Myanmar has had a promising image for economic development and opportunities. Especially in the manufacturing sector, Myanmar offers chances. When China becomes too expensive, together with Vietnam and Cambodia Myanmar is named to be interesting to seek opportunities.

CIL China and Myanmar

CIL China has a strong relation with manufacturing entities that relocate in other countries such as Myanmar. Because the majority of companies and manufacturers moving to these countries are Chinese, Chinese business cultures and infrastructures also having their presence in Myanmar. Working ways and our knowledge are therefore very applicable in these countries as well.

Myanmar business relationship culture

As doing business within the manufacturing sector is very related to China, the way of doing business in Myanmar also has similarities. Myanmar is a relationship-based country. Meaning that companies and people do business based on personal relationships. Internet with its emails and calls are not doing it for you within Myanmar. Physical presence within Myanmar is, therefore, the most beneficial for any operations needed within Myanmar.

Myanmar manufacturing

Until now Myanmar manufacturing for exports has especially gained development within the garment industry. Textiles such as clothing, shoes and bags have increased presence within Myanmar. In the last years that CIL China have created infrastructure and resources in Myanmar, CIL China has gained business infrastructures and resources within manufacturing in Myanmar.

Myanmar SEZ Thilawa Yangon (Special Economic Zones)

Special economic zones are locations that the government have pointed out to be a location with special benefits towards economic developments. Here different laws and rules regarding doing business are applicable to support economic development within the zone. One of the most important ones and related to garment manufacturing is the SEZ Thilawa near Yangon.

0% Tax regulation on imported raw-materials (SEZ)

One of the special regulations, when you are a manufacturer within the Thilawa SEZ in Yangon, is that the Myanmar government allows companies to import raw materials from China import-tax free.

Raw materials of textiles, such as fabrics, need to be imported. As the country has not developed a supply chain for fabrics, raw-materials still need to be imported from China. Besides, China raw-materials are, because of the strong local supply chain in China, difficult to beat on costs and productivity.

0% import-tax regulation in EU (Everything, but arms initiative EU)

One of the interesting benefits of buying in Myanmar is the “Everything, but arms initiative” of the European Union. This policy is helping developing countries with duty-free import regulation except from weaponry and arms. This policy has created that for all products “Made in Myanmar” the EU is holding an import-tariff of 0%. That means on all clothing, shoes and bags made in Myanmar, there is a 0% tariff import-tax regulation within the EU. Compared to importing garments from China, this is a huge profit made where import-taxes can rise up high.

That makes purchasing from Myanmar in the garment industry only based on China-based prices already significantly cheaper than China. Also, Myanmar has lower wages and operational costs than China.

US America trade war

The US-China trade war is also adding speed to a transition of the garment industry from China to countries such as Myanmar. With the current extra tariffs of the US against Chinese products, there is now an additional 10% added on the existing import-tax of Chinese garments which is competing China away in this sector. A move of US garment purchasing orders from China to Myanmar is at the moment going on and will continue as the trade war continues.

Visit of CIL China together with BenCham PRD

CIL China has been visiting Myanmar recently along with the BenCham PRD. To be updated about the developments within Myanmar, we have visited key players within Yangon to discuss the further developments.

EuroCham Myanmar (Yangon)

European Chamber of Commerce Myanmar is an organisation supporting European companies in Myanmar. Being semi-funded by the European Union, it has a key diplomatic role within Myanmar. Besides, they offer valuable advocacy and advisory services for businesses wanting to do business or invest in Myanmar. The Euro Cham have provided us the latest insights regarding the business performance, changes and business opportunities within Myanmar.

Embassy of the Kingdom of The Netherlands (Yangon)

In our visit together with BenCham PRD, we visited the Embassy of the Kingdom of The Netherlands. The embassy, located in Yangon, fulfils a key role on different stages within Myanmar. On a diplomatic level the embassy protects the interests of the Kingdom of The Netherlands and the European Union. It has a key objective within political development and protecting human rights within the country. Also, it supports Dutch businesses operating within Myanmar or wants to enter the Myanmar market.