Myanmar Land Ownership and Investment: A Complex Picture
Navigating the Challenges of Foreign Investment in Myanmar
As Myanmar continues its transition towards becoming a more open economy, foreign investors are eager to explore opportunities in the country. However, navigating the complexities of land ownership and investment can be a daunting task.
The Current Landscape
At present, there is no centralized legislation governing land ownership and use in Myanmar. Instead, a patchwork of laws and regulations applies to different types of land, including:
- Farm land
- Forest land
- Vacant land
- Industrial land
- And more
Key Issues Facing Foreign Investors
One of the key issues facing foreign investors is the prohibition on selling, transferring or exchanging land to foreigners, as outlined in the Treaty for the Promotion and Protection of Investments (TIPRA). However, exemptions can be granted by relevant government ministries, allowing foreign governments, diplomatic missions, and organizations to secure land use rights.
Opportunities for Foreign Investors
The Myanmar Investment Law (MIL) and the Special Economic Zone (SEZ) Law also offer opportunities for foreign investors to lease land for a term of at least 50 years. These laws give foreign investors the right to lease land for development projects in specific sectors, such as:
- Manufacturing
- Tourism
- Real estate
Sectors Off-Limits to Foreign Investors
Certain sectors remain off-limits to foreign investors, including:
- Exploration, extraction, and sale of petroleum and natural gas
- Postal and telecoms services
- Pilotage and air navigations services
- Power generation and distribution
- Cultivation and conservation of forest plantations
However, the government has shown a willingness to allow non-state entities to participate in these sectors through joint ventures or partnerships with local companies.
Recent Developments
In recent months, the Central Bank of Myanmar has taken steps to strengthen financial regulation and stability. The bank has introduced new rules requiring banks to maintain a minimum liquidity ratio of 20% and to report their weekly average liquidity position to the central bank.
The yearly update of the Union Tax Law (UTL) also came into force in April, introducing a number of changes aimed at simplifying tax administration and reducing the tax burden on small and medium-sized enterprises (SMEs).
In the labor sector, the Ministry of Labour, Immigration and Population has issued a revised Standard Employment Contract Template (SECT), which aims to provide greater clarity and consistency for employers and employees.
A draft Workplace Safety and Health Law is also under consideration, which would introduce new safety standards for industries such as:
- Manufacturing
- Construction
- Mining
The law would require businesses to obtain licenses and permits before operating, and would establish a system of workplace inspections and enforcement.
Conclusion
While the complexities of land ownership and investment in Myanmar can be challenging, there are opportunities available for foreign investors who are willing to navigate the regulatory landscape. By understanding the current laws and regulations, as well as the recent developments in the country, foreign investors can make informed decisions about their investments in Myanmar.