Energy, oil & gas stand top in foreign investment
Reported by Ah Ngae Htwe + Naing Naing Oo Translated and Edited by Win Htut + MYA
In the foreign investment in Myanmar, energy and oil and gas have accounted for 81 percent in the total foreign investment, according to the official release issued on 31 March 2012.
According to the report released on 31 March, there are a total of 467 companies invested in Myanmar with the total volume of foreign investment US$ 40699.048 million. Among them, the countries having the most heavily invested in Myanmar are China, Thailand, Hong Kong, South Korea, Britain, Singapore and Malaysia, it was learnt.
“The foreign investment is the life-blood in improving a country and it is also economic driver. In inviting foreign investment, job creation should be placed emphasis. Although the foreign investment flows into the country, it will be useless if it does not aim at creating labor in the country. Therefore, if the foreign investment provides local employment, it will be better for the country and its people. For example, the foreign investment going into garment business could put Bangladesh on the right path of development. Skill is not a main factor in the garment. However, capacity building is for the local employment is necessary. If not so, local employees will have to work only for grass cutting. For that reason, the investment capable of creating job opportunities should be invited,” said Dr. Aung Tun Thet.
Similarly, UN reports highlighted the regional integration in the foreign investment. The ASEAN Free Trade Area is only three years away. For this, local SMEs may face difficulties if the AFTA comes into effect. The reviews said that there is the need to prepare strategies and tactics to be able to overcome these challenges.
“It will be better if the foreign investment goes into education and health sectors. If the foreign investment is poured in the health sector, it is important to provide basic health service to the people. In the education sector, all levels including primary like Bangladesh must have access to computer. MBA course opened in Institute of Economics of Yangon is reasonable. Foreign MBA has already
started and it costs Ks 9 million for 18 months. If there is a large gap between the rich and the poor, it is not an economic problem. Perhaps, there will be political and social problems,” continued Dr. Aung Tun Thet.
Insurance investment was opened last month. Insurance investment in education and health sectors are welcome. Experts are extensively discussing about the quality of investment in the world of today, it was learnt.
“In fact, media is responsible to highlight the foreign investment where to be poured. The foreign investment like cosmetic surgery is useless. The villages badly need being provided basic healthcares. Therefore, it is required to review on the type of investment. The government needs to control the policy. The government must point out the direction. Professor Stiglitz said that there was a
choice in your country. For example whether you will import a Mercedes or a bus? He meant the type of investment,” said an economist.
According to the report of UNESCAP released in 2012, Myanmar’s economy is expected to grow by 5.3 percent in 2010, 5.5 percent in 2011 and 6.2 percent in 2012.
“What types of investment will go into which sectors? For instance, if steel plants will be built in Dawei special economic zone, lesser number of employers can be recruited at a plant. But, factories like garment and cold storage can create job opportunities for more employment. Therefore, to choose the type of investment is utmost importance. At present, everyone takes great interest in oil and gas and energy sectors,” said U Win Myo Thu of Eco Dev.
A county being rich in mineral resources is a strong point. On the other hand, the resource curse may be laid upon the country. The report released from the UN for this year stated the resource curse. It is necessary that limited resources available ought to be used usefully and effectively, said Prof. Stiglitz during his visit to Myanmar.
The Investment Law is now being drafted in Myanmar and it will be enacted soon. Foreign investors are still studying the prevailing conditions in Myanmar. Economic experts are still fear of the foreign investment that will flow into the profitable businesses in an easy way, it was learnt.
The Investment Law is now being drafted avoiding these unpleasant situations. The main point is the type of investment capable of providing job opportunities. Foreign investment leading to the long-term interest for the country is under negotiation,” said Mr. Winston Set Aung, Economic Adviser to the State’s President.