Private Sector Development Activity Quarterly Report

PRIVATE SECTOR DEVELOPMENT ACTIVITY QUARTERLY REPORT

QUARTER 3 FISCAL YEAR 2019 (APRIL 1 TO JUNE 30, 2019)

ROBOLEAGUE COMPETITION JUNE 1, 2019 PHOTO CREDIT: PHANDEEYAR FOUNDATION

DISCLAIMER Nathan Associates Inc. prepared this report for review by the United States Agency for International Development. The authors’ views expressed in this publication do not necessarily reflect the views of the United States Agency for International Development or the United States government.

PRIVATE SECTOR DEVELOPMENT ACTIVITY QUARTERLY REPORT 3 FY2019

PRIVATE SECTOR DEVELOPMENT ACTIVITY QUARTERLY REPORT Fiscal Year 2019 Quarter 3: April 1, 2019 to June 30, 2019

Submitted To USAID/Burma

Under Contract AID-482-C-15-00001

Submitted By Steve Parker Chief of Party August 15, 2019

Table of Contents Abbreviations ...... v Program Overview ...... 1 Program Description ...... 1 Q3 FY2019 Program Highlights ...... 1 Work Plan Implementation Progress ...... 4 Intermediate Result 1 – Inclusive, Effective and Transparent Economic Governance Activities ...... 4 Component 1: Economic Policy Making and Implementation ...... 4 Component 2: Building Capacity for Effective Economic Policy Dialogue and Entrepreneurism ...... 9 Intermediate Result 2: Broaden Access to Finance ...... 16 Component 1: Mobilize Credit to Underserved Enterprises through USAID Development Credit Administration Credit Guarantees ...... 16 Component 2: Continuing to Advance the Microfinance Sector ...... 18 Component 3: Insurance Liberalization ...... 19 Component 4: Bank Lending to SMEs ...... 20 Component 5: Central Bank and Banking Reform ...... 21 Cross-Cutting Activities ...... 22 3.1 Accelerate Development of a Market-Driven Agriculture Sector ...... 22 3.2 Support Gender and Ethnic Minorities in Economic Development ...... 23 3.3 Improve Economic Policy Making at Sub-National Levels and Around Post-Conflict Areas ...... 23 3.4 Facilitate Development of the ICT Sector ...... 24 Grants ...... 27 Status of Active Grants for Quarter 3 FY 2019 ...... 27 Activity Locations ...... 31 Stakeholder Participation and Involvement ...... 32 Donor Coordination ...... 33 Implementation Challenges ...... 33 Priorities for Programming for Next Quarter ...... 33 Activity Management and Administration ...... 35 Personnel Management ...... 35 Financial Management ...... 35

PRIVATE SECTOR DEVELOPMENT ACTIVITY QUARTERLY REPORT 3 FY2019

Contract Management ...... 35 Close-Out Planning ...... 35 Progress Report on Indicators ...... 35 Monitoring and Evaluation ...... 35 Gender and Inclusion ...... 36 Annex 1: FY2019 Quarter 3 Key Performance Indicator Results ...... 37 Annex 2: Q3 FY2019 PSDA Activities ...... 48 Success Story

PRIVATE SECTOR DEVELOPMENT ACTIVITY QUARTERLY REPORT 3 FY2019

ABBREVIATIONS A Bank Ayeyarwaddy Farmers Development Bank ASEAN Association of Southeast Asian Nations AMS ASEAN Member States ASW ASEAN Single Window ATIGA ASEAN Trade in Goods Agreement BRN Business Reporters Network CBM Central Bank of Myanmar CO Certificate of origin CSO Civil society organization DaNa United Kingdom’s private sector support facility; DaNa is the Burmese word for “prosperity” DCA Development Credit Authority (USAID) DEAR Development for Environmentally Friendly Agriculture and Rural Life DICA Directorate of Investment and Company Administration DOCA Department of Consumer Affairs DRI Department of Research and Innovation FRD Financial Regulatory Department FY Fiscal year GEW Global Entrepreneurship Week GIZ German Agency for International Cooperation ICT Information and communication technology ICT Council U.S. ICT Council for Myanmar IFC International Finance Corporation INGO International nongovernment organization IP Intellectual property IPPAM Intellectual Property Proprietor’s Association of Myanmar IPR Intellectual property rights JICA Japan International Cooperation Agency MCD Myanmar Customs Department MCIX Myanmar Microfinance Data Sharing Platform MCU Myanmar Consumer Union MCF Myanmar Computer Federation MDI Myanmar Development Institute MFI Microfinance institution MIPPA Myanmar Intellectual Property Proprietor’s Association MMFA Myanmar Microfinance Association MOALI Ministry of Agriculture, Livestock, and Irrigation MOC Ministry of Commerce MONREC Ministry of National Resource, Environmental Conservation MOTC Ministry of Transport and Communications

PRIVATE SECTOR DEVELOPMENT ACTIVITY QUARTERLY REPORT 3 FY2019

MOU Memorandum of understanding MTP Myanmar Trade Portal NECC National Economic Coordination Committee NGO Nongovernment organization NPT Nay Pyi Taw NSW National Single Window NSW-RP NSW-Routing Platform PSSAG Phyu Sin Saydana Action Group PPP Public Private Partnerships SME Small and medium sized enterprise(s) SOP Standard operating procedure STEM Science, technology, engineering, and mathematics UAGO Union Attorney General’s Office US-ABC U.S. ASEAN Business Council USAID United States Agency for International Development USPTO United States Patent and Trademark Office WIPO World Intellectual Property Organization WTO World Trade Organization YWCA Young Women’s Christian Association

PRIVATE SECTOR DEVELOPMENT ACTIVITY QUARTERLY REPORT 3 FY2019

PROGRAM OVERVIEW

Program Name: USAID Private Sector Development Activity Activity Start Date And End July 1, 2015 to June 30, 2020 Date: Prime Implementing Nathan Associates Inc. Partner: Contract Number: AID-482-C-15-00001

Geographic Coverage: Burma

Reporting Period: FY2019 Quarter 3: April 1, 2019 to June 30, 2019

Program Description

The USAID Private Sector Development Activity (”the Activity”) promotes increased broad-based economic opportunities in Burma by 1) creating more inclusive and transparent economic governance processes; and 2) increasing access to finance for emerging economic actors. Its goal is to help Burma lay a foundation of economic governance and stakeholder engagement that promotes its transition to an inclusive and sustainable market economy and that provides meaningful opportunities for Burma’s people to improve their lives.

The Activity now works on policy and capacity issues primarily at the national level. We use a “full political-economy approach” whereby we support champions of economic reform within civil society, the private sector, government, and parliament to advocate for or implement appropriate policies, laws, regulations, and advocacy processes to facilitate economic liberalization and to generate sustained, inclusive economic growth. All activities contribute to improved bilateral U.S.- Burma economic relations by assisting Burma to meet World Trade Organization (WTO) and ASEAN Economic Community treaty requirements and by improving the business environment to stimulate bilateral trade and investment.

Nathan Associates implements this Activity in partnership with its subcontractors, J E Austin Associates, Nathan London, and Internews. The $23.3 million contract began on July 1, 2015, and runs through June 30, 2020. As of July 2019, it is expected that program activity will conclude in January 2020.

The program includes a grant fund of around $2.8 million (reduced from $4.0 million) that is available for nongovernment organizations (NGOs) to build capacity and stimulate inclusive policy dialogue. The Activity strategically combines grants and technical assistance to achieve Activity objectives.

Q3 FY2019 Program Highlights

USAID designed the Private Sector Development Activity to be a fast-response economic reform and institution building operation, with emphasis on promoting evidence-based, public-private policy dialogue. At the same time, the Activity delivers specific technical assistance to foster important

PRIVATE SECTOR DEVELOPMENT ACTIVITY QUARTERLY REPORT 3 FY2019 policy and legislative reforms. We are a demand-driven activity that must be nimble and responsive to various requests from the Burmese Government, the private sector, and USAID. Government agencies that are not active and responsive to the Activity’s recommendations are less apt to receive assistance than agencies that are responsive and open to learning about international best practices and promoting reforms that can accelerate inclusive growth.

The Activity has had a number of important successes in this quarter, partly culminating in a number of major government actions that have been supported over time and partly from new initiatives that are evolving:

 Implementing the New IPR Laws. Following passage of three key intellectual property laws last quarter, the new Copyright Law was approved on May 24, 2019, all with technical support from the Activity. To implement the new laws quickly and effectively, the Activity met with Ministry of Commerce leadership and related government leaders along with supporting donor partners from June 11-14, 2019 to coordinate support to set up the new IP Office. As well, the Activity was asked to provide comments and recommendations on key implementing regulations for the four laws, which started with detailed Activity comments on the implementing rules for the new Industrial Design Law on June 17, 2019.  Raising Public Awareness to Strengthen Understanding of IPR. To promote the landmark passage of modern IP Laws and commitment by the government to develop an effective regime to protect IPR, the Activity supported two major public awareness programs on April 26, 2019 in celebration of World Intellectual Property Day – one in NPT organized by the IP Office and one in Yangon organized by grantee Myanmar Intellectual Property Proprietors Association, combined with more than 400 participants and major media coverage.  The Major Insurance Sector Liberalization Plan Is Implemented. The government implemented its major insurance liberalization plan with a path-breaking announcement on April 5, 2019 to allow five (one being Chubb from the U.S.) of the world’s largest life insurers to operate as 100-percent foreign-owned subsidiaries in Burma. (On July 31, 2019, six joint-venture insurance operations with 35% foreign participation were also authorized.) Over this quarter as well, the Activity advanced an improved draft of a modern Insurance Business Law, which will be required to regulate a rapidly expanding and increasingly sophisticated insurance sector in Burma.  A Milestone Reduction in Electricity Tariffs. On June 25, 2019, the Ministry of Electricity and Energy announced major electricity tariff increases to go into effect July 1, 2019, supported by our consultant Latitude Capital (and others working in the sector). This major policy reform will reduce the burden of substantial subsidies on the government budget and should increase private investment incentives to expand generation, transmission, and distribution of electricity.  The Gemstone Policy Was Approved by the Supporting Committee and Submitted to the Minister. The Myanmar Gemstone Supporting Committee, a tripartite multi-stakeholder group of government, private sector, and civil society representatives, finalized the content of the country’s first National Gemstone Policy, covering colored stones and jade. The final draft policy was submitted to the Minister of Natural Resource and Environmental Conservation (MONREC) in the second week of April 2019. The U.S. Embassy with support by the Activity organized a public seminar on “Myanmar’s Gemstone Policy Consultative Process” at the American Center – Yangon on May 29, 2019 to reflect

PRIVATE SECTOR DEVELOPMENT ACTIVITY QUARTERLY REPORT 3 FY2019

on lessons learned from the path-breaking consultative process, hosted by U.S. Ambassador Scot Marciel and moderated by PSDA Deputy Chief of Party Show Ei Ei Tun.  Stakeholder Consultation on the Draft Regulation to Implement the Gemstone Law. On June 17, 2019, the Myanmar Gems Enterprise organized a stakeholder consultation workshop on the draft gemstone regulation in Nay Pyi Taw, drawing over 100 key stakeholders at Union and State/Region levels, and further bringing transparency to one of the traditionally most opaque and conflict-ridden sectors in Burma.  Advancing Decision Making On How to Rationalize Two Heavily Indebted Steel Mills and an Iron Ore Mine. A Phase 2 report on options for rationalizing the steel mills and iron ore mine at Myingyan and Pin Pet were discussed with leadership of the National Economic Coordination Committee (NECC); based on the request by the NECC, a quick additional report was developed on options for preserving the value of the equipment at the Myingyan mill that are currently exposed to the elements and a draft Final Report for review was provided shortly thereafter.  Building the Foundation for Good Decision Making on Deciding the Location of a New Deep Sea Port for Yangon. Completed an assessment of the best options for a deep-sea port for the Yangon market, working closely with leadership in the Ministry of Transport and Communication and the Myanmar Port Authority, which provides a foundation for the Ministry to consider moving forward to initiate a comprehensive deep- water seaport master plan.  Supported an Innovative RoboLeague Competition for Young STEM Students from All States and Regions. On June 1, 2019, Activity grantee Phandeeyar held the first national robotics competition, “RoboLeague.” Working with 46 technical universities across the country, 14 teams representing each State and Region were created and provided with components to build robots with which they competed in the national competition held on June 1, 2019 and opened by the U.S. Ambassador and Minister of Education. More than 80 students under the age of 20 participated. The winner will represent Burma in the FIRST Global Robot Olympics to be held in Dubai in late 2019.  Closing Down Three Years of Successful Support for Enhancing Business Reporting Among All Forms of Media. Continued support for capacity-building of business reporters in States and Regions where the Activity through Internews has advanced business reporting skills among local media outlets over the past nearly four years, with Business Reporters Networks established now in five states/regions -- Ayeyarwaddy, Sagaing, Mon, Mandalay and Yangon. A major Close Our Forum was held that represented the largest grouping of business journalists to date with discussions on the success of the program and challenges for business reporting in Myanmar.  Raising Awareness for the Upgraded Myanmar Trade Portal. The Ministry of Commerce presented its upgraded version of the Myanmar Trade Portal (MTP) on March 29, 2019 to an audience of business participants in Yangon. This Portal serves as a comprehensive source of information on all elements of exporting and importing, with details for the more than 11,000 tariff lines at the 10-digit level.  Supported the Development and Effective Operation of the Project Bank and PPP Center. Through a grant, supported resident advisors in the Myanmar Development Institute to provide core support for the effective operation of the steadily developing Project Bank and PPP Center.

PRIVATE SECTOR DEVELOPMENT ACTIVITY QUARTERLY REPORT 3 FY2019

WORK PLAN IMPLEMENTATION PROGRESS The narrative below provides information about the progress the USAID Private Sector Development Activity made during the third quarter of fiscal year 2019 (April 1 through June 30, 2019). As in the annual work plan, this report is organized around the Activity’s two intermediate results and their components, as well as crosscutting tasks and grant activities.

Intermediate Result 1 – Inclusive, Effective and Transparent Economic Governance Activities

Component 1: Economic Policy Making and Implementation

Under this Component, the Activity works directly with government agencies and private-sector stakeholders to support legislative reforms, institutional innovations, and better regulatory processes to improve the business environment for private-sector development and to stimulate sustained, inclusive economic growth. The Activity provides agencies with analyses and recommendations for improving legislation, advancing policy reforms, and initiating institutional innovations to incorporate international best practices and to meet treaty obligations in the World Trade Organization (WTO), ASEAN, and other international agreements to which Burma is a member. We support and encourage transparency and participation by civil society organizations (CSOs), business associations and other relevant stakeholders throughout policy reform processes, including by building capacities and providing policy dialogue opportunities for the private sector through grants. While working to help Burma leapfrog into international best practices, our support is grounded in the realities and contexts of the political economy and governance environment in Burma.

1.1 Strengthen Intellectual Property Rights (IPR)

1.1.1 Support Passage of IPR Laws. Following passage of three key intellectual property laws last quarter, the new Copyright Law was approved on May 24, 2019, all with technical support from the Activity. With the new laws in place, a next key step is for the government to establish an IP Office to build the administrative capacities to implement the new and greatly strengthened IP regime, noting the transfer of authority for IP from the Ministry of Education to the Ministry of Commerce. From June 11-14, 2019, the Activity met with Ministry of Commerce leadership and related government leaders along with supporting donor partners to coordinate support to set up the new IP Office (this was the first time that all key donors and government agencies had met together to support a stronger IP system.) An additional key next step is to develop the implementing regulations needed to implement the new laws effectively. In this regard, the Activity was asked to provide comments and recommendation on drafts of key implementing regulations, which started with detailed comments on the implementing rules for the new Industrial Design Law provided on June 17, 2019. Further, the Activity provided an initial set of comments on the Department of Customs procedures for intellectual property rights protection (border measures) was provided on June 11, 2019, which will be subsequently updated for a new version of the draft provided by Customs. The Activity is preparing a framework for judicial review of administrative

PRIVATE SECTOR DEVELOPMENT ACTIVITY QUARTERLY REPORT 3 FY2019

decisions with the Union Supreme Court, which is required by the new IP laws but where there are currently no formal procedures for such review. We expect to provide this new quarter.

