PwC MyanmarWeekly Business Intelligence

Issue 9616 February 2018

www.pwc.com/mm

PwC | February 2018

Disclaimer

PricewaterhouseCoopers Myanmar Co., Ltd helps organisations and individuals create the value they’re looking for. We’re a member of the PwCnetwork of firms in 158 countries with more than 236,000 people who are committed to delivering quality in assurance, advisory and tax services.Tell us what matters to you and find out more by visiting us at www.pwc.com/mm.

This content is for general information purposes only, and should not be used as a substitute for consultation with professional advisors.

© 2018 PricewaterhouseCoopers Myanmar Co., Ltd, a company duly established and operating under the laws of Myanmar. All rights reserved.PwC refers to the Myanmar member firm, and may sometimes refer to the PwC network. Each member firm is a separate legal entity. Please seewww.pwc.com/structure for further details.

The information contained in this publication is for general guidance on matters of interest only and is not meant to be comprehensive. Theapplication and impact of laws can vary widely based on the specific facts involved. Before taking any action, please ensure that you obtain advicespecific to your circumstances from your usual PricewaterhouseCoopers Myanmar Co., Ltd client service team or your other tax advisers.

2

PwC | February 2018

1. Weekly Key Financial & Business News

3

PwC | February 2018

Weekly Key Financial & Business NewsHeadlines

YCDC profits from farm production, leasing activities

Local banks struggle to meet CBM regulations amid slower economy

Minbu solar power plant construction begins

Govt to remove withholding taxes from April 1 to support businesses

4

Draft Municipal Law for Yangon Draws Fire from Lawmakers, Urban Planners

PwC | February 2018

Weekly Key Financial & Business NewsHeadlines

Kyaukphyu authorises ESIA but Rakhine committee demands strategic review

Thilawa’s complaint mechanism criticised as “a process on paper”

CBM to monitor inflation, kyat strength; looks for chance to adjust interest rates

Devil will be in the detail for Belt and Road courts

5

Myanmar power plans could spare the Salween

PwC | February 2018 6

Local banks struggle to meet CBM regulations amid slower economy

Local banks are finding it difficult to meet a set ofnew regulations set by the Central Bank ofMyanmar (CBM) in July 2017 to modernise thedomestic financial sector and better attractforeign direct investments at a time of slowergrowth.Under a new Financial Institutions Law, the CBMhas ordered banks to maintain higher capitaladequacy ratios, limit lending exposure to singleborrowers, reclassify loans and advances andrecover overdraft loans. Drafted with assistancefrom the International Monetary Fund, theregulations are in line with international Basel IIIstandards.“The regulations imposed by the CBM are meantto align the Myanmar financial sector with theinternational banking industry. They are verygood regulations and should be implemented,”said U Than Lwin, senior adviser at KanbawzaBank and former CBM vice governor.But banks have so far struggled to comply withthose requirements. “The CBM has given thebanks too little time to comply with theregulations given the current state of the domestic

economy. It is too difficult for them,” U ThanLwin added.Among the toughest of those regulations is onerequiring banks to convert all overdraft loans toterm loans within a deadline of six months. TheCBM has since relaxed that rule in November,allowing banks to recover the open-ended loansthat make up the bulk of their loan books, withina maximum of three years.Despite the move however, banks say manyborrowers are still unable to repay their loans dueto the slower economy. In Myanmar, borrowershave come to rely on overdraft facilities, or loanswhich were rolled over indefinitely by theirlenders, as long as interest payments on theprincipal were made. About 70 percent ofMyanmar’s $9 billion-odd lending pool is in theform of overdraft loans, according to Reuters.

Source: Myanmar Timeshttps://www.mmtimes.com/news/local-banks-struggle-meet-cbm-regulations-amid-slower-economy.html

