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Burma's food industry: Time for investment

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Burma, still mainly an agricultural country, needs help from Thailand developing its food industry & technology.



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AGRICULTURE

Food institute: Invest in Myanmar before AEC

15/05/2012
Nanchanok Wongsamuth

The National Food Institute (NFI) is advising businesses to take advantage of the Asean Economic Community (AEC) to invest in Myanmar and use the neighbouring country as a gateway to the Middle East, Europe and Africa.

NFI president Petch Chinabutr said Myanmar will soon pass policies to promote the agriculture industry including an expansion of growing areas, irrigation systems and foreign investment.

Although Myanmar has factories that produce processed food, the quality is not good as their technology is old and they lack basic infrastructure.

"The Myanmar government wants investors to develop this sector," he said.

Myanmar's agricultural industry is its largest source of revenue, totalling 59.1% of the country's GDP and employing 67.1% of the population.

Main imports include palm oil, ready-made food, vegetable oil, non-alcoholic drinks and rice.

During 2002-2009, imports on average grew 9.4% per year, while exports increased 10.4% per year. Dried nuts were the main exports, followed by sesame seeds, chick peas, corn and rice.

Myanmar is in the process of revising measures to promote overseas investment, such as drafting a new investment act that waives corporate income tax for a period of eight years, up from the existing three years, and lowering by 50% the tax on profit made from exports.

Business opportunities exist in the food service sectors, processed food, restaurants and selling tea.

Mr Petch predicts the food sector will greatly benefit once the deep-sea port and industrial estates are built in Dawei, providing a gateway to the Indian Ocean, the Middle East, Europe and Africa.

Thai businesses should sell cheap consumer goods, technology and agricultural machinery to Myanmar, he said.

Consignment and word of mouth is one way to introduce products along the Thai-Myanmar border, as Myanmar people stick to the products they know.

He added Myanmar is a good source of unskilled labour for the food industry.

Last year Thailand imported 2.45 billion baht worth of food from Myanmar, down from 3.12 billion in 2010. Thailand is the fourth-largest exporter to Myanmar.
 
Mr Petch said despite the benefits Thailand will receive from Myanmar investment, such as the generalised system of preferences (GSP), businesses also need to consider raw materials, machinery, packaging and logistics costs.

(Source: Bangkok Post,, AGRICULTURE, Food institute: Invest in Myanmar before AEC, 15/05/2012, Nanchanok Wongsamuth, link

Food Industry Investment Vocabulary

National Food Institute (NFI) - an organization that does reasearch on the food industry and food markets in Thailand (See Wikipedia)

Asean Economic Community (AEC) -
the system of free trade and free labour movement between Asean countries starting from 2015

advantage - a condition giving a greater chance of success ความได้เปรียบ
take advantage of - take an opportunity; take some benefit or good thing offered to you that allows you to succeed
take advantage of the Asean Economic Community (AEC)

gateway
- a place that provides easy access to other places (here: can ship goods to many places from here)
gateway to the Middle East, Europe and Africa.
use the neighbouring country as a gateway to the Middle East, Europe and Africa.

The National Food Institute (NFI) is advising businesses to take advantage of the Asean Economic Community (AEC) to invest in Myanmar and use the neighbouring country as a gateway to the Middle East, Europe and Africa.

promote an industry - help the industry, develop new products, methods  and gain new customers and markets
policies to promote the agriculture industry

expansion - when something increases in size, number or importance การขยายออก

irrigation
- the process of bringing water to land through a system of pipes, ditches, etc. in order to make crops grow ระบบชลประทาน (See Wikipedia)
irrigation systems

investment
- taking your money and putting it into projects to make a profit or earn interest (buying stock shares, bonds, real estate)
foreign investment.

expansion
of growing areas, irrigation systems and foreign investment.

NFI president Petch Chinabutr said Myanmar will soon pass policies to promote the agriculture industry including an expansion of growing areas, irrigation systems and foreign investment.

processed - treated in some way, e.g., treated with chemicals, cut, etc.
processed food

lack
- does not have ขาดแคลน
infrastructure - the high-cost facilities that everyone in the economy shares (water, roads, electricity, trains) สาธารณูปโภค
basic infrastructure
lack basic infrastructure

sector
- a part of the economy ภาคเศรษฐกิจของประเทศ (public sector = government, private sector = all businesses, household sector = families and consumers, banking sector,...) (See Wikipedia)

"Although Myanmar has factories that produce processed food, the quality is not good as their technology is old and they lack basic infrastructure. "The Myanmar government wants investors to develop this sector," he said.

