OBG talks to U Nyan Htun Aung, Minister for Transport

Interview: U Nyan Htun Aung

How can the government encourage foreign direct investment (FDI) in the transport sector?

U NYAN HTUN AUNG: Recent reforms have led to an increase in FDI in the transport sector, particularly with regards to aviation and maritime services, and 20 aviation service areas have been opened up to FDI. Foreign investors will be able to pursue 100% ownership in 18 areas, and to set up business as a joint venture in the other two. In terms of maritime transport, there are investment opportunities in three main areas: firstly, developing Kyauk Phyu and the Dawei Deep Sea Port; secondly, port construction and operations; and lastly, shipbuilding and repair. Regarding investment opportunities in ports, foreign investors have been invited to participate in port development projects which were laid down by the Myanmar Port Authority with a joint venture system or a build-operate-transfer arrangement. Investors are encouraged to participate in the form of a joint venture, at a maximum of 49%, with Inland Water Transport, the state-owned enterprise.

What plans are in place to increase the ease of access to Myanmar’s borders for ASEAN members?

NYAN HTUN AUNG: Myanmar has concluded bilateral air service agreements with 46 states, and more than 22 Asian carriers already fly directly to Yangon. Others will no doubt soon follow suit. There are also plans to build superhighways between Myanmar and its neighbouring countries, overseen by the Ministry of Construction. Myanmar also has a very active shipping industry, with more ports currently under construction to increase maritime capacity on various levels. This will undoubtedly have the effect of increasing shipping traffic and facilitating connectivity with other members of ASEAN.

What kind of investments are required to raise the capacity levels of Myanmar’s transportation sector?

NYAN HTUN AUNG: Myanmar needs further aviation training, and maintenance, repair and operations services to raise our aviation capacity. Japan International Cooperation Agency has also recently been engaged in upgrading air navigation facilities at certain airports in Myanmar, with the help of grants from the Japanese government. Myanmar is also grateful for the infrastructure development aid that it is receiving from China, Japan, Korea, and Thailand. Furthermore, to raise the capacity levels on inland water transportation, Myanmar needs more passenger vessels. We also believe that development in human resources will be critical in improving capacity levels in the sector, for instance providing training to raise the standards of management and operational capabilities.

What measures are being taken to raise safety standards within the aviation and maritime sectors?

NYAN HTUN AUNG: An agreement has been reached between Japan International Cooperation Agency and Myanmar’s Department of Civil Aviation to implement a project to improve nationwide air transport safety.

This will adhere to the standards set by the International Civil Aviation Organisation (ICAO). As a member of ICAO, Myanmar naturally follows the ICAO’s Standards and Recommended Practices. Indeed, the Department of Civil Aviation has issued a series of Myanmar Civil Aviation Requirements to regulate safety in the aviation industry. We have also implemented the International Maritime Organisation’s safety conventions to improve safety standards on our conventional vessels, and drafted relevant legislation, such as the Myanmar Merchant Shipping Act and the Inland Vessel Act.

What benefits do you expect to result from increased competition within the aviation sector?

NYAN HTUN AUNG: The government expects increased competition within the sector to create more options and expand benefits for everyone who uses these services. It is predicted to provide better service with lower prices and higher safety standards. State-owned Myanma Airways expects to compete with other airlines, in line with the state’s newly amended legislation.