“Myanmar, the best investment opportunity in the world. If I could put all of my money in Myanmar, I would”

Legendary Investor

Jim Rogers

Invest In myanmarAsiA’s FinAl Frontier

HIstory of MyanMar

PolItIcal and econoMIc reforMs

In 2010, the military Junta was officially dissolved following a general election. A civilian government was formed, currently led by Mr Thein Sein. Being a pro-reformist, he has rolled out many new policies and changed his cabinet personnel, propelling Myanmar into the age of political and economic reforms.

Myanmar’s economic goals include its desire to modernize and industrialize and investments have to be aligned with their broader environmental and social goals.

The government seeks to create jobs for its population, create sustainable growth as well as re-engaging the international economic community

Myanmar, formerly known as Burma, is a strategically located country in Southeast Asia, bordered by China, India, Bangladesh, Laos and Thailand. One third of Myanmar’s total coastal line perimeter of 1,930 kilometres forms an uninterrupted coastline along the Bay of Bengal and the Andaman Sea.

Myanmar was the richest country in Asia back in 1962 and was the world’s largest rice exporter. All these ceased after the military rule took over after coup d’état and the country’s economy declined to ruin and ironically became the poorest in the region. Economic stagnation for the next 50 years as it remains isolated from the rest of the world till its recent opening up.

GeoGraPHy ▌ 34% Urbanized Population ▌ 90% Literacy Rate ▌ 40th Largest in South-East Asia ▌ 55 Million Population ▌ 45% under age of 25

Situated between the world’S two moSt populouS and faSteSt growing economieS: india and china.

myanmar offerS direct border acceSS to 40% of the world’S population.

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MyanMar’s econoMyThe country is a major natural gas exporter. Other exports include oil, teak, and precious and non-ferrous metals. The extractive resource sector – natural gas, timber and mining – as well as power generation, are all sectors with significant FDI. Energy and mining account for 55% of Myanmar’s exports and 86% of its FDI.

There is also potential for Myanmar to develop exports in agricultural outputs and fisheries. Although 34% of Myanmar’s population live in urban areas, around 70% of the labour force is employed in the agricultural sector. Myanmar fisheries companies resumed exports to the United Stated in Feb 2013 after the sanctions have been lifted.

groSS domeStic product ▌ USD 45 Billion in 2011 ▌ USD 51 Billion in 2012 ▌ GDP is expected to reach USD 55 Billion by 2014

Source: World Bank, ADB Estimates

economic growth rate ▌ Average growth of 5.3% from 2006 - 2010 ▌ The World Bank forecasts that Myanmar’s GDP growth at 6.3% during the 2012-

13 financial year. ▌ Asian Development Bank (ADB) expects growth to rise to 6.7% in 2014.

MyanMarasIa’s fInal frontIer

Post Opening-Up Growth Rate of China and VietnamChina’s growth rate averaged 9.22% from 1989 to 2013

Vietnam’s growth rate averaged 6.3% from 2001 to 2012

2011 2012 2014

25M

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2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

foreign direct inveStment in variouS SectorS Energy - 49% (12.5 Billion) Oil and Gas - 41% (10.4 Billion) Mining - 9% (2.2 Billion) Others - 1% (0.3 Billion)

if you have miSSed china or vietnam, do you want to miSS myanmar again? In

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foreIGn dIrect InvestMentsForeign Direct Investment (FDI) reached USD 794 million over the first nine months of the 2012 - 2013 fiscal year. Myanmar’s total foreign trade reached USD 8.5 billion - USD 13.3 billion in 2012, contributing to 27% of the country’s GDP.

Myanmar sees an in flux of foreign investors seeking to tap on the unique opportunities that eased sanctions presents. MNCs like Coca-Cola Company and Ford Motor Company are flooding in to capitalize on the untapped potential.

countrieS fdi in myanmarNo. Country USD in million %1 China 13,949 34,3%2 Thailand 9,568 13,5%

3 Hong Kong 6,308 15,5%4 Rep. of Korea 2,941 7,2%5 UK 2,760 6,8%6 Singapore 1,804 4,4%7 Malaysia 1,027 2,5%8 France 469 1,2%

9 United States 244 0,6%10 Indonesia 241 0,6%

Source: Ministry of National Planning and Economic Development

multi national corporationS in myanmar

MyanMar tourIsM BooM

mutli national hotelierS in myanmar

Myanmar’s recent opening up has resulted in a dramatic increase in visitors to the country. It is an unique travel experience to a completely unspoiled country retaining rare natural beauty.

TOURISM MASTER PLAN ▌ 1.5 million visitors in

2013 ▌ 7.5 million visitors by

2020 ▌ Upgrade 3 airports to

combined capacity of 8 million passengers annually by 2018

New hotels are planned to serve the coming tourism boom. Include global chains such as Accor and Hilton.

Singapore was the biggest hotel investor in Myanmar, beginning construction of 12 hotels and apartment complexes with total value of US$597.75 million, followed by 10 projects from Thailand worth US$235.75 million, and six from Japan costing US$183 million.

There is a present severe shortage of quality hotels to support booming tourism.