An effective regime for protecting intellectual property has been highlighted in the Myanmar Sustainable Development Plan and is an important objective of U.S. policy to improve the business environment for U.S. firms in Burma. It opens up avenues for Burma to empower businesses, facilitate research and innovation and attract FDI. Activity support moving forward will include supporting the IP Office to develop a webpage to establish effective communication and awareness with the private sector, to develop a minimal IT capacity for running the new WIPO software that will be used to administer, process and grant IPRs, to provide furnishings to establish the first IP Office in Yangon to make it easier for the private sector to apply and engage with IP authorities, and to provide on-going comments and recommendations on draft rules for the new laws as they are made available. Throughout this process, to leverage our inputs, the Activity has worked closely with the U.S. Patent and Trademarks Office and other donors.

1.1.2. Raising Public Awareness to Strengthen IP Protection through Support for World Intellectual Property Day. The Activity supported its government (in cooperation with JICA) and civil society partners to celebrate the World Intellectual Property Day in Nay Pyi Taw and Yangon on April 26, 2019. Both the Intellectual Property Division of the government and the Myanmar Intellectual Property Proprietor's Association (MIPPA), a civic organization promoting IPR and former grantee, have long been active players in shaping the IP landscape of Burma. The two events combined to attract over 400 participants from government agencies, legal practitioners, businesses, and the public along with national TV coverage. The events had panel discussions, skits, songs and presentations on this year’s theme “IP and Sports.”

1.2 Develop a Modern National Quality Infrastructure

Given the slow development of the draft Law on Standards, which is needed to upgrade all key elements of standardization in Burma, the Activity has limited its support for the Department of Research and Innovation (DRI) in the Ministry of Education. The Activity did work this quarter to facilitate the purchase of ASTM standards by the Ministry of Construction. In 2016, the Activity facilitated a memorandum of understanding (MOU) that was signed between the U.S. standards organization ASTM (previously known as the American Society for Testing and Materials) and the Burmese government, through DRI. This American organization maintains the largest collection of construction and related product standards in the world. However, when Burma’s Ministry of Construction recently attempted to buy ASTM standards, outdated information on USG sanctions toward Burma in ASTM’s internal database prevented the purchase. In May 2019 the Ministry notified the Activity of its inability to purchase the desired standards. We then worked with ASTM to quickly update its internal information and the purchase of the construction standards by the Ministry proceeded successfully.

1.3 Strengthen Food Safety and Related Trade Facilitation

The Food and Drug Administration’s food safety division made progress in developing their internal procedures to apply risk-based regulatory processes to imports and domestic producers, based on our recommendations provided over the last two quarters. They have developed an internal action plan that has identified key steps and several remaining challenges. We will continue to stay in contact and be responsive as possible to requests as these internal processes evolve.

PRIVATE SECTOR DEVELOPMENT ACTIVITY QUARTERLY REPORT 3 FY2019

1.4 Strengthen the Protection of Consumer Rights

The Activity is implementing a comprehensive strategy to support the Ministry of Commerce’s (MOC) Department of Consumer Affairs (DOCA), and the Myanmar Consumer Union (MCU), a key non-government organization committed to strengthening consumer rights. This strategy includes providing 1) technical support in the development of laws and regulations; 2) capacity building support to enable DOCA to implement them; 3) support for raising public awareness on consumer rights; and 4) strengthening the MCU to represent consumer interests at all stages of the process.

Support to Implement the Recently Passed Consumer Protection Law. On May 22, the Activity met with DOCA to discuss technical assistance needs during the Activity’s final program months.

The Activity provided comments on a standard operating procedure (SOP) for labeling. We recommended strongly that DOCA considers drafting a new notification on labeling with a detailed SOP quickly so that businesses will have enough time to adjust their labels to comply with the new Law.

The Activity also worked with DOCA staff to develop software that will improve DOCA’s management of the ever-growing consumer complaint process, including improving communications between the State and Region Offices and headquarters in NPT. It is expected that the software purchase should be completed and installed next quarter, with training provided as appropriate.

For the next quarter, plans are in process for the Activity to support a stakeholder consultation workshop on both the draft regulation and the draft labeling notification that could also serve as a public awareness program for the new Law on Consumer Protection. The Activity remains ready to provide technical comments on draft regulations to implement the new Law on Consumer Protection, and will update the old SOP for handling complaints by the Dispute Settlement Bodies in the States and Regions. This entails review by the Activity of the draft regulation to implement the new Law, and any other related efforts.

1.5 Support Trade and Responsible Investment Reforms and Facilitation

Modernizing Burma’s Trade Licensing and Registration System. The new online trade licensing system (TradeNet 2.0) will use updated technology and will improve the MOC’s capability to receive e-applications and to process trade registrations and import and export licenses, which will significantly reduce the time and cost for traders, import/export businesses and the MOC to apply and approve licenses and registrations. The Activity met on June 18, 2019 in NPT with the MOC’s Director-General of Trade and his staff to provide an update on developing TradeNet 2.0, with the MOC and the Activity working closely with a local IT vender funded by the Activity. The MOC plans to launch the upgraded TradeNet 2.0 by December 2019. MOC’s goal is to match the efficacy and capabilities of DICA’s successful MyCo Investment portal.

Rationalizing Trade Licensing Study. The Activity’s staff and consultant Ian Hogg started discussions and research for a study on rationalizing trade licensing in Myanmar along with case studies from other ASEAN countries as Myanmar tries to reduce the currently high number of commodities that require licenses for importation and exportation and to streamline the licensing

PRIVATE SECTOR DEVELOPMENT ACTIVITY QUARTERLY REPORT 3 FY2019

process (note the close connection to work on TradeNet 2.0 noted above). On May 20, 2019, the Activity shared the initial outline of the study with the Director General of the MOC’s Department of Trade and key staff for comments. The Activity will continue working on the report with a goal to finalize a strong draft next quarter. This work will benefit from comments from the U.S. Special Trade Representative and the U.S. Department of Agriculture.

Upgraded Myanmar Trade Portal Launched. Following the official launch of the upgraded version of the Myanmar Trade Portal (MTP) and Trade Repository (MTR) last quarter in NPT, the Activity supported the Ministry of Commerce to hold a public awareness workshop on March 29, 2019 at the UMFCCI in Yangon for businesses to become more aware of the upgraded version of the Myanmar Trade Portal (MTP) and Trade Repository (MTR). Opened by the Deputy Minister of Commerce, the event highlighted how the Portal (website) provides easier public access to key import and export rules, regulations, procedures, tariffs and non-tariff measures available at the 10- digit tariff line (for more than 11,000 tariff lines). Since the upgraded Portal, which is now more accessible by cell phone, was launched two months ago, there have been over 5,000 new users.

Facilitated the Sharing of Myanmar Trade Portal’s Source Code to Mozambique. The Activity and USAID/Mozambique’s Support Program for Economic and Enterprise Development project facilitated the signing of a memorandum of understanding (MOU) on May 21, 2019 in Nay Pyi Taw that will allow Burma’s MOC to share its National Trade Portal software with its counterpart in Mozambique to serve as basis for them to develop their Trade Portal. The MOU between ministries is an example of how two USAID programs across continents can leverage, collaborate, and synergize to bring about a transparent and easy to access source of information on trade policies, regulations, and processes so that traders, businesses, and the public can have a clear picture of how to participate in and maximize the benefits of trade.

Progress Made on Burma’s Basic National Single Window (NSW) Linked to the ASEAN Single Window (ASW). The Activity is providing continuing technical assistance to Myanmar to build its Basic National Single Window – Routing Platform (NSW-RP) to be able to go live and join the ASEAN Single Window (ASW) by November 2019. This quarter, this was done in three broad ways; 1) working closely with and guiding the Myanmar Customs Department (MCD) and an IT company to develop the NSW-RP; 2) supporting MCD to effectively participate in ongoing ASEAN regional level Working Group meetings on Technical Matters for the ASEAN Single Window and to initiate testing protocols with ASEAN Member States; and 3) coordinating with key relevant government agencies, such as Ministry of Commerce, as well as other donors as necessary.

The Activity this quarter (May 27-31 and June 10-14, 2019) helped the MCD to run a successful first- round end-to-end testing of the exchange of the ATIGA e-Form D (ASEAN certificate of origin) between Myanmar with eight other ASEAN Member States (AMS) through the National Single Window – Routing Platform (NSW-RP) that the Activity helped build. Myanmar was able to successfully send out the e-Form D to eight AMSs (Brunei, Cambodia, Indonesia, Malaysia, Philippines, Singapore, Thailand, and Vietnam) and received back the associated acknowledgement messages from the respective systems within the ASW. Only two countries – Malaysia and Singapore – failed to respond with its associated messages during this official testing. The second-round end-to-end testing and parallel testing with the eight AMSs will be carried out in the next quarter. These requirements, set by ASEAN, must be completed before Burma can join live ASW operations, now expected in November 2019. On May 7 – 10, 2019, the Activity’s technical specialist Naw Tsai Blut Moo and IT consultant Moe Zaw Aung accompanied two MCD officials (one funded by the Activity) to join the

PRIVATE SECTOR DEVELOPMENT ACTIVITY QUARTERLY REPORT 3 FY2019

47th Meeting of the Working Group on Technical Matters for the ASEAN Single Window in Singapore. The Activity’s staff provided technical support to the MCD officials before, during and after the trip, helping Myanmar project out the progress being made to other ASEAN countries and to coordinate next testing requirements. As well, this support helps to deepen the expertise in MCD to carry on the work of the NSW-ASW as the Activity moves to close out.

On June 24, 2019, the Activity’s technical staff was requested by the MCD to participate and give a presentation on the progress of Myanmar’s effort to build its NSW at the “Fourth Symposium on the ASEAN Single Window: the Way Forward” in Bangkok, Thailand. The event was jointly organized by the USAID IGNITE project and ASEAN.

1.6 Support the Development of a Responsible National Gemstone Policy

Since 2017, with guidance and coordination from the U.S. Embassy, the Activity has been providing technical assistance to the Myanmar Gemstone Supporting Committee (“the Supporting Committee”) to develop an inclusive, responsible national gemstone policy. On April 26, 2019 after one and a half years of consultations, the tripartite multi-stakeholder group of government, private sector, and civil society representatives reached a consensus on the content of Burma’s first National Gemstone Policy, covering colored stones and jade. The final draft policy was submitted to the Minister of Natural Resource and Environmental Conservation (MONREC) in the second week of April 2019. The Activity has played a lead technical role in advancing this policy. The National Gemstone Policy breaks new ground in providing a systematic approach for responsible investment in mining, trading, and value-addition in a sector long maligned by conflict, weak regulation, and limited positive contributions to national and local economic development.

In addition, the Activity collaborated with the U.S. Embassy to organize a public seminar on “Myanmar’s Gemstone Policy Consultative Process” at the American Center – Yangon on May 29, 2019 to reflect on lessons learned from the path-breaking consultative process. Hosted by U.S. Ambassador Scot Marciel, the event brought together senior representatives from the tri-partite group – government, business and civil society – that worked together to develop a policy for responsible gemstone production around one of the most lucrative and contentious sectors in Burma. The session was moderated by Activity Deputy Chief of Party Show Ei Ei Tun. An open, inclusive, and consultative policymaking process is not the norm in Burma, especially for such a contentious sector; facilitating consensus building amongst diverse stakeholders is a major breakthrough and highlights important lessons applicable to other sectors.

On June 17, 2019, the Myanmar Gems Enterprise under MONREC organized a stakeholder consultation workshop on the draft gemstone regulation to implement the recently promulgated Gemstone Law in Nay Pyi Taw with assistance from the Activity. Opened by MONREC’s Deputy Minister, the event drew over 100 participants representing key stakeholders at the Union as well as State/Region level, including government, parliaments, businesses, civil society and academia. A number of detailed and relevant recommendations were generated and transmitted to the drafting team, including on: permit allocation for gemstone production; licensing for value-addition activities; fiscal regime; and environmental and social impact management.

PRIVATE SECTOR DEVELOPMENT ACTIVITY QUARTERLY REPORT 3 FY2019

1.7 Support for Processes to Develop Priority Infrastructure Projects Responsibly and Effectively

The Activity has become increasingly involved with supporting more transparent and evidence-based decision making complemented by strategic legal analysis for a range of priority infrastructure projects. Much of the Activity’s work in this regard is described under the section 2.1 related to support for the Myanmar Development Institute and National Economic Coordination Committee (the Project Bank, PPP Center, steel and Yangon port). In this section, we review progress made in the Activity’s support for improving Burma’s electricity and energy sector. This sector has historically underperformed relative to the needs of the economy, with frequent blackouts and brownouts combined with limited access for most rural areas that debilitate people and businesses throughout the country. Further, substantial electricity subsidies by the government crowd out more productive use of the limited government revenue base.

Supporting the Modernization of Burma’s Electricity Sector and Major Policy Reform to Eliminate Electricity Subsidies. With consultants from Latitude Capital, the Activity delivered an electricity sector paper (June 2019) that has helped to raise visibility regarding the urgent need to increase power generation capacity to avoid power shortages (especially during the critical period leading up to the 2020 elections). The Ministry of Electricity and Energy has responded by signing a Notice to Proceed with procurements to add additional capacity in/around Yangon; has re-tendered emergency power supply contracts; and is beginning to reconsider the strategic importance of smaller scale and affordable power generation in other parts of the country. Latitude Capital has worked with the Ministry to develop a Leadership and Capacity-building program for Ministry leadership and executives of the three operating electricity distribution companies that aims to improve the efficiency of electricity generation, transmission and distribution.

On June 25, 2019, the Ministry of Electricity and Energy announced major electricity tariff increases to go into effect July 1, 2019, supported by Latitude Capital (and others working in the sector). This significant reform will reduce/eliminate the burden of subsidies on the government budget and should increase investment incentives for the private sector to expand generation, transmission, and distribution.

Component 2: Building Capacity for Effective Economic Policy Dialogue and Entrepreneurism In addition to a focus on policy issues and stakeholder engagement, the Activity also works to develop the capacity of a range of advocacy and policymaking organizations to provide more robust, analytic, and inclusive inputs to advance effective policy making in Burma.

2.1 Strengthen the Myanmar Development Institute and the National Economic Coordination Committee

Through a grant and coordinated technical assistance the Activity is supporting the Myanmar Development Institute (MDI), the leading think tank supporting policy reforms in Myanmar, to strengthen institutional and staff capacity to undertake evidence-based policy advisory work on a number of pressing issues. We are also providing direct technical assistance support to the National

PRIVATE SECTOR DEVELOPMENT ACTIVITY QUARTERLY REPORT 3 FY2019

Economic Coordination Committee (NECC), which has become the focal point for spearheading economic policy reform in the government. Both of these units are in Nay Pyi Taw.

Consultants Working in MDI Make Important Contributions. Full-time MDI consultants supported by our grant have provided lead, on-the-ground support for moving forward the Project Bank and PPP Center processes, including helping to filter the most important projects into priority status and building capacities to fund such projects through public-private partnerships. MDI leadership has noted that USAID’s approach using grants to support full-time advisors in NPT has provided the most effective support for these processes relative to related support by other donors.

