Representatives of US companies have become frequent guests at the Myanmar Federation of Chamber of Commerce and Industry these days as they explore business opportunities in the long-isolated country.
The visits have gathered pace since the National League for Democracy (NLD) won the election and the power transition from military rule appeared to be going smoothly, Win Aung, president of the federation, said last week.
“I strongly believe that Myanmar-US economic relations will strengthen in the next government’s term.
“As now is the transition period, many US and Western companies are in a wait-and-see mood. Most of them want to observe what would be the NLD’s economic policies and the important legislative changes in the next government’s term,” he said.
At the US-Myanmar business-matching event held by the federation and the American Chamber of Commerce Myanmar Chapter, more than 30 executives of 22 US companies, including blue chips like Ford Motor, Dow Chemical, DuPont and Honeywell, mingled with more than 50 local businessmen.
“It usually takes time to set up joint operations after only one discussion. But I expect more than 50 business deals from this matching. Partnerships will start with trading followed by investment,” he said.
Richard Jackson, general manager of RLC Technical Recruitment Specialist, an outsourcing company, was among the American businessmen.
“We do not come here with expectations of immediate business. I think there are opportunities everywhere.
“It is a great opportunity to get to know what our customers need and to discuss face-to-face with key decision-makers of the federation and local businesses as well as other American companies looking at Myanmar to set up a business here,” he said.
RLC has no local representative in Myanmar. Without someone on the ground, no proper job could be carried out, so the company is looking to set up operations here.
“Perhaps a big expansion will take place in two or three years.”
A few years ago, US companies still thought it a risk to do business in Myanmar. Now, that fear no longer exists, Jackson said, adding most US businesses are, however, concerned about poor infrastructure and skilled-labour shortages.
To make the country more attractive, the new government should strengthen the legal framework for foreign ownership and business protection.
It should invest big in technical skills training, English training and education for long-term benefits, he added.
As of last month, 17 US projects with combined investment of US$248 million (Bt8.9 billion) were approved – making the US the 14th-largest source of foreign direct investment into Myanmar, according to the Directorate of Investment and Company Administration.
However, only two companies with $4.65 million actually launched operations in the country, resulting in the 30th ranking.
While urging US companies to find local partners, Win Aung said that attracting US investment were factors such as abundant natural resources, a sizeable labour pool and very competitive wages.
He also called for the complete lifting of US sanctions to further boost business ties.
“We expect full lifting of US sanctions in the near future. We want sanctions to be lifted rather than suspended.
“If the sanctions are lifted, local businesses will get a lot of benefits from exporting their products to the US. This will lead to further growth of our economy,” he said.
The federation strongly proposed the lifting during a discussion last August with John Goya, senior director for Southeast Asia at the US Chamber of Commerce.
Since then, both sides have had close interaction regarding challenges posed by US sanctions for developing bilateral economic relations.
Sanctions remain on some enterprises and individuals connected to the military.
The US government last year announced a lifting of trade sanctions. That suspension of the sanctions will expire within six months.