NewspapersMyanmar Times

12 Feb 2018

PwC | February 2018 7

YCDC profits from farm production, leasing activities

Yangon Region draws profits every year from itsfarms and other means of production, YangonMayor U Maung Maung Soe said at a YangonRegional Parliament session last week. Since2001-02, Yangon residents have enjoyedaffordable access to rice, fish, eggs, poultry, meatand vegetables produced by farms operated by theYCDC. There are currently 12 such YCDC farms inYangon. Since farming operations started, theYCDC has cultivated over 4,000 acres of paddyand harvested over 1,000 acres of crops everyyear. It also operates 3,000 fish farms, whileprawn and shrimp farms occupy 250 acres of landaround Yangon. The YCDC also bred around90,000 hens, U Maung Maung Soe said. Theproduce is sold to Yangon residents at affordableprices.In 2006-2007, five years after the farms were upand running, the YCDC began leasing out its fishand prawns farms to private businesses togenerate more income. It then diversified intocement and brick production by opening two newplants.In 2013, the cement plant, which can produce up

to 500 tonnes of cement a day, was leased out tothe private sector.Meanwhile, the brick factory was transferred tothe Ministry of Industry. Since its opening in2009, the brick factory has produced around 15million bricks and now also supports the YCDC’sconstruction projects, U Maung Maung Soe said.According to YCDC documents, total capitalexpenditure for its farming and constructionprojects was around K90 billion for the ninemonths ended December 2017. So far, K68.5billion, or around 76 percent, of the YCDC’s capexrequirements have been met with internal fundsand supply from the farms and plants.The shortfall of K21.5 billion was adequatelycovered by income generated from the YCDC’sleasing and other investment activities, whichtotaled K33.3 billion as at December 2017. “So,the YCDC is in a net profit position for productionactivities,” said U Maung Maung Soe.

Source: Myanmar Timeshttps://www.mmtimes.com/news/ycdc-profits-farm-production-leasing-activities.html

NewspapersMyanmar Times

12 Feb 2018

PwC | February 2018 8

Minbu solar power plant construction begins

The Ministry of Electric Power and Energy hasbegun constructing the 170MW Minbu solarpower plant in Magway Region. Upon completion,it will generate 350 Million Kilowatt Hours yearlyand supply power to 210,000 households, asource at the Ministry of Electric Power andEnergy said.GEO (Myanmar) Co Ltd is now implementing the170MW Minbu solar power plant on a basis of abuild-operate-transfer (BOT) system. The projectwill be built in four stages, with 40MW installedin each of the first three stages.The Ministry of Electric Power and Energy andGEO have already signed an agreement on powerpurchase. The 170MW Minbu solar power plant isthe first-ever project in Myanmar, Win Khaing,Minister for Electric Power and Energy, said.Monechaung, Kyeeohnkyeewa and Myitthahydropower plants and Khunchaung natural gas-fired power plant and Marn natural gas-firedpower plant have been built in Magway Region.Upon completion, the projects will generate 350Million Kilowatt Hours yearly and supply powerto 210,000 households in Magway Region.

Surplus power will be sent to the national powergrid. The surplus power will be distributed to theplaces of other regions that have difficult access topower. These projects run by the BOT will beimplemented through foreign investment.Power demand increases by 15 per cent yearly.The ministry expects that there will be 4,531MWin power consumption in the 2020-2021 fiscalyear. Now, the ministry is generating up to3,189MW and still needs a further 1342MW tomeet the requirement.

Source: Consult Myanmarhttps://consult-myanmar.com/2018/02/13/minbu-solar-power-plant-construction-begins/

NewspapersConsult Myanmar

13 Feb 2018

PwC | February 2018 9

Govt to remove withholding taxes from April 1 to support businesses

The Inland Revenue Department (IRD) isplanning to stop levying withholding tax startingApril 1 onwards in a bid to boost the economy, itrevealed during a weekend discussion.The discussions, which took place with theYangon Regional Government, Union ofMyanmar Federation of Chambers of Commerceand Industry and other business associations,were held in conjunction with preparations fornew regulations under the 2018 Union Tax Law.The IRD issues new tax regulations every fiscalyear, effective April 1.Among the changes for the new fiscal year will bethe removal of withholding tax. The decisionfollows the IRD’s move last month to cancel a 2percent withholding tax on exports, which camein response to feedback from a December 2017discussion, during which businesses called for thetax to be withdrawn. The move was in line withthe Ministry of Planning and Finance’s strategy topromote exports.Starting April 1, 2018, all forms of withholdingtaxes will be removed. For residents, a 2pcwithholding tax is currently levied on goods,

services and leases procured, while a 10pcwithholding tax is levied on royalties paid.Residents are not taxed on interests paid.Meanwhile, non-residents pay a 2.5pcwithholding tax on goods, services and leasesprocured and a 15pc withholding tax on bothinterest and royalties paid.Local businesses have complained thatwithholding taxes are an unnecessary burden oncash flows and profits. The businessmen alsoasked for lower commercial tax rates on localfactories involved in manufacturing goods forexports and import substitution.At the meeting, Yangon Region Chief Minister UPhyo Min Thein reminded businesses to beresponsible tax payers as the government worksto improve the business environment by makingthe tax rates more attractive.