Working through a purchase order with the University of California, Dr. Saw Htay Wah is providing classroom and on-the-job training to MDI and the Project Appraisal and Progress Reporting Department (PAPRD) in the Ministry of Planning and Finance. The trainings will build the analytical and research capacity of policy researchers and decision makers. During this quarter, Dr. Saw Htay Wah delivered the following:

• On-the-Job training on impact evaluations of the Yangon River Dredging project. From March 23 – April 26, 2019, Dr. Saw Htay Wah mentored 6 staff from the PAPRD as the team conducted and assessment of the socioeconomic impacts of the dredging project. • From March 30 – May 16, he delivered a classroom-based training on Cost Benefit Analysis I. 26 management and technical staff from the PAPRD and MDI completed this training, designed to increase their abilities in conduct cost-benefit analysis of public projects. • On May 13, he received a direct request from MDI management to organize a resume- writing workshop for all MDI staff members, which he delivered on May 20 to 18 participants. • From May 28 – June 16, Dr. Wah delivered classroom-based training on advanced Cost Benefit Analysis. 24 new management and technical staff from the PAPRD and MDI completed the training. • From June 14 – June 21, 2019, he provided on-the-job training and mentorship to 12 PAPRD staff as they conducted a study on the impact of the hydropower station at Paung Laung dam on farmers in the surrounding area.

Under the grant, MDI is holding workshops across Myanmar to present the Myanmar Sustainable Development Plan (MSDP), a framework for inclusive development with cooperation across all ministries and all the States and Regions, and to present on the Project Bank, an interactive, web- based, publicly accessible database of projects that provides information on planned projects under the MSDP.

During this quarter, MDI presented on the MSDP and Project Bank to state and regional governments, Hluttaws, district and township level government departments and private sector participants in Thaninthayi Region on April 2 with around130 participants, in Kachin State on April 5 with around 150 participants, with Kayin State on April 10 with around 120 participants, and with Mon State on April 11 with around 135 participants.

In this quarter, Dr. Khin Maung Nyunt, worked through the MDI grant to provide intensive training for around 20 MOPF staff to increase their analytical capacity to conduct macroeconomic forecasting and public finance analysis.

PRIVATE SECTOR DEVELOPMENT ACTIVITY QUARTERLY REPORT 3 FY2019

Activity grant grant supported administrative staff have helped upgrade MDI’s financial and administrative capacities as they grow and are increasingly involved with a wide set of important policy issues with support by a wider range of donors.

Assessment of Two Heavily Indebted State-owned Enterprises. Around two years after Parliament closed two state-owned steel mills and an iron ore mine to minimize costs, the NECC requested USAID to help them develop a strategic review and analysis to identify strategic options for how best to rationalize the operations given their the more than $1 billion foreign debt burden for these operations. The Activity responded quickly to provide advisory services to evaluate economic and financial prospects for the Myingyan steel mill and Pin Pet mill and iron ore mine.

This quarter the consulting team continued to refine the available data needed to evaluate the technical and financial options for rationalizing the operations, which were developed into formal models with initial findings presented for discussion on May 21-22, 2019 to NECC leadership, including the Minister of Planning and Finance. Based on an urgent request by NECC leadership, the team visited the Myingyan plant to diagnose the severity of the problem of hundreds of millions of dollars worth of new equipment that are exposed to the elements and rapidly deteriorating. The NECC also arranged for additional meetings with the Ministry of Industry and other related agencies to refine and double check key information needed for the models and for effective decision-making.

Based on these meetings, the Activity team developed a draft final report that was provided to the NECC in June. Additional work is being done to develop an Executive Summary and other refinements with the expectation that a full Final Report will be provided next quarter. The draft Report, however, is being used by NECC leaders and staff as a framework for digging even deeper into possibilities, costs and prices needed to develop rigorous rationalization options for these operations. It is expected that over the next quarter the NECC Secretariat will use our reports to develop their own 5-10 policy option paper for full NECC consideration (which will include the State Counselor and several key ministers). Further Activity support will depend upon NECC decisions and requests.

Assessing the Best Options for a Deep Sea Port for Yangon. The Activity finalized two assessment reports on best options for a deep sea port for Yangon this quarter, both of which were presented to the Union Minister of the Ministry of Transport and Communications and the Myanmar Port Authority as facilitated by the NECC. The first report on “Statement of Requirements for a Yangon Port Master Plan” provides an overview of the key issues, and an estimate of the budget and types of expertise needed to develop a comprehensive Master Plan that would provide the government with the full set of information and analysis that would be needed to make the best decisions on where and how to build a deep sea port to service Yangon and the heart of the country’s economy. The second report titled “Report on Ensuring Performance Competitiveness and Capacity Management for Burma’s Port System” focuses on the issue of how to increase capacity at the Yangon ports. The reports were well received by the Ministry and bolstered further discussion on implementation between the government of Burma and the US embassy.

2.3 Enhancing the Role of Media in the Economic Reform Process

Supporting the Regional Business Reporters Network (BRN). The Activity, through a subcontract with Internews, continues to support capacity building of business reporters, especially

PRIVATE SECTOR DEVELOPMENT ACTIVITY QUARTERLY REPORT 3 FY2019

in States and Regions where Internews has advanced business reporting skills among local media outlets over the past three years. Regional level networks have now been formed in five Regions/States – Ayeyarwaddy Region, Sagaing Region, Mon State, Mandalay Region and Yangon Region. As we close down the Activity’s work in this area, these regional networks will provide the foundation to support business journalists working throughout the country.

Internews organized a half-day forum, “Availability of Data and Information for Better Economic Reporting,” in Mandalay on April 24, 2019. Opened by local government leaders, experts from the Central Statistics Office worked with 48 participants from the media, CSOs, and government to discuss the availability and accessibility of official economic and business data, including a new e- government portal recently launched by the Mandalay Region Government. The forum was the first time that officials from the Mandalay Region Government, business reporters and editors, and relevant CSOs gathered together for such a discussion, with the aim of supporting more accurate and evidence-based business reporting particularly in Mandalay.

On May 28, 2019, the Activity supported Internews to organize the 2019 Myanmar Business Reporters Forum in Yangon with more than 80 business journalists (representatives from print, electronic, TV and radio media) to reflect on current challenges and share experiences on business reporting in the country. This was the largest gathering of business reporters ever in Burma, attended by a mix of senior and junior journalists and editors from throughout the country who are beneficiaries of the USAID-supported training programs and Myanmar Business Reporters’ Network. Discussions focused on fact-based reporting that effectively uses data and analysis. A senior official from the Ministry of Commerce spoke about the USAID-supported Trade Portal, which makes a wide range of trade data publicly available for the first time in Burma. As noted by the Head of the U.S. Embassy Public Affairs Office who opened the Forum, journalists throughout Burma operate in a difficult and uncertain environment. Yet, an open, vibrant and credible media is vital to the next stages of political and economic development in Burma. Within this context, USAID has supported a successful program over nearly four years that has built the capacity of business journalists throughout the country, over half of whom work outside Yangon and Mandalay and including a number who operate in ethnic areas and languages.

2.4 Supporting Entrepreneurial Drive and Policy Dialogue

The Activity’s work on entrepreneurism focused on our two grants supporting Phandeeyar activities and technical funding support for them to carry out the RoboLeague competition.

Through Phandeeyar’s “Bringing Development to Myanmar through Entrepreneurship” grant, Phandeeyar recruited and started Founder Institute Yangon Cohort 3. In Cohort 3, 25 founders enrolled in the program, which exceeded its target of 20 participants. From March through May 2019, Phandeeyar held 12 meetups where “founders” discussed specific topic areas that would help them develop their ideas. On May 29, 2019, seven “founders” graduated from the Founder Institute Yangon Cohort 3. Six of the seven graduates of Cohort 3 were women.

PRIVATE SECTOR DEVELOPMENT ACTIVITY QUARTERLY REPORT 3 FY2019

The startup ideas were:

• Harvest Moon – A chemical free farm near Yangon producing and selling organic produce. • mm Hotel Jobs – A recruiting talent network focused on the hospitality sector providing skilled staff and professional chefs across Myanmar. • OMG Burg – A producer of 100% plant based vegan burgers. • KyalEain Entertainment – A talent booking platform for artists to find more gigs, where stars get connected to the opportunities. • YES Yangon EDUSPACE – Tutoring services for international school courses and exams using digital based classrooms. • Flexi Lingo – A platform that provides interactive and fun English Speaking Learning Experience with Avatars courses. • Skill Edge – Skill Edge aims to improve the capabilities of the Myanmar workforce by working closely with corporations and SMEs. Leveraging cutting-edge digital technologies and fast- growing mobile penetration.

As noted for the earlier Founders programs, there is typically a significant drop out rate given the rigor and time commitment required by the program (the program is determined by its founders in Silicon Valley). Phandeeyar will consider for future “Founders” programs whether they can tailor the program a bit more toward the Myanmar context to reduce the drop out rate.

Phandeeyar focused its “Bringing Development to Myanmar through Technology” technology grant efforts on implementing the RoboLeague Competition, which took place on June 1, 2019. RoboLeague brought previous successes in international participation at the Robotics Competitions in Washington DC (2017) and Mexico City (2018) to the national level. It was designed to bring together young technical students from all fourteen States and Regions to facilitate exchange and learning experiences, fostering mutual understanding, trust and cooperation through a friendly robotics competition.

The competition was focused around the theme “Disaster and Rescue: Flood” where 6 robots in a simulated playing field (3 on each side) “rescued” civilians to a safe zone while cooperating with each other and maximizing their points. From over 740 applicants from 46 universities throughout the country, fourteen teams (80 students twenty years old or younger) representing each State and Region spent three months designing their robot with the support of local universities, Phandeeyar staff and mentors. They were able to showcase their work in friendly competition at the Thein Phyu Stadium in Yangon on June 1, 2019. In order to engage with the 46 computer and technical universities that recommended and supported participants throughout the country, the program received strong support from the University Rectors Committee and the Minister of Education, who opened the competition along with the U.S. Ambassador on June 1.

Team Yangon, comprised of students from Yangon Technological University, won the competition. The five team members were mentored by Htet Myat Aung, an avid follower of robotics games. The five players (4 males/1 female) of Team Yangon were second year mechatronics engineering majors from Yangon Technological University Hein Htut Zaw, Thaw Dar San, Khat Kyaw Khaung and Thiha Zaw along with Win Naing Kyaw, a second year mining engineering major from Yangon Technological University.

PRIVATE SECTOR DEVELOPMENT ACTIVITY QUARTERLY REPORT 3 FY2019

The top eight teams, along with their scores are found below.

Team Name Rank Sum of Scores

Yangon Rank 1 4,650

Kayah Rank 2 4,375

Bago Rank 3 4,070

Kachin Rank 4 4,140

Rakhine Rank 5 4,170

Sagaing Rank 6 3,620

Kayin Rank 7 3,780

Shan Rank 8 3,910

The competition was presented live for five hours on national TV and through Facebook with around 400 people in audience surrounding the competition play area. The winning team – from Yangon universities -- will represent Myanmar in the international Robotics Olympics, which will be held in Dubai, UAE in October 2019.

Also under the technology grant, Phandeeyar planned and implemented Start-up Challenge activities that took place from June 29 – July 7, 2019. The StartUp Challenge was a 9-day ideation program that supported around 250 participants1 formed into teams who are looking to turn their ideas into reality. Participants, a number of whom traveled to Yangon from throughout the country, were able to expand their ideas, challenge their initial assumptions and validate their knowledge with potential customers. Through the implementation of tech design thinking, the participants developed business models using the Lean Canvas approach, which is an essential startup building/idea prototyping tool used around the globe. There were four different tracks in the StartUp Challenge, in each case supported by local sponsors and mentors, including KBZPay, Proximity Designs, the Embassy of Netherlands, ADB Ventures and Unilever-LUX.

These four tracks focused on current issues including:

"Tech for Women Safety". This track was intended for entrepreneurs with ideas to solve safety problems and challenges faced by women in Myanmar.

"FinTech". "FinTech ideation" was intended to expand ideas using FinTech.

1 Participant numbers for the StartUp week require verification and will be included in the M&E report for next quarter. Of the 277 participants who started the week, 85 were women, which represents an increase from 43 women the year before. A concerted effort was made to increase female participation in the typically male dominated tech space.

PRIVATE SECTOR DEVELOPMENT ACTIVITY QUARTERLY REPORT 3 FY2019

"Tech for Farms". This track is to build on the ideas that that can solve problems in the agriculture sector in Myanmar.

"Tech for Cities". This track was for entrepreneurs who were interested in solving problems for urban populations in Myanmar.

The program was opened by USAID Asia Bureau economist Lindsey Moore, who was visiting Myanmar from the U.S., along with a high-level female official from the Yangon City Development Committee; USAID Mission Director Teresa McGhie attended the final session.

The winners and runner-ups from the StartUp Challenge are reported in the table below.

Track Name of Description of StartUp Idea StartUp Tech for Boolean An all-in-one app for women to Women (Winner) instantly report public harassment and Safety share their experiences in a forum and getting support from the community. Safie (Runner A mobile based crowd sourced Up) reporting map that collects data of public harassment and raise awareness on the issue and notify users about incidents. FinTech SaveIT An application software that offers two (Winner) core products – micro lending brokerage and debt management. SaveIT aims to alleviate the financial strains the community is suffering from. Hlumal A hassle-free donation platform (Runner up) connecting needy organizations and willing donors in a convenient, credible, and transparent manner. Tech for Yae Yae Sar QR-code tracing technology to ensure Farms (Winner) food safety to producers and consumers. NOVA A mobile app for farmers to scan their (Natmyatsi) crops and get advice from expert to (Runner up) improve the quality of their products and increase productivity. Tech For Tech KaTiLa An online database platform for Cities (Winner) students and staff of schools to transform paper into digital data to save time and make the work more efficient.

PRIVATE SECTOR DEVELOPMENT ACTIVITY QUARTERLY REPORT 3 FY2019

The Passions An all-in-one health care app that Pursuers offers an open community, a health (KuTha) guide and a virtual clinic to connect (Runner up) physicians and patients.

Intermediate Result 2: Broaden Access to Finance

Component 1: Mobilize Credit to Underserved Enterprises through USAID Development Credit Administration Credit Guarantees 2.1.1 Continue Support for Implementation of the Existing USAID Development Credit Authority (DCA) Facilities

Usage of the DCA 1 facility, established in 2017 for five MFIs to provide guarantees of an aggregate $10 million of loans, continues apace. The MFIs are all using it for guarantees of individual loans going to small businesses, which are becoming increasingly important in Myanmar. Reporting to DCA on usage is semi-annual, and cumulative utilization and outstanding loans to/as of 31 March 2019 were as follows:

Total Volume of Volume of Avg Total Number of Avg Loan Volume Loans Loans Loan No. of Loans O/S, of Loans Outstanding Outstanding O/S, Loans Outstanding (MMK) (US$) (US$) (MMK) (US$) ASA Myanmar 1,275 877,158 1 1,684 2,526,000 1,684 2,526,000 LOLC Myanmar 657 1,874,177 550 831,269 1,256,461,374 1,511 2,284,475 MDP 349 398,772 126 98,035 147,053,210 778 1,167,089 PGMF 1,668 2,999,530 246 275,852 413,777,467 1,121 1,682,022 Proximity 2,408 484,209 561 111,408 167,362,400 199 298,329 Totals to/as of 31/3/19 6,357 6,633,846 1,484 1,318,248 1,987,180,451 5,293 7,957,915

ASA had used 87 percent of its facility, although they thought that they had used up the full amount a year ago (discrepancy was likely caused by conversion rates of MMK to USD). ASA has replaced its CEO, and the MFI is now looking to expand into new parts of the country. It has asked USAID to consider giving it a part of the unallocated portion of the facility for coverage of its individual and enterprise loans, which are much larger than its common group loan product.

PRIVATE SECTOR DEVELOPMENT ACTIVITY QUARTERLY REPORT 3 FY2019

LOLC has been using the guarantee for crop loans and loans to agri-businesses, and is expanding both its geographical footprint and crops that it will lend for. Its main constraint in doing this is that the farmers need technical assistance to perform well, so LOLC wants to see such agriculture extension support lined up before it makes loans available. There is little technical assistance available for agriculture, however. The guarantee capacity for LOLC will take a couple of years to use, because these are term loans and are for fairly small amounts.

