|Fiscal year||1 October – 30 September|
|Trade organizations||WTO, ASEAN, BMISTEC|
|GDP||$224.4 billion (PPP)|
|GDP rank||75th (nominal)|
|GDP per capita||$4800 (PPP)|
|Labor Force||32.53 million|
|Main industries||Agricultural processing; wood and wood products; copper, tin, tungsten, iron; cement, construction materials, pharmaceuticals; fertilizer; petroleum and natural gas; garments, jade and gems|
|Export goods||Natural gas, wood products, pulses, beans, fish, rice, clothing, jade and gems|
|Main export partners||Thailand, India, China, Japan|
|Import goods||Fabric, petroleum products, plastics, fertilizer, machinery, transport equipment, cement, construction materials, crude oil; food products, edible oil|
|Main import partners||China, Thailand, Singapore, South Korea, Japan, Malaysia|
The economy of Myanmar is an emerging economy with an estimated nominal GDP of $59.43 billion and a purchasing power adjusted GDP of $111.1 billion. Real growth rate is estimated at 5.5% for the 2011 fiscal year.
The major agricultural produce is rice which covers about 60% of the country’s total cultivated land area. Rubber plantations are being promoted in areas of high elevation like Mong Mao. Sugar plantations are grown in the lowlands such as Mong Pawk District.
Myanmar has very large capacity in Asean member countries and also facing fast liberalization and heavy competition. There are new demands from manufacturing industry. Currently, Myanmar has attracted investment from Thai, Malaysian, Filipino, Russian, Australian, Indian, and Singaporean companies.
Japanese Prime Minister Shinzo Abe has identified Burma as economically attractive market that will help stimulate the Japanese economy. Among its various enterprises, Japan is helping build the Thilawa Port, which is part of the Thilawa Special Economic Zone, and helping fix the electricity supply in Yangon.
Japan’s three largest banks Bank of Tokyo-Mitsubishi UFJ (BTMU), Sumitomo Mitsui Banking Corp and Mizuho Bank enter into Myanmar in October 2014.
Many companies found the Myanmar focus motivated by the opportunities arising from Myanmar’s growing middle class and significant business opportunities arising from the rapid modernization.
|No.||Country||US$ in mil||%|
|6||Republic of Korea||3,231||6.08|
Foreign investments by Country as of 31 January 2015
|No.||Industry||US$ in mil||%|
|2||Oil and gas||16,993||31.96|
|4||Transport & communication||3,183||5.99|
|7||Hotel and tourism||2,148||4.04|
|8||Livestock & fisheries||453||0.85|
Foreign investments by sector as of 31 January 2015
Industries of Myanmar by categories
|Competitive Industries||Potential Industries||Basic Industries|
|Food and Beverages||Automobile Parts||Agricultural Machinery|
|Garment and Textile||Industrial Materials||Agricultural Fertilizer|
|Household Woodwork||Minerals and Crude Oil||Machinery and spare parts|
|Gems and Jewelry||Pharmaceutical||Electrical and Electronics|
|Construction Materials||Paper and Publishing||Renewable Energy|
|House Hold products|
Small and medium-sized enterprises are businesses whose personnel numbers fall below certain limits. Small enterprises outnumber large companies by a wide margin and also employ many more people. SMEs are also said to be responsible for driving innovation and competition in many economic sectors.
Capacity building, creating partnerships, and adopting collaborative approach will give certain benefits to local SMEs.
Container Movement (2009 – 2014)
Percentage of Sector Contribution to GDP
|Transport & comm||14%||13%||13%||15%||15.0%|
Foreign direct investment (FDI)
A foreign direct investment (FDI) is a controlling ownership in a business enterprise in one country by an entity based in another country.
View of FDI
- Need more time to learn and research
- To understand Myanmar market and its opportunities
- Need to know Myanmar business scene
- Long term in sustainable and its socially responsible
- Transparency and risk involved in value chain operation in the region
Trade facilitation benefit
- Increase FDI
- Abilities to use the market access
- Increase transparency and predictability
- Facilitate just – in – time economy
- Improve security and reduce corruption
- Enhance the economic development
Border Trade Facilitation
- One stop service at 15 border trade posts
- Strengthen the bilateral trade relation
- Collaboration with various department concerned
- Fast moving of goods and passenger across border
- SEZ should be implemented along the border
- Wide enough bonded areas
- Dry port is also considered for development
- Identified type of trucks and loading capacity
- Traffic policy must clearly inform to each countries
- Exchange of information and consultation should be carried out frequently
- Necessary to think how to accommodate the truck (container trailer)
- Barriers and Issues
Information Data Exchange
– Not adequate
– Not clear rule and regulation
– No coordination between SMEs
– Insufficient Communication
- Lack of PPP for Infrastructure (IT) & Transport
No Access to modern financial tools
No automated systems in custom procedures
Registration is required to conduct new service
Still need prior license or permit for Export and Import
Rural connectivity & Regional Connectivity
Low Integration of Sub-sectors
Lack of sector support
Absence of transport policy and traffic regulation
Construction standards of primary road
Inefficient institution and technology constitution
Accessing to financing with high interest rates
- Myanmar Business Opportunities
Over the past four years, the Myanmar Government has introduced a series of reforms designed to improve the business climate and provide more favorable conditions for foreign business entering the market. A number of laws and regulations, including Myanmar’s Foreign Investment Law and mining legislation, are under revision. The government has been holding sectoral information sessions to engage potentially interested firms in the reform process and clarify foreign business entry and investment procedures.
