Fri 25 Jan 2013
Filed under: Inside Burma,Military,News
Davos, Switzerland—A Myanmar minister has predicted that ethnic fighting and tensions will not threaten ballooning foreign investment, expressing hope of attracting $5 billion to the Southeast Asian country from just $1 billion in 2012.
Soe Thane said in an interview on the sidelines of the World Economic Forum that outbreaks of violence would not substantially affect the investment environment in the country, which has been opening up its economy and political system since 2010 after decades of military rule.
“Last year we had lots of investors doing feasibility studies,” Mr. Soe Thane, a minister in the president’s office who has played a major role in liberalizing the economy and steering a new law on foreign investment, said Thursday. “This year, people are more familiar with us and investment will rise.”
President Thein Sein’s government has been beset by ethnic and religious strife in the country’s west, where majority Buddhist Rakhines have clashed with minority Rohingya Muslims near the site of a major energy pipeline to China. In the far north, the military has been battling ethnic Kachin rebels. The combined conflicts have displaced tens of thousands of people.
But Mr. Soe Thane said that the unrest would not substantially affect the investment climate, which is largely focused on Yangon, the country’s largest city, and the central regions where most of Myanmar’s estimated 60 million people live.
“Conflict affects a very small part of the country,” Mr. Soe Thane said.
The government has been slow to deliver on promises of rapidly opening up the oil and gas sectors and telecommunications. Government officials familiar with the matter said that Thein Tun, who resigned as telecommunications minister last week, and several ministry officials were being investigated for corruption. They were not immediately available for comment.
Mr. Soe Thane said that in the telecoms sector, the tender process for four licenses was under way, two for independent operators and two for joint ventures. The government had hired an independent international consultancy to review the bids and make selections.
“We need to be transparent and accountable as we open up,” Mr. Soe Thane said. “We are expecting the results within a month.”
Mr. Soe Thane acknowledged concerns that insiders have been benefiting disproportionately from Myanmar’s opening. Domestic investors buying up land in the hope of big capital gains when they sell to incoming foreign firms has also become an issue, he said.
“Sometimes local people need to be far-sighted, not protectionist, and look for win-win solutions with foreign investors,” Mr. Soe Thane said.
The bulk of investment so far had been in the garment, textiles and tourism sectors, with some spending on infrastructure, Mr. Soe Thane said. Foreign car companies were looking at opportunities for investment, he said, and foreign investment has so far created 100,000 jobs in the country.