Myanmar Development Partners (MDP) has been using the facility, and is expected to be using a part of the unallocated portion. Like many of the MFIs that are operating in Yangon it is finding that competition is getting fierce, and it finds that customers are leaving, but then also coming back if they can be seen as providing better service.

PGMF has utilized its initial allocation of the facility and was not interested in an additional allocation, since it is comfortable with the risk of the individual loans that it makes. It is in the process of converting from an NGO to a for-profit company, as requested by the regulator. It is their preference to be a for-profit so that they can attract additional investors for expansion.

Proximity also does crop lending, and is moving into making individual loans. It was restricted from doing this by the regulator (which licenses MFIs to offer group and individual loans, which can vary by township) and had been making what are substantially individual loans to two person partnerships. Proximity recently completed a conversion to for-profit status from being an NGO, and expects to bring in more investors.

Aya Bank has started using its $20 million facility approved under DCA 2 in 2018, as the schedule below indicates:

CMS Aya Bank Workbook MMK 1,500 = USD 1 Data Avg Loan Commitment Number Size Avg Loan - MMK Commitment - of MMK Size USD Name Millions USD Thousands Loans Millions Thousands 31 March 2019 or earlier

Total MFI Lending 5,500 3,667 2 2,750 1,833

Total SME Lending 770 513 17 45 30

Total Commitments O/B 3/31/19 6,270 4,180 19

This utilization is significant, since the facility was not used during its first year, with $3.7 million loans made to MFIs. This is aggregate utilization of about 20% of the facility. The average SME loan size is fairly small, and is lower than might have been expected from a commercial bank. This may reflect the fact that guaranteed loans were to be tied to agriculture, and likely were made out in the regions, which is a positive development.

2.1.2 Developing a Third DCA Facility

PRIVATE SECTOR DEVELOPMENT ACTIVITY QUARTERLY REPORT 3 FY2019

While a third DCA facility was anticipated and two banks provided substantial information, USAID decided to not pursue a DCA this year.

No additional DCA facilities are expected to be developed in the life of the PSDA project. However, PSDA is keeping an eye on activities and areas that may be fruitful for a future USAID DCA program, and is reporting these back to USAID. The PSDA A2F lead attended a workshop conducted by the Myanmar Renewable Energy Association to better understand progress being made in regional development of hydropower grids, and the businesses that are operating these in remote Shan areas. She also attended a workshop sponsored by the Department of Rural Development, part of the Ministry of Agriculture, Livestock, and Irrigation, to discuss possible bank financing of rural mini-grids that are not connected to the national grid.

The A2F lead also attended an IFC-sponsored workshop on development of a corporate bond market in Myanmar. This is significant to PSDA work in insurance, because insurance companies, and life insurance companies in particular, are typically major buyers of long-term government and corporate bonds. Building out this market will be important in developing PSDA’s goal of increasing savings in the country, as insurance companies need viable Kyat investment vehicles for premium revenue.

Component 2: Continuing to Advance the Microfinance Sector 2.2.1 Expanding Access to Finance for Local MFIs

In cooperation with the Myanmar Microfinance Association (MMFA), the Activity had planned this quarter to follow up the two training workshops in March 2019 for MFIs on seeking funding for expansion or on-lending outside of the owner’s own circle with a similar training for FRD staff. It was not possible, however, for FRD to organize such a meeting that would include FRD officials from key State and Region offices, so such a training will not be held. The full materials, in both English and Burmese, have been provided to MMFA so that sessions can continue to be scheduled for the MFIs and possibly FRD under their own initiative.

2.2.2 Continuing to Build the Capacity of the Myanmar Microfinance Association

PSDA continued activities focused on training MFI member staff in this quarter, including offering two sessions of the Lending to Small Enterprises course through the MMFA, one in Mandalay and one in Yangon. The Yangon workshop included a Training of Trainers for MMFA staff and PSDA provided soft copies of all workshop materials to MMFA, comprising the power points, case studies, handouts, answer sheets, and trainer notes, in both English and Burmese. This provides a foundation for MMFA to continue to carry out these training programs on their own initiative.

MMFA with support from the Activity held a half-day workshop to present its customer information sharing platform, MCIX, to encourage additional MFIs to join this reference exchange. An emerging problem in microfinance is over-borrowing by clients, as several MFIs are now competing in the same markets, especially in Yangon, Mandalay, Bago, and parts of Ayeyarwaddy. A key way to address this is to do credit bureau checks on clients to confirm other indebtedness, and to understand payment experience. The Myanmar Credit Bureau (MCB) is not yet operational, however, and initial exchanges of information among the banks are not expected to begin until late

PRIVATE SECTOR DEVELOPMENT ACTIVITY QUARTERLY REPORT 3 FY2019

in 2019. While the MCB is finally now talking to MMFA and major MFIs about terms for participation in the credit bureau, this is going slowly.

FRD has recognized that this over-borrowing problem is an issue, and has verbally encouraged the MFIs to exchange information through the MCIX. A problem is that the Financial Institutions Law specifies that the Central Bank should license credit bureaus, thus the MCIX, which is functioning much as a credit bureau (with more limited services), does not have any official authorization. This has posed a question for MFIs on deciding whether or not to join. The MMFA Head noted at the workshop that the Minister of Planning and Finance explicitly endorsed the expansion of the MCIX, which is hoped to provide legitimacy and to encourage more MFIs to participate.

This workshop was designed to support joining the MCIX, and a few more MFIs did join after hearing the presentation, so there now are some fifteen members (of approximately 180 MFIs but representing a number of the largest MFIs) that are sharing information this way. Participation has been particularly active in Mandalay. The database now comprises over one million discrete borrowers. A side benefit of this activity is that it makes the MFIs increasingly attractive members of the MCU, since they can bring a large database with them, and puts them in a better bargaining position for pricing on getting credit reports, in addition to getting board representation.

Component 3: Insurance Liberalization As mentioned in the last quarterly report, the FRD announced on April 5, 2019 that it approved five, not the previously announced three, 100-percent foreign owned life insurance companies to apply for life insurance licenses. These represent some of the largest insurance companies in the world, including one US company, Chubb. They are expected to start operations with a preliminary one-year license around October 5, 2019 (6 months following the announcement).

Immediately after the announcement of these licenses the FRD accepted requests for applications for life and general insurance to form joint ventures, allowing a maximum 35% foreign ownership. The FRD announced approval of six JVs on schedule on July 31, 2019 – three life and three non-life. Three applications were withdrawn by companies when they were not able to come to an agreement on the JV relationship. It is expected that additional JVs will be able to form over time.

In addition to the activities described below PSDA attended a brainstorming session sponsored by the World Bank to discuss developing insurance education in Myanmar, both at the university level and for industry development and refreshers, and to develop actuarial capacity and training in the country. The Yangon University of Economics will likely house both of these education programs, and the Myanmar Insurance Association is forming partnerships with counterpart programs in other regional countries to develop continuing education programs.

The Activity is also cooperating with the DfID-funded DaNa program to develop an awareness of and interest in micro-insurance in the country. DaNa has been providing grant funding to a company that is developing a fintech approach to micro-insurance, and expects to be cooperating with an MFI and the state-owned Myanmar Insurance Company to offer this type of product. PSDA is recommending that micro-insurance be allowed in the new draft Insurance Business Law and that the role of MFIs as a facilitator/agent of micro-insurance be clearly laid out in the soon to be amended Microfinance Law. We are recommending that a separate license and regulatory regime be created for micro-insurers, where it is clear that only a micro-insurance company may underwrite

PRIVATE SECTOR DEVELOPMENT ACTIVITY QUARTERLY REPORT 3 FY2019

micro-insurance policies. A separate licensure is preferable because capital requirements for micro- insurance can generally be lower, and oversight is different both because outreach is typically done by third parties (e.g. an MFI, with a base of product-appropriate clients) and the typically low-income clients are more vulnerable.

2.3.1 Building Capacity and Experience Conducting Risk-Based Supervision of Insurance Companies

While the Activity had expected to resume mentoring insurance site visits, the FRD requested that these be postponed until the joint venture insurance application processing was completed. FRD has requested the Activity insurance expert Gail Burns come to Myanmar from September 8-20, 2019 to support development of the insurance business law, to provide training on the Conduct of Business Manual and to provide support for upcoming on-site examinations of the new foreign-owned life insurance companies. It has been decided by FRD that future examinations will include financial reports, including data on risk-based capital adequacy.

2.3.2 Moving Forward the Draft Insurance Business Law

Over this quarter, as FRD has focused on implementing the insurance liberalization plan, it has also begun to accelerate movement forward on developing a modern Insurance Business Law that can provide the regulatory principles and authority to both facilitate and manage the expected huge expansion in modern insurance services in Myanmar as the new higher-powered firms begin operations. The Activity has been meeting with FRD and JICA to review the draft Insurance Business Law, and these meetings and reviews have been conducted with a greater urgency; a UAGO official has also been attending these day-long meetings, and World Bank has been commenting off-site. The current plan is to advance the draft law as follows:

• Continue drafting refinement through a series of meetings with FRD, JICA, the WB and USAID to develop a “technical consensus” English draft by the end of August that can be reviewed more generally by key stakeholders. • Conduct a stakeholder consultation workshop on the English language version of the draft law on September 12-13, 2019. • Revise the draft as needed, and then translate the draft into Myanmar language. • Submit the Myanmar version for inter-agency review in October or November. • Adjust the draft as needed and submit the draft for UAGO legal review in November. • Send a draft to Cabinet in February or March 2020 for submittal to Parliament shortly thereafter.

Component 4: Bank Lending to SMEs Other than the DCA-related visits no new activity on bank lending to SMEs was undertaken in this quarter. Interest in SME lending by the banks appears to have expanded because of the new provisions allowing for higher interest rates and less rigid requirements for collateralization, and many are now moving forward on their own volition, in some cases building upon previous technical assistance provided by the Activity (AYA on a new small business lending strategy; Yoma on using a credit scorecard for evaluating risk for SME lending).

PRIVATE SECTOR DEVELOPMENT ACTIVITY QUARTERLY REPORT 3 FY2019

Component 5: Central Bank and Banking Reform 2.5.1 Advising and Training the Central Bank of Myanmar and Training for the National Economic Coordination Council

The Activity’s Central Bank advisor Dr. Dennis Farley continued to work intensively with CBM leadership, both in terms of training and providing policy analysis. In addition to personal meetings with Deputy Governor U Soe Thein and key staff, his activities included the following:

1) Seminars for Department leaders and staff on interest rate liberalization, on central bank operating regimes, and on the use of macroeconomic models for monetary policy; 2) Memos to Deputy Governor U Soe Thein on deposit auction frameworks, conducting board meetings and related issues, and a wrap-up memo reviewing progress made over the six month period of weekly meetings and trainings, along with recommendations for key next steps. 3) Research topic write-ups on the following: • Assessing reserve money targeting – approved for the Research Department to carry out; • Requirements for deposit auctions – proposal being developed by staff in MCB; • Additional research topics suggested: o A micro data investigation of deposit auctions; o Issues relating to the computation and maintenance of required reserves; o A description of problems in knowing CBM’s balance sheet on a timely basis; o An assessment of the interbank market and how to monitor and promote it; o Building a more complete picture of the financial system; o Techniques for ensuring data quality; and, o Investigating seasonality in financial data

4) Development of a Close Out memo that reviewed the key policy recommendations and suggested a range of issues where further CBM research could be conducted and areas where the CBM could improve their operations.

As these items suggest, not all of Dr. Farley’s work was policy-oriented. It was also designed to show staff and management how the CBM could be more efficiently organized, and how staff time could be used more constructively. Dr. Farley encouraged the CBM to actively use staff to develop deeper knowledge of relevant areas, so that the staff can be pro-active in supporting CBM leadership, not just reactively assembling information. The final wrap-up memo made a range of suggestions and recommendations to continue developing CBM as an effective implementer of monetary policy.

A wrap-up meeting with the Deputy Governor and several Director Generals and Directors took place on June 24, 2019, where a close out memo was thoroughly reviewed. The Deputy Governor expressed his appreciation and satisfaction with the work done by Dr. Farley, and promised to follow through on key recommendations as possible over time. This program helped not only to

PRIVATE SECTOR DEVELOPMENT ACTIVITY QUARTERLY REPORT 3 FY2019

provide the CBM with a range of pragmatic and experience-based technical assistance, but it also helped to establish USAID as a credible donor partner on important financial sector and monetary management issues with the CBM, which may be helpful for future programming options for USAID.

For the NECC, Dr. Farley completed a full set of introductory micro and macroeconomic classes and partially completed a set of advanced micro and macroeconomics classes. While the introductory sequence received strong participation by NECCI staff, attendance lagged somewhat for the more advanced classes. As a result, Dr. Farley’s time spent providing classes to NECC declined and shifted to focus more on work in the central bank. While leadership of the NECC perceived the need for their staff to be better trained in core economic analysis, NECC staff interest lingered as the courses became more difficult, and it appears that some NECC staff did not see how such training on general economic thinking was helpful for their daily job requirements. In the future, training offered could be more on-point if the NECC could be more specific about needs, e.g., at present staff are looking at project bank processes for approving infrastructure projects, and conducting financial analysis of state-owned enterprises, both of which where training on cost- benefit analysis would be beneficial.

Cross-Cutting Activities

3.1 Accelerate Development of a Market-Driven Agriculture Sector Over this quarter, the Activity’s work on accelerating development of a market-driven agriculture sector has largely been carried out through its grantees, Kasante in Kachin State and DEAR Myanmar in southern Shan State near the Kayah boarder.

Over these three months, the Myitkyina-based grantee Kasante provided a series of trainings to local walnut growers in Kachin State on key components of producing high quality value-added roasted walnuts and engaged with the local community and government through policy discussions. In May 2019, Kasante organized two trainings on sustainable harvesting, processing and quality control in Sadong township and remote Putao township, where walnut trees are largely grown. On May 9-10, 2019 Kasante organized a training on basic food safety and implementation of good manufacturing practice (GMP) in Myitkyina for those who will be working in the processing of roasted walnut snacks. During June 11-28, 2019, Kasante had a series of meetings with a number of relevant government officials from the Department of Agriculture’s Land Record Department, the Forest Department, the Directorate of Industry of Company Administration (DICA) and ethnic affairs Ministers in order to get a better understanding of government’s views on land policy, including the currently controversial Vacant, Fallow and Virgin (VFV) Lands Management Law that is perceived as a threat to the customary land ownership arrangements prevalent across rural agricultural communities in Burma. Kasante then organized an awareness workshop for local communities on the government’s land policy because most of the walnut growers are internally displaced persons (IDPs) living in conflict-sensitive areas where proper land records are largely non-existent. All the events organized by Kasante have over 60 percent of beneficiaries from ethnic minorities across Kachin State, such as Lisu, Rawang, Jing Hpaw, Lachid. Most of their events have more than 60 percent participation by women.

On May 6, 2019, DEAR Myanmar organized a “Lesson Learned Dissemination Workshop” in Taunggyi, Shan State where they shared experience of working with ethnic Kayan and Karen farmers

PRIVATE SECTOR DEVELOPMENT ACTIVITY QUARTERLY REPORT 3 FY2019

from 31 villages in southern Shan State and near-by Karen State, providing them capacity building on good farming methods, basic business knowledge and producing good quality value-added products from chili, peppercorn and bamboo shoots. Opened by the Shan State Agricultural Minister, the workshop was joined by officials from Shan State Government’s Planning and Finance Department, Rural Development Department, township administrators, and representatives from NGOs, farmers and local SMEs.

By nature, these organizations are engaged in a combination of policy advocacy to improve the local business environment as well as building capacities and skills of local farmers, intermediaries and government officials. The grants have allowed them to work more effectively and directly with local farmers, teaching them about good farming methods, business planning and marketing, and have induced them to become more engaged in policy advocacy with local authorities.

