YANGON -- Foreign direct investments in Myanmar rose 18% during the full year ended March 31, with the capital inflow fueled by economic growth expectations for a country making a historic break from its military-led past.
About $9.48 billion worth of foreign investments were approved, data by Myanmar's investment authority shows. The amount is dwarfed only by the roughly $20 billion logged in fiscal 2010, which was marked by a series of investments by Chinese enterprises in hydroelectric power projects. The government started keeping records in fiscal 1988.
Fiscal 2015's figure, however, is the largest since Myanmar started undergoing democratic reforms in 2011. Not only did relations with the international community improve, but the foreign investment law put in place by the previous administration of President Thein Sein also contributed.
The oil and gas sector received 51% of the investments. China's Guangdong Zhenrong Energy is building a large-scale oil refinery in Dawei, a city in south Myanmar. Funds from Royal Dutch Shell and other European resource companies are apparently going toward developing deep-sea mining blocks in the Indian Ocean.
The transport and communications sector collected 20% of offshore funds. Cellphone carriers like Norway's Telenor Group and Qatar's Ooredoo have been building base stations since 2014. Manufacturing, real estate and power were also big winners.
Singapore was the biggest source of funds, providing 45%. Many multinationals utilized financial arms located in the city-state to channel capital to Myanmar. China ranked second with 35%, more than six times the total from a year earlier. Japanese investment jumped 160%, moving the country up three notches to eighth place.
The National League for Democracy led by Aung San Suu Kyi secured a landslide victory in November's general election. President Htin Kyaw was sworn in at the end of March, becoming the first elected civilian leader in half a century. Before the transfer of power, there was an apparent rush of investment applications -- mainly from China. March ended up raking in 40% of the full-year total.
The capital influx is expected to surge again this fiscal year, due in part to the U.S. easing sanctions during Myanmar's first year under NLD rule. The Asian Development Bank predicts Myanmar's gross domestic product will grow by 8.4% in 2016, the fastest pace in Southeast Asia.