Inclusive Business a “Radical Triple Win” for Myanmar
Myanmar, March, 19 2018 -
Adopting inclusive business practices will be a “triple win” for Myanmar, policy experts and business leaders advocated. Meanwhile, the government wants this approach to secure better jobs and better lives for the bottom 40 percent of income earners.
Businesses joined with policy experts and members of the donor community to explore the implementation of inclusive business practices on March 15 in Yangon. The event was supported by the UK-funded DaNa Facility, the Union of Myanmar Federation of Chambers of Commerce and Industry (UMFCCI) and Myanmar Young Entrepreneurs Association (MYEA).
Gail Marzetti, head of DFID Myanmar, stressed that inclusive business is a triple win for businesses, the labour force and the government.
“Supporting and expanding inclusive business here in Myanmar would be a radical triple win for businesses, the poor and the government. When inclusive businesses succeed not only does the company profit, but the poor gain through improved income or services, as does the government through more inclusive growth and a reduction in poverty levels,” she said.
Inclusive business (IB) is an approach in promoting fairer economic growth by having the private sector to bring about opportunities for the poor. Inclusive businesses refer to commercially viable companies whose core business is to offer innovative and systemic solutions for poor and low-income people.
IB should benefit the communities regardless of locations and income-level, according to U Maung Maung Ley, UMFCCI vice president.
“My hope is that our work on inclusive business can do more than just transform the economy for the poorest. But that by spreading prosperity around the whole of Myanmar, we can also promote peace and stability in many of the areas affected by conflict in our country,” he highlighted.
Inclusive business is a new concept in the country and the notion of engaging the poor through core business activities is not yet established. In addition, Nay Pyi Taw is keen for IB models to generate income and services for the bottom 40 percent of income earners.
DaNa is currently undertaking an inclusive business market scoping study, which examines 50 inclusive business investment projects, of which 21 could create more than 50,000 new well-paid jobs by 2020 and provide social and infrastructure services to millions of poor and low-income people in the country. The study will include a draft framework with eight policy recommendations.
IB is not CSR
“Inclusive business can affect poverty reduction and is different from Corporate Social Responsibility [CSR],” Dr Aung Thura, vice president of MYEA, stated. He explained that CSR refers to donation from a company but IB is about doing business at a grass-root level. IB businesses have taken off in countries such as the Philippines, but the concept is still largely novel to the business community in Myanmar.
“IB businesses which are certified can enjoy incentives such as tax reduction and other benefits. This practice started from G20 countries and now Myanmar is promoting this by partnering with local and international organisations,” U Htun Htun Naing, MYEA president, remarked. He also agreed that many domestic firms confuse the IB concept with CSR.
For the Directorate of Investment and Company Registration (DICA), agriculture should be the top IB priority, followed by microfinance institutions, power supply in rural areas, retail businesses and so on. Agriculture sector hires the most number of people and is in desperate need of revamp and revival, so farmers can improve their income level.
“The agricultural sector is vital in Myanmar because most of the people in the industry are poor. Thus, implementing IB should be the first priority in order to raise the income of farmers,” U Than Aung Kyaw, DICA deputy director general, noted.
DaNa, funded by the UK Department for International Development (DFID), is a 4.5-year programme which supports inclusive economic growth and private sector development in Myanmar. DFID’s budget for Myanmar in 2017-18 is £110 million (US$152.4 million), and the department extensively supports work through multi-donor agencies.