Source: Myanmar Timeshttps://www.mmtimes.com/news/govt-remove-withholding-taxes-april-1-support-businesses.html

NewspapersMyanmar Times

13 Feb 2018

PwC | February 2018 10

Draft Municipal Law for Yangon Draws Fire from Lawmakers, Urban Planners

YANGON — Members of the Yangon RegionParliament condemned a new draft law forproposing to allow the Yangon City DevelopmentCommittee (YCDC), the municipality’s governingbody, to run business enterprises with taxrevenue from the city’s 5 million-plus residents.The new draft of the Yangon City DevelopmentCommittee Law was prepared at the request ofState Counselor Daw Aung San Suu Kyi in late2016. It is intended to replace the existing 1922City of Rangoon Municipal Act and the 2013Yangon City Development Committee Lawbecause they need to be reformed, according tothe state counselor.The new draft was submitted to Parliament onFeb. 2 by Mayor U Maung Maung Soe on behalf ofthe Yangon Region government. It has attractedcriticism from architects and urban planners whosay it has weak provisions for urban planningmanagement and that measures to preventconflicts of interest involving YCDC memberswere nonexistent.According to Article 23 of the draft, the YCDC isauthorized to form business enterprises in various

industries including construction, recreation andservices.“It doesn’t make sense,” said Daw Kyi Pya, anNLD lawmaker. “The YCDC is supposed toprovide municipal-related services to the people,not make money.”Fellow NLD lawmaker U Kyaw Zay Ya said he wasagainst the formation of business enterprises forYangon and would encourage Parliament to strikethe article from the draft.“All they have to do is levy the taxes they aresupposed to and give services to the people,” hesaid. Technically the YCDC is an independentbody led by the mayor, who reports to the YangonRegion chief minister. It raises its own revenuesfrom taxes and fees on everyone from propertydevelopers to public toilet operators and roadsidevendors while wielding responsibility for cityplanning, land administration, municipal services,development and more.Source: The Irrawaddyhttps://www.irrawaddy.com/news/draft-municipal-law-yangon-draws-fire-lawmakers-urban-planners.html

NewspapersThe Irrawaddy

14 Feb 2018

PwC | February 2018 11

Thilawa’s complaint mechanism criticised as “a process on paper”

The SEZ responded that the new process hasinvolved consultations with more than 300stakeholders.An international non-governmental organisationhas accused a recently launched complaintprocess in Thilawa of violating human rightsnorms, whereas developers have insisted themechanism is a culmination of consultations withmore than 300 stakeholders and that they “standby” its quality.Companies in Thilawa Special Economic Zone(SEZ) have “failed their obligations underinternational business and human rights norms”in the new Thilawa Complaints ManagementProcedure (TCMP), the US-headquarteredEarthRights International (ERI) said in astatement on February 7.Thilawa community members have sent the SEZdevelopers a formal letter requesting anegotiation to improve the grievance mechanism,arguing that the affected communities have spentthree years to develop a mechanism to addressrights abuses.Katherine McDonnell, the ERI’s legal advocacy

coordinator, said that “the TCMP was rushedthrough without proper due diligence.”“As a result, it fails to address the community’sconcerns about the impacts of the SEZ, and lacksbasic criteria such as accessibility, predictability,and legitimacy. A process on paper is not thesame as a functioning mechanism,” she added.New mechanism for complaintsDesigned to receive, investigate and resolveaffected communities’ concerns regarding SEZactivities, the TCMP will be run by Thilawa SEZManagement Committee (TSMC) and MyanmarJapan Thilawa Development Limited (MJTD).The ERI argued that, in publishing the TCMP, thedevelopers rejected three years of requests fromThilawa community members to collaborate on aCommunity-Driven Operational GrievanceMechanism (CD-OGM) to address the impacts.

