HCMC – Many Vietnam-based companies are eyeing Myanmar as a new investment
destination after the Myanmar Government approved a new foreign investment law
offering strong incentives for international investors.
At a seminar on investment into
Myanmar held in HCMC on Thursday, Edwin Vanderbruggen of VDB Loi Law Co. said
despite the imperfect new law, Myanmar now is changing at a rapid rate.
He compared the case of Myanmar
to that of Vietnam, saying the country has still attracted large numbers of
foreign investors in spite of its incomplete legal corridor and
yet-to-be-favorable business environment.
At the moment, Myanmar is
considered the last attractive destination in Southeast Asia to foreign
enterprises, he told the seminar held by the Malaysian Enterprises Department
in Vietnam.
Vanderbruggen has already
provided consulting services to petroleum companies, distributors and assets
and private funds investing in Myanmar.
Foreign investors have considered
sky-high tax levels in Myanmar the biggest barrier discouraging them from
participating in the market, he pointed out. But the newly-issued law allows
new investors to be subject to tax exemption for up to five years compared to
only three years as specified in the 1988 law and this is really worth consideration,
he said.
The new law is also loosened
compared to the old regulations issued in 1988 regarding investment. Foreign
entities are currently allowed to pour capital into mining, industrial and
manufacturing sectors, construction, transport and repairing services, road
transport or hotels.
However, a number of business
activities with foreign investment will be banned or restricted in certain
areas or business spheres.
Vanderburggen predicted there
would be a lot of changes in the coming time which are expected to pave the way
for Myanmar to join the ASEAN + China free trade zone in 2015.
A slew of enterprises have shown
keen interest in the market, including foreign-invested companies operational
in Vietnam.
Bill Watson, general director of Coats
Phong Phu Co. in Vietnam, said he is considering a convenient point of time to
make investment into Myanmar.
Several other big companies at
the seminar said they had plans to open their representative offices in Myanmar
soon. Therefore, there might be a tough race among foreign firms in Vietnam as
well as Vietnamese companies and investors from other regional nations to
invest into Myanmar in the near future.
Vietnamese firms like CT Group
and Huu Lien A Chau along with many firms under the Association of High-Quality
Vietnamese Goods Producers over the past time have sought ways to approach the
Myanmar market to sound out investment and trade opportunities.
Hoang Phi - The Saigon Times
Daily
Business & Investment Opportunities
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