Myanmar President Thein Sein speaks Oct. 10 during the closing ceremony and handover of the ASEAN Chairmanship to Myanmar as part of the 23rd Summit of the Association of Southeast Asian Nations (ASEAN) in Bandar Seri Begawan, Brunei. (Roslan Rahman / AFP)
YANGON — The Myanmar military’s secretive business empire made a rare foray into the public spotlight on Wednesday, seeking to reassure foreign investors over their treatment in the former junta-ruled country.
The unusual step out of the shadows by Myanmar Economic Holdings Ltd (MEHL) came as the sprawling mining-to-brewing conglomerate announced it had begun arbitration proceedings against Singapore-based food and beverage giant Fraser & Neave (F&N).
The row centers on MEHL’s bid to buy F&N’s 55 percent stake in their joint venture Myanmar Brewery Limited (MBL).
MEHL said F&N had defaulted on a term in their joint venture deal after a change in the ownership structure following the Singapore group’s takeover by Thai billionaire Charoen Sirivadhanabhakdi earlier this year.
It said it decided to speak out in response to media reports painting the dispute as a “test case” for Myanmar’s investment laws.
MEHL, which was built by Myanmar’s generals during their decades of iron-fisted rule, said the arbitration move “is not about the investment laws in Myanmar or how foreign investors are treated in the country”.
“We believe that allowing parties to exercise their contractual rights, including the right to arbitrate a dispute, will strengthen and not weaken foreign investors’ confidence in Myanmar,” MEHL deputy managing director Myint Aung said in the statement.
“We know it will serve the interest of some parties to politicize the dispute but doing so does no justice to the case or to anyone interested in investing in Myanmar.”
Foreign investors are flocking to Myanmar following the end of junta rule in 2011, lured by the country’s abundant natural resources, untapped consumer markets and low-paid workforce.
The lifting of most Western economic sanctions has attracted international businesses, including Ford and Coca-Cola.
But experts say an opaque legal framework is one of a number of major challenges facing businesses entering the once-reclusive nation.
In an attempt to address their concerns, the country’s reformist President Thein Sein last year signed into law an eagerly awaited foreign investment bill.
The former general has vowed to put the economy at the center of a second wave of reforms, following dramatic political changes including the election of opposition leader Aung San Suu Kyi to parliament.