source - the place or person something comes from or starts at, or the cause of something ต้นกำเนิด, แหล่งกำเนิด
revenue - income from taxes or business activities รายได้
source of revenue - where revenue comes from

population - the group of people that lives in one country, area or place กลุ่มที่อาศัยอยู่ในบริเวณหนึ่ง
agriculture employs 67.1% of the population

ready made food - food that has already cooked and is ready to eat after you buy it in the store

Myanmar's agricultural industry is its largest source of revenue, totalling 59.1% of the country's GDP and employing 67.1% of the population. Main imports include palm oil, ready-made food, vegetable oil, non-alcoholic drinks and rice.

sesame seeds - a small seed used in many foods around the world (See Wikipedia)
chick peas - a bean (legume) very popular in Middle Eastern food (See Wikipedia)

During 2002-2009, imports on average grew 9.4% per year, while exports increased 10.4% per year. Dried nuts were the main exports, followed by sesame seeds, chick peas, corn and rice.

process - a series of actions that you take in order to achieve a result แนวทางปฏิบัติ, กระบวน, วิธีการ
in the process of - currently doing it now (not finished yet)

measures - actions taken to deal with a problem มาตราการ
revise - rewrite, change and make better
revising measures -
changing the actions being taken to solve a problem
in the process
of revising measures to promote overseas investment

draft -
write
act - a law passed by a country's government พ.ร.บ. พระราชบัญญัติ
drafting a new investment act

income
- money that people receive from work or some other source, used for household consumption and savings
income tax -
tax paid on the income of a person or company 
corporate income tax - the tax that large companies (corporations) pay to the government on the money they make each year

waive -
say that you do not have to do or pay something
waive income tax -
when the government says you do not have to pay income tax
a new investment act that waives corporate income tax

profit
- money that you make from selling goods and services after all your costs have been paid กำไร
lowering by 50% the tax on profit made from exports.

Myanmar is in the process of revising measures to promote overseas investment, such as drafting a new investment act that waives corporate income tax for a period of eight years, up from the existing three years, and lowering by 50% the tax on profit made from exports.

opportunities - a situation where it is possible to do something that you want to do
business opportunities

benefit
- to get help or an advantage from something ผลประโยชน์
the food sector will greatly benefit

port - an area of water where ships stop, including the buildings around it ท่าเรือ
deep-sea port - a special port that can handle the largest ships that send cargo and oil around the world  (See Wikipedia)
industrial estates -
special areas for factories

Business opportunities exist in the food service sectors, processed food, restaurants and selling tea. Mr Petch predicts the food sector will greatly benefit once the deep-sea port and industrial estates are built in Dawei, providing a gateway to the Indian Ocean, the Middle East, Europe and Africa.

consumer - someone who buys and uses goods and services ผู้บริโภค
consumer goods - goods that people have to buy in their everyday life (toothpaste, soap, etc)
cheap consumer goods

consignment -
goods that you deliver to a store to sell for you or return them to you if they cannot sell them
sell on consignment

word of mouth -
when people tell their friends how good some product and their friends buy it too (free advertising)

border
- the official line separating two areas, regions or countries เขตแดน อาณาเขต
the Thai-Myanmar border

skilled labour - workers with special training or experience that has value in the market
unskilled labour
a good source of unskilled labour for the food industry.

Thai businesses should sell cheap consumer goods, technology and agricultural machinery to Myanmar, he said. Consignment and word of mouth is one way to introduce products along the Thai-Myanmar border, as Myanmar people stick to the products they know. He added Myanmar is a good source of unskilled labour for the food industry. Last year Thailand imported 2.45 billion baht worth of food from Myanmar, down from 3.12 billion in 2010. Thailand is the fourth-largest exporter to Myanmar.
 
benefits - goods things that can happen from an activity ผลประโยชน์

preferences - things that you want or like ความต้องการ
generalised system of preferences (GSP) - a special system of tariffs to help least developed countries (LDPs) with selling their exports (See Wikipedia)
least developed country (LDP) - the official UN list of the least developed and poorest countries in the world, Burma (Myanmar) is on this list (See Wikipedia)

raw materials - materials in their natural state before being processed or used in manufacturing
packaging - the container or covering for a product while it is waiting to be sold in stores

logistics - the activity of transporting, storing, and tracking goods (being sent from one place to another), on the way from factory to consumer (See Wikipedia) การขนส่งและจัดจำหน่ายสินค้า

Mr Petch said despite the benefits Thailand will receive from Myanmar investment, such as the generalised system of preferences (GSP), businesses also need to consider raw materials, machinery, packaging and logistics costs.

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