Myanmar state media details new foreign investment law

Sat Nov 3, 2012 8:00am GMT
 

By Aung Hla Tun

YANGON (Reuters) - Myanmar's new foreign investment law allows overseas firms to fully own ventures and offers tax breaks and lengthy land leases, state media said on Saturday, releasing details of legislation passed by parliament this week after a long delay.

The law, approved by President Thein Sein on Friday, had gone back and forth between the legislative and executive branches since March in a tussle involving a government eager to attract foreign investment, tycoons determined to protect their monopolies, and small businesses keen not to be shut out.

Thein Sein took office in March 2011 at the head of a quasi-civilian government that brought almost 50 years of military rule to an end.

He has undertaken economic and political reforms that have persuaded Western countries to suspend sanctions and prompted an upsurge of interest in the country from multinational firms, which see potential in Myanmar's abundant resources and a primitive, low-cost economy bordering India and China.

Most major firms have been waiting to see the new law before committing significant funds.

The details in Myanmar-language state newspapers said joint ventures between foreigners and Myanmar citizens or the government would be permitted with any stake ratio agreed between the partners.

Foreigners can still own 100 percent of businesses without the need for a local partner, as in the previous law dating from 1988. But there could be restrictions in some areas.

A previous draft had said foreigners would only be able to hold a maximum 50 percent of a firm in certain sectors deemed sensitive, including agriculture, and that foreigners would have to hold at least 35 percent of any start-up joint venture.   Continued...

Myanmar's President Thein Sein walks out from his first news conference since his reappointment as head of the ruling party Union Solidarity and Development Party (USDP), at the presidential palace in Naypyitaw October 21, 2012. REUTERS/Soe Zeya Tun
 
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