WITH a clear road map leading the way toward economic and political development, Myanmar has become a beacon of hope for a growing number of foreign investors lured by the promise of riches in the years to come. With that in mind, the Thai ambassador to Myanmar has suggested that Thai entrepreneurs jump on the bandwagon and rethink their strategies about doing business in this neighbouring country.
Pisanu Suvanajata said the Myanmar government has developed a promising road map for the country’s political and economic reform, so the time is right for Thai companies to invest.
“Political reform started in 2008 with a new constitution, which was followed by a general election in 2010 and a by-election two years later. In the meantime, Myanmar stepped up and created global integration by improving its foreign relations. The result of that was the lifting of sanctions by the West,” Pisanu explained.
Pisanu also said the November 8 general election was another indicator that the road map was on track with almost 90 parties contesting polls under the watchful eye of international bodies. In addition to this, the peace process is also underway. The government has signed a national cease-fire agreement with rebels and began political dialogue with relevant parties.
He suggested that Thai business enterprises should have a strong presence in Myanmar, which has a population of 51.4-million people. They should establish a business here instead of monitoring the development in Myanmar from home, he said.
Competition in Myanmar has become intense with active overseas investors from Japan, China, South Korea, Singapore, Hong Kong, some European countries and the United States.
“If Thai entrepreneurs stay in their own comfort area at home, there will possibly be no room for them in the near future,” he stressed.
In 2012, Thailand was ranked number 2 in terms of trade value, followed by Hong Kong, South Korea and Japan. But this year, with the fierce competition, Thailand has fallen to number 6.
However, import value from Thailand is still on the rise. Last year, it surged to US$4.23 billion from 2013. In terms of investment, the Directorate of Investment and Company Administration in Myanmar also witnessed an increase of Thai Investments. In fiscal year of 2014-2015, Thai investment value surged to US$3.14 billion from 2013/14 (US$489.07 million) and from 2012/13 (US$1.3 million).
The economic climate in Myanmar is healthy, the ambassador said, and it is ready to leapfrog development with 8 per cent growth per annum in five consecutive years. The country also welcomes more foreign direct investment through modernised trade and investment regulations and newly adjusted monetary and financial systems and privatisation.
By the end of this year, the stock exchange of Myanmar will be opened.
He said the information technology (IT) development was a good example of Myanmar’s rapid success.
“Myanmar went from zero to 2 million registered phone numbers in the last three years. In the near future, it will enter the 5G wireless network,” he said.
After the elections this month, a coalition government is expected to be formed. The foreign and economic policy is not expected to change that much.
“You know, some foreign investors are taking a wait-and-see approach in Yangon in case they possibly get an opportunity for a windfall,” he added.
Vichai Kanrahong, a counsellor based in Yangon, suggested that Thai companies focus on construction due to the high demand of buildings and the government’s policy to allow developers to construct over 700 high-rise buildings, a huge increase from the 250 sites permitted the previous year.
Given this real estate development, a lot of opportunities have been presented to Thai firms in related businesses such as furniture, construction equipment and lifestyle products, he said.
Meanwhile, Myanmar has the potential to become a manufacturing hub for Thai companies that want to take advantage of the generalised scheme of preferences (GSP) from the EU.
Myanmar is also a link between the Asia Pacific and the Indian Subcontinent. Located on the outskirts of Yangon, Thilawa Special Economic Zone will be a hub of manufacturing, electronics, computers and automobiles.