South Korean investments in Myanmar halted by pandemic

Inward investments from South Korea are now put on hold because of the COVID-19 pandemic, the country’s top diplomat in Myanmar told this newspaper during an exclusive interview at the sidelines of a donation ceremony in Yangon last week.

South Korean Ambassador Lee Sang-hwa said loans and programmes undertaken by Korean International Cooperation Agency and investments plans of Korean companies are now either suspended or postponed by the global crisis.

He added that Seoul has a plan to provide training for businesses after the pandemic.

The Myanmar economy can withstand the shock for now but may not be able to hold out if the crisis continues for a long time, the envoy warned. If that’s the case, the Korean government will shore up support for the Southeast Asian country.

Despite the fact that investment plans have taken a hit, bilateral trade has not halted but only declined.

South Korea is among the top 10 sources of foreign direct investment approvals in Myanmar. Cumulative FDI commitments from the East Asian country have reached US$4 billion as of March 2020, according to Myanmar Investment Commission statistics.

Korean banks are among the seven Asian banks granted operating licences by the Myanmar authorities in early April.

Industrial Bank of Korea and KB Koomin Bank were given preliminary subsidiary licences, which allow the two lenders to carry out wholesale and, from January 2021, onshore retail banking services. Korea Development Bank was awarded a preliminary branch licence for a range of wholesale banking activities.

The three Korean banks have nine months to demonstrate they can fulfill business plans laid out in their application to the authorities before they will be given proper licences, according to the central bank’s licensing committee April 9 statement.

During the first quarter of 2019-20 fiscal year, bilateral trade exceeded US$337 million, with exports amounting to $178 million and imports amounting to $158 million. – Translated

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Source : Myanmar Times

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