Out of the 8000 hotel rooms in Yangon, only 1,500 – 2,500 are of international standard. Against 1m tourist arrivals last year.

As a result, hotel room rates in Yangon have more than tripled to US$250-300 from US$80 in 2011.

2006 2012 2013

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Infrastructure develoPMent and urBan PlannInG Myanmar’s commercial capital – Yangon’s population is expected to reach 10 million by 2030 from the current 5.14 million. Migration Dynamics will create a huge and stable increase in property prices as the population increases. In view of this increase in population, the Myanmar government has called for infrastructure development and had introduced a new master plan for Yangon.

Drawing from urban planners in Singapore, the Yangon City Development Committee seeks to decentralise Yangon’s CBD by shifting it outward within a 10km to 15km radius.

legal framework ▌ Myanmar is a party of Geneva

Protocol on Arbitration Clauses ▌ Myanmar is a party of ASEAN

Investment Protection Agreement ▌ Myanmar Companies Act ▌ Special Companies Act ▌ Foreign Investment Law ▌ Myanmar Investment Commission ▌ State-owned Economic Enterprises

Law

myanmar foreign inveStment law (fil) ▌ Amended and Enacted on 2nd Nov 2012 ▌ Land leases: Land leases will clearly define what the land can be used for ▌ The terms of the grant for land leases will also be more specific. ▌ Any foreign business that is nationalised will be compensated at current market

prices. ▌ Guidelines for local labour requirements: ▌ Foreign companies must meet employment targets. All unskilled workers must

be Myanmar citizens and foreign companies have 15 years to ensure that at least 75% of their skilled workforce is Myanmar citizens.

foreign equity participationMyanmar allows 100% foreign investment in projects approved by the Myanmar Investment Commission and mandates that the foreign partner must contribute at least 35% of the capital. The new law also states those sectors where joint ventures with local companies are permitted.

▌ Allows for 100% foreign owned companies ▌ Allows for 100% foreign capital ▌ Permit to Trade: USD 50,000 for Service Industry ▌ MIC Permit: To be prescribed by MIC according to business activity ▌ Foreign Companies allowed to lease land from the locals/government for an initial

period of 50 years + 10years + 10years depending on business and industry and amount of investment

▌ 5 Year Tax Holiday ▌ Income tax 25% ▌ Double Tax Agreement with Singapore

myanmar inveStment commiSSion (mic)Develop State’s economy by promoting investment projects, promote more opportunities for investment, technical know-hows and jobs prospects.

▌ Under the Directorate of Investment and Company Administration (DICA) ▌ Approving Foreign Investment Proposal ▌ Liaise between Investors and Government ▌ Handles complaints from Foreign Investors ▌ Seek approval from MIC for any changes in Co. Admin/Operations

build, operate and tranSfer (bot) A private entity receives a concession from the private or public sector to finance, design, construct, and operate a facility stated in the concession contract. This enables the project proponent to recover its investment, operating and maintenance expenses in the project.During this period the private party has the responsibility to raise the finance for the project and is entitled to retain all revenues generated by the project and is the owner of the regarded facility. The facility will be then transferred to the public administration at the end of the concession agreement, without any remuneration of the private entity involved.In

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sInGaPore and MyanMar BIlateral tIes Singapore and Myanmar enjoy good bilateral relations and cooperate closely within ASEAN. Myanmar is among the top 10 recipient countries under the Singapore Cooperation Programme (SCP). Under the Initiative for ASEAN Integration (IAI), Singapore established the Myanmar-Singapore Training Centre (MSTC) in Yangon in 2001 to train Myanmar officials.

SINGAPORE - MYANMAR

myanmar and other countrieS Japan and myanmar

▌ Japan writes off USD1.74 billion in arrears owed to it by Myanmar’s government ▌ Prime Minister Shinzo Abe said Myanmar had met the necessary conditions,

including a series of political and economic reforms. ▌ The debt forgiveness was contingent upon Myanmar pushing ahead with reforms

over the past year that included lifting media censorship, enacting a new foreign investment law and allowing more freedom for political activists and parties such as the National League for Democracy (NLD).

▌ 51.05 billion yen in new aid announced in May 2013 ▌ Japan will provide up to 20 billion yen for the Thilawa project which will be

invested in electricity infrastructure and expansion of the port.

norway and myanmar ▌ Norway’s Telenor awarded telecommunication license ▌ Burmese and Norwegian governments along with the Asian Development Bank

announced the implementation of a US$500 million tourism master plan. ▌ More than 30 development projects will be completed in accordance with the

master plan, including the building of new roads and expanding arrival terminals at the country’s airports.

