Chinese banks eye operations in Burma

Monday, 21 December 2009 13:10 Moe Thu

Rangoon (Mizzima) - Two Chinese banks are gearing up to launch commercial banking operations in Burma, according to a source close to a Chinese diplomat and the business sector in Rangoon.

“The China Development Bank and Bank of China are keen on having operations in Burma. It wants to open representative offices and then its branches in the commercial hub Rangoon next year,” the source said. Both are leading banks with a huge capital.

Increased Chinese business ventures in Burma have raised the demand for banking services, which will also give a leg up to economic ties between the two countries, the source said.

Jiang Chaoliang, Chairman of the China Development Bank visited Burma in mid-2009 to explore business opportunities in the country. During his stay, Chaoliang met senior officials of Burma's Ministry of Finance and Revenue.

Similarly, Bank of China officials also visited Myanmar in 2007 to discuss cooperation in the banking sector between the two countries.

However, a local banking expert said opening offshore bank branches here in the near future were impossible.

“That’s because military-ruled Burma is yet to have laws and regulations concerning offshore banks in the country,” the expert pointed out, adding that opening representative offices was more likely.

However, the expert welcomed the entry of foreign banks into the Burmese financial sector, saying it is likely to boost the country’s economy.

The value of bilateral trade surged to US$2.626 billion in 2008, compared to less than one billion dollars a few years ago, according to official Chinese statistics.

There were about 50 representative offices of foreign banks from United Kingdom, Singapore, Malaysia, Japan and other countries in 1994. Foreign banks opening representative offices in Burma include mega banks like HSBC.