Friday, June 28, 2013

Politics & Business In Myanmar 2013

The phlegmatic government (you can try to get rid of the booger from your fingers but it just sticks around) of Myanmar just announced a shocking awardment of foreign telco licenses to build 4G networks in Myanmar. The winners of the 15 year concession were Telenor from Norway (DIGI fame) and Ooredoo from Qatar.

What was shocking was the favourites did not get a mention. SingTel which was easily the hot favourite did not get it. SingTel was bidding as part of a consortium with Myanmar's biggest bank Kanbawza Bank. SingTel with a large footprint in emerging markets, backed by Temasek, not to mention being buddies in  ASEAN loose coalition of neighbours to boot.

It would appear that there are other concerns in the awardment of the concessions. The messages are loud and clear. One, Myanmar still regards ASEAN as not the most important grouping as the memebrs try to make it out to be. Suffice to say, Myanmar has had lingering political issues that earned the ire of many foreign countries. Be it Aung San Sukyi or the dastardly acts towards the Rohingyas. It appears you cannot EVEN say anything negative or try to interfere in any way, even by political suasian or closed door sessions. A hands off and mouth zipped policies are valued.

The other favourite was a consortium led by Digicel, a Jamaica based telco that first invested in Myanmar in 2009 and employs close to 900 people in the country. The consortium also included Goerge Soros and Seung Pun, a leading businessman in the country. This was supposed to be a shoo-in. But no.

Again, that may have a message to George Soros, an advocate of democracy and supporter of many private efforts via NGOs globally. If you want to do big business in Myanmar, be apolitical.Any country that supports sanctions etc... will be "punished".

Ooredoo was ranked 9th out of 11 bids and was unlikely given the tension with anti-Islam violence with the Rohingyas, as the company was Qatari. Still, Ooredoo is 67% owned by Qatar government and provides telco services in Indonesia, Singapore, Laos and the Philippines. It supposedly has over 60mn customers in Indonesia alone. 

Telenor can better explain its cause as it has Norway government support. Plus the Norway government has been one of the more active European countries in Myanmar, supporting and funding various projects in the country.

So, it could be political ... or it could also be corruption. Who knows? It certainly did not look to be fully on merit alone. Though Telenor could win by merit alone as well. Too many questions, the perils of doing business with government. 


bruno said...

Now that the dovish on the way out Big Benny has sent the bond markets on a panic mood,it is time to take another look especially at the beaten up ones.The precious metals and the very badly bruised currency called the Aussie.

If indeed Bernanke is going,his likely replacement would be the biggest dove Janet Yellen or other dovish fed presidents.

The gurus has jumped on the bandwagon of a very bullish greenback,which is usually a correction around the corner.

bruno said...

Finally we were able to take profits in Usd/Sf for 260 pics after years of patience in waiting and roller coastering.

On Monday pre market trading the Aussie gapped down and was on sale at lows of .9110.I jumped in feet first,averaged at .9125 and was up 150 pics Thursday,only to end up 40pics Friday.

After NFP the greenback shot up like a rocket and was at the day's high an hour later.On a Friday,with uncertainties around the universe including Eygpt,Pigg's nations and the planet of Mars.If this is as far as it can go,especially on a Friday with better than expected NFP's and uncertainties around the globe,the elephant's footprints are telling us that it is an very overcrowded market.

For the stock market we just have to be a bit patient.Give it a couple more weeks to really run out of gas.It might come sooner rather than later.Have a nice weekend folks.

TheBoyer0103 said...

I have to say that business and the Myanmar economy is doing well despite of the peace instability in their region. A good time to invest on their stock I guess, I checked on bbinary broker review and seen how most stocks and indices from Myanmar are doingm and I have to say they are performing better than the past few years.