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3 Nov 2015

International Economy

Myanmar’s Historic November 8 Elections May Draw More Foreign Investors (Current Issue No. 2669 Full Ed.)

Myanmar has set November 8 as the date for landmark general elections. We at KResearch hold the view that if this national polling runs smoothly and political conditions there become even more stable later, international investors may again focus on Myanmar as an important investment haven within ASEAN. The EU's decision to reinstate GSP benefits for Myanmar in July 2014 and the fact that the US may do the same soon should attract more FDI, as well.
To accommodate greater FDI, Myanmar will need to expedite infrastructure development because the country remains plagued by shortcomings in that, aside from bureaucratic red tape. Nevertheless, the Myanmar government is trying very hard to convince the world that they are ready for such FDI by allowing international banks to open branches there and forging G2G cooperative agreements on infrastructural development and special economic zones.

Meanwhile, other changes there offer opportunities for Thailand to export more to Myanmar than ever before. Thai businesses, particularly those in the labor-intensive industries, may consider expanding their production base there to take advantage of Myanmar's reinstated EU GSP benefits and those to be granted by the US. However, they must remain vigilant towards inadequate infrastructure that may significantly increase costs. As a result, Thai businesses are advised to seek inroads into larger cities having well-equipped infrastructure first.

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International Economy