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Newsletter | March 2018

News | Inside GMBC | Upcoming | Events

Myanmar Newsletter

Dear reader,

Welcome to the March edition of our Myanmar Newsletter! 

We are again proud to provide you with a short overview on the major topics and headlines about Myanmar. Myanmar got a new President this month and significant changes to the tax law have been approved by the parliament.
Please see our report on the Goethe Institute project in Yangon and the insights into the German Myanmar Business Chamber (GMBC) activities.

If you wish to receive more frequent information, please like us on facebook or visit our website!

Yours truly,


Martin Klose,
Delegate of German Industry and Commerce in Myanmar

News

Political, economic and legal news

  • Myanmar has a new president
    In late March, the Myanmar parliament elected U Win Myint as new president of the country. He is a longtime loyalist to Aung San Suu Kyi and is expected to carry on his predecessor's practice of letting Suu Kyi be the nation's de facto leader. U Win Myint was sworn into office on 30th March.
    He succeeds U Htin Kyaw who resigned on 21th March 2018 to take a rest of his responsibilities, according to a statement by the government.
    Linkicon  More information
  • Union Tax Law approved without tax amnesty clause
    The Myanmar Parliament has approved the Union Tax Law for 2018 with several changes including a decrease of commercial tax for cars from 20% to 10%. Furthermore, taxation of alcohol and cigarettes will change.
    Initially, the new law included a tax amnesty clause, taxing undisclosed income of residents with 3% (from currently 15-20%). This clause has been omitted by the parliament.
    Linkicon  More information
  • New daily minimum wage may take effect in April
    The National Minimum Wage Council has sought approval of the president for the wage rate of 4,800 MMK (3.60 USD/2.70 EUR), which means an increase of 33% from the former 3,600 MMK rate.
    The new wage is likely to be enforced from April onwards. However, in 2015, when the first minimum wage was introduced, workers were on strike because employers cut allowance fees and other benefits, which shall now be forbidden.
    Linkicon  More information

Investment and business news

  • Yangon to upgrade disposal of toxic waste
    Yangon gets an incineration facility to properly dispose harmful waste originating from the city's hospitals. Currently, the partly toxic waste is burned in an open garbage collection area which is harmful to the environment and the people around.
    Linkicon  More information
  • Japan eyes Hantharwaddy airport construction project
    Japan may take over Myanmar's largest airport construction project from a consortium led by Singapore's Yongnam Holdings which won the 1.5 billion USD bid in 2014. The consortium and the Myanmar government could not reach an agreement, and therefore ended the negotiations. Now Japan, offering to finance large parts of the project by loans, and the Myanmar government have started negotiating. The planned Hantharwaddy Airport is located 80 kilometers northeast of Yangon, in Bago Region.
    Linkicon  More information
  • Goethe-Institut renovation to be completed soon
    German architecture firms OLIVER GERHARTZ / TSSB.architekten.ingenieure from Berlin are planning and supervising the refurbishment of the Goethe-Institut premises on Kabaraye Pagoda Road in Yangon. Renovations will be completed by May 2018, after GERHARTZ / TSSB and their partners have been restoring the old structures of the villa and building new facilities according to German standards (including earthquake-proof construction, fire protection) for one and a half years.
In June 2015, GERHARTZ / TSSB were awarded the German Federal Ministry for Foreign Affairs-funded renovation project after participating in a public tender in Germany. GERHARTZ / TSSB joined forces with Germany-based Berliner Dachbau (roofing) as well as with Myanmar companies The Tokyo Enterprise (construction) and NIKKI Group as well as Comin Asia (building services engineering).
GERHARTZ / TSSB also cooperated with the German Senior Expert Service (SES), a program that funds short term stays of German technical experts in e.g. Myanmar (SES is accessible via the Delegation of German Industry and Commerce in Myanmar).

The renovated facilities of Goethe-Institut Myanmar will include a historic villa that houses classrooms and administration as well as three new buildings for a library with an outdoor amphitheater and an indoor theater space, a cafeteria and a janitor apartment. GERHARTZ / TSSB are hoping to do more restoration projects in Myanmar and chief architect Oliver Gerhartz says he truly enjoyed the restoration work at Goethe-Institut and the mutually beneficial exchange of experiences with the Myanmar constructers: teaching German building standards and learning to build with limited and simple tools and materials.
KfW signed two agreements with Myanmar government
On 26th of February, KfW and the Ministry of Education signed a financing agreement for the Technical Vocational Education and Training Reform Program (TVET Reform Program), which includes the modernization and expansion of three TVET institutions.
The second agreement is called Rural development program IV and was signed on 27th of February.
With the two programs, KfW contributes around 20 Million EUR to Myanmar's development.
U Hand Zaw, Minister of Construction and the German ambassador, Dorothee Janetzke-Wenzel, attended the signing ceremony in Shan state.
Linkicon  More information

Since 2015, the German Myanmar Business Chamber (GMBC) is the official membership organization of German businesses in Myanmar. It provides a platform for exchange, dialogue and cooperation for Myanmar and German businesses bringing together corporate activities and strengthening the German business community in Myanmar. The GMBC organizes events on a regular base covering important policy issues as well as interesting business cases. Moreover, these events are made to extend and improve the network of its members. Visit the GMBC website for more information.
This section introduces new members and covers recent activities of GMBC members in Myanmar. If you are a GMBC member and are keen to see your company featured in this section, please contact GMBC.

