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Investment Opportunities In Myanmar’s Tourism Industry Presentation by: Ms. Thida Aung Assistant Director Directorate of Hotels and Tourism Ministry of Hotels & Tourism, Building No.33, Nay Pyi Taw, The Republic of the Union of Myanmar. Tel and Fax: 95 67 406249, 406104 E-mail: [email protected] Website: www.tourism.gov.mm

Investment Opportunities In Myanmar’s Tourism Industry 1. Background of Myanmar 2. Tourism Situation in Myanmar 3. Law, Rules and Notifications 4. Foreign Investment in Hotels and

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Investment Opportunities In Myanmar’s Tourism Industry

Presentation by:

Ms. Thida AungAssistant DirectorDirectorate of Hotels and TourismMinistry of Hotels & Tourism, Building No.33, Nay Pyi Taw,

The Republic of the Union of Myanmar.Tel and Fax: 95 67 406249, 406104

E-mail: [email protected]: www.tourism.gov.mm

2

1. Background of Myanmar

2. Tourism Situation in Myanmar

3. Law, Rules and Notifications

4. Foreign Investment in Hotels and Commercial Complexes

5. Procedures and the Salient Points for the investment in Hotel and Commercial Building Projects

6. Conclusion

LET THE JOURNY BEGIN

Situates in Indochina

peninsula

Second largest country

in ASEAN

Border with five

countries,

Bay of Bengal & Adman

Sea

Easily access by Air, Sea

and Land

Area 676,577km2

Population: 51.46

million

Density: 76/ sq km

Capital: Nay Pyi Taw

Religion: Buddhism

Hot, Rain & Cold

seasons

135 National races

Background of Myanmar

MYANMAR

A Country With Diverse National Races

Major Destinations in Myanmar

Yangon

LET THE JOURNY BEGIN

Major Destinations in Myanmar

Mandalay

LET THE JOURNY BEGIN

Major Destinations in Myanmar

Bagan

LET THE JOURNY BEGIN

Major Destinations in Myanmar

Inlay Lake

LET THE JOURNY BEGIN

International Air Routes to Myanmar

1 Air Asia2 Air China3 Air India4 Air KBZ5 All Nippon Airways

6 Bangkok Airways

7 Biman Bangladesh Airlines8 Cathy Dragon Air9 China Airlines10 China Eastern Airlines

11 China Southern Airlines

12 Emirates Air

13 Himalaya Airlines(H9)

14Hong Kong Express Airways

15 Jet Star Air

16 Korean Airlines

16 Myanmar Airways International

17 Nok Air18 Qatar Air19 Silk Air20 SingaporeAirlines21 Thai Airways22 Thai Air Asia23 Thai Smile24 Tige Air25 Vietnam Airlines

11 China southern Airlines

12 Dargon Air13 Jet star Asia14 Korean Air

15 Malaysia Airlines

Tige AirTige Air

International Air Routes to Myanmar

17 Malaysian Airlines

18 Malindo

19Myanmar Airways International

20Myanmar National Airlines

21 Nok Air

22 Qatar Airways23 Scoot Airllines24 Silk Air25 Singapore Airlines26 Thai Air Asia27 Thai Airways International28 Thai Smiles Airways29 Thai Lion Airlines30 Vietjet Air31 Vietnam Airlines

Myanmar National AirlineOperate to Domestic Airport

Asian Wings (since 2010)

Air Mandalay (since 1994)

ATR-72, A321

ATR-72, ATR-42, MA60, Beech 1900D, ERJ 190 -

ATR-72, ATR-42Operate to Domestic Airport

Yangon Airways (since 1996)ATR-72Operate to Domestic Airport

Air KBZ (since 2010)

ATR-72Operate to Domestic Airport

Operate to Domestic Airport

Domestic Flights in Myanmar

Golden Myanmar (since 2013)Airbus A320 -Operate to Domestic Airport

MannYadanarpon Airline(since 2013)Operate to Domestic & International AirportATR 72-600

Apex Airline(since 2015)Operate to Domestic AirportATR 72-600

FMI Air (since 2012)CRJ200,ATR 72-600Operate to Domestic & International Airport

International Visitor Arrivals to Myanmar

Name Of Entry Points 2013 2014 2015 20162017

(Jan- Sep)