Source: Myanmar Timeshttps://www.mmtimes.com/news/thilawas-complaint-mechanism-criticised-process-paper.html

NewspapersMyanmar Times

14 Feb 2018

PwC | February 2018 12

Kyaukphyu authorises ESIA but Rakhine committee demands strategic review

A Strategic Environmental Assessment prior toESIA is “a tangible step the NLD can take to avoidanother Myitsone scenario”, the ICJ said.THE committee charged with implementing therecommendations of the Advisory Commission onRakhine State announced that the KyaukphyuSEZ Management Committee (KSMC) willconduct a Strategic Environmental Assessment(SEA) prior to Environmental and Social ImpactAssessments (ESIA), but the SEZ developerdenied this and has recently been authorised to goahead with the ESIA.The Committee for Implementation of theRecommendations on Rakhine State (Rakhinecommittee), jointly chaired by the social welfare,relief and resettlement minister and Rakhine'schief minister, issued the “Report to the Peopleon the Progress of Implementation of theRecommendations on Rakhine State”. Publishedon a state-owned newspaper on February 13, thecommittee has taken forward the commission’ssuggestion to carry out an SEA for the KyaukphyuSEZ project. “Previous experience has shown thatlarge-scale projects, including SEZs, can have

negative consequences on the environment, othereconomic sectors and local people; therefore, theEnvironmental Conservation Department and theKSMC have been discussing and coordinating toconduct the Strategic Environmental Assessmentin a comprehensive approach,” the report stated.An SEA would likely take one to two years andmeans another procedure has to be done prior tothe ESIA. With this announcement, thegovernment is signalling that they are movingforward with the recommendations which werefirst made in March last year and repeated inSeptember. The Advisory Commission, headed byformer UN Secretary-General Kofi Annan,reiterated the SEA recommendation in its finalreport in September 2017, arguing that large-scale projects in Rakhine have bred localresentment towards Nay Pyi Taw and stressingthat local communities should have a greater sayin the state’s development.Source: Myanmar Timeshttps://www.mmtimes.com/news/kyaukphyu-authorises-esia-rakhine-committee-demands-strategic-review.html

NewspapersMyanmar Times

15 Feb 2018

PwC | February 2018 13

CBM to monitor inflation, kyat strength; looks for chance to adjust interest rates

U Soe Thein, vice chair of the Central Bank ofMyanmar (CBM), is aware of the struggles thecountry’s small and medium enterprises (SMEs)face when raising cash for new ventures orexpansion. Stringent collateral requirementseliminate the majority of borrowers, while thosewho remain are deterred by lending rates as highas 13 percent.Things have gotten tougher in recent months,with growth slowing and foreign directinvestments (FDI) down for the secondconsecutive year. “In an economy that is slowingwe can understand that interest rates should belower,” U Soe Thein said.“In fact, we are actively working on many ideasincluding a new structure for interest rates andcategorising collateral to make it easier forcompanies to borrow and do business (seeaccompanying story). But before all this can takeplace, inflation has to be stable,” he said.Inflation in Myanmar is currently around 4.5pc,according to the CBM. That is down from 6.8pc in2016 and 10pc in 2015. In comparison, theminimum bank deposit rate in the country is 8pc,

while the maximum bank lending rate is 13pc. TheCentral Bank rate is 10pc.To boost the economy, members of Parliamenthave recently called for deposit and lending ratesto be brought down to as low as 7pc and 11pc,respectively.The CBM will monitor the economy over the next6-8 months and consider adjusting interest ratesonly if inflation remains stable at its current levelbelow 5pc. “In Myanmar, inflation has a history ofbeing high. So, deposit rates must be higher thaninflation to attract savings. This is our mainconcern,” said U Soe Thein.While inflation is currently well below theminimum deposit rate of 8pc, the CBM runs therisk of moving too soon if it acquiesces todemands for lower rates now. “Our concern iswhether inflation will remain below 5pc for thelong term or spike in the short term,” U Soe Theinsaid.Source: Myanmar Timeshttps://www.mmtimes.com/news/cbm-monitor-inflation-kyat-strength-looks-chance-adjust-interest-rates.html

NewspapersMyanmar Times

15 Feb 2018

PwC | February 2018 14

Devil will be in the detail for Belt and Road courts

THE new Belt and Road courts could complementexisting common law-based arbitrationinstitutions and widen the choices for projectparties, but the devil could be in the detail, suchas the structure, composition of judges andgoverning rules, experts have warned.In early February, the Chinese embassy in Yangonconfirmed that Beijing will set up a Belt and Roaddispute settlement mechanism involving newcourts, while news media reported that threeinternational commercial courts will be set up byChina’s Supreme People’s Court in Xi’an,Shenzhen and Beijing.In Myanmar, the proposed Kyaukphyu SpecialEconomic Zone (SEZ) in Rakhine State is amongthe foremost mega projects in the Belt and RoadInitiative. The proposed SEZ has hugeimplications on Rakhine’s development,Myanmar’s trade economy, foreign investments,infrastructure as well as human rights. U KyawHtin from CITIC Myanmar told The MyanmarTimes on February 2 that they were only madeaware of the development through news reportsabout the BRI courts, adding that since the

