Interview: Cheah Swee Gim
As Myanmar’s political and economic landscape continues to evolve, how would you assess the development of its legal infrastructure thus far?
CHEAH SWEE GIM: Myanmar has made excellent progress in terms of legal reform. In 2012 Myanmar started updating old laws and enacting new ones, giving investors a framework to conduct business. While there was criticism that the broad legal principles lacked clarity in terms of implementation, Myanmar then embarked on a second phase of legal reform and began to implement very detailed rules and procedures to address those uncertainties.
These reforms have taken place across sectors, in areas including employment laws and foreign exchange management. To date, there are many laws that have not yet been implemented, some of which are very important – for instance, intellectual property laws have not been passed. But it is not easy for an emerging market to enact a comprehensive set of laws overnight. Myanmar has been isolated from the international business community for a long time, and investors have to pay attention to the fact that the Myanmar government is sincerely committed to legal reform. They have spent a lot of time and resources evaluating the laws that must be passed and redrafting those laws so that they align with Myanmar social and legal business conditions.
What legal changes should investors expect in the near future, and how will these amendments impact investor confidence?
CHEAH: The most widely discussed changes are those relating to the revamping of the Myanmar Companies Act, which was formulated in 1914, and the amalgamation of the Myanmar Foreign Investment Law with the Myanmar Citizens Investment Law to create a more level playing field for foreign investors. When foreign investors have come to events over the past three and a half years, often they have found foreign investment laws to be sufficient for doing business in Myanmar. Their confidence is bolstered by the fact that there is willingness on the part of the Myanmar government to listen to international feedback and to take that feedback into consideration when revising the laws.
To what extent did the national election change the appetite for new business ventures?
CHEAH: In the months leading up to the election there was a slowdown in activity, as many investors adopted a cautious approach. Nevertheless, many investors are coming into Myanmar, as they feel that the early bird will catch the best worms. More importantly, a group of investors already has an interest in Myanmar, and they are continuing to expand their business while waiting for the next wave of foreign investment to occur. This will bring in a lot of opportunities and new investors across different sectors.
In which areas do you see the greatest need to strengthen investor rights in Myanmar?
CHEAH: I believe that investors have sufficient rights at the moment. The foreign investment laws and regulations in Myanmar have been well formulated and thought out. I would say that they are robust and on par with the foreign investment laws of other emerging market jurisdictions. Generally speaking, investors have an issue not in terms of the protection of investments but rather with the problems they encounter in enforcing their rights while doing business in Myanmar.
On a day to day basis, investors have challenges in obtaining permits and licences, and determining the correct structure and procedure to carry out their investment. Myanmar is now embarking on the enactment of detailed rules and regulations which will go a long way in making investors more comfortable when carrying out business in Myanmar.
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