Thai firms urged to tap GSP privileges in Myanmar

Economy April 23, 2014 00:00

By Petchanet Pratruangkrai

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Thai enterprises should invest in many potential industries such as consumer manufacturing, garment, food processing, and tourism service to benefit from the reinstatement of the European Union Generalised System for Preferences, and tax privileges expect

The Siam Commercial Bank organised “SCB First Open AEC: Penetrating Myanmar around 360” seminar was held at Siam Kempenski Hotel yesterday.
The seminar also told Thai investors and traders that there were tremendous opportunities for Thais to explore in Myanmar, although they should be prepared for some challenges before penetrating the market.
U Win Aung, president of the Union of Myanmar Federation of Chambers of Commerce and Industry, said that many Thai industries have higher opportunities to set up operations and expand in Myanmar, particularly in industries that will get tax privileges from the EU’s reinstatement of the GSP.
“Everything but arms products will get tax privileges to the EU. Many manufacturers in Myanmar are benefiting from the tariff privileges,” said Win Aung, adding the US was also expected to reinstate the GSP for Myanmar soon.
He said Thai enterprises could invest in Myanmar in many industries such as garment, food processing, consumer products manufacturing, and other services especially tourism service, education, and medical service. Machinery industries, mainly agricultural machinery, and infrastructure development should also have bright future in Myanmar as the country is focusing on agricultural sector development.
Not only tax privileges, but also investors will get advantages from the low cost of labour compared with other Asean countries, and the rich source of raw material supply in Myanmar. To start a business in Myanmar, he suggested that Thais find the right local partner so that they would have a better understanding of the demands of local people.
Damrong Kraikruan, director-general for East Asian Affairs at the Foreign Ministry, said that as funding in Myanmar was not yet ready for investors, Thai investors should take capital from their own country first. To ensure efficient financial and investment capital management, investors need to carefully consult experts and banks on exchange rate.
He warned that although Thai investors need to urgently consider investments and trade with Myanmar, they should consult embassies and Thai agencies such as the chamber of commerce, or other responsible agencies before going to Myanmar alone.
Speaking on “Make it big in Myanmar”, Vichai Kemtongkum, director of G Business Link Co (GBL), said there are both opportunities and obstacles in Myanmar. While the country has abundant unskilled labour and business operators there have limited capital sources, the country has experienced a steep rise in the cost of doing business, such as land rent and office rent.
He suggested that those who want to tap the Myanmar market should create their own strong brands. GBL has exported products such as construction materials and agricultural machinery to the Myanmar market.
Nattawin Phongsphetrarat, managing director of Tharaphu Decor, which has done business in Myanmar for over 40 years, said the key to success for those seeking to enter Myanmar is to find strategic partners and create synergies with them. The company’s businesses in Myanmar at present range from furniture to providing total solutions for construction.