Thursday, August 17, 2017

Microsoft inks second deal with Myanmar

Microsoft has for the second time in three months announced a deal with a local Myanmar conglomerate, this time to license infrastructure and software to real estate and construction giant Shwe Taung Group for an undisclosed sum.

Microsoft yesterday announced it would license infrastructure and software to Shwe Taung Group. Photo: SuppliedMicrosoft yesterday announced it would license infrastructure and software to Shwe Taung Group. Photo: Supplied

The partnership follows a similar tie-up between Microsoft and Kanbawza Group of Companies announced in September, with both Myanmar firms working to modernise their IT systems and gear up for battle with international competitors.

The American company’s strides into the market indicate its confidence in Myanmar, despite lingering sanctions on the country and reported ties between Microsoft’s newest business partners and the former military regime.

Yesterday, such concerns were not a topic of discussion for the US embassy’s deputy chief of mission Kristen Bauer.

“Myanmar companies like the Shwe Taung Group are really setting a positive public example for other local companies by providing their employees with the access to genuine world-class software respecting intellectual property rights and helping Myanmar protect itself against cyber security threats,” she said.

The deal allows Shwe Taung Group to access tools such as Windows 10 Enterprise and Office 2016 Professional through Microsoft partner Myanmar Information Technology, which according to Microsoft is the sole licencing partner in Myanmar for the agreement.

Microsoft Asia Pacific general manager Michelle Simmons praised the company’s dedication to intellectual property rights and strong corporate governance – significant as IP protection and compliance are two areas where many Myanmar companies have yet to meet international standards.

“The stack of Microsoft solutions included in this agreement will enable them to be more competitive on a global scale and better collaborate with their employees, partners and vendors, along with a priority to security,” she said.

The current chair of Shwe Taung Group has been painted less rosily by some in the United States government.

A WikiLeaks cable from 2007 states that “much speculation surrounds Aik Htun, including claims that [he] has close ties to drug traffickers” and that the US Treasury once labelled him as linked with the narcotics trade.

The cable also highlights his ties to the previous military regime.

“Aik Htun acknowledged that his position stems from his comfortable relations with major government and business players built on 30 years of experience working deals through the regime,” it said. “[He] enjoys the regime’s confidence, and benefits handsomely from its business.”

The cable also clarified that U Aik Htun “denied the widespread allegations connecting him to narcotics trafficking and money laundering”.

U Aung Zaw Naing said yesterday that the company was very confident it had not done anything wrong.

“We are not in any sanctions list,” he said in an interview. “We are not now in the EU sanctions list ... We [were] never in the SDN,” he said, referring to the United States’ specially designated nationals list.

Ms Simmons said that Microsoft had completed due diligence on its partner – as it does for all its customers – a process which involves ensuring compliance with local laws as well as US laws and regulations.

Meanwhile, speakers on the day emphasised the values of Shwe Taung Group – a UN Global Compact member for the past three years – demonstrated through the partnership.

“Today we continue our journey to set the gold standard for corporate governance in Myanmar,” said Shwe Taung CEO U Aung Zaw Naing. “It is a journey we will not take alone.”

He called Microsoft’s offering an essential platform. “When you talk about IT platforms ... you cannot run away from Windows,” he said.

The instinct to modernise comes in advance of an anticipated influx of foreign firms. To compete, local companies could in future have to deal with issues of compliance – licencing software and addressing other aspects of good corporate governance.

Microsoft entered Myanmar in 2013 and acted as a founding member of the ICT Council for Myanmar the following year. With this and its new partnerships, it seems to be moving toward establishing a secure foothold in the market.

“The US ICT council and its members like Microsoft ... have signalled their clear long-term commitment to Myanmar,” said Ms Bauer.