3.2 Support Gender and Ethnic Minorities in Economic Development In addition to the activities mentioned above in 3.1, the Activity’s work on supporting gender and ethnic minorities in economic development this quarter include supporting the first ever national robotic competition “RoboLeague” on June 1, 2019 where more than 80 students from 46 technical and computer universities across the country, including a number of ethnic minorities, forming 14 teams, came to Yangon to contest in the competition. The winner will represent Myanmar at the FirstGlobal Robot Olympics to be held in Dubai in late 2019. In a country just emerging from more than a half-century of isolation and still fractured by on-going civil wars and distrust among ethnic groups, RoboLeague brought together bright young people from all parts of the country with diverse ethnicity and gender, aiming to build trust, understanding and collaboration for innovation. With support from the highest levels, it projects out the potential in Myanmar for technology and innovation to be an important source of inclusive economic growth and the building of a more harmonious Myanmar.

3.3 Improve Economic Policy Making at Sub-National Levels and Around Post-Conflict Areas The Activity worked to improve economic policy making at sub-national levels and around post- conflict areas this quarter as follows.

1. Training journalists to operate more effectively at the sub-national level and in ethnic and post-conflict areas, and bringing ethnic journalists to a major Business Reporters Forum in Yangon so that they can network with other fellow reporters as well as prominent journalists and editors from national media outlets. 2. Providing grants to groups operating in post-conflict regions. The Activity provided grants to Kasante and DEAR Myanmar, organizations whose work was primarily in post-conflict regions. In addition, the PSSAG’s grant, “Cooperative Formation as a Platform for Economic Empowerment in a Post-Conflict Area” was completed this quarter and managed to increase broad-based economic opportunities by increasing access to finance for emerging economic actors in Kayin State. Under this grant, the PSSAG grant set up and registered “bottom-up” cooperatives at a township level in 30 villages in northern Hpa-An Township where there had been no formal MFI services and where various illicit schemes had further eroded trust around formal financial institutions.

PRIVATE SECTOR DEVELOPMENT ACTIVITY QUARTERLY REPORT 3 FY2019

3. Continuing to work on gemstone policy, as gemstone mining often takes place in conflict and post-conflict areas and are often used to fund conflict. 4. Supported MDI to organize presentations for government and the private sector in four States and Regions on the MSDP and the operation of the Project Bank, noting the important role played by sub-national governments in both regards.

3.4 Facilitate Development of the ICT Sector The Activity helped to establish and has supported over the last four years the development of the U.S. ICT Council for Myanmar (ICT Council) as a way to mobilize U.S. input to IT policy and to promote IT education and ecosystem development in Myanmar. Over the last year, the Activity has worked with the U.S.-ASEAN Business Council (US-ABC) to take over leadership of the ICT Council, with the Activity fully phasing out support by the end of the year. Moving the takeover process forward, the ICT Council was registered with DICA on May 13, 2019. ICT Council due paying members as of this quarter include Amazon Web Services, Cisco, Google, Microsoft, Oracle, VMware and Visa, with several activities including Facebook.

ICT Council activities this quarter include the following:

1. Cybersecurity Policy Brief. On April 15, 2019 a cybersecurity policy brief “Keeping It Simple: A Framework to Future-proof Myanmar's Cybersecurity Policies” was published with recommendations, including establishing an overarching national cybersecurity entity or empowering an existing entity with greater coordinating and implementation responsibilities; aligning with international cybersecurity standards and best practices; and utilizing guidelines and policies where legal requirements are not needed. The brief was provided to the Ministry of Transport and Communications (MOTC) to be distributed to other ministries and the working group that is drafting and reviewing the cyber law and policy framework draft.

2. ASEAN-US Digital Policy Consultative Forum. On May 6, 2019 the ICT Council and US-ABC co-organized a ASEAN-U.S. Digital Policy Consultative Forum on the sidelines of the ASEAN Telecommunication Regulators' Council Joint Working Group (ATRC JWG) meeting, with support from the Ministry of Transport and Communications in Yangon. The purpose of the forum was for attendees to learn about data security resources and solutions and to share best practices for protecting the ASEAN region’s data ecosystem. U Soe Thein, Permanent Secretary of MOTC, gave a keynote speech. Speakers from ICT Council member companies included AWS, Cisco and Visa and participants included telecom regulators from all ASEAN nations (about 50 participants). This was the second of a series of US-ABC regional data security workshops for regulators. It was well-attended as all 10 ASEAN countries were represented and the discussion topics will be combined into a set of cross-cutting digital data governance principles to complement initiatives laid out in the ASEAN Framework on Digital Data Governance.

3. MOU with MoTC to Collaborate on Technology Training and Capacity-building Programs. On May 7, 2019 the ICT Council and MOTC’s Information Technology and Cyber Security Department (ITCSD) signed a MOU in Nay Pyi Taw. Jennifer Peterson, Economic Officer from US Embassy Rangoon, U Soe Thein, MOTC Permanent Secretary, and Daw Aye Aye Thinn, representing the HR development sub-committee of the e-

PRIVATE SECTOR DEVELOPMENT ACTIVITY QUARTERLY REPORT 3 FY2019

Government Steering Committee and the Myanmar Computer Federation, delivered remarks. MOTC Deputy Ministers U Tha Oo and U Kyaw Myo were present to witness the signing. Attendees included representatives from ICT Council member companies Cisco, Microsoft, and VMware and about 50 government personnel. The MOU will enable the ICT Council and MOTC to collaborate on technology training and capacity-building programs as well as to provide a channel for ICT Council member companies to provide training and e- government solution recommendations to government ministries. Sample activities under the MOU will include:

• Co-hosting workshops and seminars to enhance the technical skills of government CIOs and their IT department staff;

• Supporting the e-Government Steering Committee’s Human Resources Development (HRD) Sub-Committee program to provide basic ICT skills training to state and regional government personnel; and

• Providing regulatory- and policy-development training, white papers and input to government officials and members of Parliament, such as for the Cyber Law and Policy Framework that is currently being drafted.

4. A “Mini”-Business Mission in Nay Pyi Taw. On May 7, 2019 the ICT Council led a “Mini”-Business Mission to Nay Pyi Taw for a delegation of representatives from Cisco, Microsoft, and VMware to meet with Nay Pyi Taw stakeholders, including: • The Myanmar Development Institute’s Project Bank team, who briefed us about existing strategic national projects and the project submission process. The Project Bank supports the Myanmar Sustainable Development Plan, which was published by the Ministry of Planning and Finance in Aug. 2018 and is the government’s master plan for Myanmar’s development and provides a framework for coordination and cooperation across all ministries, states and regions. U.S. and other foreign companies can work with Myanmar government ministries to develop and propose national projects to be reviewed by MDI. ICT Council members can follow up directly with MDI with any questions or project proposals. • The Asian Development Bank health team, who briefed us about various public health research projects with which they have been assisting the Ministry of Health and Sports. Project examples included communicable disease surveillance projects, district health information systems, and an ICT platform for the Ministry, and a mobile phone app for health services to track migrant populations. The next step is for the ADB to help arrange a meeting for ICT members to meet with Ministry of Health and Sports officials. 5. Facilitated a 5G Study Tour to Bangkok for MoTC. On May 23-24, 2019 the ICT Council facilitated a 5G study tour to Bangkok for MOTC’s Posts & Communications Department officials. • As an initial activity under the MOTC-ICT Council MOU, the ICT Council organized a study tour to Bangkok for three MOTC Posts & Telecommunications Department officials under the theme of “5G Strategies and Solutions,” which took place in conjunction with a 5G Workshop that was co-hosted by the U.S. and Republic of Korea governments. • ICT Council and members Cisco and Oracle co-hosted a dinner as part of the study tour that included the Myanmar delegates, U.S. government representatives from the

PRIVATE SECTOR DEVELOPMENT ACTIVITY QUARTERLY REPORT 3 FY2019

U.S. Embassy Bangkok, the U.S. Federal Communications Commission, the U.S. Department of Homeland Security, and senior executives from Telenor. • The study tour also included seminars at the Cisco and Oracle offices in Bangkok, a meeting with U.S. company Qualcomm, and a briefing provided by senior executives from Advanced Info Service Public Company Limited (AIS), Thailand's largest GSM mobile phone operator. The study tour has enabled the ICT Council to strengthen its relationship with MOTC Department of Posts and Telecommunications, and the delegates assisted with arranging a meeting between Director General Myo Saw and the ICT Council and Cisco in Yangon. As a follow-up to the study tour, the ICT Council plans to organize a 5G workshop in Nay Pyi Taw in coordination with the U.S. Embassy Rangoon. 6. Meeting to Discuss USAID Digital Asia Accelerator program. On May 28, 2019, the ICT Council assisted USAID’s Regional Development Mission for Asia (RDMA), who visited from Bangkok, to convene a meeting with ICT Council members and key local stakeholders to discuss the Digital Asia Accelerator program, which aims to support digital and cybersecurity upskilling efforts in Myanmar and other ASEAN countries. The program supports the global U.S. government’s Digital Connectivity and Cybersecurity Partnership. The meeting took place at the USAID PSDA office in Yangon with attendees from the Myanmar Computer Federation, the Digital Economy Development Committee, UMFCCI, Cyberbaykin, AmCham’s ICT Committee, Myanmar Computer Industry Association, and ICT Council members Cisco and Visa. The group discussed digital capacity-building needs in Myanmar and potential project ideas. At the meeting, a cybersecurity task force was formed comprised of the attendees and other stakeholders as a result of this meeting. The ICT Council has emailed the RDMA team recently to determine whether the accelerator program funds can be used to support Myanmar Cybersecurity Awareness Month activities scheduled for October. 7. Coordination with MOTC, Myanmar Computer Federation, and Telcos to Prepare for Unicode Migration. During the month of June (various dates) 2019, the ICT Council facilitated coordination with MOTC, the Myanmar Computer Federation, and key telcos (telecommunication companies) to prepare for the Unicode migration that will commence on October 1, 2019. The ICT Council has conducted several meetings with members, the MOTC, the Myanmar Computer Federation and telcos to discuss how our members can support the migration from the Zawgyi to Myanmar Unicode font. ICT Council members will assist with preparing users for the migration and to align with the government and MCF’s communications plans over the coming months. 8. Cybersecurity Awareness Month Planning Meeting. On June 20, 2019 the ICT Council presented its plan to organize the first Myanmar Cybersecurity Awareness Month to coincide with similar national campaigns in October. Attendees included those who attended the May 28 Digital Asia meeting along with civil society organization Myanmar Center for Responsible Business, Myanmar Youth Empowerment Opportunities, USAID PSDA, Facebook, Mandalay Computer Industry Association and the newly-formed Myanmar Information Security Association. The group discussed target audiences for the campaign and a draft concept note was circulated recently. The campaign will be led by ICT Council and MCF, with other organizations supporting as partners. We have also requested the support of DEDC, MOTC, Ministry of Commerce, Ministry of Education, and the Central Bank of Myanmar.

PRIVATE SECTOR DEVELOPMENT ACTIVITY QUARTERLY REPORT 3 FY2019

9. Digital Literacy Teachers Training. On June 24-27, Myanmar Book Aid and Preservation Foundation (MBAPF) and the ICT Council kicked off their Digital Literacy Teachers Training pilot program in Yangon with 33 participating secondary school teachers.

• The 4-day training program is supported by the Ministry of Education (MOE) and aims to equip teachers with essential digital knowledge and skills that align with the capacity- building goals set by the Union Government’s inter-ministerial Digital Economy Development Committee (DEDC). • The pilot program will have three phases: Phase 1 covers four (4) days of hands-on training at the MBAPF Training Centre. After completing the training, the teachers will advance to Phase 2 that involves teaching the curriculum at their respective schools under the supervision of MBAPF instructors. Under Phase 3, the trained teachers should be able to teach the course independently in their classrooms and may also participate or lead in further training the trainers training within their school. • This cohort of teachers expects to teach the digital literacy curriculum to about 6000 students by the end of this year. • The ICT Council has invited its members to sponsor the program, which will expand to include teachers from other areas of Yangon, which has over 20,000 secondary school teachers, and in Mandalay.

Grants

During the life of the program, the Activity awarded 30 grants with an approximate total value of $2.8 million dollars. The grant program was used to (1) complement and leverage technical assistance with key government policy makers to promote economic reforms; (2) build the capacity of nongovernment groups to participate effectively in economic reform policy dialogue; and (3) provide NGO members with better services and understandings for them to take advantage of the economic reforms.

In this quarter, the Activity focused on the following active grants:

1. Phyu Sin Saydanar Action Group (PSSAG) 2. Myanmar Engineering Society (MES) Phase 2 3. Koe Koe Tech 4. DEAR Myanmar (Phase 2) 5. Phandeeyar – Technology 6. Phandeeyar – Entrepreneur 7. Opportunities Now (ONOW) 8. Myanmar Consumers Union (MCU) 9. Kasante 10. Myanmar Development Institute (MDI) Status of Active Grants for Quarter 3 FY 2019 Phyu Sin Saydanar Action Group (PSSAG). The “Cooperative Formation as a Platform for Economic Empowerment in a Post-Conflict Area” grant was intended to set up functional “bottom up” cooperatives at a township level in 30 villages in northern Hpa-an Township (a post-conflict area) that have had no formal MFI services or no prior access to finance. Cooperatives that have already

PRIVATE SECTOR DEVELOPMENT ACTIVITY QUARTERLY REPORT 3 FY2019

been established will be agents for Wave Money, a digital money transfer facility that allows remittances of people to and from Hlaing-bwe and Paing Kyone to other areas in the country and that generates income for the cooperatives. All activities were completed in the previous quarter. The achievements under this grant include:

1. Consolidation of the Savings Groups into a larger group named Zwe Kabin Myae Group, with a network of savings groups in 30 villages in Northern Hpa-an. Initially, the Zwe Kabin Myae Group was intended to be registered as a cooperative, however, the Kayin State Minister for Agriculture, Livestock and Irrigation advised them to register as a community-based organization (CBO) instead. This is because the local Cooperative Department is unwilling to issue licenses to cooperatives that are initiated by the community with intervention from international development partners, and also because of the nature of the location as post-conflict areas with a blurred line of the government’s relative to the Karen National Union’s authority. The community leaders and the Board of Directors of the group also agree to register as CBO. The organizational structure and operational strategy that PSSAG helped formulated will remain unchanged. So this will not affect the way the Zwe Kabin Myae Cooperative group was originally intended to operate as set out under the PSDA’s grant. The registration is still in process. The formation of the group enables the community to have a financial intermediary that can provide financial services in the area. Other than financial services, the group can also venture into other economic activities that will benefit the community and contribute to the development of the villages where it is operating.

2. Membership of 700 individual members with shares amounting to 8,500,000 Kyats (US$5,666) as of March 2019. The initial shares placed in the cooperative will be the working capital of the cooperative for its lending operations, providing much needed capital to small enterprises in the area. The income generated from the lending operations will also sustain the cooperative as it expands its operations to include more members and mobilize more resources. PSSAG is also considering infusing its own additional funds to augment the resources of the cooperative to be able to reach out to more enterprises and to energize the economy of the area.

3. Elected members of the Board of Directors trained to govern the affairs of the cooperative. The cooperative has elected and qualified leaders who have shown good management practices both at the savings group and cooperative levels. The training provided to the leaders enabled them to gradually become familiar with the operations of the cooperative. Actual handling of the affairs of the cooperative and continuous mentoring from PSSAG will further enhance the capacities of the leaders.

Myanmar Engineering Society (MES) Phase 2. MES’s grant for the “Establishment and Operation of the Quality Management Center” helped to establish an organization that promotes the implementation of quality standards in Myanmar. Through this grant, MES was able to train local ISO auditors. The grant was closed on May 7, 2019. In this quarter, MES focused on preparing its final report. Successes under this grant include signing contracts to conduct ISO audits of three firms, including a producer of galvanized iron sheet and two providers of medical diagnostic services. The fees collected under these contracts will support the sustainability of the QMC.

