By May Oo
YANGON, Sept. 16 (Xinhua) -- Myanmar hailed the United States' recent lifting of sanctions and reinstatement of the Generalized System of Preferences (GSP) program which will create better investment environment for the Asian country.
Myanmar has vowed to make appropriate preparations in order to maximize the benefits of the recent policy adjustments.
After the bilateral meeting between U.S. President Barack Obama and Myanmar's State Counselor Aung San Suu Kyi on Wednesday during her first visit to Washington since her National League for Democracy-led government took office, a statement that the Generalized System of Preferences (GSP) program, a preferential tariff system, would be reinstated, was made.
The GSP program will be reinstated effective on Nov. 13 this year after a 60-day Congressional-notification period. This decision will give Myanmar the opportunity to export nearly 5,000 products to the U.S. duty-free, according to the statement from the Office of the United States Trade Representative in Washington.
The United States suspended the GSP benefits to Myanmar in 1989 due to labor rights concerns. In 2013, Myanmar began engaging in negotiations for the reinstatement of the GSP, compiling the GSP eligibility criteria.
After the recent bilateral meeting, Obama said that the United States is preparing to lift remaining sanctions on Myanmar and will complete the process soon.
The joint statement by both countries said that the United States will also terminate the national emergency with respect to Myanmar, which has been in place since 1997, and will revoke the executive order-based framework of the Myanmar sanctions program.
According to the statement, the move represented Washington's recognition of the progress towards democratic transition that Myanmar has achieved including through the election of a civilian-led government.
Some local experts said that sanctions such as prohibiting certain imports of jade and rubies, banning the trading of weapons, blacklisting some individuals close to former military government, should not be lifted.
Other said, however, that removing such powerful businessmen from the blacklist could have a positive affect as they are some of the Myanmar's main economic players.
Aung Ko Ko, a local economist, said that the United States may maintain such sanctions as prohibiting jade for Myanmar's jade industry as the industry is complicated and plagued with problems.
"Despite regaining preferential trade benefits under the European Union's GSP program since 2013, the country could not enjoy the benefits completely as the local businesses lack infrastructure, technology for mass production, quality management and financing," U Aung Than Oo, vice president of Myanmar Rice Federation, told Xinhua.
"As for the rice sector, we can afford just 2,000 tons of broken rice exports to the EU per month," he explained.
As a consequence, the Southeast Asian country has a limited competitive capacity in exploring global markets than other regional countries. In fact, the country is mainly depending on its neighboring countries for its export, U Aung Than Oo added.
"Myanmar will miss the chance if it does not enhance the country's productivity, trade and financial transaction systems," Ag Ko Ko also said.
The Obama administration will make a power transition later and U.S. foreign policy to Myanmar may change in accordance with the new government. Therefore, Myanmar needs to be flexible to change and shift as necessary in an effective and timely manner, he explained.
"To meet the criteria of the U.S. GSP program completely, the country will continue implementing the National Export Strategy and with an emphasis on quality management of major export items," U Aung Soe, director general of the Ministry of Commerce, told Xinhua.
The United States also lifted restrictions on Myanmar's financial institutions and certain transactions related to U.S. individuals living in the country were allowed in May this year. Seven state-owned enterprises and three state-owned banks were removed from the U.S. blacklist.
Meanwhile in May, the United States toughened restrictions on six Myanmar companies which are linked to local giant Asia World company, for the purpose of galvanizing further democratic reforms and maintaining pressure on targeted individuals, entities and the military.
Overall the United States has only 17 businesses with trade here amounting 248.216 million U.S. dollars as of August of this fiscal year 2016-2017. Bilateral trade relations restarted after a civilian government was formed in 2011. The bilateral trade value reached 196.902 million U.S. dollars in the previous fiscal year 2015-2016, which is comparatively less than with other countries.
During the former government's era, U.S. investments were made through third-party countries due to restrictions, limiting Myanmar's access to trade and income.
Lifting sanctions will create a better investment environment, said U Aung Naing Oo, director general of Directorate of Investment and Company Administration (DICA).