“increaSingly, they have Seen greater intereSt from Singaporean buSineSSmen to look at the proSpect in myanmar and i think thiS iS an excellent Start”

tony tan keng yampresident of Singapore

“aS an iron fiSt haS unclenched in burma, we have extended our handS, and are entering a new phaSe in our engagement on behalf of a more democratic and proSperouS future for the burmeSe people.”

president barack obama

Technical Corporation

Program

Economic Development

Public Administration

Human Resource

Development

▌ 3rd largest trading partner ▌ 6th largest FDI ▌ Top FDI in Tourism ▌ 1st country to offer

assistance following Cyclone Nargis

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thilawa Special economic Zone ▌ Over 2,000 hectares between Thanlyin and Kyauktan townships in Yangon region ▌ Joint Cooperation between Japan and Myanmar ▌ The SEZ project includes factories, high-tech industry, textile, labour intensive

industry and manufacturing industry.

yangon international airport hanthawaddy international airport

▌ Upgrade of Yangon International Airport to increase its capacity to 6 milion visitors by 2015.

▌ Hanthawady International Airport in central Bago region. This airport with a planned capacity of up to 12 milion visitors is set to complete by 2016.

Sino – burma oil & gaS pipeS ▌ China and Burma signed an agreement to build a natural gas pipeline, and an

agreement to build a crude oil pipeline. ▌ The oil pipeline will have a capacity of 12 million tonnes of crude oil per year. ▌ Completed in July 2013.

india-myanmar-thailand trilateral highway

▌ From Moreh in Manipur to Mae Sot in Thailand, via Myanmar

▌ Greatly enhance the connectivity between the Mekong sub-region and India.

SOUTHERNCORRIDOR

india-burma-laoS-cambodia-vietnam Southern corridor

▌ Building roads and rails to the Thai-Burma border that will eventually link up the Dawei seaport

Myanmar

ShweAnn

Kyauk Phyu

Mandalay

China

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world economic forum 2013 ▌ First post-reforms leading international gathering to be held in the country ▌ An unrivalled opportunity to understand and to shape Myanmar’s ongoing

reforms and reconciliation process

myanmar Stock exchange

▌ To open in Oct 2015 ▌ Japan’s Daiwa Securities and the Tokyo

Stock Exchange signed an MOU with the Central Bank of Myanmar (CBM) to modernize Myanmar’s securities market

▌ Securities and Exchange law will be on the country’s statute books by July 2013

▌ International Monetary Fund is currently working with the country’s government on upgrading its financial systems and regulatory framework.

27th Sea gameS ▌ Held across 3 cities – Naypyitaw, Mandalay and Yangon ▌ After 1961 and 1969, this is the 3rd time Myanmar is hosting the SEA Games

aSean chairmanShip 2014 ▌ Myanmar assumes the chairmanship of ASEAN in 2014 ▌ A critical role in guiding the bloc’s ten member economies toward the planned

economic integration in 2015.

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“myanmar iS in the Same place china waS in early 1979, when deng xiaoping Said we have to do Something new. myanmar iS now opening up.”

Jim rogerslegendary investor

“the Scope of opportunitieS in myanmar iS immenSe, given itS SiZe, population, reSourceS, market and relatively undeveloped economy.

companieS can expect to face immediate demand for their productS or ServiceS acroSS a wide

Spectrum of induStrieS. aS myanmar developS itS inStitutionS, the proSpect of levelling up

within a Sector iS there”.ie Singapore

If you could turn back time...

InvestInG In tHe Golden land...Why NOW?

Myanmar is abundant of natural resources with a land mass of approximately 677,000 sq km. 1

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The country has a young and educated labour force. 45% of the Population are under the age of 25 and a high literacy rate of 90%.

The government is cutting layers of bureaucracy, shoring up infrastructures and instituting financial reforms.

Foreign Direct Investment catapulted from USD 200 Million in 2007 to USD 20 Billion in 2011.

Singapore’s foreign investment into Myanmar is USD 600 Million and is the top foreign investor in the hotel sector.

Amendments to the Foreign Investment Laws in November 2012 are pro foreign investors and have a strong legal framework which safeguards foreign investment.

Myanmar is Asia’s final frontier. It is at where China was in 1979. It is the last country in the Mekong Sub-Region and the Indo-China area to open up. Myanmar will experience the leapfrogging phenomenon and double digit GROWTH in the following of liberalization.

Visitors to Myanmar have increased exponentially from 600,000 in 2006 to 1 Million in 2012. It is expected to receive 1.5 Million visitors in 2013.

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Would you Have Invested In cHIna 20 years aGo?

would you have inveSted in Singapore 30 yearS ago?

There’s no way we can go back in time but we can educate ourselves using lessons of the past to foresee the future and look for SIMILAR OPPORTUNITIES.

inveSting in myanmar with Zochwell group Zochwell Group has established a strong foothold and wide network in Myanmar giving us unique access to land securitization and acquisition. Zochwell Group is also involved in multiple development projects in Naypyitaw, Yangon and Mandalay, including boutique hotels, Condominium and Casino Island Development.

Invest in Myanmar with Zochwell Group, your opportunity to wealth creation.

Think Myanmar, Think Zochwell.

MyanMar is aT The sTage where singapore and China were 30 years ago. The TiMe is now for MyanMar.

This material is published for general information only and does not have regards to the specific investment objectives, financial situation and particular needs of any specific person. Full details of standard terms and conditions can be found in relevant agreement.

Information is correct at time of publishing.For more details, speak with your Zochwell Advisory Consultant or visit us at www.zochwell.com

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