The procedure for Authorized Economic Operators was announced by the Ministry of Planning and Finance through Notification 21/2018 on 30 March 2018.
The procedure for Authorized Economic Operators was announced by the Ministry of Planning and Finance through Notification 21/2018 on 30 March 2018.
As stated in the Procedure for Authorized Economic Operators, an Authorized Economic Operator is a company or organization officially recognized by the Customs Department that meets the criteria outlined in this Procedure and operates within the international trade chain. The international trade chain refers to the system that includes the organizations, processes, technologies, and resources involved in transferring goods or services from the seller to the consumer.
The criteria for recognition as an Authorized Economic Operator require that a person wishing to operate as an Authorized Economic Operator must comply with the company registration requirements and the business licence regulations specified by the Ministry of Planning and Finance, Directorate of Investment and Company Administration. The period between the date of registration under the Myanmar Companies Act and the date of application for registration as an Authorized Economic Operator must be at least 3 years. The applicant must also continuously comply with the Sea Customs Act, rules, regulations, orders, instructions, and procedures. The company must publish official financial statements and reports annually from the date of its establishment. The accounting records and business-related financial information must be maintained for seven years. There must be a good record-keeping system and an effective internal control system which is acceptable to the Customs Department in maintaining financial matters, business records, systems, processes, and any issues related to the Customs service agent.
All taxes and duties imposed by the Customs Department, as well as any other taxes payable to the State, must be paid on time. The applicant must be financially sound. Before applying as an Authorized Economic Operator and before the issuance of the recognition certificate, the applicant must have no record of Customs-related offences or penalties within the past three years, must not be blacklisted, must accurately declare import and export transactions, and must have no record of economic misconduct or fraud. If prior notice is given for inspection when required, it must be possible to undergo inspection at any location.
The benefits available to an Authorized Economic Operator include the right to process Customs declarations with priority status, the right to pre-file import and export declarations before the arrival of goods, the right to obtain customs clearance without inspecting the documents or goods (except in cases involving potential risks for preventing illegal imports or exports), the right to receive priority inspection when required, the right to obtain customs services related to goods at the importer or exporter’s premises or other locations permitted by the Customs Department, the right to operate under the Deferred Duty Payment System within one month, as outlined in Section 41 of the Sea Customs Act, the right to receive the Customs Department’s recognition certificate and display the recognized logo as per requirements, and the right to enquire about Customs procedures with the Customs Department and the Authorized Economic Operators Division.
Therefore, I urge all economic operators throughout Myanmar to cease engaging in illegal trade and apply for a certificate of recognition as an Authorized Economic Operator, which offers the benefits of legal trade. This will allow them to follow the right path of legal trade and operate as “Authorized Economic Operators”.
Source: The Global New Light of Myanmar
The procedure for Authorized Economic Operators was announced by the Ministry of Planning and Finance through Notification 21/2018 on 30 March 2018.
As stated in the Procedure for Authorized Economic Operators, an Authorized Economic Operator is a company or organization officially recognized by the Customs Department that meets the criteria outlined in this Procedure and operates within the international trade chain. The international trade chain refers to the system that includes the organizations, processes, technologies, and resources involved in transferring goods or services from the seller to the consumer.
The criteria for recognition as an Authorized Economic Operator require that a person wishing to operate as an Authorized Economic Operator must comply with the company registration requirements and the business licence regulations specified by the Ministry of Planning and Finance, Directorate of Investment and Company Administration. The period between the date of registration under the Myanmar Companies Act and the date of application for registration as an Authorized Economic Operator must be at least 3 years. The applicant must also continuously comply with the Sea Customs Act, rules, regulations, orders, instructions, and procedures. The company must publish official financial statements and reports annually from the date of its establishment. The accounting records and business-related financial information must be maintained for seven years. There must be a good record-keeping system and an effective internal control system which is acceptable to the Customs Department in maintaining financial matters, business records, systems, processes, and any issues related to the Customs service agent.
All taxes and duties imposed by the Customs Department, as well as any other taxes payable to the State, must be paid on time. The applicant must be financially sound. Before applying as an Authorized Economic Operator and before the issuance of the recognition certificate, the applicant must have no record of Customs-related offences or penalties within the past three years, must not be blacklisted, must accurately declare import and export transactions, and must have no record of economic misconduct or fraud. If prior notice is given for inspection when required, it must be possible to undergo inspection at any location.
The benefits available to an Authorized Economic Operator include the right to process Customs declarations with priority status, the right to pre-file import and export declarations before the arrival of goods, the right to obtain customs clearance without inspecting the documents or goods (except in cases involving potential risks for preventing illegal imports or exports), the right to receive priority inspection when required, the right to obtain customs services related to goods at the importer or exporter’s premises or other locations permitted by the Customs Department, the right to operate under the Deferred Duty Payment System within one month, as outlined in Section 41 of the Sea Customs Act, the right to receive the Customs Department’s recognition certificate and display the recognized logo as per requirements, and the right to enquire about Customs procedures with the Customs Department and the Authorized Economic Operators Division.
