On 24 September 2019, Singapore and Myanmar concluded a Bilateral Investment Treaty (“BIT”) on the Promotion and Protection of Investments. The BIT is a legally-binding agreement between Singapore and Myanmar and establishes rules on how Myanmar should treat investments and investors from Singapore and vice versa.
The BIT was concluded during the 7th Singapore-Myanmar Joint Ministerial Working Committee meeting. The Singapore Ministry of Trade and Industry (“MTI”), in announcing the signing of the BIT, noted that Singapore and Myanmar share warm economic relations and that Singapore is Myanmar’s largest foreign investor with a cumulative investment of US$22.1 billion (approximately S$30.5 billion) (as of August 2019).
Greater protection afforded to investors
The BIT will promote investment between Singapore and Myanmar by protecting the interests of these investors. Singapore companies operating in Myanmar will enjoy protection for their investments, and have recourse to international arbitration in the event of investment disputes. The BIT will also serve to provide investors with greater certainty and confidence.
The MTI states that the BIT will grant investors from both countries the following:
- Non-discriminatory treatment compared to other foreign investors and their investments;
- Non-discriminatory treatment compared to local investors and their investments in most sectors;
- Fair and equitable treatment and full protection and security;
- Protection from illegal expropriation;
- Non-discriminatory treatment with respect to compensation for losses arising from war, armed conflict, and civil strife;
- Freedom to transfer capital and returns;
- Access to international arbitration for investment disputes;
- Rights for investors to submit dispute claims on behalf of their locally-established enterprise in the host State; and
- Improved restitution or compensation rights for investors.
The MTI press release announcing the conclusion of the BIT also noted that Myanmar highlighted the need for closer cooperation in the promotion of trade and investment and noted possible areas of collaboration between the two countries such as industrial parks, technical cooperation, assistance in small and medium-sized enterprises (SMEs) and finance and banking.
The BIT will complement the ASEAN Comprehensive Investment Agreement (ACIA) that Singapore and Myanmar are also party to.