Koe Koe Tech. Koe Koe Tech’s grant to develop the “Oobade” application is in the final stages of the app development. The app would provide a platform that offers continuing legal education. It

PRIVATE SECTOR DEVELOPMENT ACTIVITY QUARTERLY REPORT 3 FY2019

would also offer digitized versions of all laws, orders, regulations, notices, by-laws, ordinances and legal updates in Myanmar. In meetings and discussions with the Activity, Koe Koe Tech indicated that the app could be finalized, however, they are experiencing difficulty providing content for the app. The Activity intends to terminate this grant because we do not envision that they will find content for this app.

DEAR Myanmar (Phase 2). A grant to DEAR Myanmar titled “Phase Two of Enhancing Business Skills and Business Modalities of Kayan Farmer Enterprises” continues to work to strengthen the capacities of the 15 farmer enterprises that had been targeted under the first DEAR Myanmar grant. The follow-on grant increased and strengthened the operations of 31 farmer villages. During this quarter, Dear Myanmar focused on drafting its final report. The DEAR Myanmar Grant closed on May 20, 2019.

Phandeeyar – Technology. The “Bringing Development to Myanmar through Technology” grant works to inspire and develop technical skills among Myanmar people, specifically increasing the interest of young people in science, technology, engineering and mathematics (STEM) fields. The grant also supports Myanmar people to create the tech-based products and services that will ultimately bring the innovations needed to make Myanmar a more competitive economy. During this quarter, Phandeeyar focused it grant efforts towards implementing the RoboLeague Competition, which took place on June 1, 2019 and Start-up Challenge activities that took place from June 29 – July 7, 2019 (reported on in detail in the technical section of this report).

Phandeeyar – Entrepreneur. Phandeeyar’s “Bringing Development to Myanmar through Entrepreneurship” grant closed on June 14, 2019. The grant created opportunities for local aspiring entrepreneurs to learn more about ways to create tech-based products and services. During this quarter Phandeeyar focused on implementing the final activities of the grant, which included recruitment and implementation for Founder Institute Yangon Cohort 3 (as reported in the technical section above).

Opportunities Now (ONOW). ONOW’s “Leveraging and Engaging Digital Media to Facilitate Financial Health” builds upon a previous grant to develop an e-learning platform to improve financial literacy in Myanmar. The result of the first grant was a chatbot, Maung Sa Yin Kaing (MSYK), which can be found on Facebook. Under this grant ONOW is developing eight animation short films that will be released under the existing MSYK. During this quarter, ONOW finalized the animations in preparation for a public launch next quarter. ONOW has partnered with VISA to introduce financial products through animations. The grant to ONOW will close on August 15, 2019.

Myanmar Consumers Union (MCU). The grant is expected to close by the end of September 2019. The grant is a second phase grant that supports increased capacity and sustainability for the MCU. During this quarter, the MCU focused on finalizing its Consumer Handbook – a publication of information on consumer rights. In addition, the MCU is finalizing a sustainability plan, which sets out a plan to fully fund the organization’s expanded operations over the next three years. The final sustainability plan will be submitted in July, but the draft includes plans to increase annual membership dues from 6,000 MMK to 10,000MMK and to increase membership through a variety activities.

Kasante. This grant is expected to close on September 30, 2019 (see a more detailed report in the technical section above).

PRIVATE SECTOR DEVELOPMENT ACTIVITY QUARTERLY REPORT 3 FY2019

Myanmar Development Institute (MDI). The “Building the Organizational Capacity of the Myanmar Development Institute” grant to MDI will be modified in the next quarter. Initially, part of the grant was to cover training and out-reach events. However, the MDI has been using their government allocated budget for those events. The Activity met with MDI staff to discuss modifications to the budget. Because less money is being spent on the events, and there is a need for additional personnel, MDI is going to submit a formal request to reallocate funds to hire additional personnel. This grant will close on January 4, 2020 (see a more detailed report in the technical section above).

PRIVATE SECTOR DEVELOPMENT ACTIVITY QUARTERLY REPORT 3 FY2019

Activity Locations

In an effort to meet our project objectives, the Activity plans events, particularly stakeholder consultations, trainings and workshops, across the country. In this quarter, the Activity, through direct support or through subcontractors and/or grantees, reported 58 events in 6 states and regions:

• Yangon – 43 • Kachin - 7 • Mandalay – 3 • Nay Pyi Taw – 1 • Sagaing – 3 • Shan – 1

A detailed list of the events can be found in Annex 2 – Q3 FY 2019 PSDA Activities.

The map below represents the locations of all program events, including those implemented by grantees, subcontractors and direct project assistance.

Figure 1. All Events Q3 FY2019

PRIVATE SECTOR DEVELOPMENT ACTIVITY QUARTERLY REPORT 3 FY2019

Not reflected in the map or list of activities are supporting efforts made to implement the events. In this quarter Nathan has implemented activities where supporting efforts included outreach to the states and regions, including the RoboLeague Competition that worked with 46 universities in all States and Regions to recruit team members and provide mentorship as the teams developed their robots in preparation for the competition.

Stakeholder Participation and Involvement

The Activity has built and continued to maintain strong relationships with stakeholders in Burma through a collaborative approach. The Activity facilitates and supports stakeholder engagement on policy reform activities. The Activity supports government departments and agencies to develop laws and regulations while simultaneously facilitating the participation of the private sector, civil society, research institutions and donor organizations in the policy reform process.

Some of the Activity’s civil society organization and private sector association partners are listed in the table below:

Sector Organizations Applied economic research • Myanmar Development Institute Business and entrepreneurship • Myanmar Young Entrepreneurs Association • Phandeeyar • Union of Myanmar Federation of Chambers of Commerce and Industry (UMFCCI) • Myanmar Business Executives Association (MBA) Consumer affairs • Myanmar Consumer Union (MCU) Finance • Myanmar Microfinance Association (MMFA) • Young Women’s Christian Association (YWCA) • Opportunities Now • Phyu Sin Saydanar Action Group (PSSAG) • Aya Bank • A Bank • Yoma Bank Food and agriculture • Food and Science Technology Association (FoSTA) • The Development for Environmental Friendly Agriculture and Rural Life of Myanmar (DEAR Myanmar) • Kasante Intellectual property • Myanmar Intellectual Property Proprietor Association (MIPPA) Legal • Koe Koe Tech Standards and measures • Myanmar Engineering Society

PRIVATE SECTOR DEVELOPMENT ACTIVITY QUARTERLY REPORT 3 FY2019

Donor Coordination

During this quarter, the Activity continued to coordinate and cooperate with other USAID projects in Burma and with other donors, such as the World Bank, ADB, IFC, DfID (DaNa2), EU-GIZ (TDP), UNIDO, JICA, ADA, and the German Metrology Institute (PTB).

Examples include close cooperation with JICA and the World Bank in the development of the draft Insurance Business Law, with the ADB, WB/IFC and ADA on the development of the Myanmar Microfinance Association, with the ADB, WB and DFID on the implementation of the Project Bank, with WIPO, JICA, UK and Swiss (and U.S. PTO) in the development of a strong IPR regime, with the IMF on support for the CBM, with the Netherlands on the Yangon Ports, with the WB and EITI on the Gemstone Policy (and with the U.S. Embassy), and with GiZ and the USAID-IGNITE project on the ASEAN Single Window.

Implementation Challenges

Over the last and this quarter, several of the new laws that we have been supporting have finally been approved by Parliament, including the 4 IPR laws and the amended Consumer Protection Law along with the implementation of the Insurance Liberalization Plan by the MOPF. In these areas we will shift our support to implementation, capacity building, public awareness and regulation drafting (still law drafting for insurance). Our challenge is that effective implementation in these areas will require support that will extend well beyond the end of the current project, which requires us to be quite strategic about what support we provide to help implementation of these new reform areas got off to a good start. The pending close out by the end of the year forces us to focus more broadly to complete our highest priority tasks and to de-emphasize less important or slower moving activities.

As has been the case throughout the project, we also continue to respond to new, unplanned but nevertheless important tasks as developed by the U.S. Ambassador or USAID. This requires strong managerial support and the ability to identify and procure quickly top-notch consultants.

To use our funds and time most effectively, we are already beginning to phase in completion of some elements for close out to reduce the need for additional spending under time pressure at the end of the year, and we are carefully managing our budget as we continue to program aggressively while winding down toward close out in early January, 2020.

Priorities for Programming for Next Quarter

The following are programming priorities for the next quarter based upon our current understanding of the evolving political economic environment and on the momentum of our successful programming activities to date.

 Continue building the capacity of the Myanmar Development Institute and NECC, including support for the operation of the Project Bank and PPP Center through our embedded infrastructure team in MDI and support for the operation of the increasingly influential NECC. This includes assisting the NECC to develop a website and supporting the MDI to develop a framework for rationalizing 28 currently suspended state-owned enterprises.

2 DaNa is the Burmese word for “prosperity.” The DaNa Facility is a DFID-supported private sector development program.

PRIVATE SECTOR DEVELOPMENT ACTIVITY QUARTERLY REPORT 3 FY2019

 Continue to deepen analysis on rationalization of the Myingyan Steel Plant and Peng Pet iron ore mine through engagement with the NECC; need to be prepared to support a possible plan to privatize or liquidate the two operations.  Continue to provide legal assistance to the NECC on important issues and to support the Ministry of Transportation and Communication on the selection of a deep-water port linked to Yangon as the major commercial center of the country; if funding is available, this could include development of a Deep-Water Port Master Plan.  With the passage of the IP laws, evolve into support for implementation and enforcement, including the development of a IP Office webpage and office IT equipment and furnishings, support for developing implementing regulations, a strategy for developing processes of judicial review of administrative decisions with the court, and providing comments on a draft Custom border measure directive.  Engage with DOCA on improving the draft Direct Sales Law in preparation for submittal to the UAGO for legal review.  Work with DOCA to develop an implementing regulation for the newly revised Consumer Protection Law and develop a notification and SOP to clearly provide for a transition to implement new labeling requirements in the new revised Consumer Protection Law; engage with the FDA on the development of their food labeling notification; revise the SOP for consumer dispute settlement to be in line with the new law.  Move to implementation of a program to modernize the Ministry of Commerce’s electronic TradeNet system of import and export licensing and registrations – creating an operational TradeNet 2.0.  Complete the basic National Single Window through the Routing Platform housed in the Customs Department to link Myanmar to the ASEAN Single Window through the ASEAN Gateway, working closely with US-IGNITE.  Build the capacity of the Financial Regulatory Department to advance the liberalization of the insurance sector; build FRD’s capacities for risk-based supervision that extends to financial reporting; support implementation of the Insurance Market Conduct Manual; and advance the draft Insurance Business Law. This will include developing an understanding on how to appropriately regulate micro-insurance relative to different requirements for general insurance.  Work with the MMFA, FRD and the ADB to advance a strong draft revision to the MFI law; continue partnership support to build the capacity of the MMFA.  Support USAID to implement the two existing DCAs.  Working closely with the Embassy, continue the process for the approval of the National Gemstone Policy by the Minister of MONREC and then by the Cabinet.  Manage the operation of active grants and for several, effectively close out the grants.  Continue to work closely with the U.S. ICT Council to advocate for improved ICT policy, including on cybersecurity; continue the phase out of USAID support for the Council to become fully self-sufficient.  Support next steps for Cabinet approval and submission of the draft Law on Medical Devices.  Focus on close out planning.

PRIVATE SECTOR DEVELOPMENT ACTIVITY QUARTERLY REPORT 3 FY2019

ACTIVITY MANAGEMENT AND ADMINISTRATION

Personnel Management

No changes in personnel were made in this quarter. In July 2019, Mary Miller, Team Lead –Access to finance will be demobilized.

Financial Management

As of June 30, 2019, the amount invoiced to USAID was $ or percent of the total obligated amount.

Contract Management

All contract-required deliverables, such as work plans, quarterly reports, financial reports, annual reports and PMP, have been delivered to USAID.

Close-Out Planning

The Activity has started discussions with the COR on close out planning. A close out plan will be submitted to the COR in the next quarter. PROGRESS REPORT ON INDICATORS

Monitoring and Evaluation

With three-quarters of the year now completed, the Activity has met or exceed all of its targets for FY19 with the exception of the credit-related indicators. Given the impending close-out of the Activity and the planned slowdown of interventions in the last half of the calendar year, it is anticipated that results for Q4 will be relatively low. Thus, the early achievement of targets does not require any amendment.

Regarding the F indicators monitored by the Activity:

FTF indicator: EG 3.1-12 “Number of agricultural and nutritional enabling environmental policies analyzed, consulted on, drafted or revised, approved and implemented with USG assistance” is now at 57 policies worked on this year, against a target of 20. This reflects sustained, reiterative work on the body of laws and regulations being addressed by the Activity, which is purposively double-counted in the USAID methodology.

PRIVATE SECTOR DEVELOPMENT ACTIVITY QUARTERLY REPORT 3 FY2019

Achievement against FTF indicator: EG 3.2-4 “Number of for-profit private enterprises, producers’ organizations, water users associations, women's groups, trade and business associations, and community- based organizations (CBOs) receiving USG food security related organizational development assistance” is now at 75 actual against a target of 32, reflecting a large number of firms participating in the MFI work.

Results for the two FTF indicators: EG. 3.2-3 “Number of micro, small and medium enterprises (MSMEs) including farmers, receiving agricultural related credit as a result of USG assistance” and FTF indicator: EG 3.2-6 “Value of agricultural and rural loans” are lower than expected due to incomplete reporting by partner MFIs. Assumptions for these indicator targets included the DCA-backed loans as well as non-DCA loans by the partner MFIs receiving Activity technical assistance. Unfortunately, PSDA has encountered difficulties in obtaining this data because of differences in methodology and reporting cycle between DCA and the Activity. Thus, reported figures reflect only non-DCA loans. Despite this incomplete data, it should be noted that the non-DCA loans alone are at $27.4 million, only 9% under the target of $30 million that was set for the entire lending portfolio. Thus, the full amount of funds being facilitated with Activity assistance can be assumed to be much higher than originally anticipated. The fact that the number of borrowers is lower then expected reflects larger loan sizes and repeat borrowers who are not double-counted.

Gender and Inclusion

A comparison of quarterly results for the fiscal year to date show that despite some variability, the Activity is generally running close to the target of 50% female beneficiaries overall for its interventions. While it remains difficult to identify female journalists for the trainings by Internews, the ratio of women in the journalism trainings doubled from 18 percent to 36 percent from Q2 to Q3. The ratio of women entrepreneurs reached is improving steadily over the year to get closer to target. Since the project trains more government and NGO representatives then journalists and entrepreneurs, the overall ratio of women is 45% for the quarter.