Myanmar is considered amongst the top investment destinations in ASEAN for 2015, with growth forecast at 8.5 percent and with a quarter of the population living in large cities by 2030, according to the UOB Asian Enterprise Survey 2014 conducted by the United Overseas Bank (UOB).
Myanmar being an emerging market presents many opportunities in infrastructure related industries such as:
Myanmar has come a long way in the last few years in terms of telecom business. Since the start of the operations by Ooredoo and Telenor subscribers have rolled in by the millions. By July 2015, Telenor boasted more than 10 million subscribers and Ooredoo more than 5 million. MPT remains the leading operator with more than 14 million subscribers.
- Mobile tower construction
A massive rollout of telecoms infrastructure has begun ahead of the anticipated launch of mobile phone service by Ooredoo and Telenor.
Network planning and engineering
Network planning and designing involves complexities that could impact existing operations for communication service providers. Demand for increased network capacity requires optimal network planning and designing that ensures cross-functional and flexible networks.
Subsea cable engineering, laying and installation
Undersea fiber optic cables connect most of the world’s people, businesses and institutions, not satellites. Lying on ocean floors, these submarine cable systems carry the vast majority of our international communications and data. Together, they form the backbone for the data centers powering the world wide web.
Optical Fiber engineering, laying and installation to residential, commercial and industrial zones.
Today’s fast-paced business world means it’s essential to keep up with the rest of your industry. Effective communication with colleagues, customers and suppliers is key to success.
Internet Service Providers
This business provides services for accessing, using, or participating in the Internet.
Public Wi-Fi rollout over large area e.g. airport, hotel, convention center, downtown, subway, etc.
In addition to the fast Internet, get the fastest WiFi connection for your customers.
The power generation business constructs and owns power generation facilities, and sells the electricity it generates to electricity companies or other customers mostly based on long-term contracts.
- Independent Power Producer
An independent power producer is a business which owns facilities to generate electric power for sale to utilities and end users. They may be privately held facilities, corporations, cooperatives such as rural solar or wind energy producers, and non-energy industrial concerns capable of feeding excess energy into the system.
- Power Grid – distribution, planning and operation
A Power grid is an interconnected network for delivering electricity from suppliers to consumers. It consists of generating stations that produce electrical power, high-voltage transmission lines that carry power from distant sources to demand centers, and distribution lines that connect individual customers.
- Green Energy Solution e.g. Natural Gas, Solar and Wind
Green Energy Solution to provide energy in four important areas: electricity generation, air and water heating/cooling, transportation, and rural (off-grid) energy services.
Hydroelectricity is the production of electrical power through the use of the gravitational force of falling or flowing water.
3.Oil and Gas extraction, mining and related technology services
Oil and Gas Extraction is the exploration and production of petroleum and natural gas from wells. The industry generates wastewater from the water extracted from the geological formations and from chemicals used during exploration, well drilling and production of oil and gas.
Industries in the Oil and Gas Extraction subsector operate and/or develop oil and gas field properties. Such activities may include exploration for crude petroleum and natural gas; drilling, completing, and equipping wells; operating separators, emulsion breakers, desilting equipment, and field gathering lines for crude petroleum and natural gas; and all other activities in the preparation of oil and gas up to the point of shipment from the producing property. This subsector includes the production of crude petroleum, the mining and extraction of oil from oil shale and oil sands, and the production of natural gas, sulfur recovery from natural gas, and recovery of hydrocarbon liquids.
Mining is extracting naturally occurring minerals. These can be solids, such as coal and ores; liquids, such as crude petroleum; and gases, such as natural gas.
4. Building and Construction
The opening of Myanmar’s economy has led to a proliferation of mega-projects in the past four years, including the upgrade of infrastructure and the expansion of utilities. The government has embarked on projects to upgrade, broaden and build a long list of facilities, ranging from roads to bridges, seaports to airports, hotels to malls, high rises to apartments and hydroelectric dams to electric plants
- Urban planning, building and management
Urban planning is a process concerned with the use of land, protection and use of the environment, public welfare, and the design of the urban environment, including air, water, and the infrastructure passing into and out of urban areas such as transportation, communications, and distribution networks.
