GRAPE VINE

JAPAN INC. BEARISH ON BURMA

Source : Far Eastern Economic Review, May 18, 2000

In a bid to strengthen Japan's economic ties with Burma, Trade Minister Takashi Fukuya unveiled a package of aid measures during an early-May visit, the first trip to Burma by a sitting cabinet minister in 17 years. The initiatives include economic assistance to support the development of small and medium-sized businesses, promote greater access to electricity in rural areas and set up information-technology training programmes.

Japanese officials also say Fukuya prodded Lt.-Gen. Khin Nyunt, first secretary of Burma's State Peace and Development Council, to improve the investment environment for foreign firms.

But it may be too late for many Japanese companies. Ajinomoto and Toyota Motor, for example, appear to be losing patience with the Burmese government. Food-products maker Ajinomoto has halted production at a local factory after it was denied permission to import a key ingredient. Toyota Motor has "temporarily" withdrawn its Japanese representative while it awaits approval to ship cars to Burma. Meanwhile, All Nippon Airways cancelled its direct flight service to Rangoon in March, citing low demand.