Aug 17, 2012

Myanmar - Big US business delegation visits Burmese vice president

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Eight large American companies are lining up to enter the Burmese market, official media reported on Wednesday.

The companies include Caterpillar, Citibank, KraftFoods, GE Energy, Ford Motor Co, Bell Helicopter, Hewleft-Packard Corporation and Arrow Technologies Pte Ltd, said the New Light of Myanmar, a state-run newspaper.

A delegation of the American Chamber of Commerce, accompanied by US Ambassador to Singapore David Adelman and new US Ambassador to Burma Derek J. Mitchell, called on Burma’s Vice President Sai Mauk Kham in Naypyitaw on Tuesday to discuss investment opportunities.

Discussions were focused on business sectors including energy, electricity, transport, communications, health and production, the report said.

Following the US Treasury's relaxation of some sanctions on on Burma in May to allow financial transactions to support certain humanitarian and development projects, the Obama Administration announced further easing of sanctions on July 11, allowing US companies to do business and invest in sectors including oil and gas.

Soon after Obama's announcement, a US business mission including more than 70 senior US executives from 38 leading companies visited Burma.

One of the U.S. companies, General Electric, made the first US deal, involving the sale of advanced medical equipment to two private hospitals in Rangoon on July 14.

Indications seem to point to a great interest in Burma among US companies, in spite of a warning issued earlier this month by a top US State Department economic official, Robert Hormats, who told US investors that doing business in Burma will not be easy and there is not likely to be a “big gush of money” coming in from the US and foreign countries.

However, business delegations have continued to flood into Burma in recent months, including high-level executives representing companies from Japan, South Korea, Britain, France, Australia and European Union counries.

Speaking to the Washington International Trade Association, Hormats said Burma is rich in resources, but it has relatively few processing industries and is poor compared to its neighbors.

Hormats downplayed the possibility of big investments in the undeveloped market, at least in the near term. 

“This notion that there's going to be a rush of American capital coming in there – there probably won't,” he said.

“Burma is a very complex place, and if you're going to invest, you have to do a lot of due diligence,” he said.

Hormats visited Burma with a US business delegation earlier this month, which included leading US companies, some of which indicated they are ready to explore business opportunities in Burma.

Hormats said that Washington is prepared to lift additional sanctions on an “action for action” basis and noted that President Thein Sein has promised another wave of reform.



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