Therefore, I urge all economic operators throughout Myanmar to cease engaging in illegal trade and apply for a certificate of recognition as an Authorized Economic Operator, which offers the benefits of legal trade. This will allow them to follow the right path of legal trade and operate as “Authorized Economic Operators”.
Source: The Global New Light of Myanmar
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What is scamming? How does it work? How are young people connected to it? How can we avoid scamming businesses? I am going to answer these questions, so I would like to encourage you to read it up to the end.
The word “scamming” comes from the Chinese language and is pronounced as “Zhàpiàn,” (in Myanmar “ကျားဖြန့်”). In Chinese, it means “cheating” or “fraud.” Today, scamming businesses are well known in Southeast Asia as fraud operations, mostly working online to trick people.
What is scamming? How does it work? How are young people connected to it? How can we avoid scamming businesses? I am going to answer these questions, so I would like to encourage you to read it up to the end.
The word “scamming” comes from the Chinese language and is pronounced as “Zhàpiàn,” (in Myanmar “ကျားဖြန့်”). In Chinese, it means “cheating” or “fraud.” Today, scamming businesses are well known in Southeast Asia as fraud operations, mostly working online to trick people.
One important question is: Who started these scamming businesses? Since the word comes from Chinese, many people believe that scamming businesses started in China. When IT technology developed rapidly in China, these businesses also grew internationally.
Scamming businesses have different types. Some mainly target Western countries, especially rich people, retirees, and those over 40 years old. They often focus on wealthy people in America and Europe.
Scamming businesses are not simple fraud operations. They are large-scale businesses that include human trafficking, forced labour, illegal weapons trade, drug smuggling, gambling, and many other illegal activities.
Where are scamming businesses based?
Where do they operate the most? The answer is simple. These businesses are mostly found in poor Southeast Asian countries such as Cambodia, Laos, Thailand, the Philippines, and Myanmar. They set up large offices and hire workers in these developing countries.
How do they find workers?
There are two main ways. First, they attract people by offering high salaries but later force them to work. Second, they use human trafficking to kidnap people and make them work against their will. In Myanmar, most of these businesses are located in border areas. They do not operate secretly but in large, well-protected buildings.
How Scamming Businesses Operate
Understanding how scamming businesses operate is very important. It is also their biggest secret. The process includes setting up a base, collecting information, recruiting workers, starting operations, and finally running scams.
Setting Up the Base
As mentioned earlier, scammers choose poor and underdeveloped countries. They negotiate with local border authorities to establish their business. They rent land for 30 to 50 years and build strong buildings with high walls. For security, they also hire armed groups to protect their operations.
Another important need for scammers is the internet. They either use local internet services or connect to better internet from neighbouring countries. For example, reports say that scam businesses in Myanmar use internet services from Thailand.
Collecting Information
Many people think that scammers only recruit uneducated or low-skilled workers. However, this is not true. Scamming businesses use digital platforms, IT equipment, and online transactions, so they need skilled workers. Most employees have at least a high school education and are skilled in using the Internet and computers. Some scammers even hire IT experts.
Language Skills in Scam Operations
Workers in scam businesses need to speak at least two or three languages. For example, in Myanmar’s border areas, scammers can speak Myanmar and Chinese or Myanmar and Thai. News reports also confirm this.
Scamming is not just a simple fraud activity. It is a highly organized business that includes illegal activities such as human trafficking, forced labour, illegal trade, and cyber fraud. Understanding their operations helps people become more aware and avoid these dangerous businesses.
How Mid-Level Scammers Operate
Scamming businesses are not run randomly; they follow a well-organized system. Mid-level scammers play an important role in collecting information, avoiding detection, and managing fraud operations efficiently.
Collecting Information Before Scamming
Before they begin their fraud operations, scammers prepare fake bank accounts, cryptocurrency wallets, stock market accounts, and fake websites. These are used to make their scams look real and professional.
When searching for victims, scammers mainly target wealthy people from developed countries. However, there are also scam operations targeting the middle class in Myanmar and other countries. They carefully collect personal details, such as home address, name, family information, job details, and financial status, before approaching their victims.
Scammers gather this information in different ways:
Buying personal data from businesses or authorities.
Using online conversations (called “chatting dialogue”) to trick victims into revealing information.
Following a scripted communication strategy, where senior scammers train employees on what to say based on the victim’s responses.
Hiring psychology experts to analyze victim behaviour and improve scamming techniques.
