Interview : U Zaw Min Win
How has the government increased the private sector’s appeal to investors?
U ZAW MIN WIN: The present government has prioritised the rapid development of infrastructure fundamental to the economy, such as electricity generation, roads and ports. Moreover, it is laying the foundations for e-government applications that will make investment procedures faster and more competitive. In addition, consultations with the Private Sector Development Committee have led to significant efforts since 2016 to relax and in some cases deregulate the legal framewrok related to investment and income tax.
Considering the domestic and international headwinds that Myanmar has faced recently, what sectors do you expect to grow fastest in 2019-20?
ZAW MIN WIN: Considering its current growth rate and our abundant resources, I predict that the agriculture sector – including the fishery and livestock industries – will be one of the most dynamic sectors and a main source of export earnings. Oil and gas will also experience significant growth, given recent discoveries and the planned activation of several blocks. Moreover, the ever-increasing potential of mining has always presented great opportunities for processing and value-adding jade and other precious gem stones and a wide variety of metal and minerals available as mine products. Several factors have contributed to Myanmar being the fastest-growing economy in ASEAN, despite the international headwinds that it faces.
How can the garment industry benefit from opportunities in the region and beyond?
ZAW MIN WIN: Relying only on the strength of domestic garment manufacturing, which is still in its infancy, is not sufficient. Thus, Myanmar must develop its ability to trade by diversifying and improving the quality of its products and services by making effective use of its resources to finance this. This is the only way that we will be able to leverage the opportunities presented by the huge Chinese market through the economic corridors that are in the Greater Mekong Subregion and the Belt and Road Initiative.
Furthermore, the memorandums of understanding signed with federations in China, Korea, Japan and India, as well as the chambers of commerce in ASEAN countries, will improve connectivity and bilateral economic cooperation – especially for small and medium-sized enterprises – and increase the value of our supply chain.
In what areas should ASEAN commercial integration be accelerated, and how can a more open and flexible trade environment help Myanmar?
ZAW MIN WIN: Areas that require acceleration include trade facilitation; food safety regulations; the institutional framework for micro-, small and medium-sized enterprises to access financing; and guidelines for development and collaboration within special economic zones. Greater openness and flexibility would undoubtedly provide more opportunities for Myanmar, alongside all countries in the region, by substantially reducing costs and eliminating barriers that delay trade.
What modifications to the tax system could address the business community’s major concerns?
ZAW MIN WIN: Our tax regime definitely needs to be reformed. According to the World Bank, Myanmar’s tax revenues as a share of GDP is 6.4% which is the lowest in ASEAN. The government is very much aware of this and has been addressing the fiscal deficit since 2016. The top priority of the new administration’s policy guidelines is the establishment of a fair and efficient tax system that increases revenue and protects individuals and property rights. The latest piece of legislation, the 2018 Union Tax Law, includes a relaxation and deregulation of tax under the new Investment Law and the new Companies Law, as well as some proposals that were made by the Private Sector Development Committee.
Read More from OBG