Yangon Entry Point 817,699 1,022,081 1,180,682 1,080,144 807430

Mandalay Entry Point 69,596 90,011 107,066 128,387 107176

Mawlamyine/Myeik/

Muse/Tachileik/ Myawaddy/

Tamu/Hteekhee

1,024 271 47,841 27632

Nay Pyi Taw 11,842 19,261 13,835 16,224 12253

Border Tourism 1,144,146 1,949,788 3,379,437 1,634,611 1567663

TOTAL 2,044,307 3,081,412 4,681,020 2,907,207 2,522154

GROWTH 93% 51% 52% -38% 21%

Hotel Apartment Rooms

Local Investment 1486 54595

Foreign Investment 27 4842

State Own Hotel(Lease Out)

21 968

J.V 6 1137

Total 1540 61542

Hotels, Motels and Lodging-House Business Licenses (Up to Sep, 2017)

Inbound Outbound

Foreign Company 1

J.V Company 41

Local Company 2628 429

Total 2670 429

Tour Operation Enterprise Licenses(Up to Sep, 2017)

Tourist Transport Business Licenses (Up to Sep, 2017)

Coach 1164

Boat/Motor Boat 1307

Hot Air Balloon 3

Yacht 16

Total 2490

Licensed Tour Guide 4266

Regional Guide 3348

Total 7614

Tour Guide Business Licenses (Up to Sep, 2017)

Myanmar Hotels and Tourism Law

Myanmar Tourism Law (New)

• Undergoing reform• 2016

Myanmar Hotel and Tourism Law (1993)

Myanmar Tourism Policies Commitments

Responsible Tourism Policy

• 2012

Policy on Community Involvement in Tourism

• 2012

Myanmar Tourism Master Plan

• 2013

Myanmar Ecotourism Policy and Management Strategy

• 2015

POLICY AND PLAN DEVELOPMENT Policies Commitments

Master PlanResponsible Tourism

Community Involvement in

Tourism

Ecotourism Policy &

Management Strategy

Related Procedures and Orders

Procedures relating to the Myanmar Tourism Law

Order For Licensing of Hotel and Lodging-House Business(2011)

Order For Licensing of Tour Operation Enterprise (2011)

Order Relating to Licensing of Tour Guide Business (2011)

Order Relating to Licensing to Tourist Transport Business(2011)

Related Procedures and Orders

Myanmar Investment Commission Notification No. 13/2017 (1st April 2017)

In exercise of the power conferred under section 43 and sub-section 100 of the Myanmar Investment Law, the Myanmar

Investment Commission has prescribed the investment promoted sectors with the approval of Union Government

Classification of Promoted Sectors

1. Providing services by construction of hotels and resorts (ISIC 55102)

2. Transport services for tourists and sight-seeing(ISIC 5011)

3. Eco-tourism business (ISIC 50111)

Foreign Investment of Permitted Enterprises as of (30/9/2017) (By MIC)

FOREIGN INVESTMENT OF PERMITTED ENTERPRISES AS OF (31/8/2017)

(BY SECTOR)

( US $ in million )

Sr . No.

ParticularsPermitted Enterprises

No. ApprovedAmount

%

1 Oil and Gas 154 22410.368 30.09%2 Power 14 20711.446 27.81%3 Manufacturing 811 9210.362 12.35%

4Transport & Communication 52 8578.127 11.52%

5 Real Estate 48 4816.508 6.47%

6 Hotel and Tourism 71 3004.448 4.03%7 Mining 71 2897.606 3.89%8 Livestock & Fisheries 44 574.175 0.77%

9 Agriculture 23 380.073 0.51%10 Industrial Estate 4 208.444 0.28%11 Construction 2 37.767 0.05%12 Other Services 84 1658.008 2.23%

Total 1378 74487.332 100.00%

FOREIGN INVESTMENT OF EXISTING ENTERPRISES AS OF 30/9/2017( By MIC )

( US $ in million )

Sr . No.

