Dr Khin Shwe, Chairman, Zaykabar: Interview

Dr Khin Shwe, Chairman, Zaykabar

Interview: Dr Khin Shwe

What steps can be taken to ensure that the quality of construction meets international standards?

DR KHIN SHWE: Both foreign and domestic construction firms have a role to play in developing infrastructure, which has lagged behind the rest of the world for many decades. In the context of the Foreign Investment Law, steps need to be taken to introduce a joint venture or a build-operate-transfer (BOT) system in Myanmar. We welcome public-private partnerships that focus on the development of high-rise buildings, as seen in Singapore, Thailand and Malaysia.

Low-cost housing projects will also be increasingly essential for the middle class and service personnel. Business enterprises that are engaged in selling and importing pre-cast or pre-fabricated construction materials should be encouraged to conduct business in Myanmar. Only then will our construction standards attain global levels of quality.

How has the lifting of sanctions affected the economy and the costs of doing business?

SHWE: The easing of, rather than comprehensive lifting of, sanctions has led to an increase in foreign investment. The new investment law in Myanmar has also contributed to attracting investment from overseas. As business competition increases over time between local and foreign companies, the cost of labour and raw materials will rise. At the same time, banking in Myanmar continues to face several restrictions under US sanctions. The US government’s Specially Designated Nationals List includes a number of organisations and individuals with which US companies are prohibited from doing business.

Additionally, a committee has been set up at the national level as part of efforts to move Myanmar out of the category of least developed countries (LDC), while continuing to work towards implementing the UN Millennium Development Goals. Myanmar has been listed in the LDC category by the World Bank and IMF, with the approval of the UN, since 1987. I remain positive that once the sanctions on Myanmar have been totally lifted, foreign direct investment inflows will pick up further. Indeed, as long as the economy continues to go from strength to strength, the cost of labour and raw materials are of course likely to increase accordingly.

Which areas of the sector could benefit from higher levels of foreign participation?

SHWE: Myanmar has already introduced the Foreign Investment Law and the Foreign Exchange Management Act. The country is currently developing its dry ports and container facilities to ensure the free flow of goods before the implementation of the ASEAN Economic Community in 2015.

In addition to the Dawei Special Economic Zone, Kyaukphyu Deep Sea Port and Thilawa Sea Port, Myanmar Railways plans to build dry ports in Yangon and Mandalay, the upper and lower commercial hubs in Myanmar. The most likely projects to offer foreign participation in the construction sector are the construction of special economic zones, high-quality hotels and supermarkets, as well as new international airports and deep sea ports.

Domestically, there should be a greater emphasis on building roads and bridges so as to improve transportation connections. The government has also concentrated its efforts on urban development through a new town planning system. Further to this, the central government and the Yangon City Development Committee (YCDC) are making combined efforts with regards to planning for brand new urban expansion projects in the areas of Twantay and Hlaingtharya, both of which are connected to the greater Yangon region. At the same time, the YCDC is currently working with the Japan International Cooperation Agency to draw up an urban plan for Yangon, given that its population is expected to grow to 10m by 2040. Steps such as these ones will strengthen the economy at a time of momentous transition.

Anchor text: 
Dr Khin Shwe

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The Report: Myanmar 2015

Construction & Real Estate chapter from The Report: Myanmar 2015

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