Antonio Berenguer, EU's head of trade and economic affairs, said that
the agreement would encourage investment from Europe by improving legal
certainty and predictability surrounding investments.
"This agreement aims to provide investors with the classical guarantees
such as non-discrimination, fair and equitable treatment and protection
against expropriation without compensation. At the same time, it will
safeguard the right of the State to regulate in the interest of the
country and its people," he said.
Berenguer added that the agreement would also encourage quality
investments -- those that are intended to be long lasting and socially
and environmentally responsible - which would provide business
opportunities in Myanmar and contribute to sustainable economic growth.
The first round of negotiation for the agreement took place between 9
and 12 February 2015 in Yangon. Jointly organised by the Directorate of
Investment and Company Administration and EU Directorate of Trade, the
four-day meeting offered the EU the opportunity to present its text
proposal and to have a first exchange of views on the text with the
Myanmar counterparts.
Nine EU officials were present over the course of negotiations. The next round will take place in May.
"This was the first opportunity to discuss the EU text proposal with
several Myanmar ministries and agencies. It is therefore too early to
reach conclusions, but it can be pointed out that the talks were
productive and held in a very constructive atmosphere," said Berenguer.
A senior DICA official echoed Berenguer's view, saying that the talks
were constructive and both sides showed a strong commitment to the
important agreement for EU investors and for Myanmar’s fast-developing
economy.
"So far, we have allowed 107 enterprises from 12 European countries to
invest more than US$5.11 billion in our country. Yet, as the total
amount of capital to be brought in is only about 9.63 per cent of the
overall FDI [foreign direct investment], we are trying to encourage more
European businesses to invest here," she said.
According to the statistics, as of January 31, the UK is the biggest
European investors in the country with 77 enterprises investing US$3.71
billion, despite the fact that a lot of these investments are from the
British overseas territories. The Netherlands is the second largest
European investors with 11 enterprises investing US$551.54 million,
followed by France, Russia, and Austria in the top five European
investors list. Other EU countries which have been allowed to invest in
Myanmar are Luxembourg, Switzerland, Germany, Sweden, Denmark, Norway,
and Cyprus.
Trade as a driver for growth
Berenguer sees trade, the empowerment of people, and encouragement of
entrepreneurship as driving forces for catalysing development while aid
plays a crucial role.
In July 2013, the EU reinstated trade preferences for Myanmar by
granting the Everything but arms preferences (EBA) under the General
Scheme of Preferences (GSP) with retroactive effect to June 2012. The
trade regime allows Myanmar to export all its products except weapons
duty free and quota free to the EU market.
"Since 2012, we have seen the exports of Myanmar to the EU increase
from Euro 165.135 million in 2012 to 222.544 in 2013 and to 391.877 in
2014, an increase by 137 per cent compared to 2012. This trend is set to
continue," said Berenguer.
Trade between Myanmar and the EU has been growing incredibly rapidly,
but investment from the EU in Myanmar has not grown as quickly as trade.
European Union companies are by far the largest investors in Asean:
since 2005 EU companies have invested an average Euro 13.6 billion
annually in the region.
"We would like to see the same trend also for Myanmar. In terms of ease
of doing business, Myanmar is not yet an easy country, not just for EU
investors but for everybody," he said.