Avoiding Law Enforcement Detection
Scammers operate systematically and take precautions to avoid being caught. Their businesses generate billions of dollars, allowing them to invest in better technology, security, and well-trained employees.
For example, scammers often target retired bankers, stock investors, or foundation managers handling large donations. They study these people’s online activities and gather detailed information before making contact. Their ability to carefully research, plan, and execute fraud makes them highly organized criminal networks rather than simple scammers.
Recruitment Process in Scam Operations
Recruiting workers is a crucial part of scam operations. As mentioned earlier, scammers mainly target developing countries, poorer regions, and low-wage workers when hiring employees. They lure educated individuals with high-salary job offers and then force them to participate in scam activities.
Target Countries for Recruitment
Scammers recruit workers from China, Hong Kong, India, Malaysia, Nepal, the Philippines, Chinese Taipei, Thailand, Vietnam, Myanmar, and African nations. They reach out to potential employees through social media platforms like Facebook, Instagram, and Telegram.
Common fake job postings include:
Translator jobs near border areas.
Factory jobs with attractive salaries.
Online marketing or customer service positions.
A 2024 report revealed that there were over 500 Telegram groups dedicated to recruiting Myanmar workers into scam operations.
High Recruitment Fees
To hire workers, scammers are willing to pay huge amounts to recruiters. For example, in 2024, a single Myanmar worker could be sold to scam groups for 40,000 Thai Baht (about 600,000 MMK).
For workers from poor countries, where salaries range between K300,000 to K500,000 per month, these job offers seem extremely attractive. This is why many educated people from low-income countries fall victim to scam networks.
Scam Business Structure
Scam operations generally have three key departments:
Technical Team – Consists of IT specialists (mainly foreigners) who manage online scams.
Target Searching Team – Responsible for finding victims.
Communication Team – Handles conversations with victims.
Each department has around 15 to 20 employees working systematically.
Role of the Technical Team
The technical team is mainly composed of IT professionals who operate scam activities. They create fake social media accounts on platforms like Facebook, LinkedIn, WhatsApp, and Skype using attractive photos of young women to gain victims’ trust.
They maintain these fake accounts for three to four months to make them look real. They also post random social media updates to appear legitimate. This is an ongoing task within the technical team.
Final Stages of the Scam Operation
Once the search team has found potential victims, they begin engaging them in conversation.
Using fake social media accounts created by the technical team, they initiate chats in different ways:
Casual conversations to build trust.
Flirtatious messages for male targets.
Job opportunities, such as investing in new businesses or earning money by watching videos.
As the conversation progresses and the victim becomes emotionally or professionally invested, they are handed over to the communication team for deeper engagement.
Manipulation by the Communication Team
This team, consisting of around 15 people, is responsible for fully convincing the victim. They engage in carefully planned dialogues:
Sharing fake personal stories to gain trust.
Showing edited photos as proof of their “authenticity”.
Talking about their “successful business ventures”.
Through constant interaction, the victim is slowly pulled into the scammers’ trap.
Executing the Final Scam
At this stage, the scammers persuade the victim to invest in fake stock markets, trading platforms, or cryptocurrency exchanges created by the technical team.
Initially, small profits are given to victims, making them believe they are earning real money.
This psychological trick encourages them to invest larger amounts.
Eventually, once a significant amount is invested, the scammers:
Shut down the platform and disappear.
Use fake links and QR codes to hack victims’ bank accounts.
Steal money through mobile payment apps.
Many victims only realize they have been scammed when it’s too late.
In conclusion, this article has provided a step-by-step breakdown of how scam operations function. In the end, these scams exploit human greed – the desire for easy money. While everyone has some level of greed, scammers manipulate it to trap victims into financial ruin. By understanding these tactics, people can protect themselves and others from falling prey to these deceptive schemes.
Source: The Global New Light of Myanmar
What is scamming? How does it work? How are young people connected to it? How can we avoid scamming businesses? I am going to answer these questions, so I would like to encourage you to read it up to the end.
The word “scamming” comes from the Chinese language and is pronounced as “Zhàpiàn,” (in Myanmar “ကျားဖြန့်”). In Chinese, it means “cheating” or “fraud.” Today, scamming businesses are well known in Southeast Asia as fraud operations, mostly working online to trick people.
One important question is: Who started these scamming businesses? Since the word comes from Chinese, many people believe that scamming businesses started in China. When IT technology developed rapidly in China, these businesses also grew internationally.
Scamming businesses have different types. Some mainly target Western countries, especially rich people, retirees, and those over 40 years old. They often focus on wealthy people in America and Europe.
Scamming businesses are not simple fraud operations. They are large-scale businesses that include human trafficking, forced labour, illegal weapons trade, drug smuggling, gambling, and many other illegal activities.
