Banks step up support for moves into Myanmar

JIJI

Japan’s three major banks are bolstering support for Japanese companies looking to enter Myanmar.

In April, Bank of Tokyo-Mitsubishi UFJ stationed a full-time chief in Yangon. Previously, the head of its representative office in Dhaka concurrently headed its office in Myanmar’s biggest city.

Since then, the megabank’s Yangon office has advised some 150 client firms hoping to enter the democratizing Southeast Asian country, which has become increasingly attractive to businesses chiefly as a low-cost manufacturing base.

In the year to next March, the office is expected to give advice and offer support services to 600 companies, up threefold from the previous year, an official of the bank said.

Its peers are also getting ready to boost client services in the country.

Mizuho Corporate Bank set up a representative office in Yangon in April and Sumitomo Mitsui Banking Corp. has inked a deal with Kanbawza Bank to provide Myanmar’s largest lender with human resource development and technical assistance.

Sumitomo Mitsui is mulling an alliance with Kanbawza, sources said.

With a population nearing 62 million, Myanmar shines as not only a potential production base for Japanese companies but a new consumer market.

“Demand for daily goods, food and construction machinery are believed to be increasing in Myanmar,” said Ritsuo Fukadai, head of the Yangon office of Tokyo-Mitsubishi UFJ, adding that his office is providing information to clients in the manufacturing and logistics industries.

But Fukadai said Japanese firms may have to wait another three to five years before fully investing in the country until infrastructure, including payment clearing systems and power networks, improves.