NEWS - Foreign Investment in Myanma (r)

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Subject: NEWS - Foreign Investment in Myanmar Encounters Sharp Drop

Foreign Investment in Myanmar Encounters Sharp Drop

YANGON (Aug. 19) XINHUA - Myanmar absorbed only 619 million U.S. dollars
of foreign investment up to the end of April this year since the
outbreak of the Asian financial crisis in July 1997. 

According to the latest Economic Indicators issued by the country's
Central Statistical Organization, the amount of foreign investment
brought in during the nearly two-year period did not come up to the
amount drawn in the first half of 1997 before the outbreak of the crisis
which reached as high as 892 million dollars. 

According to the indicators, foreign investment in Myanmar in fiscal
1998-99 dropped to the lowest level as compared with the past five
fiscal years. The foreign investment hit a peak in 1996-97 with 2.814
billion dollars. 

Brigadier-General Abel, Myanmar Minister at the Office of the Chairman
of the State Peace and Development Council, admitted at a business forum
of the Association of Southeast Asian Nations (ASEAN) held in Yangon in
May this year that ASEAN investment accounted for almost 60 percent of
the total prior to the crisis, adding that ASEAN investment fell by 70
percent in 1998 after the outbreak of the crisis. 

One of the main reasons for the steep drop in Myanmar's foreign
investment, he said, is the impact of the crisis. 

As part of its efforts to cope with the problem, Myanmar promulgated the
1999 State Budget Law in March this year, declaring to restrict
expenditure from the state reserve fund and the taking of loans and levy
a commercial tax of 8 percent on foreign currency if included in the
proceeds of sale. 

Myanmar had drawn a total of 7.108 billion dollars of foreign investment
from 24 countries and regions up to the end of April this year since the
country opened to foreign investment and adopted a market- oriented
economic policy in late 1988.