Where are scamming businesses based?
Where do they operate the most? The answer is simple. These businesses are mostly found in poor Southeast Asian countries such as Cambodia, Laos, Thailand, the Philippines, and Myanmar. They set up large offices and hire workers in these developing countries.
How do they find workers?
There are two main ways. First, they attract people by offering high salaries but later force them to work. Second, they use human trafficking to kidnap people and make them work against their will. In Myanmar, most of these businesses are located in border areas. They do not operate secretly but in large, well-protected buildings.
How Scamming Businesses Operate
Understanding how scamming businesses operate is very important. It is also their biggest secret. The process includes setting up a base, collecting information, recruiting workers, starting operations, and finally running scams.
Setting Up the Base
As mentioned earlier, scammers choose poor and underdeveloped countries. They negotiate with local border authorities to establish their business. They rent land for 30 to 50 years and build strong buildings with high walls. For security, they also hire armed groups to protect their operations.
Another important need for scammers is the internet. They either use local internet services or connect to better internet from neighbouring countries. For example, reports say that scam businesses in Myanmar use internet services from Thailand.
Collecting Information
Many people think that scammers only recruit uneducated or low-skilled workers. However, this is not true. Scamming businesses use digital platforms, IT equipment, and online transactions, so they need skilled workers. Most employees have at least a high school education and are skilled in using the Internet and computers. Some scammers even hire IT experts.
Language Skills in Scam Operations
Workers in scam businesses need to speak at least two or three languages. For example, in Myanmar’s border areas, scammers can speak Myanmar and Chinese or Myanmar and Thai. News reports also confirm this.
Scamming is not just a simple fraud activity. It is a highly organized business that includes illegal activities such as human trafficking, forced labour, illegal trade, and cyber fraud. Understanding their operations helps people become more aware and avoid these dangerous businesses.
How Mid-Level Scammers Operate
Scamming businesses are not run randomly; they follow a well-organized system. Mid-level scammers play an important role in collecting information, avoiding detection, and managing fraud operations efficiently.
Collecting Information Before Scamming
Before they begin their fraud operations, scammers prepare fake bank accounts, cryptocurrency wallets, stock market accounts, and fake websites. These are used to make their scams look real and professional.
When searching for victims, scammers mainly target wealthy people from developed countries. However, there are also scam operations targeting the middle class in Myanmar and other countries. They carefully collect personal details, such as home address, name, family information, job details, and financial status, before approaching their victims.
Scammers gather this information in different ways:
Buying personal data from businesses or authorities.
Using online conversations (called “chatting dialogue”) to trick victims into revealing information.
Following a scripted communication strategy, where senior scammers train employees on what to say based on the victim’s responses.
Hiring psychology experts to analyze victim behaviour and improve scamming techniques.
Avoiding Law Enforcement Detection
Scammers operate systematically and take precautions to avoid being caught. Their businesses generate billions of dollars, allowing them to invest in better technology, security, and well-trained employees.
For example, scammers often target retired bankers, stock investors, or foundation managers handling large donations. They study these people’s online activities and gather detailed information before making contact. Their ability to carefully research, plan, and execute fraud makes them highly organized criminal networks rather than simple scammers.
Recruitment Process in Scam Operations
Recruiting workers is a crucial part of scam operations. As mentioned earlier, scammers mainly target developing countries, poorer regions, and low-wage workers when hiring employees. They lure educated individuals with high-salary job offers and then force them to participate in scam activities.
Target Countries for Recruitment
Scammers recruit workers from China, Hong Kong, India, Malaysia, Nepal, the Philippines, Chinese Taipei, Thailand, Vietnam, Myanmar, and African nations. They reach out to potential employees through social media platforms like Facebook, Instagram, and Telegram.
Common fake job postings include:
Translator jobs near border areas.
Factory jobs with attractive salaries.
Online marketing or customer service positions.
A 2024 report revealed that there were over 500 Telegram groups dedicated to recruiting Myanmar workers into scam operations.
High Recruitment Fees
To hire workers, scammers are willing to pay huge amounts to recruiters. For example, in 2024, a single Myanmar worker could be sold to scam groups for 40,000 Thai Baht (about 600,000 MMK).
For workers from poor countries, where salaries range between K300,000 to K500,000 per month, these job offers seem extremely attractive. This is why many educated people from low-income countries fall victim to scam networks.
Scam Business Structure
Scam operations generally have three key departments:
Technical Team – Consists of IT specialists (mainly foreigners) who manage online scams.
Target Searching Team – Responsible for finding victims.
Communication Team – Handles conversations with victims.
Each department has around 15 to 20 employees working systematically.
Role of the Technical Team
The technical team is mainly composed of IT professionals who operate scam activities. They create fake social media accounts on platforms like Facebook, LinkedIn, WhatsApp, and Skype using attractive photos of young women to gain victims’ trust.
