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Investing in Myanmar – CSR must be “built-in, not bolt-on”

CSR Asia, 10 December 2014 - After being isolated for more than half of the century, Myanmar is taking steps to position itself in the international market. In 2007, the Association of Southeast Asian Nations (ASEAN) Leaders adopted the ASEAN Economic Blueprint to serve as a coherent master plan guiding the establishment of the ASEAN Economic Community (AEC) by 2015. As a member of ASEAN, Myanmar has a mandate to implement a number of policy reforms, as agreed to in the AEC Blueprint. In 2014, Myanmar became the rotating chair of ASEAN for the first time since joining ASEAN 17 years ago, to lead the transformation of its 10 member countries (i.e. Brunei Darussalam, Cambodia, Indonesia, Laos, Malaysia, Myanmar, The Philippines, Singapore, Thailand and Vietnam) into a single production base with free movement of goods, services, investment, skilled labour, for which Myanmar aims to link economic reform to societal progress. In addition, the launch of Yangon Stock Exchange (YSE), which will replace the Myanmar Securities Exchange Centre (MSEC) in October 2015, will further drive greater foreign investment in the country.

Against the backdrop of these developments, the Government of Myanmar has articulated its position on foreign direct investment. President U Thein Sein has publicly stated that “While encouraging investment, it is important to promote the welfare of the Myanmar people and protect the environment upon which their livelihoods depend”. Similarly, Professor Aung Tun Thet, economic adviser to the President and member of the Myanmar Investment Commission (MIC), said “You must see CSR within the context of national reforms for the private sector development. In promoting private sector development, the Myanmar business community must be socially responsible".

For foreign investors, there is a growing consensus among them to make CSR a strategic tool to enter the market. Indeed, we have seen examples of companies operating in Myanmar involved in initiatives that supports the overall development of the country. For example, PepsiCo is partnering with the UN Educational, Scientific and Cultural Organisation (UNESCO) and the Ministry of Education to develop vocational training initiatives. This partnership will result in the establishment of a Center of Excellence for Business Skills Development at Yangon Institute of Economics and create curricula and training materials to help youth entering the workforce. Similarly, Microsoft has partnered with Myanmar Computer Company (MCC) to train 100,000 people with workforce-ready IT skills over the next three years.

The focus on supporting skills development makes strategic sense for organisations operating in Myanmar. According to the McKinsey Global Institute (MGI), educational attainment of Myanmar’s workers is relatively low, compared with other developing Asian peers. Based on the data in World Development Indicators (WDI) 2010, only 5% of Myanmar’s workers finished tertiary and higher education, and only 15% finished secondary education in 2010, while in Thailand and Vietnam about 30% of workers have a secondary education. In addition to the gap in skilled workers, as the country continues to grow, it has been reported1 that the country will need 32 million workers in 2015.

Opportunity to engage in dialogue on skills development and employment for returning refugees and migrant workers:

To further develop essential talent within Myanmar to meet needs derived from the growth of the country, CSR Asia and the International Rescue Committee (IRC) Thailand have launched a new project to invest in the voluntary return of refugees and migrant workers to Myanmar. These refugees and migrants left Myanmar for Thailand to pursue a better and more secure life away from decades of conflict and poverty – but now, with ongoing reforms, they can finally see a real opportunity to return home and help develop their country. We are currently looking to engage in dialogue with leading companies operating in Myanmar to identify employment opportunities and skills development opportunities for returning skilled refugees and migrant workers. IRC, together with a plethora of partners on both sides of the border, including NGOs, government institutions, and international donors, have been working to train refugees and migrant workers for many years in skills to fit a range of sectors, such as education, hospitality, management, health, agriculture, and construction, so that they may one day have a chance to go home and sustain a future livelihood that is dignified and dynamic. The first meeting will be convened on 15th January 2015 in Yangon to begin dialogue on this issue. If any companies are interested in understanding more about this project or participate in the first meeting, please feel free to get in touch with CSR Asia at Iris.Lui@csr-asia.com.

 

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