The Notification, which is effective immediately, allows 100% foreign owned, as well as foreign and local joint-venture, companies to carry out wholesale and retail trading throughout Myanmar.
This marks a significant step in the Ministry of Commerce’s efforts to open Myanmar’s economy to greater levels of foreign investment and activity and builds upon liberalization efforts that began in 2017.
Foreign companies previously faced major restrictions on trading in Myanmar. It was only in 2017 that liberalization began to occur, and foreign companies were allowed to trade in specific classes of goods that included:
- Chemical fertilizers;
- Hospital equipment; and
- Construction materials.
Notification 25/2018 brings much greater liberalization for trading, although restrictions do remain. To engage in wholesale and retail trading, a 100% foreign owned company must meet the following criteria:
- If wholesale, the initial investment of goods must be a minimum of US$ 5 million
- If retail, the initial investment of goods must be a minimum of US$ 3 million
A local and foreign joint venture company must also meet investment criteria to carry out wholesale and retail trading. For joint ventures, the companies local share percentage must be a minimum of 20%.
If the local share percentage is less than 20%, than the company would be considered a foreign owned company and therefore must adhere to the rules listed above. In addition to having a minimum of 20% local ownership, joint ventures must also meet the following criteria:
- If wholesale trading, the initial investment of goods must be a minimum of US$ 2 million
- If retail trading, the initial investment of goods must be a minimum of US$ 700,000
All investment amounts exclude land rent. If a company meets these criteria, it can then apply for a Retail and Wholesale Registration Certificate. Existing restrictions on trading prohibited goods established in laws, notifications and regulations remain in place.
The announcement of Notification 25/2018 will have profound effects on Myanmar’s economy. Foreign companies will now be able to engage freely in trade allowing for more products to enter the market and reducing the cost of goods to customers.
The ability of foreign companies to import directly will also allow companies to retain inventory in Myanmar, and reduce costs and delays previously associated with importing products for manufacturing and distribution.
There does remain questions as to how the notification will be implemented, including if the government may still use its authority to impose ad hoc restrictions on foreign trade and how companies will navigate the bureaucratic system of Retail and Wholesale Registration Certificates.
Although these concerns do exist with implementation, the announcement is a major indication of Myanmar’s drive to increase foreign investment and investor confidence.
Source : Tractus Asia Limited (www.tractus-asia.com)
Marketing and investment strategies in Myanmar, India
To encourage Thai SME operators to enter the international market, the Office of Small and Medium Enterprises Promotion (OSMEP) aims to urge them to invade Myanmar, Cambodian, Chinese and Indian markets.
BANGKOK, 26 July 2019 (NNT) – To encourage Thai SME operators to enter the international market, the Office of Small and Medium Enterprises Promotion (OSMEP) aims to urge them to invade Myanmar, Cambodian, Chinese and Indian markets.(more…)
Thailand pushes CLMVT as the “New Value Chain Hub of Asia”
The Ministry of Commerce, in cooperation with 11 relevant agencies, hosted the CLMVT Forum 2019 with delegates from Cambodia, Laos, Myanmar, Vietnam, and Thailand
BANGKOK, 24 June 2019 (NNT) – Thailand’s Prime Minister, Gen. Prayut Chan-o-cha, today attended the opening of the CLMVT Forum 2019, and urged its member countries to push for the development of the CLMVT Regional Value Chain, so that they can have more bargaining power and improve the well-being of their citizens.(more…)
Hello, shadowlands : inside Southeast Asia’s $100 billion dark economy
Organized crime in Southeast Asia has entered a golden age : now valued at $100 billion, this dark economy is expected within the next decade to hit $375 billion
Hello, Shadowlands takes a deep plunge into crime rings both large and small. It also examines how China’s rise and America’s decline is creating new opportunities for transnational syndicates to thrive.
Thailand Ecommerce Market: Shooting For Success
At present, the Thai ecommerce market is valued at USD 3.5 billion. According to a Google Temasek study, Thailand’s e-commerce...
Aspire Set to Become First SME Neobank in Southeast Asia with US$32.5 Million Raise
The recent financing has been led by Mass-Mutual Ventures Southeast Asia with participation from Silicon Valley’s Arc Labs and existing...
How is Thailand Bringing Technology to the Table?
In Asia, a country like Thailand has taken the initiative to implement agricultural biotechnology in its industry. The country has...