Myanmar Monitor


Photo credit: Myanmar Insider

Economy, Investment and Trade

Myanmar to strengthen its strategy of repaying debt through sovereign bond market
(21 March 2018) According to Myanmar Ministry of Planning and Finance (MOPF), as of 31st January 2017, Myanmar had internal debts totalling US$13 million (K18 billion) and foreign debts amounting to US$9.1 billion (K12 trillion). The ministry added that the government is currently paying interest between 8.16 percent and 9.69 percent for Treasury bills and bonds with maturities ranging from 3 months up to 3 years. According to the Myanmar Debt Management Strategy, in order to attract more investors to buy more bond and reduce risk for the government, longer-term bonds with higher interest rates should be auctioned. Since 2016, the country has raised its effort to develop a functioning sovereign bond market to reduce borrowing from the Myanmar central bank to fund the fiscal deficit the country is currently facing.
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Myanmar parliament approves Union Tax Law for 2018
(21 March 2018) Myanmar Parliament has approved the Union Tax Law for 2018 after omitting a tax amnesty clause proposed by the government. The government had originally proposed that resident citizens and non-resident citizens with undisclosed income would be subject to income tax at reduced rates. Currently, undisclosed sources of income are subject to income tax at rates ranging from 15 percent to 30 percent. The Joint Bill Committee stated that reasons provided for rejecting the tax amnesty clause include the need for better public education on tax amnesty and the lack of punishment for those who declared undisclosed income after the tax amnesty period.
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Myanmar government and private sectors jointly establish Ethnic Entrepreneur Association
(20 March 2018) The Union of Myanmar Federation of Chambers of Commerce and Industry (UMFCCI), United Nations Global Compact Network Myanmar (UNGC Myanmar) and Ministry of Ethnic Affairs have jointly established the Myanmar Ethnic Entrepreneur Association (MEEA). The establishment of the association aims to promote peace through sustainable economic development in the ethnic regions of Myanmar by involving the ethnic communities in the country’s business, education, and healthcare initiatives. U Win Myint, Myanmar’s Intha Ethnic Affairs Minister and former government official in Inle Region said, with support from the government and private sector in the form of access to export and trade finance as well as technology, the ethnic businesses will have better opportunities to market their products to tourist as well for exports.
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Myanmar to provide its country with power needs without affecting its budget
(20 March 2018) Myanmar’s Ministry of Electricity and Energy is currently facing difficulties to meet the country’s growing short-term power needs without adversely affecting its budget. The decision by the government to approve four power projects totalling 3,000 MW was the biggest development in the Electricity and Energy sector of the country for several years. In November 2017, a World Bank report said recently the government had given more prioritisation on rental power plants, which have much shorter PPAs. This is due to a clause which stated that if the Myanmar government was unable to supply the privately run plants with enough gas, the country would still need to pay for the cost of the unused energy generating capacity, thus leading the government to recently opt for rental power plants.
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Myanmar ministry to conduct a discussion with local businesses on the reduction of tax rate on income from unidentified sources
(20 March 2018) The Ministry of Finance and Revenue of Myanmar will conduct extensive discussions with the business sector on whether to reduce the tax rate on income from unidentified sources. On 20th March 2018, the Union Parliament has approved a recommendation from the Joint Bill Committee to exclude a provision on the taxing of income and possessions from the taxpayers’ undisclosed income. The parliament decision to reconsider the tax reduction has disappointed business developers as they were anticipating a tax cut will be only effective by 1st of April. This led to a public outcry amid complaints that the provision would facilitate money laundering.
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