One of the major challenges facing Myanmar when developing its economy and attracting new investment is insufficient access to electricity. And, as the economy continues to expand, the demand for power is also increasing.
Yangon based youngster, Nicky Min Ye Myat, does his shopping online. He’s 28 years old and following the global trend for Millennials to do most of their business over the internet.
He is a personal trainer and finds the selection and prices online better than the clothes available in the local shopping mall. Using popular ecommerce platform Alibaba Express, Nicky can find what he wants, quickly and easily.
In 2020, Hotel Okura, the hotel chain based in Japan, will open its first hotel in Myanmar. The project will be the company’s first in Myanmar and will centre around the construction of Okura Prestige Hotel in Yangon.
The huge amount of money needed for the government to supply electricity to the whole of Myanmar for 2017/2018 means that they are supplying this vital resource at a loss.
An amount of K300 billion is needed by the government to supply the electricity across the country, but according to U Myint Oo, the deputy director general of the Electricity and Energy Ministry’s Department of Electric Power, the government doesn’t have the funds.
There has been a move from the Securities Exchange Commission of Myanmar (SECM) to crack down on illegal trading and financial scams carried out by unlisted companies in Myanmar.
The SECM appealed to the public in July 2017 to gather information on a specific company trading in Mawlamine. The company is called I Smart Co and has been reported as engaging in suspicious trading in Ayeyarwady. The company has also been linked to Saxon Capital Limited (SCL), which was shut down due to illegal trading.
The government of Myanmar has recommended that more than one thousand small and medium sized businesses (SMEs) should come under consideration to receive bank loans. This information has been released by the Central Department of Small and Medium Enterprises Development (CDSMED) and is good news for the start-ups in the country.
The Ministry of Industry has 46,794 businesses officially signed up and registered with them, and have recommended that financial institutions offer loans to the selected enterprises after they conduct an assessment.
A new report by International Growth Centre (IGC), a research centre based in the UK, has stated that Myanmar’s economic development depends just as much on regional capitals as it does on the major cities of Yangon and Mandalay.
The report highlighted how important it is to develop secondary cities as part of the established plan for boosting the main cities in the country. The research centre is based at the LSE (London School of Economics and Political Science) and is partnered with Oxford University. It has offices in London and Yangon and has released the report called Urban Myanmar.
Strategic growth centres
The three main growth centres as part of the government’s economic strategy for Myanmar are Yangon, Mandalay and Nay Pyi Taw.
Yangon takes its place as a crucial growth centre as it leads the country’s financial and commercial services, as well as exports due to its ports. Mandalay is up there as it is a major trading hub for northern Myanmar and should play a big part in many initiatives. Nay Pyi Taw retains its importance due to being the centre for the government.
However, the main thrust of the report warns against relying too much on the development of Yangon’s economy. It argues that inclusive development is vital, including the growth of regional capitals and secondary cities.
Cities like Yangon attract a lot of investment from overseas and develop quickly. They are busy importing new technologies for manufacturing, for example, giving firms based there an advantage. This can be seen with the garment factories that are situated on the border of Yangon, as well as the industries thriving in the Thilawa Special Economic Zone.
Moving industry out beyond key cities
The report said that secondary cities need to be connected with their regional towns and the main tier cities. This, along with border town and agro-industrial centres being linked will help to allow production to spread away from the main cities.
Secondary cities should be seen as regional hubs that are strategically very important for commercial gain. Similarly, the development of towns on the borders of cities can help to boost trade and support a national identity for the country.
Urban planning vital
Along with these suggestions, the report also says that urban planning is the key to make sure that cities become hubs of economic activity rather than centres of congestion and problems.
The three channels that make productive urban areas:
- Deep local product and labour markets that allow workers and companies to find jobs or fill positions quickly.
- Higher wages that attract workers to the cities.
- Availability of intermediary services.
These have all contributed to the success of Yangon’s growing economy and workforce and need to be implemented in other cities, as well as regional towns for the growth of the country’s overall economy.
Experts from the International Finance Corporation (IFC) and the Securities and Exchange Commission of Myanmar (SECM) held a business forum at the Stock Exchange in Yangon recently. Its aim was to discuss the best ways to attract investment and increase stakeholder confidence.
Listed firms were invited to hear key speakers discuss disclosure and transparency standards in reporting. The conference was called Enhancing corporate transparency trends and a business case on transparent reporting and ongoing disclosure and was held with input from the UK Department for International Development and the Australian Department of Foreign Affairs and Trade.
A report (called the Observance of Standards and Codes or ROSC) from the World Bank and International Money Fund (IMF) has just been released.
Among its findings were that the revisions the government has made to its statutory institutional framework for accounting and financial reporting will align the country much more with international good practice. It praised the ‘good progress’ that has been made with the suggested amendments to the framework, but notes that these changes are yet to be finalised.
The UN Children’s Fund (UNICEF) has warned that while progress has been made in terms of economic growth in Myanmar, life is still difficult for children in remote areas.
A report by the United Nations shows that the government’s reforms and efforts at reconciliation and improving the economy still leave around 2.2 million kids in desperate need of humanitarian help. Most of these children are in the remote areas of the particularly conflict-ridden regions of the country.