parties involved are still in negotiations, thedispute settlement mechanism is not finalised.Beijing’s decision to create a new mechanismcame under fire earlier, with an academiclambasting such arrangements as “essentiallytools for corporations to restrict access to justice”.But there are lawyers in Myanmar who defendedand supported the proposal.Bodenheimer Herzberg, an internationalarbitration specialist in Europe, confirmed thatwhen it comes to viability of the alleged plans,several well-established arbitration centres existin the region, the ones in Singapore and HongKong being the most prominent. There are alsoalternatives such as Kuala Lumpur RegionalCentre for Arbitration (KLRCA) in Malaysia oreven existing institutions in mainland China, suchas the China International Economic and TradeArbitration Commission (CIETAC).

Source: Myanmar Timeshttps://www.mmtimes.com/news/devil-will-be-detail-belt-and-road-courts.html

NewspapersMyanmar Times

16 Feb 2018

PwC | February 2018 15

Myanmar power plans could spare the Salween

Myanmar and Thailand have announced plans formajor gas power projects, as well as greatermoves to adopt renewable energy sources. Thenews will cheer conservationists battling toprevent large dams being built on major rivers inthe north of Myanmar.Myanmar’s Aung San Suu Kyi-led governmentaims to tackle the country’s chronic powershortage by building four gas-fired power plantsover the next three years.Officials from the Ministry of Electricity andEnergy said the plants, to be located in westernRakhine state and the commercial hub of Yangon,would double the country’s generation capacity,currently at around 3,000 megawatts. They putthe total cost of the plants at US$5.2 billion,Reuters reported.There are also plans to set up ‘mini-grids‘ in ruralareas not yet linked to the national power grid.Last year, the French utility EDF signed anagreement with Magway’s regional government tosupply electricity via a mini-grid to 8,000households. Meanwhile, Thailand’s national oiland gas giant PTT has said it will develop energy

and gas businesses with state-owned ElectricityGenerating Authority of Thailand (EGAT). Initialprojects will include a liquefied natural gas-receiving terminal and a floating storage re-gasification unit in the Malaysia-Thailand JointDevelopment Area. The two utilities are alsolooking towards power plant development inMyanmar. At first blush, this appears to be goodnews for conservationists and citizens inMyanmar’s eastern Shan state, many of whomhave campaigned for years to prevent large-scaledams from being built on the Salween River.The International Finance Corporation seeks toencourage private-sector development indeveloping countries, has been conducting areview of Myanmar’s eight major river basins andhydropower projects proposed on the country’smajor rivers and tributaries since late 2016.

Source: Consult Myanmarhttps://consult-myanmar.com/2018/02/16/myanmar-power-plans-could-spare-the-salween/

NewspapersConsult Myanmar

16 Feb 2018

PwC | February 2018

2. Weekly Investment News

16

PwC | February 2018

Weekly Key Investment NewsHeadlines

Foreign investments to be invited for the upgrade of jetties

Japan’s Yamato Group, South Korea’s HUBS MK eye Myanmar’s logistics market

U.S. Based Pharmaceutical Manufacturer Eyes Naypyidaw Industrial Zone

17

Myanmar Received $5 Bn in Foreign Investment in Current Fiscal Year

SG’s Oxley-led consortium bags $2.5b Yangon Central Railway upgrade project

PwC | February 2018 18

Foreign investments to be invited for the upgrade of jetties

Foreign investments will be sought to upgradejetties along the coast into international-standardports as additional capacity is needed tosupplement the Yangon port, which now handles90 per cent of sea-based goods transport.“Jetties along the coast are mainly used forhandling domestic cargo. They will becomeinternational ports when there is an inflow ofadditional investments,” said Dr Myo Nyein Aye,deputy general manager of the Ministry ofTransport and Telecommunications. He wasspeaking on February 8 at the Myanmar-KoreaInvestment Promotion Seminar at Lotte Hotel inYangon.Coastal jetties in Sittwe, Kyaukphu, Thandwe,Pathein, Mawlamyine, Dawei, Myeik andKawthoung now work with domestic cargo.The ministry will invite foreign investors to turnthe jetties into international-standard ports, saidMyo Nyein Aye.A total of 36 ships can moor simultaneously atYangon port. The ministry is in discussions withChina to upgrade Kyaukphyu jetty tointernational standards. In addition, the

discussions are underway with Japan andThailand to upgrade Dawei jetty in Tanintharyiregion to a high standard.Since 1996, the government has allowedentrepreneurs to invest in the jetty projects. Theinvestment ratio between the government andprivate sector is 93.6 per cent to 6.4 per cent.

