1. Myanmar government and rebels sign draft ceasefire agreement
President U Thein Sein has witnessed the signing of a draft Nationwide Ceasefire Agreement (NCA) between the government and 16 rebel groups which is geared towards ending more than 60 years of hostilities in Myanmar. Since independence from the British in 1948, the Myanmar government has been engaged in armed conflict with various rebel groups who all seek greater autonomy and devolution of power and resources. The current government, which came to power in 2011, has made it a key priority to end these hostilities as it looks to solidify its commitment to reform ahead of the general election, which is due to take place later this year. The first official ceasefire talks began in mid-2013 and the draft NCA comes during the seventh official ceasefire talks, although there have been 22 unofficial talks aimed at settling differences.
The draft NCA was drawn up between members of the government’s negotiating team (the Union Peace Working Committee (UPWC)) and the ethnic armed organisations’ Nationwide Ceasefire Coordination Team (NCCT). It is not yet clear when the final NCA will be signed as the negotiators need to take the text back to their groups for approval, and it will also need final sign off from parliament. President U Thein Sein has indicated that a full NCA could be signed within months. However, details of the draft NCA have not been made public and it remains to be seen whether all points of contention have been fully resolved.
2. Myanmar launches first National Export Strategy (NES)
The NES serves as a five-year strategy of Myanmar’s priorities for sustainable development through trade. Key interventions in the NES include boosting the competitiveness of small and medium-sized enterprises (SMEs), as well as implementing longer-term policy and legislative changes which are all geared towards realising sustainable export-led growth and prosperity for an emerging Myanmar. Traditionally, Myanmar’s exports have focused on unprocessed natural resources and a small number of export markets. The NES aims to extend trade to new products and markets in the following priority sectors: beans, pulses and oilseeds, fisheries, forestry products, rice, rubber, textiles and tourism.
The NES was developed primarily by Myanmar’s Ministry of Commerce, with support from the International Trade Centre and cooperation from both the private and public sectors.
3. Myanmar foreign bank licenses announced
On 2 April 2015, the Foreign Bank Licensing Committee (FBLC) announced that the following three foreign banks have been granted a final licence to operate in Myanmar from 22 April 2015: The Bank of Tokyo-Mitsubishi UFJ, Ltd.; Oversea-Chinese Banking Corporation Ltd; and Sumitomo Mitsui Banking Corporation. The FBLC will review the final applications of the remaining six foreign banks (which were granted preliminary approval in October 2014) over the coming months. For our previous update on foreign bank licences, please see BLP’s Myanmar Postcard from October 2014.
4. Yangon Stock Exchange (YSX) update
Myanmar’s first stock exchange is now almost 75% complete according to Dr Maung Maung Thein, Myanmar’s Deputy Minister of Finance and Revenue. The Securities Exchange Commission (SEC) has been formed and renovation work on the stock exchange building is due to be completed by May 2015.
The YSX will commence operations by offering shares only before moving into the bond market and eventually the derivatives and futures markets. Restrictions will be imposed on foreign investors (including foreign funds and institutional investors) investing in the YSX. Dr Thein has indicated: “We are concerned that local investors will lose their place in YSX when foreign investors come. For this reason, we will allow foreign investors to invest in YSX in the second phase”.
For previous updates on the YSX, please see BLP’s Myanmar Postcards from March 2015, January 2015 and August 2014.
5. Myanmar awards further telecom licence
Based on the “Licence Issued List” published on 1 April 2015 on the Ministry of Communications and Information Technology (MCIT) website, the MCIT has issued over 17 communication related licences to local and foreign companies. The licenses awarded include four Network Facilities Service (Individual) Licences which permit holders to construct networks, lease such networks to other licensees and offer any other type of public or private telecom service and 11 Network Facilities Service (Class) Licences which permit holders to construct passive infrastructure and lease such infrastructure to other licensees. These developments signify the growth of the telecommunications infrastructure industry in Myanmar.
We recognise the importance of working with local counsel in connection with Myanmar deals. To support our clients, we have established a strategic relationship with Legal Network Consultants, a Myanmar-based member of BLP Asia Network* of law firms, which enables us to provide an integrated legal solution to support our clients’ inbound and outbound business operations, and to deliver seamless advice.
* "BLP Asia Network" refers to a series of bilateral strategic relationships between BLP and individual, legally separate, local legal practices in Asia operating independently. The Network is created in the interest of delivering joint services to shared clients and joint marketing activity only.