In 2016, construction material markets were affected by the new government’s policies and has slowed down due to the halting of high-rise buildings constructions across the city for a review. The demand for low-rise apartments also has fallen due to oversupply. Cement is the most imported construction material and according to Customs department, the cement import value increased by 29.7 % from $157.5 million in FY 2012-13 to $204.2 million in FY2013-14. The growth is expected to sustain in the near future with the Myanmar construction sector expected to grow at a CAGR of 11% driven by the real estate boom and government infrastructure projects. The other types of popular most used materials are concreting sand, stone aggregate, reinforced concrete, high tensile steel bars, structural steelwork, plywood formwork and clay bricks.
The Ministry of Commerce is inviting foreign companies to import high-quality building materials and the regulatory changes are promoting development in the construction sector, which has slowed since 2014 following a three-year boom. Low-quality and counterfeit materials are major challenges threatening the local contractors across the country and the goods are produced locally or smuggled across the country’s borders.
The Ministry of Commerce controls the types of construction materials that can be imported and the import procedures. Until 2011, foreigners were not allowed to participate in export and import sectors of Myanmar. In July 2016, The Ministry of Commerce has further relaxed trade restrictions on foreign companies, opening onshore trade in construction materials to local-foreign joint ventures. In 2016, the government allowed foreign companies access to onshore trade for the first time initially in agricultural products and hospital equipment with a condition that requires forming a JV with a local entity. Furthermore, such companies are allowed to engage in retail and wholesale trade in the listed materials.
Licenses for trading construction materials are being awarded to local-foreign joint ventures if they meet standards set by the relevant department and the joint ventures will have to follow the same rules as local traders, including limits on the value of trade.
Investment businesses permitted with recommendation of Ministry of Construction are production and domestic distribution of materials relating to PC Strand, PC bar, anchor, steel bar, bailey steel bar, plate girder, steel truss and bridge-related reinforced concrete and pre-cast concrete.
Trade Restrictions Updated, Luther Law Firm Myanmar, January 2016
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