They maintain these fake accounts for three to four months to make them look real. They also post random social media updates to appear legitimate. This is an ongoing task within the technical team.
Final Stages of the Scam Operation
Once the search team has found potential victims, they begin engaging them in conversation.
Using fake social media accounts created by the technical team, they initiate chats in different ways:
Casual conversations to build trust.
Flirtatious messages for male targets.
Job opportunities, such as investing in new businesses or earning money by watching videos.
As the conversation progresses and the victim becomes emotionally or professionally invested, they are handed over to the communication team for deeper engagement.
Manipulation by the Communication Team
This team, consisting of around 15 people, is responsible for fully convincing the victim. They engage in carefully planned dialogues:
Sharing fake personal stories to gain trust.
Showing edited photos as proof of their “authenticity”.
Talking about their “successful business ventures”.
Through constant interaction, the victim is slowly pulled into the scammers’ trap.
Executing the Final Scam
At this stage, the scammers persuade the victim to invest in fake stock markets, trading platforms, or cryptocurrency exchanges created by the technical team.
Initially, small profits are given to victims, making them believe they are earning real money.
This psychological trick encourages them to invest larger amounts.
Eventually, once a significant amount is invested, the scammers:
Shut down the platform and disappear.
Use fake links and QR codes to hack victims’ bank accounts.
Steal money through mobile payment apps.
Many victims only realize they have been scammed when it’s too late.
In conclusion, this article has provided a step-by-step breakdown of how scam operations function. In the end, these scams exploit human greed – the desire for easy money. While everyone has some level of greed, scammers manipulate it to trap victims into financial ruin. By understanding these tactics, people can protect themselves and others from falling prey to these deceptive schemes.
Source: The Global New Light of Myanmar
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SMEs in Myanmar
In Myanmar, the role of Small and Medium Enterprises is crucial as SMEs comprise approximately 94 percent of all registered enterprises and 52-97% of labor forces. SMEs in Myanmar can be generally classified into five categories-
Import substitution in industrialization
Export-oriented SMEs
Rural-located SMEs
Local and traditional SMEs
SMEs in Myanmar
In Myanmar, the role of Small and Medium Enterprises is crucial as SMEs comprise approximately 94 percent of all registered enterprises and 52-97% of labor forces. SMEs in Myanmar can be generally classified into five categories-
Import substitution in industrialization
Export-oriented SMEs
Rural-located SMEs
Local and traditional SMEs
International subcontracting SMEs
Myanmar is heavily dependent upon imported products even on daily necessities. This heavy dependence on imports can be fixed only with promoting import-substituting SME businesses. Some SMEs in Myanmar are engaged in export, but it is needed to promote more varieties of exported goods. Hence, it is essential to encourage SMEs that produce processed export products, using local raw resources. Some business sectors which have high propensity to export include agricultural processing, food processing, woodworking, metalworking, and the processing of marine products, among others. The registered number of SMEs in line with the list issued by SME development center in 2023 is approximately 46,014. SME registration rates are the highest in Yangon region and Shan State.
SME Development Law and Policies in Myanmar
3. During the time when the State Law and Order Restoration Council was in power, the official law for small and medium-sized enterprises (SMEs) was enacted in the year 1990. Then, the 2011 Private Industrial Law was enacted and gave definitions of SMEs based upon four criteria (i) horsepower used (ii) number of employees (iii) capital investment (iv) annual production. The most recent SME-related law is the SME Development Law (2015), which gives the definitions of SMEs based upon business sectors namely manufacturing, wholesale, retail, service and others. Then, SME development rules was enacted in 2017 and in 2018, the term Small and Medium Enterprises was renamed MSMEs which stands for Micro, Small and Medium Enterprises by the Central Committee for Development of Micro, Small and Medium Enterprises.
SMEs’ export
4. A great deal of previous literature provide factors enhancing SMEs’ export. Concerning factors enhancing export, there are two widely-used approach listed as resource-based approach and the contingency paradigm. The resource-based approach focuses on the firm’s internal variables whereas the second method focuses on the external aspects. Internal determinants include management qualities such as age, education, innovativeness, foreign exposure and export dedication as well as export marketing techniques such as product, pricing, promotion, distribution, service and networking tactics. The external factors are the characteristics of the foreign market such as legal, political, and economic system, cultural similarities, market dynamics, consumer and competitor behavior and the characteristics of the domestic government, which include government tax rates, government export support, government policies and the domestic business environment.