Source: Eleven Myanmarhttp://www.elevenmyanmar.com/business/13394

NewspapersEleven Myanmar

11 Feb 2018

PwC | February 2018 19

Japan’s Yamato Group, South Korea’s HUBS MK eye Myanmar’s logistics market

Japan’s Yamato Group and local firm AyeInternational Group have committed $500,000 incapital to launch a logistics joint venture inMyanmar in 2018, Yamato Holdings announcedearlier. Singapore-headquartered Yamato AsiaPte Ltd, a subsidiary of Yamato Holdings, willhold an 80 per cent stake in the new JV, YamatoGlobal Logistics Myanmar Co, that was formed inlate 2017. The JV will offer services such as freightforwarding by land, sea and air, overseas homerelocation and warehousing.“With its geographical advantage, Myanmar hasbecome an important part of supply chain withThailand which is deemed as industrial hub inASEAN. Besides the geographical advantage,improvement of infrastructure at TirawaIndustrial Park at Myanmar helped to draw innumerous foreign investments (includingJapanese companies) to set up JVs,” Yamato saidin its announcement. Aye International Group,led by Than Tun Aye, is engaged in providinglogistics services, trading, staffing services andmanufacturing.South Korea’s HUBS MK Co Ltd and the

Myanmar Trade Promotion Organization havesigned a memorandum of understanding (MoU)to proceed with a $98-million logistics facility inShwe Linban Industrial Zone in Yangon,according to the Ministry of Commerce. Theplanned hub will offer container terminalfacilities, warehouses, quality preservationfacilities like cold storages for goods goingthrough air or shipment overseas. U Aung Soe,director general of Myanmar Trade PromotionOrganization told DEALSTREETASIA that thelogistics hub will be equipped with technology tooffer better services. Feasibly study for the projectwill be done soon and if all goes well, the projectcan take off in a year. Others who have alreadyforayed into the logistics space include Japans’Ryobi Holdings, Singapore’s Yusen Logistics,Japan’s Konoike Myanmar and FujitransLogistics.

Source: Deal Street Asiahttps://www.dealstreetasia.com/stories/myanmar-japan-yamato-south-korea-hubs-mk-logistics-92357/

NewspapersDeal Street Asia

12 Feb 2018

PwC | February 2018 20

U.S. Based Pharmaceutical Manufacturer Eyes Naypyidaw Industrial Zone

U.S. based joint venture pharmaceuticalmanufacturer is looking to invest in a pharmacyfactory in Dekkhina Thiri industrial zone,Naypyidaw, according to the Directorate ofIndustrial Supervision and Inspection(Naypyidaw Country).“They will be producing American standardserum, we haven’t yet approved the proposals forpharmaceutical factories including the one forproducing serum. We are examining theproposals and we are working to announce theprice of land with complete infrastructure,” UHein Zaw, Director of Directorate of IndustrialSupervision and Inspection, said.He did not further elaborate that such as name ofmanufacturers or details of the proposal.The government started inviting investment intoDekkhina Thiri Industrial Zone in 2016 and thisU.S based pharmaceutical manufacturer’sproposal is the largest received as its proposedarea is 20 acres. Nine local and internationalcompanies have also submitted investmentproposals to build factories in the industrial zone.Since the proposed projects only need 50 acres,

there will be another 50 remaining for otherinvestors since the industrial zone is 100 acres intotal. The estimated price of land with completeinfrastructure is over K80 million per acre, theauthorities are planning to announce the exactprice soon.

