Interview: U Soe Thane
What role does the MIC play in attracting foreign investment? Which sectors will you prioritise?
U SOE THANE: The MIC plays the role of regulator and gatekeeper of foreign investment to Myanmar. The MIC stands on four guiding principles: not to violate the interests of the state and the people; not to have any impact on the national dignity; not to breach sovereignty; and not to have any effect on the environment. In the short run, the emphasis will be on labour-intensive industries in order to create job opportunities. However, in the interest of long-term equitable growth, the focus is on inviting downstream and value-added industries. This would allow Myanmar to move from producing primary goods to value-added goods and services.
The country’s new foreign investment law gives the MIC discretionary powers. What are the main priorities of the new legislation?
SOE THANE: In congruence with the principles of the MIC, the new foreign investment law has several criteria for evaluating investment proposals. These are: to protect investors; safeguard the environment; emphasise social impact; transparency and accountability in financial matters; create job opportunities; abide by the existing labour law; support corporate social responsibilities consistent with regional and international standards and agreements; and bring about a transfer of technology. These are the criteria that an investment proposal must meet for the approval of the proposal.
As a result of decades of sanctions, Myanmar finds itself economically behind other nations in the region. Which sectors will bridge this gap?
SOE THANE: Although Myanmar finds itself lagging behind other regional neighbours, we are fortunate enough to be endowed with an abundance of natural resources and labour at competitive wages. The efficient utilisation of these resources is necessary in bridging the development gap between Myanmar and our regional neighbours. Through partnerships and joint ventures with foreign investments, we wish to build the capacity of existing local businesses and the labour force, as well as achieve technological transfer. Through these, Myanmar will develop its downstream value-added industries in the medium and long term to promote the country’s economic development.
What considerations has the MIC made to ensure that the new legislation will create local jobs?
SOE THANE: As one of the criteria for investment, local job creation is also a priority when evaluating an investment proposal. The new foreign investment law specifically states that an investment project must employ local citizens as technicians and service personnel for skilled posts, as per the following schedule: a. First two years: 25% b. Second two years: 50% c. Third two years: 75% The investor is also responsible for providing necessary vocational training to local employees in order to upgrade their skills and to appoint only citizens to jobs for which expertise is not required.
Some foreign companies are concerned sanctions may one day be put back in place. What actions can the government take to assuage these worries?
SOE THANE: The new foreign investment law offers guarantees against the nationalisation and termination of investment during the permitted term. It also allows for transfer of the entitled foreign capital to the investor on the expiry of the term of the contract. Sanctions are not entirely under Myanmar’s control, but what we guarantee is that the comprehensive reform initiatives undertaken to achieve democratisation and equitable development for Myanmar are irreversible.
Myanmar will continue to push ahead with its reforms and is working hard to ensure that the fruits of our current initiatives will be enjoyed by all of our citizens. The MIC also ensures that the benefits of foreign investments will be able to be enjoyed by the full population.
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