5. Compared to other ASEAN countries, SMEs in Myanmar are less likely to export, reporting that only 4.2 % of medium-sized firms and 0.8 % of small enterprises export directly or indirectly at least 1% of their sales (World Bank’s
Enterprise Survey, 2014). Export destinations of Myanmar SMEs differ across firm size. Large firms have much more export propensity than SMEs and large firms have the capacity to export to high-income markets such as the EU and US. But, SMEs opt for regional markets such as China, Malaysia and Thailand whose target customers are less-demanding. According to World Bank Enterprise Survey, on the bright side, only 27% of medium-sized firms and 13% of small enterprises in Myanmar use material inputs of foreign origin. In Myanmar, SMEs from 4 states, 7 divisions and Union Territory, Nay Pyi Taw are engaged in export. ASEAN is an important market for Myanmar’ exports and Myanmar SMEs mainly export to China and Japan. Most of the exported products are agricultural products, marine products and wood and wood-related products. Agricultural products mainly include rice, different types of beans, white yam powder, coffee seed and coffee powder, Myanmar Tea, tamarind, jaguar, coconut, groundnut oil, sesame oil, ginger oil, oil palm, rubber, sugar, bees, lemon and honey. Marine products consist of fish, frozen fist stake, shrimps, soft shell crab, squid and lobster. Wood and wood-related products are wood, teak, value-added wood products, rattan products and bamboo place mate.
Government Export Assistance Programs
6. In accordance with notification (64/2023), which was issued by Ministry of Planning and Finance, the government provides exemption of commercial tax on 27 kinds of goods listed as different kinds of corn, fresh fish and shrimps, soil bean, milk and dairy products, yogurt, animals and animal products, fertilizer, various kinds of pesticide and weed killer that are used in agriculture, animal, fish and prawn medicines, veterinary preventative medicines, raw and finished materials for animal, fish and prawn feed (not included animal food that used for pets), pure seeds and seedlings of crops, raw materials for cotton, agricultural products, coconut oil, state flag, stationeries, X-ray, absorbent cotton wool, gauze, bandages, hospital sundries to take medicines, surgical mask (once used), cap, surgical glove, masks that used to prevent flu infection, household pharmaceutical and other medicines and traditional medicines, fire engine and hearse, raw materials used in making soap, battery electric vehicles and goods purchased by donated fund. The government offers tax incentives such as offering SMEs exemption from income tax for 3 consecutive years in accordance with Union Taxation Law. The government strives to adjust their tax rates with the enactment of Union Taxation Law each year as a way of rehabilitating economy when the economy slows down. Furthermore, SME loans are offered through different loan programmes. Now, it has been recently announced that Small and Medium businessmen can get loans from 15 private banks as well as state-owned Myanmar Economic Bank (MEB) and Myanmar Agricultural Development Bank (MADB).
7. In conclusion, the Central Committee for Development of Micro, Small and Medium Enterprises has been planning MSMEs products’ exhibition to encourage SMEs. I happened to visit one of those exhibitions and witnessed a lot of local SMEs’ products, which are displayed well. I gladly realized most SMEs just made use of local raw material. Some SMEs’ products are not well-recognized in the local market, but these products are value for money. These potential SMEs need some assistance in making their quality products well-recognized in the market. Some SMEs do not have enough capital to make mass production and these quality products disappear in the market sadly. Some of these local products equal other imported products. I believe that if these local products are well-promoted with special support from all responsible government organizations, it would be a great thing. If SMEs’ requirements and government’s export assistance programs coincide, these products can survive in the domestic market as well as foreign market.
References
The Global New Light of Myanmar
Myanmar Micro, Small and Medium Enterprise Survey (2019)
Myanmar Business Insight Report (2020). Inya Economics.
Factors Affecting Propensity to Export: The Case of Indonesian SMEs.
SMEs in Myanmar
In Myanmar, the role of Small and Medium Enterprises is crucial as SMEs comprise approximately 94 percent of all registered enterprises and 52-97% of labor forces. SMEs in Myanmar can be generally classified into five categories-
Import substitution in industrialization
Export-oriented SMEs
Rural-located SMEs
Local and traditional SMEs
International subcontracting SMEs
Myanmar is heavily dependent upon imported products even on daily necessities. This heavy dependence on imports can be fixed only with promoting import-substituting SME businesses. Some SMEs in Myanmar are engaged in export, but it is needed to promote more varieties of exported goods. Hence, it is essential to encourage SMEs that produce processed export products, using local raw resources. Some business sectors which have high propensity to export include agricultural processing, food processing, woodworking, metalworking, and the processing of marine products, among others. The registered number of SMEs in line with the list issued by SME development center in 2023 is approximately 46,014. SME registration rates are the highest in Yangon region and Shan State.
