Banks ready to fund expected boom in Burma

Apisak Tantivorawong, president of Krung Thai Bank (KTB), said recently that Burma was one of the markets in Asean showing high potential for rapid growth, and that all areas of business, including banking, were eyeing greater involvement in the country.
Many Thai firms have invested in Burma, including construction giant Italian-Thai Development (ITD), which has been granted a 75-year concession on 160,000 rai (25,600 hectares) in Dawei by the Burmese government.
Apisak said the Dawei project was regarded as the largest in Burma in terms of investment value. Many parties plan to join with ITD on projects in the port town, including KTB, which is in talks with investors to provide financing.
“We believe all parties want to cash in on the Dawei project. But its large size means all parties can join together to win on this project,” he said.
Foreign investors are also interested in Burma. This will also benefit Thailand, because of its proximity to the country.
When the Asean Economic Community is implemented in 2015, Thai companies will have an advantage if they want to set up plants in Burma to send products back to Thailand because of the Kingdom’s position as a logistics centre.
Kannikar Chalitaporn, president of Siam Commercial Bank (SCB), said Burma offered many opportunities for investors, but cautioned that investors should expect to look for long-term opportunities.
SCB is waiting for approval from the Bank of Thailand to set up a representative office in Burma.
Burma’s central bank will not allow foreign banks to set up branches yet.
Kannikar said that when the central bank in Burma gives licences to foreign banks to open branches, SCB would be ready to jump in.
SCB prefers to expand its financial services to Laos and Burma rather than Malaysia and Indonesia.
“SCB can handle many overseas deals from Thailand. Therefore, the bank believes it can service all financial services even it has no branches overseas,” she said.
Banthoon Lamsam, chief executive officer and president of Kasikornbank, said Burma was a potential market for investors. However, it was not an appropriate arena for all businesses, the banker said, pointing out that the initial wave of investors in Burma were involved in infrastructure.