Total Bilateral Trade between ASEAN and the US reached more than US$260 billion in 2018 with major ASEAN exports including electrical machinery, machinery, textiles and garments, and footwear.
ASEAN member countries have been promoting special economic zones (SEZ) to attract more foreign investment. SEZs can help facilitate greater trade between ASEAN and the US through various fiscal and non-fiscal incentives. SEZs – which include industrial parks, special export processing zones, technology parks, and innovation areas – gained increasing prominence after the establishment of the ASEAN Economic Community (AEC) in 2015, and more so now as a tool to attract US investors seeking to diversify their supply chains.
In ASEAN countries, Vietnam was the largest exporter to the US, amounting to US$49.2 billion in 2018, along with Malaysia (US$39.4 billion), Thailand (US$31.9 billion), Singapore (US$27 billion), and Indonesia (US$21 billion).
There are currently three SEZs in Myanmar; Thilawa SEZ in Yangon Region, Kyauk Phyu SEZ in Rakhine State and Dawei SEZ in the Thaninthary Region. Kyauk Phyu and Dawei SEZs are still under development. Total trade between Myanmar and the US is only valued at US$1.1 billion as of 2019 with major exports to the US are textile and garments and leather goods.
The Thilawa SEZ project was a joint venture between the Myanmar and Japanese government. 90 international firms have already moved into the zone since 2015, from a wide variety of sectors that range from ship building to garment manufacturing.
The Thilawa SEZ has also developed a one-stop service center to provide an efficient and effective service to foreign investors. The center is comprised of officials from 13 ministries and uses advanced technology to process business permits in addition to broadcasting important legal information.
Through its SEZs, the government has granted several tax exemptions and relief measures for investors. This includes zero CIT for the first eight years of operations and 50 percent tax relief for the next five years.