GMBC member activities
  • Yoma Strategic to buy stake in Wave Money for 19.4 million USD. More information
  • As reported in our previous newsletter, Siemens will invest 2.1 billion USD in a 1,230 MW LNG power plant in Tanintharyi Region. This article gives an overview of recent power plant projects including the one of Siemens.
  • Events in March:
    • 14 March: Joint Chambers Networking Event, with the British Chamber of Commerce
    • 21 March: Understand the certification process of ISO 9001:2015, with TÜV Rheinland and the Thai Business Association of Myanmar
    • 28 March: Cybercrime - A new threat in Myanmar, with AMCHAM, CCI France, EuroCham and MIBA

General Information

Energy solutions
In preparation for the upcoming AHK business trip and the 2nd Myanmar-German Renewable Energies Symposium in September 2018, RENAC will host an information event in Berlin. The event on 17 May 2018 will brief interested German companies on photovoltaics and biomass energy in Myanmar with a focus on industrial projects.
More information on the event and registration
AHK job vacancy service
Starting this month, we are offering a new service for you. We will publish your job vacancies on our website, Facebook, LinkedIn and in our newsletter, helping you to find the right employee by reaching out to 2,000+ local and international experts. Advertisements can be booked on a monthly base. GMBC members get a discount. For further information, please check the full service description on our website and feel free to contact us.

AHK tender information service
This month, we have successfully launched a new tender information service. This special tender newsletter informs you in a timely manner about tenders opened by the government or international organizations in Myanmar - including information only available via hard copy and Myanmar language. This is particularly ideal for companies not yet represented on the ground but eager to set foot in Myanmar. Please find more information on our website or contact us by e-mail.


Key figures for Myanmar
 GDP growth (est. 2017) 6.4%, GDP: 72 billion USD
 Population (2017) 53 million
 Export goods (2016) 11 billion USD; China, Thailand, India
 Import goods (2016) 16 billion USD; China, Singapore, Thailand
 Export services (2015) 3.86 billion USD
 Import services (2015) 2.44 billion USD
 Current account balance,
 % of GDP (2016)1
 -5.8%
 Exports to Germany goods (2016)2 172.4 million USD; apparel, footwear
 Imports from Germany goods (2016)2 76.8 million USD; machinery, vehicles
 Inflation rate 6.9%
 Unemployment rate3 0.8% (2015, ILO), 4% (2014, Myanmar Census)
 Aggregate measure of labor underutilization 6.9% (2015, ILO)
 Central Bank interest rate
 10%
 Lending/deposit rate 13% lending, 8% deposit
 Exchange rate March (2018) 1 EUR ≈ 1,650 MMK

1
According to the IMF, the actual deficit may be significantly lower as exports are not always recorded.

2 Using mirror trade data gives significantly higher imports (155.8 million USD) and exports (358.8 million USD).
3 While the census asks 3 questions about the labor force, and only one specifically about unemployment, the ILO survey asks stepwise several questions about employment, which leads, eventually, to a much lower number of unemployed. There is no significant difference in the workforce.
Sources: Trade data: UN Comtrade and UNCTAD (FDI), Economic data: WB and IMF, CBM for interest rates

German-ASEAN Business Council
Project Calendar for the ASEAN region 2017/18   
(in German language)

Linkicon  Project Calendar ASEAN 2017/18

Upcoming Events

April 5, 2018 | Yangon, Myanmar
Pre-Thingyan Celebration at L'Opéra Restaurant by Inya Lake
April 18, 2018 | Berlin, Germany
3. Deutsch-Asiatischer Wirtschaftsdialog
April 25, 2018 | Hannover, Germany
ASEAN Forum at Hannover Messe
May 10, 2018 | Yangon, Myanmar
German Asparagus Dinner
May 17, 2018 | Berlin, Germany
Informationsveranstaltung zu Eigenversorgung mit Erneuerbaren Energien (Solar und Biomasse) für Industrie und Gewerbe in Myanmar

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AHK Myanmar
Martin Klose
Uniteam Building, 6 floor, 84 Pan Hlaing Street Sanchaung TS
11111 Yangon
Myanmar

+95 9 4506 293 64
martin.klose@myanmar.ahk.de