British Investors Interested but Cautious, Ambassador Tells Burma

[News_Editor]

Britain’s Queen Elizabeth looks at a Jaguar motor car at the Coronation Festival in the garden of Buckingham Palace in central London on July 11, 2013. (Photo: Reuters / Stefan Wermuth)

RANGOON — British investment in Burma is on the rise, but problems on the ground in the Southeast Asian frontier market have some investors reluctant to commit, UK Ambassador to Burma Andrew Patrick said at a press conference on Thursday.

Patrick, who took up his post in September, said that even though Burma’s transition to democracy remained incomplete, UK business interest in Burma was growing.

“Many British businessmen are coming here … we’d like to see more,†he said at the Rangoon-based British Embassy.

“We’re encouraging investment here,†Patrick continued. “We think that investment is important to create jobs—Western countries bring the technology, skills. They will help improve businesses to an international standard.â€

However, he acknowledged that challenges to internal stability were giving reason for pause among some Britons. The ongoing conflict between ethnic Kachin rebels and the government army in the north, religious tensions in Arakan State and a series of bomb blasts that have rocked the nation over the last week were cited as deterrents to foreign investment and trade between the two countries.

“British companies are coming here, but of course, yes, when you see the incidents in Kachin, Rakhine [Arakan] recently, and bomb blasts too, it has an effect for the business sector,†he said.

More than 10 British businesses’ delegations are on average meeting with their Burmese counterparts per month, Patrick said, adding that the UK-based luxury car company Jaguar-Land Rover plans to open a showroom in Rangoon early next year.

Last month 14 companies sent scouts to Burma, including firms in the construction sector. But UK businesses, and most other prospective Western investors, consider the country’s economic potential to be intimately tied to its political situation.

“My sense is that international companies are seeing the same opportunities and have similar concerns about the country. I don’t think UK companies are more reluctant than Japanese and US companies, I think British companies will be coming here,†he said.

One factor deterring foreign investors was the high and rising property prices in Rangoon, which have sent commercial rates skyrocketing over the last two years.

In June, British Trade Minister Stephen Green visited Rangoon and said the UK recognized the Burma market’s attractiveness, but saw key hindrances to foreign investment: corruption; a lack of transparency; physical and technological infrastructure shortcomings; the country’s underdeveloped banking system; and low-skill labor pool, among others.

Eleven Media reported in June that the UK had witnessed a significant increase in its exports to Burma compared with previous years. Total UK exports to Burma rose 113 percent to US$12.8 million in 2012, and 178 percent in the first quarter of 2013 compared with the same period last year, according to the UK government.

According to the figure of the Ministry of National Planning and Economic Development and the United Nation Economic and Social Commission for the Asia and Pacific, cumulative UK investment in Burma reached nearly $2.8 billion from 1989 to 2012. That compares with $14 billion into the country over the same period from Burma’s main investor, China.

Addressing a string of recent bomb blasts in Rangoon and other towns across Burma, Patrick said his embassy was still encouraging Britons to visit the country.

“We haven’t said to travelers, ‘Don’t come here.’ We’re still welcoming tourists here,†he said.

He added that the UK government is encouraging the Burmese government to complete the democratization process by amending the Constitution.

“It can’t say it has completed the democratization process without amending the Constitution, as the [2015] elections will not be free and fair,†he said.

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Source: Irrawaddy.org