CHAPTER 1. Business environment While the first phase of the reforms achieved only limited economic growth, the reform process stagnated from 1997 to 2010 due to various reasons such as the still-dominant roles of SOEs in industries, negative sentiment towards foreign investments, international economic sanctions and on-going civil wars with ethnic minorities. During that period, however, the Government maintained its national accounts mainly with its rich natural resources such as minerals, natural gas, hydroelectricity and lucrative border trade (OECD, 2015).
of new business laws (table 1.1). The present phase also emphasizes the development of necessary infrastructure and utilities, such as upgrading roads, building power plants and opening deep-sea ports, particularly for fostering cross-border production networks. It is apparent that Myanmar aims to follow the success of its neighbouring countries through export and FDI-driven development (Abe, 2014). Although the Government has initiated economic reforms and streamlined their roles in working with business, the basic legal and regulatory framework for business is still provided by the colonial-era Companies Act (1914) and associated rules (1940) and regulations (1957).9 A number of line ministries plus various local municipal authorities are involved in the registration and licensing of individual businesses as well as supervision of different industries (e.g., agribusiness, manufacturing,
The second and current phase of reforms, initiated in 2011, has promoted development strategies led by exports and foreign direct investment (FDI), while trying to create a positive business environment for investors, mainly through the development of special economic zones8 (see figure 1.2) and the enforcement
Figure 1.2. Industrial zones and special economic zones in Myanmar
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Source: Abe, 2014.
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