Myanmar's Privatization Payment Policy for Businessmen

The Myanmar Government has been successively carrying out wave of privatizations -- accepting biddings on sales of real estate, engine oil shops, and port areas and biddings on state-owned enterprises that will be transferred to the private sectors.

For those who won the tender or who have succeeded in their proposal to do business in privatized sectors the stipulations concerning payment of due amount has been laid down. The stipulation concerning the payment applies whether payment is for operating engine oil shops, real estate or state owned enterprises.

Successful Proposal
If the due amount of payment in a privatized sector irrespective of the reasons such as whether the tender has been won or proposal has been successful, exceeds one billion kyat (Myanmar's currency unit, 1,000 Kyat is equivalent to $1), the bidder is liable to pay 30 percent of the total in one time immediately and the remaining amount to be paid as bank loan.

According to the stipulations, payments as bank loans must be paid up within the deadline of six years. If the amount to be paid is under one billion kyat, immediate payment for the entire amount must be made within one time.

Winning Tender Price
Candidates who won bids to operate on engine oil shops, docks where engine oil will be loaded, and engine oil storage must make payments in accordance with the stipulated terms.
"We have proposed to operate engine oil shop. If we get the right to operate by winning the tender, we have to abide by the assigned stipulation method when we pay the amount of the winning tender price. If the amount to pay is overdue 1 billion kyat, 30 percent of the due amount is immediate down payment, and the remaining 70 percent is to be paid in six years, as a repayment for bank loans for which interest must be paid.

If the due amount is below one billion kyat, the entire amount must be paid immediately. Immediately does not mean immediate payment right after the tender is won, the due amount must be settled within a certain time frame. The payment rule applies not only to engine oil shops but also to other successful tenders such as real estate, state owned economic enterprises and all others," , said a person who have submitted a proposal to operate an engine oil shop.