Quarterly Business Magazine

Ministry Owned Timber Factories to Be Transferred into Private Operators

Posted :
Wednesday, October 29, 2014

Yangon – The Myanmar government is planning to allow private operation in timber and related factories owned by Myanmar Timber Enterprise.

“The government has been trying to transform state-run enterprises into private businesses, so our ministry is following this policy,” says an official from Myanmar Timber Enterprise.

There are a total of 84 timber and related factories owned by the Ministry of Environmental Conservation and Forestry. As the initial phase, the ministry is planning to obtain long-term leases for 12 timber factories and 3 furniture factories from private investors. If the initial phase proves to be successful, other factories will be leased out in multiple phases. The ministry officials are still discussing what kind of leasing will be adopted.

In Myanmar, the ministry has the monopoly on logs, log cutting, and furniture manufacturing. After the government‘s ban on log exports since April, the ministry has announced that it will allow private operations for its factories.

Although the government stopped log exports and is trying to encourage exports in processed wood goods, the latter is facing difficulties in the international market because only teak has demands in the market.

After the ban on log exports, about half of over 50 domestic timber companies will transform themselves from log exporters to processed wood exports.

Not only is there an increase in the number of domestic processed wood manufacturers, four companies from Korea, India, and Singapore have invested in the wood processing sector, according to Myanmar Investment Commission.

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