Japan External Trade Organisation and the Union of Myanmar Federation of Chambers of Commerce and Industry will begin building the Thilawa Special Economic Zone in early 2013, officials said on October 21.
U Win Aung, UMFCCI chairman and head of Dagon International Construction, said the Myanmar side will own 51 percent of the venture, while the Japanese will have the remaining 49pc.
“We will invite investors to take part in the Thilawa SEZ. We will sell shares to the public before the project is launched in January,” U Win Aung told The Myanmar Times.
The 2400-hectare zone, which was announced in January 2011, is about 25 kilometres south of Yangon along the Yangon River in Thanlyin and Kyauktan townships. It incorporates the Myanmar International Terminals Thilawa – a deepsea port facility built in the mid 1990s.
Major Japanese companies reportedly involved in the project include Mitsubishi, Marubeni and Sumitomo corporations.
Minister for National Planning and Economic Development Dr Kan Zaw said the zone is the first step towards building an attractive business environment for investors – and a keystone of economic reforms intended to create the investor friendly-environment in Myanmar.
Deputy Minister for the National Planning and Economic Development U Set Aung said potential investors are required to accomplish a number of tasks before beginning projects.
“Investing companies must register their companies first,” he said “We have already simplified the registration process, which can be done in three hours, where it used to up to one year. Even when there is a delay it should take only a day to register,” U Set Aung said.
Interested companies must also register their planned projects with the Myanmar Investment Commission. Each economic zone will have a one-stop service centre to assist companies interested in investing, he said.
“Although investment is so far limited to private businesspeople, we plan to ease limitations later, especially in the energy and communication sectors,” U Set Aung said.
“Some large foreign companies have applied to invest in mining and energy projects too,” he added.
He said the special economic zones would be classified as either free zones or promotion zones. He said companies that focused on exports would be encouraged to work in the free zones.
“If they distribute goods to the domestic market from the free zones they will be required to pay taxes. And residential houses will not be allowed to be built in the free zones,” he said.
Shopping centres, hospitals, education centres, banks and insurance companies will be placed in the promotion zone, where companies focused on the domestic market would be based.
“From the promotion zone, they can distribute to the domestic market freely but they have to pay tax on products, importing raw materials and instruments when they export the products to other countries from the promotion zone,” U Set Aung said.
Translated by Zaw Winn