A file photo shows a container crane at the Myanmar International Thilawa Terminal, south of Yangon. Figures released by the Customs Department reveal state enterprises accounted for 52 percent of foreign trade in 2006-07.

THE government controlled more than half of Myanmar’s foreign trade in the 2006-07 fiscal year after its share of trade rose six percentage points, according to figures released by the Customs Department.

State enterprises were responsible for 52 percent of Myanmar’s trade in the year to March 31, 2007, up from 46pc the previous year.

The increase was largely attributed to higher earnings from the sale of natural gas by the Myanma Oil and Gas Enterprise (MOGE).

“We can’t say that trading in the private sector is declining. The (government’s) rise is mainly due to stronger exports of natural gas,” said Dr Maung Aung, an economist with the Economic Studies and Research Centre, under the Union of Myanmar Federation of Chambers of Commerce and Industry (UMFCCI).
The government dominated exports during the year, generating 61pc of the US$5.01-billion total as officials sought to increase their foreign exchange earnings.

Imports, meanwhile, were mainly the domain of the private sector, with the government responsible for 36pc of the $2.92 billion of imports in 2006-07, Customs figures show.

Myanmar achieved a record $7.93 billion in trade in 2006-07 – up 43pc on the previous year – with a surplus of $2.09 billion due largely to the government’s “export first, import second” strategy which limits payment of imports to money first earned through sales abroad.

The MOGE, which alone was responsible for 43pc of the country’s export earnings mainly through its gas exports to Thailand, brought in $2.16 billion in foreign exchange during the year, according to a list of Myanmar’s top 50 exporters and importers released by the Customs Department.

The MOGE’s earnings were particularly strong last year – more than twice the $1.08 billion it exported in 2005-06 – due to high gas prices rather than an increase in the amount of gas exported, an official from the Ministry of Energy told The Myanmar Times on condition of anonymity.

“The amount of natural gas exported was the same as the previous year’s amount but the price was higher,” he said.

The MOGE earned more than four times the country’s next largest exporter, the state-run Myanma Timber Enterprise, which sold $519 million worth of goods abroad.

Third place was the government’s Myanma Gems Enterprise, which brought in $296.9 million from sales. An MGE official said most of the income was from jade sold at three jade and gem emporiums during the year.

“Jade production increased and Chinese passion for jade pushed up prices and demand,” he said, asking not to be identified.

The country’s fourth biggest exporter was Myanmar Ivanhoe Copper Co., Ltd (MICCL), a joint venture between the government’s Mining Enterprise No. 1 and Canadian giant Ivanhoe Mines. MICCL, which brought in $106.6 million from its Monywa Copper Project during 2006-07, has an uncertain future as Ivanhoe Mines in March this year announced it had decided to divest all its business interests and assets in Myanmar.

The country’s fifth top exporter was Htoo Trading Co., Ltd ($65.1 million), which is heavily involved in teak log exports. Run by one of the country’s top tycoons, U Tay Za, Htoo Trading was also the biggest private sector exporter in 2005-06.
Rounding out the top 10 in the Customs Department’s rankings were Myawaddy Trading ($64.3 million); Cooperative Export Import Enterprise ($50.9 million); Golden Peacock Co., Ltd ($33.5 million); KB International Co., Ltd ($27.7 million); and Myanmar Airways International ($24.6 million).

In imports, the private sector, despite accounting for 64pc of incoming trade, featured only once among the top 10 importers.

Cigarette company Rothmans of Pall Mall came in at 5th place with nearly $40 million of imports. The United States Embassy was 10th, bringing in $20.7 million of goods during the year – presumably associated with the construction of its new compound in Yangon.

Myanmar’s top importer, Myanmar Petrolchemical Enterprise, was far ahead of the pack with $676.3 million of imports during 2006-07 as it topped up the country’s petrol and diesel needs.

The MOGE was the second biggest importer ($150.8 million), followed by Myawaddy Trading ($91.2 million), Myanma Railways ($54.0 million), Rothmans, Myanma Electrical Power Enterprise ($36.9 million), Cooperative Export Import Enterprise ($30.6 million), Myanma Posts and Telecommunication ($27.0 million) and the Department of Health in 9th place ($20.9 million).

The private sector was more strongly represented in imports of smaller quantities, however, and accounted for 34 of the country’s top 50 importers, according to the Customs Department.

Dr Maung Aung commented that greater flexibility in trade procedures would likely see the private sector become more heavily involved in international trade.

“Both the government and private sectors are important for economic development of the country. But the government should show some encouragement to the private sector as the country is now practising a market-oriented economic system,” he said.

Thailand was Myanmar’s top trading partner during 2006-07 with a bilateral trade volume of $2.66 billion, Ministry of Commerce figures show.

After Thailand, Myanmar’s other main trading partners were mainland China ($1.27 billion), Singapore ($1.22 billion), India ($895 million) and Hong Kong ($424 million).

China’s official Xinhua news agency last week said 90pc of Myanmar’s foreign trade was with other Asian countries, and was 4.8pc with European nations and a paltry 1.5pc with American countries.