A total of 3,032 foreign-based companies and more than 70 joint ventures have registered to open offices and to operate 720 projects under foreign investment as of June, according to the Directorate of Investment and Company Administration.
“The investment commission gave approval to mostly garment factories, shoe factories and other manufacturing businesses,” said an executive from the Myanmar Federation of Chambers of Commerce and Industry. “This will create employment opportunities for the citizens. On the other hand, labour rights should be ensured. It is bad if foreign investors cannot ensure labour rights after getting approval for investment.”
Government-approved foreign investment reached more than US$46 billion (Bt1.47 trillion) last June. Meanwhile, actual foreign investment was recorded at $36 billion.
The energy sector represents the largest amount of foreign investment as it accounts for $19.28 billion. The oil and gas sector follows next with foreign investment of $14.37 billion.
Deposit rate hiked
Meanwhile, a number of private banks, including the largest KBZ Bank, have recently announced an increase in the deposit rate from 8 to 8.25 per cent.
The banks, however, kept the borrowing rate at 13 per cent.
The rate adjustment followed the Central Bank of Myanmar’s plan to issue licences to foreign banks.
The central bank has now set the minimum and maximum interest rates between 8 and 13 per cent to control inflation.
Asia Green Development Bank announced a raise in the interest rate on deposit from 8 to 8.25 per cent with effect from July 1. The Cooperative Bank promised to do the same.
“We are able to offer an interest rate of 8.25 per cent,” said KBZ Bank deputy general manager ThetKoKoMyo. “This means a person who deposits Ks100,000 [Bt3,200] with those banks will receive Ks687 in interest at the end of the year instead of the usual amount of Ks666.”
KBZ Bank, boasting the largest number of branches in Myanmar, said it would increase the interest rate for fixed deposit.
ThetKoKoMyo said the interest rate on one-month fixed deposit has been raised from 8 per cent to 9, three-month deposit from 8.5 per cent to 9.5, six-month deposit from 9 per cent to 9.5 and nine-month deposit from 9.5 per cent to 9.75, while one-year deposit remains at 10 per cent. There are 22 local private banks and 42 foreign banks in Myanmar.