SME Development Law and Policies in Myanmar
3. During the time when the State Law and Order Restoration Council was in power, the official law for small and medium-sized enterprises (SMEs) was enacted in the year 1990. Then, the 2011 Private Industrial Law was enacted and gave definitions of SMEs based upon four criteria (i) horsepower used (ii) number of employees (iii) capital investment (iv) annual production. The most recent SME-related law is the SME Development Law (2015), which gives the definitions of SMEs based upon business sectors namely manufacturing, wholesale, retail, service and others. Then, SME development rules was enacted in 2017 and in 2018, the term Small and Medium Enterprises was renamed MSMEs which stands for Micro, Small and Medium Enterprises by the Central Committee for Development of Micro, Small and Medium Enterprises.
SMEs’ export
4. A great deal of previous literature provide factors enhancing SMEs’ export. Concerning factors enhancing export, there are two widely-used approach listed as resource-based approach and the contingency paradigm. The resource-based approach focuses on the firm’s internal variables whereas the second method focuses on the external aspects. Internal determinants include management qualities such as age, education, innovativeness, foreign exposure and export dedication as well as export marketing techniques such as product, pricing, promotion, distribution, service and networking tactics. The external factors are the characteristics of the foreign market such as legal, political, and economic system, cultural similarities, market dynamics, consumer and competitor behavior and the characteristics of the domestic government, which include government tax rates, government export support, government policies and the domestic business environment.
5. Compared to other ASEAN countries, SMEs in Myanmar are less likely to export, reporting that only 4.2 % of medium-sized firms and 0.8 % of small enterprises export directly or indirectly at least 1% of their sales (World Bank’s
Enterprise Survey, 2014). Export destinations of Myanmar SMEs differ across firm size. Large firms have much more export propensity than SMEs and large firms have the capacity to export to high-income markets such as the EU and US. But, SMEs opt for regional markets such as China, Malaysia and Thailand whose target customers are less-demanding. According to World Bank Enterprise Survey, on the bright side, only 27% of medium-sized firms and 13% of small enterprises in Myanmar use material inputs of foreign origin. In Myanmar, SMEs from 4 states, 7 divisions and Union Territory, Nay Pyi Taw are engaged in export. ASEAN is an important market for Myanmar’ exports and Myanmar SMEs mainly export to China and Japan. Most of the exported products are agricultural products, marine products and wood and wood-related products. Agricultural products mainly include rice, different types of beans, white yam powder, coffee seed and coffee powder, Myanmar Tea, tamarind, jaguar, coconut, groundnut oil, sesame oil, ginger oil, oil palm, rubber, sugar, bees, lemon and honey. Marine products consist of fish, frozen fist stake, shrimps, soft shell crab, squid and lobster. Wood and wood-related products are wood, teak, value-added wood products, rattan products and bamboo place mate.
Government Export Assistance Programs
6. In accordance with notification (64/2023), which was issued by Ministry of Planning and Finance, the government provides exemption of commercial tax on 27 kinds of goods listed as different kinds of corn, fresh fish and shrimps, soil bean, milk and dairy products, yogurt, animals and animal products, fertilizer, various kinds of pesticide and weed killer that are used in agriculture, animal, fish and prawn medicines, veterinary preventative medicines, raw and finished materials for animal, fish and prawn feed (not included animal food that used for pets), pure seeds and seedlings of crops, raw materials for cotton, agricultural products, coconut oil, state flag, stationeries, X-ray, absorbent cotton wool, gauze, bandages, hospital sundries to take medicines, surgical mask (once used), cap, surgical glove, masks that used to prevent flu infection, household pharmaceutical and other medicines and traditional medicines, fire engine and hearse, raw materials used in making soap, battery electric vehicles and goods purchased by donated fund. The government offers tax incentives such as offering SMEs exemption from income tax for 3 consecutive years in accordance with Union Taxation Law. The government strives to adjust their tax rates with the enactment of Union Taxation Law each year as a way of rehabilitating economy when the economy slows down. Furthermore, SME loans are offered through different loan programmes. Now, it has been recently announced that Small and Medium businessmen can get loans from 15 private banks as well as state-owned Myanmar Economic Bank (MEB) and Myanmar Agricultural Development Bank (MADB).
7. In conclusion, the Central Committee for Development of Micro, Small and Medium Enterprises has been planning MSMEs products’ exhibition to encourage SMEs. I happened to visit one of those exhibitions and witnessed a lot of local SMEs’ products, which are displayed well. I gladly realized most SMEs just made use of local raw material. Some SMEs’ products are not well-recognized in the local market, but these products are value for money. These potential SMEs need some assistance in making their quality products well-recognized in the market. Some SMEs do not have enough capital to make mass production and these quality products disappear in the market sadly. Some of these local products equal other imported products. I believe that if these local products are well-promoted with special support from all responsible government organizations, it would be a great thing. If SMEs’ requirements and government’s export assistance programs coincide, these products can survive in the domestic market as well as foreign market.