Figure 2. Proportion of Women Participants in FY2019 To Date

70% 62% 60% 53% 52% 52% 50% 46% 46% 45% 42% 41% 38% 40% 36% 34% 33% 30% 30% 18% 20%

10%

0% Journalists Entrepreneurs Government NGO Overall

Q1 Q2 Q3

PRIVATE SECTOR DEVELOPMENT ACTIVITY QUARTERLY REPORT 3 FY2019

ANNEX 1: FY2019 QUARTER 3 KEY PERFORMANCE INDICATOR RESULTS

Table 1. Private Sector Development Activity Indicators FY19 Actual FY15 FY16 FY17 FY18 Oct - Jan - Apr - FY19 Indicators Jul - Sep Remarks Actual Actual Actual Actual Dec Mar Jun Total Target 2019 2018 2019 2019 Intermediate Result (IR) 1: More Inclusive, Effective and Transparent Economic Governance Intervention Area 1: More Inclusive and Transparent Economic Policy Making and Implementation Intended Outcome 1.1: Transparency of government policies increased 1.1.1: Number of media stories on the Q1 - (1) Weekly journals - 31 sto economy published by journalists Newspapers - 56 stories (3) Web completing Activity training (custom stories (4) TV - 66 stories; (5) Rad indicator) Q2 - (1) Weekly journals - 52 sto N/A 916 423 3,212 184 232 129 545 300 Newspapers - 76 stories (3) Web stories (4) TV - 76 stories; (5) Rad Q3 - (1) Weekly journals - 28 sto Newspapers - 24 stories (3) Web stories (4) TV - 48 stories; (5) Rad 1.1.2: Cumulative number of economic Q1 - 167 cumulative laws/regulat laws, regulations, and policies published Portal Website Q2 - 193 cumulat with Activity assistance (custom 0 41 70 116 167 193 198 198 165 laws/regulations on Trade Portal W indicator) 198 cumulative laws/regulations o Website 1.1.3: Number of new visitors to Q1 - 7,512 new visitors from 85 c websites receiving Activity assistance Trade Portal website; 2,939 new v (custom indicator) countries to Internews website; 2 0 5,769 20,528 38,371 14,367 13,332 19,109 46,808 27,000 visitors from 66 countries to MCU new visitors from 31 countries to Q2 - 7,671 new visitors from 94 c

PRIVATE SECTOR DEVELOPMENT ACTIVITY QUARTERLY REPORT 3 FY2019

FY19 Actual FY15 FY16 FY17 FY18 Oct - Jan - Apr - FY19 Indicators Jul - Sep Remarks Actual Actual Actual Actual Dec Mar Jun Total Target 2019 2018 2019 2019 Trade Portal website; 3,838 new v countries to Internews website; 4 from 24 countries to MCU websit visitors from 52 countries to MMF - 11,001 new visitors from 116 co Trade Portal website; 4,880 new v countries to Internews website; 34 from 13 countries to MCU websit visitors from 57 countries to MMF Intended Outcome 1.2: Private sector and civil society input into policy making increased 1.2.1: Number of public-private dialogues Q1- (1) World Standards Day in Y and public awareness events held with (2-3) 2 Policy Consultation of Mic Activity assistance (custom indicator) YGN & MDY on Nov 16 & 19 (4) Workshop on Risk-based Supervis Insurance in YGN on Dec 12 (5) S Meeting for Microfinance in NPT o 57) 55 GEW events on Nov 12-18 events of World Consumer Rights 15 (3-5) 3 Public Consultation Wo 2 11 86 70 60 5 4 69 60 Direct Selling Law on Feb 18, 20 & 2 events of World Intellectual Pro Apr 26 (3) Gemstone Regulation D Jun 17 (4) Kachin State level Land Discussion workshop on Mar 30

Intended Outcome 1.3: Economic governance aligned with international obligations and best practices 1.3.1: Number of agricultural and Q1- Analysis - (1) 1 process for nutritional enabling environmental Food Regulation Policy (2) 1 proce policies analyzed, consulted on, drafted 1 11 42 109 24 24 9 57 20 Standards Law (3) 1 process for C or revised, approved and implemented Protection Settlement Body SOPs

PRIVATE SECTOR DEVELOPMENT ACTIVITY QUARTERLY REPORT 3 FY2019

FY19 Actual FY15 FY16 FY17 FY18 Oct - Jan - Apr - FY19 Indicators Jul - Sep Remarks Actual Actual Actual Actual Dec Mar Jun Total Target 2019 2018 2019 2019 with USG assistance (FTF indicator: for Microfinance Law (5) 1 proces EG 3.1-12) Implement Insurance Supervision for Policy on Ports (7) 1 process f SOP for Department Of Consume (DOCA) (8) 1 process for Anti-D Countervailing Duty (9) 1 process Entrepreneur Ecosystem Policy; S Consultation – (1-3) 3 processe Microfinance Law (4) 1 process fo Implement Insurance Supervision for Labeling for Food & Drug Adm (FDA) (Drugs, Food, Cosmetics & Devices) (6) 1 process for Labelin DOCA (7) 1 process for Entrepre Ecosystem Policy; Drafting or Re process for Risk Based Food Regu 1 process for Consumer Protectio Body SOPs (3) 1 process for Micr (4) 1 process for Labeling SOP for process for Anti-Dumping and Co Duty; Official Approval (legisla regulatory) – (1) 1 process for Regulations (2) 1 process for Proj Private Partnership; Full & Effect Implementation – (1) 1 process Distribution Regulations Q2 - An processes for Policies on Port (3) Improving Electricity Sector; Draf Revision - (1) 1 process for Insur Regulations (2) 1 process for Polic 1 process for Improving Electricity Official Approval (Legislation/ (1) 1 process for Law on Consum (2) IPR Law-Trademark (3) IPR La (4) IPR Law-Industrial Design (5) I (6) Insurance Law Regulations (7-9

PRIVATE SECTOR DEVELOPMENT ACTIVITY QUARTERLY REPORT 3 FY2019

FY19 Actual FY15 FY16 FY17 FY18 Oct - Jan - Apr - FY19 Indicators Jul - Sep Remarks Actual Actual Actual Actual Dec Mar Jun Total Target 2019 2018 2019 2019 for Bank Regulations (10) 1 proce SOP for DOCA; Full and Effect Implementations (1-8) 1 proce Notifications Q3 - Analysis - (1) Microfinance Law (2) 1 process fo Business Law (3) 1 process for Po (4) 1 process for Land Policy in Ka Stakeholder Consultation - (1) Land Policy in Kachin State; Offic (legislation/ regulatory) - (1) 1 Microfinance Regulation on Intere Law - Copy right (3) Insurance Lib (4) Electricity Tariff Reform 1.3.2: Number of non-agricultural Q1- Analysis – (1) 1 process for enabling environmental policies analyzed, Law (2) 1 process for Medical Dev consulted on, drafted or revised, process for Medical Device Regula approved and implemented with USG process for Gem Stone Policy; Dr assistance (custom indicator) Revision – (1-2) 2 processes for Policy Q2 - Analysis - (1) 1 proc 1 15 6 6 4 3 13 3 Reform; Stakeholder Consultat processes for Direct Sales Law Q (1) 1 process for Steel Reform; St Consultation - (1) 1 process for Regulations; Drafting or Revisio process for Gemstone Regulation

1.3.3: Number of capacity building Q1- (1-10) 10 credit analysis and workshops conducted with Activity mobilization training of MMFA in S Assistance (custom indicator) 5 IT training for DOCA in Nov-D training of MES in Aug - Sep (19-2 N/A 33 251 298 26 28 35 89 92 Phandeeyar in Jun & Aug (22-23) 2 Bank in Nov & Dec (24) A credit for YOMA Bank in Dec (25) Arbit building program for academics in

PRIVATE SECTOR DEVELOPMENT ACTIVITY QUARTERLY REPORT 3 FY2019

FY19 Actual FY15 FY16 FY17 FY18 Oct - Jan - Apr - FY19 Indicators Jul - Sep Remarks Actual Actual Actual Actual Dec Mar Jun Total Target 2019 2018 2019 2019 training on Risk Based Supervision Dec Q2 - (1-23) 23 training of Pha entrepreneurs on May-Dec in 201 training of PSSAG for local entrep & Feb (26) 1 training on Operating Trade Portal for MOC staff in Feb training for MFIs in Mar Q3 - (1-2 of Phandeeyar for entrepreneurs o May 2019 (29-31) 3 trainings of Ka (32-34) 3 trainings for MFIs in May training in Dec 2018 Intervention Area 2: Support for Entrepreneurship

Intended Outcome 2.1: Entrepreneurship opportunities and capacity increased 2.1.1: Number of for-profit private Q1 - (1-15) 15 organization in GE enterprises, producers organizations, For-profit private enterprises; 2 P water users associations, women's Organizations; 2 Community base groups, trade and business associations, & 4 Disaggregates not available) (1 and community-based organizations Farmer enterprises in DEAR Myan (CBOs) receiving USG food security (47-65) 19 microfinance institution related organizational development trainings (15 For-profit private ent assistance. (FTF indicator: EG 3.2-4) Community based Organizations) profit private enterprise in ONOW 0 2 88 268 65 1 9 75 32 (1) 1 Producer organization in DE event (2-8) 7 organizations in Kasa Producers Organizations; 1 For-pr enterprise; 1 Community based o Women's group) (9) 1 Producer o Internews event

Q1 - (1) 3 events by Phandeeyar = N/A N/A 646 1664 310 764 521 1,595 290 women (2) Training by MES = 4 P

PRIVATE SECTOR DEVELOPMENT ACTIVITY QUARTERLY REPORT 3 FY2019

FY19 Actual FY15 FY16 FY17 FY18 Oct - Jan - Apr - FY19 Indicators Jul - Sep Remarks Actual Actual Actual Actual Dec Mar Jun Total Target 2019 2018 2019 2019 (3) Training by DEAR Myanmar = women Q2 - (1) 24 events by Pha People/227 women (2) 4 events by People/22 women Q3 - (1) 16 eve Phandeeyar = 396 People/177 wo trainings by Kasante = 42 People/ 2.1.2: Number of entrepreneurs (M/F) Training by MES = 57 People/22 w receiving Activity assistance (custom Gemstone Regulation event = 17 indicator) women (5) Workshop by DEAR M People/2 women 33% F 38% F 30% F 33% F 42% F % F 35% F 50% F

Intermediate Result (IR) 2: Broader Access to Finance

Intervention Area 3: Improve Access to Finance and Mobilize Savings

Intended Outcome 3.1: Access to Credit Increased 3.1.1: Number of micro, small and Q1- (1) 13 MSMEs by A Bank (2) medium enterprises (MSMEs) including AYA Bank (3) 81 MSMEs by GRET farmers, receiving agricultural related MSMEs by MDP (5) 3 MSMEs by O credit as a result of USG assistance (FTF MSMEs by PGMF Q2 - (1) 8 MSM indicator: EG.3.2-3) 0 1,073 2,427 2,472 527 662 1,503 2,692 9,205 (2) 33 MSMEs by GRET Chin (3) 1 MDP (4) 275 MSMEs by PGMF (5) YWCA Q3 - (1) 11 MSMEs by A MSMEs by GRET Chin (3) 73 MSM 1,264 MSMEs by PGMF (5) 98 MSM 3.1.2: Number of micro, small and Q1- (1) 31 MSMES by A Bank (2) medium enterprises (MSMEs) receiving GRET Chin (3) 139 MSMEs by MD

non-agricultural related credit as a result 0 795 1,694 8,089 2,651 5,260 7,208 15,119 52,948 MSMEs by ONOW (5) 2,445 MSM of USG assistance (custom indicator) Q2 - (1) 32 MSMEs by A Bank (2)

PRIVATE SECTOR DEVELOPMENT ACTIVITY QUARTERLY REPORT 3 FY2019

FY19 Actual FY15 FY16 FY17 FY18 Oct - Jan - Apr - FY19 Indicators Jul - Sep Remarks Actual Actual Actual Actual Dec Mar Jun Total Target 2019 2018 2019 2019 GRET Chin (3) 197 MSMEs by MD MSMEs by PGMF (5) 741 MSMEs b (1) 53 MSMEs by A Bank (2) 42 M Chin (3) 94 MSMEs by MDP (4) 32 ONOW (5) 6,409 MSMEs by PGM MSMEs by YWCA 3.1.3: Value of agricultural and rural loans Q1- (1) Value of 13 Agric loans by (FTF indicator: EG3.2-6) $1.17million (2) Value - 7 Agric by $0.26million (3) 81 Agric by GRET $48,600 (4) 133 Agric by MDP = $ 3 Agric by ONOW = $2,052.5 (6) PGMF = $0.82million Q2 - (1) 8 A $0.34 $5.208 $14.5 $2.45 $3.8 $21.19 $27.44 $30.19 = $2.65million (2) 33 Agric by GR 0 million million million million million million million million $35,900 (3) 187 Agric by MDP = $ 275 Agric by PGMF=$0.76million by YWCA = $0.18million Q3 - (1 Bank = $17.25million (2) 57 Agric = $55,100 (3) 73 Agric by MDP = (4) 1,264 Agric by PGMF = $3.64m Agric by YWCA = $0.108million 3.1.4: Value of non-agricultural and rural Q1- (1) Value of 31 Non-Agric loa loans disbursed (custom indicator) = $15.81million (2) Value - 17 No GRET Chin = $10,200 (3) 139 No MDP = $0.13million (4) 19 Non-A ONOW = $7,243.72 (5) 2,445 No PGMF = $6.42million Q2 - (1) 32 A Bank = $25.79million (2) 29 No $1.417 $5.105 $43.64 $22.39 $39.26 $75.7 $137.35 $145.64 0 GRET Chin = $63,000 (3) 197 No million million million million million million million million MDP=$0.197million (4) 4,261 Non PGMF=$12.38 million (5) 741 Non YWCA = $0.82million Q3 - (1) 53 A Bank = $56.85million (2) 42 No GRET Chin = $78,400 (3) 94 Non = $0.16million (4) 32 Non-Agric b $21,076 (5) 6,409 Non-Agric by P

PRIVATE SECTOR DEVELOPMENT ACTIVITY QUARTERLY REPORT 3 FY2019

FY19 Actual FY15 FY16 FY17 FY18 Oct - Jan - Apr - FY19 Indicators Jul - Sep Remarks Actual Actual Actual Actual Dec Mar Jun Total Target 2019 2018 2019 2019 $17.91million (6) 578 Non-Agric b $0.675million

Intended Outcome 3.2: Access to savings products increased 3.2.1: Number of people with a savings The Activity has not yet provided account or insurance policy as a result of assistance in this area. 1. Of the D

USG assistance (custom indicator, former PGMF has a license to take savings F indicator 4.5.2-25) forced and 5% voluntary. 2. MFIs l 3.2.2: Value of new savings account or have the IT capability to offer savi insurance policy as a result of USG widespread basis. The Activity doe assistance (custom indicator) anticipate providing technical assis area.

Cross-cutting Indicators

Indicator 4.1 Cumulative number of Q1- (1) 55 GEW events = 3,800 T people (M/F) attending events conducted women (2) 10 trainings of MMFA with Activity assistance (custom Total/117 women (3) 9 events of indicator) 168 Total/70 women (4) 5 IT train 3,293 14,267 20,721 5,795 2,284 2,161 10,240 4,500 = 44 Total/25 women (5) 5 events Myanmar = 74 Total/7 women (6) PSSAG = 222 Total/94 women (7) N/A FRD = 212 Total/108 women (8) MES = 30 Total/15 women (9) 3 t Phandeeyar = 295 Total/90 wome of Kasante = 8 Total/3 women (1 for A Bank = 49 Total/40 women 42% F 56% F 59% F 52% F 38% F 45% F % F 47% F 50% F with DRI = 153 Total/73 women ( with FDA = 147 Total/65 women with MMFA = 306 Total/138 wom

PRIVATE SECTOR DEVELOPMENT ACTIVITY QUARTERLY REPORT 3 FY2019

FY19 Actual FY15 FY16 FY17 FY18 Oct - Jan - Apr - FY19 Indicators Jul - Sep Remarks Actual Actual Actual Actual Dec Mar Jun Total Target 2019 2018 2019 2019 events on Arbitration = 79 Total/6 A training for YOMA Bank = 14 T Q2 - (1) 24 events of Phandeeyar Total/405 women (2) 15 events of 199 Total/59 women (3) 4 events 111 Total/48 women (4) 3 worksh DOCA = 231 Total/98 women (5) National Trade Portal = 132 Tota 2 Consumer Rights Day events = women (7) 2 workshops of MMFA women (8) 1 event of ONOW = women Q3 - (1) 29 events of Pha Total/327 women (2) 10 events of 240 Total/107 women (3) 7 event 128 Total/45 women (4) 4 events 166 Total/71 women (5) 3 events Total/72 women (6) IPR Day 2 eve Total/161 women (7) MES training Total/157 women (8) Gemstone r = 91 Total/30 women (9) DEAR M Workshop = 30 Total/12 women Indicator 4.2 Number of women’s Q1- (1-51) 51 women saving grou associations participating in activities events in Sep - Dec) (52-74) 23 gr (custom indicator) events on Nov 12-18 (3 For-profit enterprises; 7 women groups; 2 C producer organization; 7 Disaggre available & 3 Faith based Organiza 0 9 372 242 133 10 4 147 62 31 Ethnic Farmer enterprises in D events in Oct (106-133) 28 microf institutions in MMFA training in Se 4) 4 microfinance institutions (at O (5-10) 6 women saving groups (in Q3 - (1-3) 2 Ethnic Women group Producer organization in Kasante

