Myanmar: Government expects growth of 6.8pc in 2017-18
Despite the slowdown in economic growth, the growth rate for Myanmar is expected to reach 6.8 percent for the fiscal year 2017-18, U Htin Kyaw, the country’s president, said during the national planning commission’s meeting on Tuesday, according to the president’s office.
This is because the weather in the time of harvest was favourable as well as other factors such as the inflow of foreign investment, increasing productivity of SMEs, improved transport infrastructure, tourism growth and other services, the president said.
Small and medium-sized enterprises (SMEs) are expected to further develop and SMEs will have access to loans and the private sector will continue to growth, he added. SMEs will be driving most of the economic growth of the country.
Against that backdrop, U Htin Kyaw said that the country’s GDP is anticipated to grow by 7.2pc from April to September 2018. Sectors such as transport, hotels and tourism and financial services will continue to grow and make progress
Nevertheless, “just over 6-7pc growth for our country is not enough for Myanmar, which is just on track for development,” State Counsellor Daw Aung San Suu Kyi said in the meeting.
She argued that there needs to be innovation for the market-oriented economy for Myanmar businesses to compete in foreign markets and establish an overseas market for domestic products.
Local SMEs businesses are hugely disadvantaged in the market compared to regional competitors, U Kyaw Win, planning and finance minister, said last month. Hence, the government is raising efforts to support the development of SMEs. Currently, the state-owned Myanmar Economic Bank offers loans to those enterprises.
For the 2017-18 fiscal year, approved FDI inflow totaled US$5 billion up until the third week of December 2017, according to the Myanmar Investment Commission. The approved inflow totaled $6.6 billion in the 2016-17 fiscal year. Despite the FDI growth, the country is expected to receive less investments from Western countries such as the European Union and US owing to the Rakhine crisis. The European Union suspended the investment protection agreement with Myanmar because of the Rakhine crisis which provoked an outcry among the international community.
The country is anticipated to receive more investments from East Asian countries, namely Japan and China.
The Myanmar Investment Commission hopes that the pending implementation of the new Companies Law in August will create a investor-friendly environment.