An open day for the media this week helped showcase the Thilawa Special Economic Zone that is working to attract foreign investors to Myanmar, offering an alternative to the increasingly costly Asian destinations such as China.
Speaking to the media at a presentation at Thilawa SEZ, Yoichi Matsui, Chief Advisor to Thilawa SEZ Management Committee from the Japan International Cooperation Agency (JICA) said the number of expansion projects and capital increases in the four years after the first company went into operation in 2015 “shows investors’ confidence in Thilawa SEZ and Myanmar workers.”
Speaking at the event on 26 September, Mr Matsui said a total of 113 projects have been approved in less than five years.
The total approved investment amounts to US$1,847 million, as of 26 September 2019, according to the chief advisor.
According to a report by Kyodo News, the Japan-backed special economic zone in Myanmar is expanding as an alternative production hub from China, attracting growing numbers of Japanese and other foreign firms to the outskirts of Yangon.
Tomoyasu Shimizu, president of Myanmar Japan Thilawa Development Ltd, or MJTD, the operator of the economic zone, told Kyodo News recently that more than half of the total developed area of 5.83 million square metres in the Thilawa SEZ is already occupied.
Since its opening in 2015, over 90 firms under full foreign ownership and 13 foreign-Myanmar joint ventures have set up in the special economic zone.
As Mr Matsui told the media this week, the purpose of the Thilawa SEZ includes the facilitation of Foreign Direct Investment, promotion of exports, inflow of up-to-date technologies, increase in employment, development of the national economy, and area development.
As he pointed out, the SEZ provides a range of facilities including Free Ports, Free Transit Zones, Free Trade Zones (FTZ), Export Processing Zones (EPZ), Economic Special Zones (ESZ), Free Zones, and Sector specific Zones.
The SEZ allows both 100 percent foreign investments and joint-Myanmar-foreign ventures.
While Myanmar is reportedly lagging behind its target for FDI this financial year, the Thilawa SEZ management committee is seeking to extol the virtues of investing in Myanmar and the special economic zone.
Its One-stop Service Center seeks to smooth the way for foreign investors, including reducing red tape.
The SEZ tenants are companies from a wide variety of sectors including apparel, building materials, packaging, food and beverage, the growing auto and auto part maker sector.
Mr Matsui said the future will see further development of the area, including a Smart City, or Central Business District.
According to Mr Shimizu, rising labour costs and tighter environmental regulations are driving foreign companies out of China to other Asian countries such as Vietnam and Myanmar.