References
The Global New Light of Myanmar
Myanmar Micro, Small and Medium Enterprise Survey (2019)
Myanmar Business Insight Report (2020). Inya Economics.
Factors Affecting Propensity to Export: The Case of Indonesian SMEs.
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ILLEGAL trade can hamper the economic development of the State by reducing manufacturing activity among business owners and diminishing their competitive capability in the market. Preventing illegal trade can boost export volume and enhance the commercial sector by promoting product manufacturing and market competition. Additionally, these initiatives can increase local money circulation, raise export product volume, and generate more foreign exchange. As a result, the country can experience growth in its manufacturing, trade, and service sectors.
ILLEGAL trade can hamper the economic development of the State by reducing manufacturing activity among business owners and diminishing their competitive capability in the market. Preventing illegal trade can boost export volume and enhance the commercial sector by promoting product manufacturing and market competition. Additionally, these initiatives can increase local money circulation, raise export product volume, and generate more foreign exchange. As a result, the country can experience growth in its manufacturing, trade, and service sectors.
Myanmar is rich in natural resources, with a strong focus on the agricultural sector. To boost the state economy, the government has encouraged the manufacturing of natural resource-based products and agricultural goods while also working to promote micro, small, and medium-sized enterprises (MSMEs). However, illegal trade activities have had negative impacts on the nation’s socioeconomic sector.
Illegal trade eradication task forces formed in regions and states managed relevant squads, impounding smuggled goods and addressing illegal trade activities worth K300.28 billion across 14,659 cases during the two years and eight months from January 2022 to August 2024. However, this amount was relatively small compared to the State’s overall trade sector. Therefore, authorities and task forces must intensify efforts to take action against those involved in illegal trade activities.
With regard to seizures in July and August 2024, the Customs Department nabbed the most considerable amount and volume of illegal trade process, followed by the task force from Mandalay Region, Sagaing Region and Kahin State in series. The authorities seized unregistered vehicles and illicit commodities in the largest volume, industrial raw materials in the second largest volume and capital goods in the third largest one.
The economic development of a country depends on manufacturing and trade sectors. As such, authorities need to encourage agriculture- and livestock-based businesses. Meanwhile, relevant ministries have to fulfil the basic needs of farmers from the agriculture and livestock breeding sectors as part of implementing the assigned duties.
It is necessary to supply fertilizers, pesticides, quality strains of seeds, agricultural inputs, animal feeds, vaccines, and other needs to farmers on time. On the other hand, relevant authorized bodies need to systematically supervise the trafficking of prohibited goods, taking advantage of priority on legal trade measures. If so, legal trade contributes to local businesspersons and traders on their official process at home and crack down on illegal trade processes.
ILLEGAL trade can hamper the economic development of the State by reducing manufacturing activity among business owners and diminishing their competitive capability in the market. Preventing illegal trade can boost export volume and enhance the commercial sector by promoting product manufacturing and market competition. Additionally, these initiatives can increase local money circulation, raise export product volume, and generate more foreign exchange. As a result, the country can experience growth in its manufacturing, trade, and service sectors.
Myanmar is rich in natural resources, with a strong focus on the agricultural sector. To boost the state economy, the government has encouraged the manufacturing of natural resource-based products and agricultural goods while also working to promote micro, small, and medium-sized enterprises (MSMEs). However, illegal trade activities have had negative impacts on the nation’s socioeconomic sector.
Illegal trade eradication task forces formed in regions and states managed relevant squads, impounding smuggled goods and addressing illegal trade activities worth K300.28 billion across 14,659 cases during the two years and eight months from January 2022 to August 2024. However, this amount was relatively small compared to the State’s overall trade sector. Therefore, authorities and task forces must intensify efforts to take action against those involved in illegal trade activities.
With regard to seizures in July and August 2024, the Customs Department nabbed the most considerable amount and volume of illegal trade process, followed by the task force from Mandalay Region, Sagaing Region and Kahin State in series. The authorities seized unregistered vehicles and illicit commodities in the largest volume, industrial raw materials in the second largest volume and capital goods in the third largest one.
The economic development of a country depends on manufacturing and trade sectors. As such, authorities need to encourage agriculture- and livestock-based businesses. Meanwhile, relevant ministries have to fulfil the basic needs of farmers from the agriculture and livestock breeding sectors as part of implementing the assigned duties.
It is necessary to supply fertilizers, pesticides, quality strains of seeds, agricultural inputs, animal feeds, vaccines, and other needs to farmers on time. On the other hand, relevant authorized bodies need to systematically supervise the trafficking of prohibited goods, taking advantage of priority on legal trade measures. If so, legal trade contributes to local businesspersons and traders on their official process at home and crack down on illegal trade processes.