PRIVATE SECTOR DEVELOPMENT ACTIVITY QUARTERLY REPORT 3 FY2019

FY19 Actual FY15 FY16 FY17 FY18 Oct - Jan - Apr - FY19 Indicators Jul - Sep Remarks Actual Actual Actual Actual Dec Mar Jun Total Target 2019 2018 2019 2019 Ethnic Producer organization in D event

Indicator 4.3 Number of CSOs or Q1- (1-5) 5 women saving group business associations representing ethnic events in Sep & Oct) (6-13) 8 grou minority (custom indicator) events on Nov 12-18 (2 For-profit enterprises; 3 women groups; 2 C Disaggregates not available) (14-44 Farmer enterprises (at DEAR Mya Oct) (45-46) 2 microfinance instit MMFA training in Sep-Dec) (47) 1 Internews event in Oct - (1-2) 0 34 227 116 47 7 19 73 62 Q2 saving groups (at PSSAG events in ethnic media at Internews events - (1-11) 6 Ethnic Community base 3 ethnic producers groups & 2 eth group (12-18) 7 ethnic media (19) Producer organization in DEAR M

Indicator 4.4 Total number of events supported by Activity (custom indicator) N/A 89 431 526 111 54 58 223 157

Indicator 4.5 Number of supported Q1 - (1) 30 GEW events by MYEA events held outside Yangon and NPT of DEAR Myanmar in Kayah state (custom indicator) PSSAG in Kayin State (4) 4 events 2 33 148 127 48 12 13 73 15 Mandalay (5) 3 events of Internew and Ayeyawaddy and Sagaing Regio of Kasante in Kachin state (7) An

PRIVATE SECTOR DEVELOPMENT ACTIVITY QUARTERLY REPORT 3 FY2019

FY19 Actual FY15 FY16 FY17 FY18 Oct - Jan - Apr - FY19 Indicators Jul - Sep Remarks Actual Actual Actual Actual Dec Mar Jun Total Target 2019 2018 2019 2019 in Mandalay Q2 - (1) 5 events of I Mon state and Ayeyawaddy region PSSAG in Kayin state (3) 2 events Mon state and Mandalay region (4 Rights Day event in Ayeyawaddy r event of MMFA in Mandalay region events of Kasante in Kachin state Internews in Sagaing and Mandalay event of DEAR Myanmar in Shan s training in Mandalay region

Remarks: (1) In relation to indicators of Access to Finance, the figures reported do not include financial information from AYA Bank, LOLC and Proximity who have not yet submitted. We’ll update the figur report based on the receipt. According to Feed the Future indicators, number of MSMEs can be counted only once during the fiscal year even if they receive multiple loans. In addition, the projecte MFIs included DCA and Non-DCA. However, MFIs are reporting only Non-DCA.

(2) Total figure under indicator 1.1.2 reflects a cumulative output. (3) Events counted under indicators 1.2.1, 4.4 & 4.5 may be double counted. (4) Events counted under indicators 1.3.3, 4.4 & 4.5 may also be double counted. (5) People counted under indicators 2.1.2 and 4.1 may be double counted. (6) Associations counted under 2.1.1, 4.2 and 4.3 may also be double counted. (7) Events counted under indicators 4.4 & 4.5 may also be double counted.

PRIVATE SECTOR DEVELOPMENT ACTIVITY QUARTERLY REPORT 3 FY2019

ANNEX 2: Q3 FY2019 PSDA ACTIVITIES

Table 2: Private Sector Development Activity Event List, Quarter 3, FY 2019 Sr. Begin End Township State/Region Issue Area Counterpart Event Title No. Date Date Founder Institute (Grantee) Yangon 2019: Session 1 4/3/19 4/3/19 Yangon Yangon Entrepreneurship Phandeeyar (10)_Mentor Progress Review Mentoring for BRG to run Economic Reporting Media in Resource Portal: 2 4/5/19 4/5/19 Yangon Yangon Economic Internews Myanmar Economy Reform Review on Three Years Regime of Current Government Founder Institute (Grantee) Yangon 2019: Session 3 4/24/19 4/24/19 Yangon Yangon Entrepreneurship Phandeeyar (11)_Hiring and Onboarding Media -CSO- Media in Stakeholders Forum: 4 4/24/19 4/24/19 Mandalay Mandalay Economic Internews Availability of Data and Reform Information in Mandalay Region Participatory Broadcast Media Content Media in Production Support- 5 4/25/19 4/25/19 Yangon Yangon Economic Internews MRTV: How to Pay Reform Income Tax by Online MPU System In-house Mentoring for Media in National and 6 4/26/19 4/26/19 Monywa Sagaing Economic Internews Ethnic/Regional Media Reform Outlets - Monywa Gazette Myanmar Intellectual Nay Pyi Intellectual World Intellectual 7 4/26/19 4/26/19 Nay Pyi Taw Property Taw Property Rights Property Day Proprietor Association

PRIVATE SECTOR DEVELOPMENT ACTIVITY QUARTERLY REPORT 3 FY2019

Intellectual Property Intellectual Rights World Intellectual 8 4/26/19 4/26/19 Yangon Yangon Property Rights Department, Property Day Ministry of Education Participatory Broadcast Media in Content Production 9 4/27/19 4/27/19 Monywa Sagaing Economic Internews Support: In-house Reform Mentoring for Monywa Gazette Business Reporters Network Discussion: Media in Challenges and Potentia 10 4/28/19 4/28/19 Monywa Sagaing Economic Internews Opportunities of Reform Agribusiness and Trade Sector in Sagaing Region Entrepreneur/Startup (Grantee) 11 4/28/19 4/28/19 Yangon Yangon Entrepreneurship Meetup:12 Legal Toolkit Phandeeyar For Businesses Founder Institute (Grantee) 12 5/2/19 5/2/19 Yangon Yangon Entrepreneurship Yangon 2019: Session Phandeeyar (12)_Growth Agriculture and (Grantee) Harvesting and Growing 13 5/3/19 5/3/19 Sadong Kachin Agribusiness Kasante Co-teaching Seminar (Grantee) Workshop on Lessons Agribusiness and 14 5/6/19 5/6/19 Taunggyi Shan DEAR Learned form Phase II Agriculture Myanmar of the Project Mentoring for BRG - Pwint Thit Media in Sa/Transparency in 15 5/7/19 5/7/19 Yangon Yangon Economic Internews Myanmar Enterprises Reform (TiME) Report and Progressive Corporate Culture in Myanmar Founder Institute (Grantee) 16 5/8/19 5/8/19 Yangon Yangon Entrepreneurship Yangon 2019: Session Phandeeyar (13)_Equity and Funding Awareness and Agriculture and (Grantee) 17 5/9/19 5/10/19 Myitkyina Kachin Implementation of GMP Agribusiness Kasante Training Myanmar Access to Small Enterprise 18 5/15/19 5/16/19 Yangon Yangon MicroFinance Finance Lending Training Association Myanmar Access to 19 5/17/19 5/17/19 Yangon Yangon MicroFinance Training of Trainers Finance Association

PRIVATE SECTOR DEVELOPMENT ACTIVITY QUARTERLY REPORT 3 FY2019

Processing and Quality Agriculture and (Grantee) 20 5/20/19 5/20/19 Puta-O Kachin Control Best Practices Agribusiness Kasante Co-teaching Seminar Myanmar Access to Small Enterprise 21 5/22/19 5/23/19 Mandalay Mandalay MicroFinance Finance Lending Training Association Media in Mentoring for BRG - 22 5/24/19 5/24/19 Yangon Yangon Economic Internews Briefing on Myanmar Reform National Trade Portal Media in Myanmar Business 23 5/28/19 5/28/19 Yangon Yangon Economic Internews Reporters Forum 2019 Reform Founder Institute (Grantee) Yangon 2019: Session 24 5/29/19 5/29/19 Yangon Yangon Entrepreneurship Phandeeyar (14)_Leadership and Graduation Participatory Broadcast Media Content Media in Production Support- 25 5/30/19 5/30/19 Yangon Yangon Economic Internews MRTV: Question and Reform Answer Time - Applying for SMEs Loan Community Policy Agriculture and (Grantee) 26 5/30/19 5/31/19 Sadong Kachin Engagement and Agribusiness Kasante Discussion Meeting with Relevant Agriculture and (Grantee) 27 6/14/19 6/14/19 Myitkyina Kachin Government Officer for Agribusiness Kasante Land Policy Myanmar Nay Pyi National Gemstone Regulation 28 6/17/19 6/17/19 Nay Pyi Taw Gemstone Taw Gemstone Policy Discussion Enterprises Community Policy Agriculture and (Grantee) 29 6/19/19 6/21/19 Sadong Kachin Engagement and Agribusiness Kasante Discussion Myanmar Access to Workshop on MCIX 30 6/21/19 6/21/19 Yangon Yangon MicroFinance Finance Program Association

PRIVATE SECTOR DEVELOPMENT ACTIVITY QUARTERLY REPORT 3 FY2019

Private Sector Development Activity Events Conducted in FY19 Quarters 1 and 2, but reported by Grantees in FY19 Quarter 3 Ser Begin End State/ ial Township Issue Area Counterpart Event Title Date Date Region No.

Startup Ideation Boot (Grantee) 1 10/17/18 10/17/18 Yangon Yangon Entrepreneurship Camp: Founder Institute Phandeeyar Yangon

(Grantee) Founder Institute 2 10/31/18 10/31/18 Yangon Yangon Entrepreneurship Phandeeyar Graduate Show Case

(Grantee) Effective Marketing for 3 11/7/18 11/7/18 Yangon Yangon Entrepreneurship Phandeeyar Entrepreneur

Entrepreneur Startup (Grantee) 4 11/8/18 11/8/18 Yangon Yangon Entrepreneurship meetup (Business Mode Phandeeyar Series 3)

(Grantee) Making the leap from 5 11/14/18 11/14/18 Yangon Yangon Entrepreneurship Phandeeyar Employee to Entreprene

Myanmar Myanmar Consumer Consumer 6 11/16/18 11/16/18 Yangon Yangon Consumer Union's 6th Anniversary Protection Union and Annual Meeting

Myanmar Consumer Internal Coordination 7 11/17/18 11/17/18 Yangon Yangon Consumer Protection Meeting Union

Startup Office Hours: G (Grantee) 8 11/29/18 11/29/18 Yangon Yangon Entrepreneurship Business Advice from Phandeeyar Experts

Female Founder (Grantee) 9 12/5/18 12/5/18 Yangon Yangon Entrepreneurship Roundtable: How to Ge Phandeeyar Ahead in Entrepreneurs

(Grantee) Sharing The Cake: Splitt 10 12/6/18 12/6/18 Yangon Yangon Entrepreneurship Phandeeyar equity among co-founde

PRIVATE SECTOR DEVELOPMENT ACTIVITY QUARTERLY REPORT 3 FY2019

Startup Networking Mix (Grantee) 11 12/13/18 12/13/18 Yangon Yangon Entrepreneurship Meet Yangon Phandeeyar Entrepreneurs

14001:2015 Environmen National Quality 12 12/15/18 12/16/18 Yangon Yangon (Grantee) MES Management Standard Infrastructure Awareness Training

Myanmar Consumer Myanmar Consumer Union's Strategy for its 13 12/17/18 12/19/18 Yangon Yangon Consumer Protection Sustainability and Revisin Union Policies

How to Build Your (Grantee) 14 12/19/18 12/19/18 Yangon Yangon Entrepreneurship Startup's Brand from Phandeeyar Scratch

(Grantee) Founder Institute Yango 15 1/3/19 1/3/19 Yangon Yangon Entrepreneurship Phandeeyar Information Session

(Grantee) Founder Institute Yango 16 1/9/19 1/9/19 Yangon Yangon Entrepreneurship Phandeeyar Session (1)_Orientation

Founder Institute Yango (Grantee) 17 1/10/19 1/10/19 Yangon Yangon Entrepreneurship Session (2)_Vision and Phandeeyar Validation

Founder Institute Yango (Grantee) 2019: Session 18 1/16/19 1/16/19 Yangon Yangon Entrepreneurship Phandeeyar (3)_Customer Development

(Grantee) Founder Institute Yango 19 1/23/19 1/23/19 Yangon Yangon Entrepreneurship Phandeeyar 2019: Session (4)_Reven

Entrepreneur/ Startup (Grantee) 20 1/25/19 1/25/19 Yangon Yangon Entrepreneurship Meetup:09 (How to get Phandeeyar startup Ideas)

PRIVATE SECTOR DEVELOPMENT ACTIVITY QUARTERLY REPORT 3 FY2019

Founder Institute Yango (Grantee) 21 1/30/19 1/30/19 Yangon Yangon Entrepreneurship 2019: Session (5)_Brand Phandeeyar and Design

Founder Institute Yango (Grantee) 22 2/13/19 2/13/19 Yangon Yangon Entrepreneurship 2019: Session (6)_Mento Phandeeyar Idea Review

Entrepreneur/Startup (Grantee) Meetup:10 How to build 23 2/15/19 2/15/19 Yangon Yangon Entrepreneurship Phandeeyar prototype without knowing coding

(Grantee) Founder Institute Yango 24 2/27/19 2/27/19 Yangon Yangon Entrepreneurship Phandeeyar 2019: Session (7)_Legal

Founder Institute Yango (Grantee) 25 3/13/19 3/13/19 Yangon Yangon Entrepreneurship 2019: Session (8)_Go to Phandeeyar Market Planning

Founder Institute Yango (Grantee) 26 3/20/19 3/20/19 Yangon Yangon Entrepreneurship 2019: Session (9)_Produ Phandeeyar Development

Entrepreneur/Startup (Grantee) Meetup:11 New Produc 27 3/26/19 3/26/19 Yangon Yangon Entrepreneurship Phandeeyar Exploration in Southeas Asia

Agriculture/Agrib (Grantee) State Level Land Policy 28 3/30/19 3/30/19 Myitkyina Kachin usiness Kasante Discussion Workshop

INSURANCE LIBERALIZATION IN BURMA

On April 5, 2019, the Ministry of Planning and Finance (MoPF) announced that it had approved five foreign insurance companies to apply for life insurance licenses to set up 100-percent foreign owned insurance subsidiaries. This announcement was a Foreign owned insurance result of a multi-faceted approach to liberalizing the infant companies will be allowed to insurance sector in Burma and opens the market to some of the operate in Burma for the first largest insurance companies in the world, including US-owned, time. Chubb.

The MoPF shortly thereafter accepted applications for life and general insurance companies to form joint ventures where foreign ownership cannot exceed 35%. Acceptance of six JVs, three life and three non-life, was announced on July 31, 2019. The MOPF is considering allowing a second phase of foreign investments in the future.

The introduction of world-class insurance services to Myanmar will quickly transform one of the weakest markets in the world, where less than one percent of the population buys insurance, into a vibrant and dynamic sector where families and businesses will be able to purchase a range of modern insurance services to meet their needs to manage risk.

This surge in activity will create thousands of jobs directly in the insurance sector, and additional thousands more indirectly through better risk management that will enable families to better invest in . their futures and businesses to protect from a wide range of risks.

USAID through the Private Sector Development Activity, working closely with other donors, is supporting: 1) the development of a modern Insurance Business Law based on Insurance Core Principles (ICPs) of the International Association of Insurance Supervisors (IAIS); 2) capacity building of the regulator to conduct on-site supervisory examinations; 3) development of a market conduct policy and procedures manual; and, 4) organizational capacity building such as training and IT equipment for a group of newly appointed regulatory staff that had limited understanding of insurance operations.

For more information contact Private Sector Development (PSD) Activity, Myanmar Mr. Steve Parker (Chief of Party): [email protected] and Ms. Show Ei Ei Tun (Deputy Chief of Party): [email protected].