More FDI to Myanmar foreseen in next fiscal year
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Myanmar expects more investment from western countries, particularly Europe, in the 2016-2017 fiscal year, said Aung Naing Oo, the secretary of the Myanmar Investment Commission.
On the sideline of a forum titled “New Myanmar Beyond 2015: The Need for New Paradigm” at Yangon Economic University on January 11, he said that the Myanmar-European Union investment protection agreement, which is expected to be signed in the first half of this year, should draw more investment from Europe.
"More investment from western countries is expected during the incoming administration because of the agreement. After that, investment from EU countries will enter with more trust than before. Depending on the situation, investment from the US might enter too. Japanese investment will be as strong as before,” he told reporters.
After the EU reinstated trade preferences to Myanmar in July 2013, the negotiations for an investment protection agreement between the European Union and Myanmar were initiated. The agreement would offer EU investors key guarantees in their relationship with Myanmar. These provisions provide guarantees to companies that their investments will be treated fairly and on an equal footing to other investors. Creating legal certainty and predictability for companies will help to attract and maintain foreign direct investment (FDI) to underpin Myanmar's development.
So far, Myanmar’s oil and natural gas sector has remained the biggest beneficiary of foreign direct investment into Myanmar.
In the 2015-16 fiscal year which will end in April, it attracted over US$2 billion during March through December, according to the Directorate of Investment and Company Administration.
The amount is half of $4.1 billion net inflows in the period and one third of the $6 billion target for the entire fiscal year.
Trailing behind were the transportation and communications sector with over $736 million and the manufacturing sector with over $685 million.
The FDI has risen sharply in the past years. From $1 billion target, the country actually attracted $3.4 billion in the 2012-2013 fiscal year. In the 2013-2014 fiscal year, actual value was $4.1 billion on top of $3 billion target. In the 2014-2015 fiscal year, actual value was $8 billion.