ParticularsExisting Enterprises

No. ApprovedAmount

%

1 Oil and Gas 96 21486.951 33.78%

2 Power 13 14681.446 23.08%

3 Transport & Communication 43 8401.897 13.21%

4 Manufacturing 713 7746.157 12.18%

5 Real Estate 34 3779.005 5.94%

6 Hotel and Tourism 53 2658.416 4.18%

7 Mining 10 2352.624 3.70%

8 Agriculture 20 351.392 0.55%

9 Livestock & Fisheries 26 314.763 0.49%

10 Industrial Estate 3 194.444 0.31%

11 Other Services 82 1641.383 2.58%

Total 1093 63608.478 100.00%

Permitted FDI Hotels by MoHT (Up to Sep, 2017)

FOREIGN INVESTMENT IN HOTELS AND COMMERCIAL COMPLEX

Sir. Projects Rooms Investment US$(m) Remarks

1. 32 6241 1749.9920 Completed

2. 11 2296 993.4454 Under Construction

3. 20 3657 1627.5280 MIC Permitted

63 12194 4370.9654 Total

Foreign Investment in Hotels and Commercial Complex

Sr. CountryNumber of

ProjectInvestment

(USD in million)Remark

1. Singapore 31 2719.8834

2. Thailand 12 486.1610

3. Vietnam 1 440.0000

4. Japan 6 394.3850

5. Hong Kong 5 187.7000

6. Korea 1 100.00007. Malaysia 3 23.1360

8. United Kingdom 3 14.5000

9. Luxembourg 1 5.2000

Total 63 4370.9654

Foreign Investment In Hotels and Commercial Complex (Up to Sep,2017)

26

Governor’s Residence (Pansea)

The Strand Hotel

Foreign Investment Hotels (Yangon)

27

Summit Parkview

Park Royal Yangon

Foreign Investment Hotels (Yangon)

28Inya Lake Hotel

Chatrium Hotel

Foreign Investment Hotels (Yangon)

Foreign Investment Hotels (Yangon)

Park Royal Sedona

Sule Shangri-la

Meliá Yangon (HAGL )

Sedona Hotel

Mandalay Hill Resort

Foreign Investment Hotels (Mandalay)

30

Thiripyitsaya Sakura Hotel

Foreign Investment Hotels (Bagan)

Procedures / Salient Points for FDI in Hotels and Related Businesses

100% foreign owned BOT System.

Hotel Business can be done in JV with Government Organizations/ local citizens

Land Lease Period: Initial (50)yrs + extendable (10) yrs x (2) times withMIC’s permission

Construction Period: (2) to (3) yrs for phase 1(2) to (3) phases

Land Use Premium: Depends on Location and Area of Land

Annual Land Lease Rental Fee: (5)% of Gross Income (or) MinimumGuarantee Payment whichever is higher.

Procedures /salient points for FDI in Hotels and Related Businesses

After having the agreement between the investor andgovernment organization (or) private sector on the termsand conditions, the both sides have to draft B.O.T Contractand Lease Agreement.

The draft BOT Contract- To be submitted to the UnionAttorney General’s Office for legal advice.

Need to submit proposal of the promoter to make foreigninvestment in Myanmar to MIC with the draft B.O.TContract, Lease Agreement and other required documents.

Procedures /salient points for FDI in Hotels and Related Businesses

After having the Permission of Myanmar InvestmentCommission (MIC) , the BOT Contract andLease Agreement shall be signed by the both parties.

Apply for prior permission to establish Hotel Businessfrom Ministry of Hotels and Tourism.

Implement the construction of project.

Obtain the license to operate the hotel business.

Tourism Business ( Tour Operator and Travel Agency)

Allow under the Joint Venture system

60% (Foreign)+40%(Local) if it is JV

Require to make registration of foreign company

incorporation at the Directorate of Investment and

Company Administration(DICA).

Require to obtain the license to operate the business

from Directorate of Hotels and Tourism(DHT)

Schedule of Specific Commitments under ASEAN Framework Agreement on Services (AFAS)

• Hotel and Restaurant Services

• Travel Agencies and Tour Operators Services

• Recreational, Cultural and Sporting Services

Service Liberalization of Myanmar

• Promotion of further liberalization of ASEAN Services,

Myanmar has already liberalized the tourism and travel

related services apart from Tourist Guide Services (CPC 7472)

Which is under Travel Agencies and Tour Operator Services up

to 9th Package in order to integrate into the ASEAN Economic

Community

Service Liberalization of Myanmar

No additional Sector or Sub – Sector that could be further

liberalized for the 10th Package because it is difficult to agree

with local tourist guide.

Contact [email protected]@[email protected]

Contact InformationBuilding No 33, Ministry of Hotels and Tourism, Nay Pyi Taw,The Republic of the Union of Myanmar.95 67 406248, 406130, 406135, 406454, 406448

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