Source: Myanmar Business Todayhttps://www.mmbiztoday.com/articles/us-based-pharmaceutical-manufacturer-eyes-naypyidaw-industrial-zone

NewspapersMyanmar Business Today

12 Feb 2018

PwC | February 2018 21

Myanmar Received $5 Bn in Foreign Investment in Current Fiscal Year

YANGON — Myanmar has received more thanUS$5.1 billion in foreign investment in thecurrent 2017-18 fiscal year from April to the firstweek of February, according to the Directorate ofInvestment and Company Administration (DICA).“We have received more than $4.4 billion inforeign investment as of the first week ofFebruary, while existing foreign businesses haveincreased their investment by nearly $700million,” said U Than Aung Kyaw, deputy directorgeneral of DICA.“They have increased investment perhaps becausethey are doing good business. According tointernational norms, businesses usually add up tonearly 60 percent of their existing investment.But in our country, $700 million is only between10 to 15 percent,” he added.The investment goes to manufacturing,transportation and communications, agriculture,livestock and fisheries, animal feed, electricity, oiland gas, property development, hotels andtourism and the service industry, according toDICA.There is so far no sign of existing foreign investors

pulling their businesses out of the country, said UThan Aung Kyaw.German consultancy Roland Berger and theUnion of Myanmar Federation of Chambers ofCommerce and Industry jointly released a surveyreport in December, stating that businessconfidence among entrepreneurs in Myanmardropped drastically in 2017.In evaluating and approving investmentproposals, DICA takes factors into considerationsuch as economic viability, job creation, amountof payable tax, technology transfer, domesticconsumption, environmental management plans,and accountability and responsibility.Foreign investors are also negotiating withconcerned ministries to implement megaprojectslike power supply and the Hanthawaddy Airport,said secretary of the Myanmar InvestmentCommission (MIC) U Aung Naing Oo.

Source: The Irrawaddyhttps://www.irrawaddy.com/news/myanmar-received-5-bn-foreign-investment-current-fiscal-year.html

NewspapersThe Irrawaddy

14 Feb 2018

PwC | February 2018 22

SG’s Oxley-led consortium bags $2.5b Yangon Central Railway upgrade project

A consortium comprising Singapore-listed OxleyHoldings, local firm Min Dhama Co Ltd andBeijing-based Sino Great Wall Co Ltd has beenchosen by Myanmar Railways to develop theYangon Central Railway Station area, estimated tocost about $2.5 billion. The railway station, builtin the 1870s during the British rule, will berefurbished into a modern transport hub. In afiling to the Singapore exchange this week, Oxleyannounced it was chosen as the preferred bidderfor the project covering an area of 25.7 hectares or63.5 acres. The development gross floor area willcover about 1.1 million square metres. “Theproject will be a mixed development projectcomprising a new central transportation hub thatintegrates rail and mass transit, surrounded byamenities of housing and commerce,” thecompany said in its filing. Sino Great Wall Co,previously known as Shenzhen Victor OnwardTextile Industrial Co Ltd, is engaged inconstruction, engineering and the health sector.Min Dhama is an arm of Mottama Holdingsowned by Myanmar-Chinese entrepreneur UYang Ho. The tender process took nearly four

years to complete and the final selection todevelop the project went through two rounds dueto lack of qualified applicants. The second tendercalled in 2015 saw 18 proposals from 14 countriesout of which 15 companies were shortlisted. TheOxley-Min Dhama-Sino Great Wall consortiumbeat another finalist, YSX-listed First MyanmarInvestment, a company owned by Serge Pun.Oxley Holdings, chaired by Ching Chiat Kwong,has been engaged in property development inMyanmar. One of its properties is “MinResidences”, a $250-million value mixeddevelopment which includes fitness andrecreational facilities, in which it holds a 50 percent stake.

Source: Deal Street Asiahttps://www.dealstreetasia.com/stories/oxley-holdings-handle-2-5b-yangon-central-railway-area-upgrade-92626/

NewspapersDeal Street Asia

16 Feb 2018

PwC | February 2018

3. Weekly New Tenders

23

PwC | February 2018

Tenders (Myanmar Government)List

Note: tenders information are collected from http://www.mmtimes.com/, https://tender.yangon.gove.mm, http://consult-myanmar.com/, and http://www.myanmar-opportunities.org/mm/tenders http://www.buildersguide.com.mm/en/ .

