Yan­gon cov­ets re­gional trade hub sta­tus

For Yan­gon to achieve re­gional trade hub sta­tus, it will need funds to im­prove in­fras­truc­ture and de­velop in­dus­trial zones, says re­gional Chief Min­is­ter U Phyo Min Thein.

The Myanmar Times - - Front Page - KANG WAN CHERN chern@mm­times.com

PLANS are un­der­way for Yan­gon, Myan­mar’s largest city, to be de­vel­oped into a re­gional eco­nomic and trad­ing hub, Yan­gon Re­gion Chief Min­is­ter U Phyo Min Thein told rep­re­sen­ta­tives from the Ox­ford Busi­ness Group (OBG) on Oc­to­ber 9.

There are op­por­tu­ni­ties for Yan­gon to be­come a gate­way hub for its land­locked neigh­bours by en­abling them to gain ac­cess to in­ter­na­tional mar­kets through the Port of Yan­gon, for ex­am­ple. The city can also lever­age on its sta­tus as the coun­try’s com­mer­cial and trad­ing hub to draw busi­ness ac­tiv­ity and growth.

To achieve this, the city will need to in­vest in im­prov­ing its cur­rent trans­porta­tion in­fras­truc­ture, U Phyo Min Thein told OBG. The re­search firm met with the chief min­is­ter as part of its work on a fifth in-depth re­port on the Myan­mar econ­omy.

Yan­gon’s in­fras­truc­ture has not kept up with its grow­ing pop­u­la­tion, and this is now putting pres­sure on the city’s man­age­ment and pub­lic ser­vice providers, said U Phyo Min Thein. Traffic con­ges­tion is a ma­jor prob­lem as a re­sult of poor road con­nec­tiv­ity and con­di­tions, for ex­am­ple.

So far, the Yan­gon gov­ern­ment has al­ready launched a cen­tralised city bus and wa­ter taxi net­work to pro­vide com­muters with an af­ford­able means of trans­port, while work on up­grad­ing its Cir­cu­lar Train Sys­tem is ex­pected to start soon.

In­dus­trial op­por­tu­nity Yan­gon can also raise its at­trac­tive­ness as an in­dus­trial and man­u­fac­tur­ing hub by ex­pand­ing ex­ist­ing pro­duc­tion and stor­age ca­pac­i­ties, U Phyo Min Thein said.

In fact, the Yan­gon gov­ern­ment is plan­ning to cre­ate twelve new in­dus­trial zones in the re­gion to boost man­u­fac­tur­ing and at­tract in­vest­ments, he said at the Union of Myan­mar Fed­er­a­tion and Cham­ber of Com­merce and In­dus­try meet­ing last week.

There are cur­rently al­ready 29 in­dus­trial zones in the Yan­gon. How­ever, they are lo­cated within the mu­nic­i­pal re­gion. As such, the new zones will be de­vel­oped in the out­skirts of Yan­gon to cre­ate more job op­por­tu­ni­ties in those ar­eas.

To fa­cil­i­tate the an­tic­i­pated chal­lenges in de­vel­op­ing the zones, pri­vate busi­nesses were ad­vised to work close with the Yan­gon City De­vel­op­ment Com­mit­tee as well as the Min­istry of In­dus­try and the Min­istry of Con­struc­tion to over­come is­sues like squat­ter re­set­tle­ments, sewer sys­tems and road con­nec­tiv­ity.

Mean­while, Yan­gon busi­nesses also pressed the gov­ern­ment to pri­ori­tise lo­cal man­u­fac­tur­ers and ser­vice providers over for­eign busi­nesses dur­ing its ten­der process.

Ris­ing in­vest­ments The gov­ern­ment’s fo­cus on pro­mot­ing Yan­gon as a re­gional trad­ing hub comes amid an uptick in for­eign di­rect in­vest­ments (FDI) and in­ter­est so far this year. In the first half of the 2017-18 Fis­cal Year, which is be­tween April and Septem­ber, ap­proved FDI in Myan­mar hit $4.3 bil­lion, which is up three times from the same pe­riod the year be­fore, when FDI to­taled just $1.3 bil­lion, ac­cord­ing to U San Myint, deputy di­rec­tor general at the Di­rec­torate of In­vest­ment and Com­pany Ad­min­is­tra­tion.

On Septem­ber 25, the Myan­mar In­vest­ment Com­mis­sion ap­proved ini­tial cap­i­tal in­flows of $403.4 mil­lion from nine for­eign com­pa­nies, seven of which would op­er­ate in the in­dus­trial sec­tor. The re­main­ing two are com­pa­nies in the real es­tate de­vel­op­ment sec­tor. The in­vest­ments came from China, Sin­ga­pore, Ja­pan, the US and UK.

The MIC also ap­proved eight ci­ti­zen in­vest­ments in in­dus­try, agri­cul­ture, live­stock and fish­eries, worth K12.3 bil­lion.

No­tably, U San Myint said re­cent in­vest­ment trends are chang­ing in favour of man­u­fac­tur­ing, with more than a third of the year’s FDI chan­neled into sec­tor com­pared to be­fore.

In FY 2016-2017, Myan­mar at­tracted over $6.8 bil­lion in FDI, half of which was ploughed into the trans­port and com­mu­ni­ca­tion sec­tors.

In­ter­est in Myan­mar is also ris­ing among a wider range of in­vestors, with coun­tries like Rus­sia, which is look­ing to set up a trade of­fice in Yan­gon early next year, and Is­rael, which re­cently signed an agree­ment with Myan­mar to pro­tect its in­vest­ments in the coun­try.

Last month, In­dia also launched its Indo-Myan­mar Cham­ber of Com­merce in the city, with an aim to dou­ble its trade with the coun­try to $4 bil­lion over the next few years.

Photo: The Myan­mar Times Photo: Thiri Lu

Work­ers re­in­forc­ing a build­ing near Sule Pagoda in Yan­gon. Plans are un­der­way to for the city to be de­vel­oped into a re­gional trad­ing hub. U Phyo Min Thein. The Yan­gon Re­gion Chief Min­is­ter said Yan­gon needs more in­vest­ments to im­prove its...

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