- SEZ & industrial park planning, building and management
Special Economic Zones (SEZs) are geographically designated areas of a country set aside for specifically targeted economic activities.
Industrial park planning can be divided into four management tasks: Site selection and feasibility assessment; industrial park planning, design, and construction; leasing and sale and sale of land; and industrial park management.
Building and management is the coordination of space, infrastructure, people and organization, often associated with the administration of office blocks, arenas, schools, sporting complexes, convention centers, shopping complexes, hospitals, hotels, manufacturing, shipping, etc.
- Building of transportation system such as airports, sea ports, rails, roads and bridges.
Transportation systems are essential to provide innovative services relating to different modes of transport and traffic management.
5. Hotel & Tourism
Hotel and tourism is the business of attracting, accommodating, and entertaining tourists, and the business of operating tours. Tourism industry has been identified as a growth sector attracting strong international investment interest. It also includes investing in tourism related transport service such as tour buses, limousine, etc., investing in tourism related novelty programs such as hot air balloons, river cruises, glass bottom boats, amphibious vessels, cable car system at scenic mountainous areas, helicopters tour, etc.
Myanmar’s fast-growing economy, its need for infrastructural development, competitive labor costs and young and vibrant workforce make Myanmar an attractive expansion destination for our manufacturing business.
The industries of greatest interest seem to be the automotive and food & beverage industries, followed by IT, shipping, construction, logistics and utilities, with Hong Kong, Thai, Chinese and Malaysian firms spearheading the push into Myanmar, according to Finance Asia.
- Food Industries
The food industry comprises a complex network of activities pertaining to the supply, consumption, and catering of food products and services across the world. Finished food products and partially prepared ‘instant’ food packets are also a part of the food industry. With the abundance of raw materials, Myanmar can develop innovative food products targeted for the developed markets.
- Building materials required by the building industry in Myanmar e.g. cement, bricks, steel, glass, paints, doors, windows, etc.
The manufacture of building materials is an established industry in many countries and the use of these materials is typically segmented into specific specialty trades, such as carpentry, insulation, plumbing, and roofing work. The construction sector is also an interesting phase of its evolution.
- Pharmaceutical products required by Myanmar
Pharmaceutical products – more commonly known as medicines or drugs – are a fundamental component of both modern and traditional medicine.
- Garment, toy, stationery, etc. manufacturing
The garment industry consists of firms that manufacture and sell clothing and garments. The garment industry is a major contributor to the economies of many countries.
- Wood design & processing – investment in value adding process such as design, furniture making, plywood factory, etc.
- Jade & Gem design and processing – investment in value adding process such as design, cutting and polishing and processing
7. Retail Service Business
The retail services industry provides an openly competitive environment that fosters strong business operations and spurs innovations that increase efficiency and reliability.
- Restaurant and café
From steakhouses to sub shops, more and more restaurants and cafés are popping up in cities every day.
- Lifestyle spa, slimming and beauty salon
Beauty salon and spa business has grown rapidly over the past decade.
- High tech laundry and cleaning business; high tech printing business, etc.
Opening dry cleaning and laundry service can be challenging and labor intensive. With careful planning, adequate financing and strong customer service skills, you can open and operate your own business in this growing industry.
8. Financial and Professional Services
In this new era of greater risk management, board scrutiny and regulatory compliance, financial services firms need access to the brightest, most trustworthy executives with extensive experience and skills. Elaborately interconnected, the world of financial services evolves every day.
9. Trading via a JV with Myanmar citizen
Most joint-ventures are setup under Foreign Investment Law (FIL) as the local partner normally provides the land, manufacturing or service facilities and local distribution while the foreign partner provides the technology, brand name and the management know how.
The foreign investor must own at least 35% of the shares.
Capital required for manufacturing JV is USD 500,000, for a service JV it is USD 300,000.
Proposed joint ventures will need to be approved by the MIC under the FIL.
Government is also encouraging FDI with all the ways possible. There are tax incentives for FDI –
- Exemption or relief from income tax on profit which is reinvested within one year.
- Relief from income tax up to 50 percent on the profit from exports.
- Right to pay income tax on behalf of the foreign employees and to deduct the same from the assessable income of the enterprise.
- Right to deduct the research and development expenditure.
- Right to accelerate depreciation.
- Right to carry forward and set off loses up to 3 consecutive years, from the year the loss is sustained.
Also if you import machinery, equipment, you can get exemption of customs duties at the construction period. For raw material, you get exemption for first 3 years of commercial production.
If you want to invest in SEZs you will also get 5 years of tax holiday. For second 5 years, you get 50% relief on income tax – overseas sale products. For third 5 years, you get 50% relief on income tax – reinvestment obtained from export sale. And more are about to come.
Now government also guarantees no nationalization, expropriation, no termination during the permitted period, and right to repatriation.
With geographical advantages, abundant workforce and rich resources, investing in Myanmar is a golden opportunity that you should not miss.