24

No applicable Tenders announced for the week ending 16 February 2018

PwC | February 2018

Tenders (Multilateral organizations) List

Note: tenders information are collected from https://wbgeconsult2.worldbank.org, www.devex.com, www.adb.org, https://www.ungm.org

25

ADB: TA-8915 MYA: Preparing Youth for the Workplace Sector Development Program -Specialist on Secondary Education Reforms (48431-002), Closing Date: 17 Feb 2018 (Individual)

WB: Communications Consultant - Yangon Expressway PPP, Closing Date: 22 Feb 2018 (Firm)

PwC | February 2018

4. MIC Permitted Projects

26

PwC | February 2018

MIC Permitted Projects (Meeting 2, 2018)

27

No. Name of Company Type of Investment Form of Investment

1 CJ Feed Myanmar Co., LtdProduction of hatchery and sale of day old chicken

Wholly Foreign Owned

2 Saturn and Fortune Co., Ltd (Korea)Manufacturing and marketing of bathroom products and accessories

Joint Venture

3 Da Hua (Myanmar) Co., Ltd (Hong Kong)Manufacturing of polyester staple fibre on CMP basis

Joint Venture

4 NTL Construction Co., Ltd Hotel and service apartment Myanmar Investment

5 Dream vision Co., Ltd Media content production and distribution Joint Venture

6 Forever Thanlwin Co. Ltd Development and operate offshore supply base Myanmar Investment

Source: DICA

PwC | February 2018

MIC Permitted Projects (Meeting 2, 2018) (cont’d)

28

No. Name of Company Type of Investment Form of Investment

7 JMOL Co., LtdConstruction and operation of integrated logistics and offshore supply base

Joint Venture Investment

8 Shwe Myint Mo Tun Stone Manufacturing Co., Ltd Production and distribution of crushed stones Myanmar Investment

Source: DICA

PwC | February 2018

5. Upcoming Events

29

PwC | February 2018

Upcoming Events (February 2018) List

Date Location Name of Event Sector Price Focus Points

22-23 Feb 2018 Yangon

International Conference on Computer Applications 2018

Technology

200 USD for Foreigner and 75,000 MMK for Local

Organized by University of Computer Studies, Yangon under Ministry of Education, Myanmar, provides a forum for the presentation of technological advances and current research results in the fields of theoretical, experimental and applied computing and technologies.

30

Note: Events information are collected from https://www.go-myanmar.com/events-and-conferences and https://10times.com/myanmar .

PwC | February 2018

Upcoming Events (March 2018) List

Date Location Name of Event Sector Price Focus Points

17-19 March2018

Yangon Housing and Building Real Estate Free

This event will be held with an intention to display all kinds of housing things like interior decoration items, a great array of oil and water paints, useful kitchen utilities, chic bathroom equipment, various tiles of many production countries, modern designed door slabs, ultra modern designed furniture, ceiling tiles and many more.

20-22 March2018

YangonMyanmar Infrastructure Summit

Infrastructure

USD1,300 for 3 & aboveUSD 1,550 for 1-2

The conference will provide a platform for potential foreign investors, infrastructure developers, technology providers and infrastructure funders to be updated on the development plans and policies of investing in Myanmar’s urban and rural infrastructure, to assess market opportunities and at the same time build potential business and investment networks with the local policymakers and industry players.

31

Note: Events information are collected from https://www.go-myanmar.com/events-and-conferences and https://10times.com/myanmar .

PwC | February 2018

Upcoming Events (April 2018) List

Date Location Name of Event Sector Price Focus Points

05-07 April 2018 Yangon

Myanmar Agriculture Food & Beverage Trade Show

Agriculture andF&B

Free

The event will showcase the latest in Myanmar Agriculture, Food Processing, Beverage, Procurement and Allied Sectors produce, manufacture and practice in Myanmar and abroad, making it a significant platform for business partnerships worldwide.

06-08 April 2018 YangonMyanmar Franchise Conference

Franchise

US$298 per sqm for Bare space only

The conference will feature more than 200 exhibitors from international names including country pavilions from USA, Singapore, Thailand, Japan, Korea, Taiwan, Philippines, Malaysia, and homegrown brands in Myanmar.

32

Note: Events information are collected from https://www.go-myanmar.com/events-and-conferences and https://10times.com/myanmar .

© 2018 PricewaterhouseCoopers Myanmar Co Ltd. All rights reserved. In this

document, “PwC” refers to PricewaterhouseCoopers Myanmar Co Ltd, which is

part of the network of member firms of PricewaterhouseCoopers International

Limited, each of which is a separate and independent legal entity.

www.pwc.com/mm

PwC Myanmar Business Intelligence Publication

For further information please contact:

Jovi SeetSenior Executive Directorjovi.seet@sg.pwc.com

Brandon LyeDirectorbrandon.lye@sg.pwc.com

33