Yangon — The American Chamber of Commerce (AMCHAM) will launch a Myanmar chapter at the end of the month, another signal that businesses from the United States are showing a greater interest in a country that was off-limits to most American investors until-mid 2012.
The launch event will take place at Yangon’s Chatrium Hotel on Oct. 31 and will be co-hosted by the US Embassy in Myanmar, with backing from Chevron, the US energy giant that has operated in Myanmar since acquiring Unocal, along with the latter’s stake in the offshore Yadana gas project, in 2005.
Judy Benn, Executive Director of the American Chamber of Commerce in Thailand, which is supporting the launch in next-door Myanmar, told The Irrawaddy that 25 companies, a mix of big brands, small and medium enterprises and Burmese businesses partnering with American companies, have joined the Myanmar chapter so far.
“The chapter will promote US business values including compliance with laws, respect for the individual and dignity of the worker, training and education for employees, environmentally responsible business practices, encourage companies to be good corporate citizens and promote high standards of professionalism and business ethics,” Benn said.
A recent World Bank survey of Asian economies said foreign direct investment into Myanmar grew from 3.7 percent of GDP in 2011/12 to 5.2 percent in 2012/13. “Most of this investment was in the energy sector, garment industry, information technology, and food and beverages,” the bank said.
American investors in these sectors include Coca-Cola, GE, Pepsi and Cisco, but overall US investment in Myanmar remains low. Out of a total of over US $43 billion worth of foreign investment into Myanmar since 1988, just over $243 million was of American origin, according to the Myanmar Investment Commission, the body that vets would-be foreign investors.
The establishment of the new AMCHAM chapter in Myanmar is a hint that American investment is likely to grow, however, in coming years. Myanmar Investment Commission official Khine Khine Nwe said that the new chamber “is quite a convincing move to show that foreign and of course American investors are interested in Myanmar.”
Several high-profile American business missions have visited Myanmar during 2013, while Myanmar President Thein Sein addressed the US Chamber of Commerce during his visit to Washington in May. Alexander Feldman, President of the US-ASEAN Business Council, a membership group for American companies operating in Southeast Asia, told The Irrawaddy that the opening of the new chamber, coming fifteen months after American businesses were given the green light to invest in Burma, “is yet another signal of the commitment of US business to Myanmar.”
US Secretary of State John Kerry met briefly with Thein Sein on the sidelines of the recent East Asia summit held in Brunei, where Deputy Information Minister Ye Htut told The Irrawaddy that, “The Secretary of State fully understands the challenges we are facing in the reform process and said that the United States wants to give full support to us in this.”
US businesses were permitted to invest in Myanmar in mid-2012, after a fifteen year investment ban on doing business in the repressive military regime was suspended.
However, some sanctions, such as a ban on dealing with businessmen deemed to have links with Myanmar’s military or are alleged to have engaged in illicit activities, such as drugs trafficking, remain in place. These remaining American sanctions were not among the topics of the fifteen-minute closed-door meeting in Brunei, according to Ye Htut.
American companies putting $500,000 or more into Myanmar, or investing in its gas and oil sectors, are required to file reports with the US government outlining steps taken toward “responsible investment.”
The reports include details such as what human rights and worker rights policies have been implemented in the course of the investment and what due diligence has been undertaken on local partners. Currently, there are five such reports posted on the website of the US Embassy in Myanmar.