“We saw, somewhat surprisingly, that business sentiment in general was positive. It remained pretty resilient despite the headwinds that the country faced,” OBG Asia regional editor commented at the survey launch.

After three years under the administration led by Daw Aung San Suu Kyi, more than two-thirds (69pc) of respondents describe their near-term expectations for business conditions as positive or very positive, with only slightly fewer (66pc) saying they expect their companies to make a significant capital investment in the year ahead.

“This will be positive news for the National League for Democracy [NLD] as it seeks a fresh mandate to govern next year amid the emergence of new opposition parties and alliances, some of which are fuelled by strong regional grievances,” he told The Myanmar Times.

Mr Cooke added it shows that there has been a reform agenda picking up since the quarter of last year and it reflects Myanmar’s inherent strengths, such as the country’s geographical location, resources and demographics.

However, the majority of executives surveyed (70pc) also felt that foreign direct investment (FDI) in their industry had been affected by the international community’s perception of Myanmar. Approved FDI in the year to September 2018 fell to its lowest since 2014, official statistics suggest, spurring the government to speed up related reform initiatives.

An even greater number (82pc) of executives voiced their concerns about the lack of transparency for conducting business in Myanmar. This is the highest percentage among countries surveyed in the Asia-Pacific region.

“What the people mean when they speak of transparency is first of all [referring to] access of information, so having a publicly available information about your investment decisions, access to state/ regional budget, access to tender documents, and investment plans,” Mr Cooke explained.

The feedback is in line with the findings of other surveys. The first Myanmar Business Environment Index (MBEI) published by the Asia Foundation shows that the government needs to substantially improve transparency. Only 3.6pc of the 4847 firms report having access to the state or region budget, and only 4.3pc of firms report having access to new investment plans. In general, businesses have very limited access to important planning and legal documents provided by the government.

An investigation by The Myanmar Times last week found out that after more than two years since the Myanmar Investment Law came into force, legal requirements for disclosure by the Myanmar Investment Commission (MIC) and investors are still not met. The findings came as the NLD government is making a big investment push to build infrastructure projects. Critics say the transparency failure is exacerbating tensions between local communities, the government and big business.

Although there are improvements in the MIC, Mr Cooke said more can be done.

“Anecdotally, there is inexperience on committees that scrutinise investments. Then you also have the issue of a lot of frequent changes in the senior level of government and agencies, resulting in difficulty to develop meaningful dialogue with the correct people.”

At the same time, there is a perception that there is a sort of favouritism towards local firms that have strong connections.

“Progress has definitely been made. But it’s still an issue for CEOs here.”

The survey also suggested that access to credit for business remains difficult and skills gap is still a concern for business.

Mr Cooke expects the efforts to ease collateral requirements on loan applications, as well as plans to open Myanmar’s first credit bureau later this year, to improve access to credit.

He also highlighted the recent liberalisation measures which drew in FDI. The much-delayed opening up of the insurance industry finally happened this year, with five foreign life insurers awarded provisional licences.

“The business community will be hoping that accelerated reforms are backed by concerted efforts to raise standards at public bodies and institutions involved in facilitating commerce.”

The OBG’s 2019 Business Barometer: Myanmar CEO Survey was conducted between September 2018 and June 2019 with around 100 executives in Myanmar.

Source: https://www.mmtimes.com/news/executives-upbeat-economy-concerned-about-lack-transparency.html