A new wholesale trade center has been given the green light to open at the Myanmar-Bangladeshi border near the town of Maungdaw, according to Aung Kyaw Nyut, the center’s chairman.
He said plans to open the center sooner had been delayed because of the security situation in western Rakhine State which was the scene of deadly communal violence over the past year.
He said the new wholesale center—which will be the third in the area alongside the Maungdaw Myomah Wholesale Center and Ngakhuya Wholesale Center—would be opened at Pyin Hpyu Port, near the banks of the River Naf.
It is hoped the wholesale center will facilitate easier and more open cross-border trade between Myanmar and Bangladesh, and reduce trading costs. Fisheries is one sector that is expected to greatly expand when the trade post opens.
“The main difficulty in exporting is transportation,” said local Maungdaw trader Saw Hla Aung. “The wholesale center should allow for easier trade.”
Taxation and immigration officers should also be appointed to the new center as it the other two wholesale centers, said Aung Kyaw Nyut.
Myanmar’s Ministry of Commerce will move ahead with plans to open a series of markets at the Indo-Myanmar border area, said Tayza Aung Win, a director at the Sub-department of Internal Trade.
The border markets will be opened in 10 villages in three townships of Chin State—Tiddim, Chikha, Tonzang— and three townships of Sagaing Region—Lay Shi, Lahe and Tamu.
The news follows an announcement by the Ministry in April that a border market would be opened in Sagaing’s Pan Saung, which is scheduled to launch first. Pan Saung is situated in the mountainous Naga Autonomous Region in the northern Sagaing Region.
Local residents living in the Indo-Myanmar border areas are relatively poor and the region has poor roads and communications, so the border markets will be opened to help promote their livelihoods, said Tayza Aung.
He added that if the border markets are successful, they will be promoted as border trade centers.
French Trade Minister Nicole Bricq will lead a delegation of small- and medium-sized businesses to Myanmar next week as France looks to boost trade ties with the once-isolated nation.
Bricq's office said in a statement that she would be joined by representatives of 15 businesses for the visit on July 30 and 31.
The trip "will allow France to present what it has to offer to authorities" in the country, and will include meetings with the finance minister and other officials.
It comes after Myanmar's President Thein Sein last week visited France, where he met with President Francois Hollande and was praised for implementing reforms.
The European Union last month readmitted Myanmar to its trade preference scheme, saying it wanted to support reform in the once-pariah state through economic development.
Myanmar exports still need to meet quality standards despite the trade privileges bestowed under the EU’s General System of Preferences (GSP), Myanmar businessman have told Mizzima.
Myanmar Fisheries Federation Vice-Chairman Hnin Oo said that being awarded preferential trading rights did not settle all issues. He said that it would help in reducing the import duty which was a benefit to home-based buyers. That, in turn, would mean cheaper imported goods and a knock-on effect that Myanmar importers would make more contacts
with buyers in other countries.
However, he said, the main difficulty for Myanmar products is quality control which must meet strict international standards. For instance, food products must meet stringent safety regulations, he said.
Economist Hla Maung said that under GSP regulations, all products must be completely manufactured and exported in the country of origin. This creates a problem for Myanmar’s garment factories because they are generally aligned to a ‘Cutting, Manufacturing, Packing’ system of production.
Rice exports too would face restrictions. Most of the rice exported from Myanmar is 25% broken rice. Only fishery products and pulse and beans exports would enjoy this GSP privilege, Hla Maung said. Mizzima has learned that pulse and beans traders are planning to begin exporting to EU countries in August and September.
Fishery product exporters said that out of 50 applicants in Myanmar only 13 had received an EU certificate of international standard, allowing them to export to Europe.
Myanmar Fruit Producers and Exporters Association Vice-Chairman Le Le Oo said, “For fruit exporters, our products must meet the EU’s requirements. We cannot yet export our fruits to the EU since we do not yet have a VHT machine for checking the quality.”
The EU issued GSP benefits to Myanmar law on June 29, 2013, and it came into effect on July 19.
For more background:
The draft telecommunications bill that will soon be presented to the lower house will include a provision allowing the free import of communication devices exempt from Myanmar’s standard licensing scheme, Myanmar Computer Federation executive committee member Zaw Min Oo today told Mizzima.
Under the current telecoms law, importing telecoms devices and equipment required an import license issued by the Telecommunications Department. Zaw Min Oo added that equipment importers will also be able to bypass obtaining trade licenses issued by Myanmar’s Trade Department under the new draft law.
“Under the current law, importing without the proper license is a punishable offense, but now this provision has been deleted in the draft law. Merchants who have a trading license can import telecoms devices and equipment as soon as the Trade Department clears their application,” Zaw Min Oo said.
Mobile handsets are commonly imported into the domestic market illegally without licenses. Under the draft law, mobile shop owners can look forward to providing warranties and service on legally imported stock.
“The price of mobile handsets will also fall as the market saturates with legal imports,” said Kaung Sett, a Samsung handset agent and dealer.
The Union Parliament accepted input on the draft law from July 12 to 15 through the establishment of a temporary affairs committee.
The European Union last week signed legislation readmitting Myanmar to the EU trade preference scheme, allowing Myanmar rice, and other products, to be imported into the EU duty-free as Myanmar is considered a Least Developed Country (LDC).
As an LDC, Cambodia rice is also allowed to be imported into the EU duty-free, and will now have to compete more directly with Myanmar for European business.
Myanmar’s membership of the trade preference scheme was withdrawn in 1997 due to EU concerns about forced labor under Myanmar’s military junta. Meanwhile, the International Labour Organization (ILO) lifted its restrictions on Myanmar in June 2012.
This article first appeared on industry website Oryza on June 24, 2013.