBC
Trust.
Clarkson is an English broad-
caster, journalist and writer
who specialises in motoring.
He is best known for his role
on Top Gear, and also writes
weekly columns for The Sun-
day Times and The Sun.
Top Gear is about motor
vehicles, primarily cars, and
is the worlds most widely
watched factual television
programme. It began in 1977
as a conventional motoring
magazine programme. Over
Jeremy Clarkson, Richard Hammond and James Mays lorries in Yangon.
Picture Shows: Jeremy Clarkson, James May and Richard Hammond heading north through
Myanmar.
time, and especially since a
relaunch in 2002, it has devel-
oped a quirky, humorous and
sometimes controversial style.
The programme is currently
presented by Clarkson, Richard
Hammond and James May,
and has featured at least three
dIerenL LesL drIvers known
as The Stig. The programme is
estimated to have around 350
million views per week in 170
dIerenL counLrIes.
It has received acclaim for its
visual style and presentation,
and criticism for its content
and often politically incor-
rect commentary made by its
presenters. Columnist AA Gill,
close friend of Clarkson and
fellow Sunday Times column-
ist, described the programme
as a triumph of the craft of
programme making, of the
minute, obsessive, musical
masonry of editing, the French
polishing of colourwashing and
grading.
Yangon Dragons to Host
Hanoi Dragons on May 3
Kyaw Min
T
he Yangon Dragons, My-
anmars only rugby club,
wIII IosL ILs hrsL ever
home match on May 3 when
the team takes on the Hanoi
Dragons rugby team from
Vietnam.
After success in international
tournaments, at the Cebu
International 10s in November
and the Bangkok Touch Tour-
nament in December, the club
sent a mens and womens team
to the world-renowned Bang-
kok International 10s Tourna-
ment in February, where both
teams narrowly missed out on
silverware.
The home match, against a
strong Hanoi Dragons, side
is the latest step in the clubs
development to try and have
rugby established in Myanmar
and to build a national team in
time for the Southeast Asian
games, to be hosted in Singa-
pore in 2015.
The Hanoi match will take
place at the Pun Hlaing Golf
Estate on Saturday, May 3 at
4pm and entrance will be $5
per person. Food and drinks
will be available pitchside.
Matches are also being
organised against teams from
Thailand and Singapore in the
near future, the club said.
Phil Blackwood makes a tackle against Bangkok Samurais.
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