International investors wary of Burmese law

International investors wary of Burmese law

International investors have told the Myanmar Global Investment Forum that even though Burma generates much interest, there are a multitude of challenges that foreign investors face.

The challenges, discussed on the panel held on the second day of the forum, were mainly a lack of transparency, unfinished ceasefire deals, and other restrictions not limited to laws.

Foreign consulting attorney Pedro Jose Fausto Bernardo, who was moderating the panel, said, “I believe that a look at Myanmar’s current landscape will reveal that protectionism still exists. There are also reports that two laws are being merged into one, and there are still no known guarantees against protectionism when the new law comes out. Those policies are due to structural legal limitations. There are also many other sectors which limit the involvement of foreign investors.”

Sunil Seth, TATA International’s representative in Burma, said, “My opinion is that trading is also restricted, not only investments. For example, our international company wants to purchase beans from here and export them to India, but foreigners are still prohibited from doing so.”

However, the Myanmar Investment Commissions (MIC) thinks otherwise.

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“Since there are two [foreign investment] laws, many are speculating about the future,” said Aung Naing Oo, secretary of the MIC. “The other thing is that since we still have yet to allow foreigners to export directly, they claim we are still protectionist, but it is not like that. We’ve just opened the doors to the country so we have to proceed phase by phase while balancing between protecting SMEs and allowing international investment for the growth of the nation.”

In 2012, the government introduced a new foreign investment law which brought greater benefits to foreign investors as well as restricting them, answering the demands of Burmese local business lobbyists and protecting significant areas of economic activity for the country’s citizens.

Even though the expected total international investment sits at US$6 billion for this financial year, projects such as the Thilawa SEZ look to boost investment further.

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