Issue 63

With rich natural resources and its strategic location, Myanmar is an attractive destination for foreign investors from around the world including Thailand.

Several sectors in Myanmar’s burgeoning economy will demonstrate significant growth over the next few years, predicts a leading member of the Thai-Myanmar business community.

“Infrastructure, labour-intensive manufacturing, agricultural and fisheries and their processed products, tourism and telecommunications, and application development will be fast-growing industries in the next five years,” Nattawin Phongsphetrarat, vice president of the Thai Business Association of Myanmar (TBAM), says.

“Myanmar’s government has promoted investment in these sectors because they are crucial for the country’s development and these are promising opportunities for all foreign investors.”

Data from the Myanmar Investment Commission shows that total foreign investment in the country reached US$5.8 billion during the period between April 1, 2016 and January 31, 2017 while the government has set a target of US$6 billion for the current fiscal year, up to March 31. The top sectors include transport and telecoms, manufacturing, real estate and energy.

However, Phongsphetrarat believes that small and medium enterprise with less than US$8 million (300 million baht) of total annual revenue should better focus on cross-border trade. “Selling products is the best option for small businesses,” he says. “They can distribute them at the border areas between Thailand and Myanmar or export products to Yangon or Mandalay.”

As purchasing power in Myanmar is still limited, setting the right price is key. “Producers have to offer products in smaller sizes and cheaper because consumers cannot afford higher prices,” Phongsphetrarat explains. “Online tools such as Facebook and Viber influence urban consumer behaviour and their purchasing decision while consumers in rural areas prefer traditional markets.”

Moreover, businesses are advised to organise below-the-line marketing activities such as product demonstrations and testing to educate consumers and allow them to have direct experience with the products. He also believes it’s important to choose the right local partner and test the water before fully committing to one product.

“Business partners play a crucial role in the business’s success or failure. Foreign businesses can form a cluster before entering Myanmar, they can share offices and other resources which help them cut costs and penetrate the market faster and more effectively,” he says. “You should study the market thoroughly by visiting Myanmar to observe the market by yourself.”

TBAM is ready to assist companies who want to expand their business into Myanmar. Established in 1997, the association provides useful business and investment information and advice to both government and private sectors. It also helps strengthen relationships between Thailand’s businesses and other chambers of commerce in Myanmar.

“TBAM has worked closely with Thai government agencies including the DITP,” he says. “We have organised seminars in Myanmar almost every month and hosted meetings between Thai entrepreneurs and Myanmar representatives in particular government agencies and private organisations to enhance their understanding about business opportunities and challenges as well as promoting Thai businesses in Myanmar.”

Phongsphetrarat believes that Myanmar’s new investment law will provide better benefits to foreign investors and ease investment restrictions.

“There’s very good opportunities for Thai investors to expand their business in Myanmar as we have the advantage of geographic proximity and similar consumer behaviour,” he says. They [Myanmar consumers] also love Thai products and services. If you miss this great chance, you could not find something like this again.”

For more information, visit www.tbam1997.com

Words by Somhatai Mosika