Myanmar Land of Opportunities and Challenges

2016

2

What are the associations?

U.S.A U.K.

China Myanmar

Aung San Suu Kyi

Where is Myanmar?

Myanmar’s Vital Statistics

Source: The World Bank/Myanmar Government

Population

-Male

-Female

53.96 mln

- 49.43%

- 50.57%

Area 676,577 sq. km

GDP Usd 46.947 bln (2012-13)

GDP annual growth rate 7.6% (as of March 2013)

Number of household 11.1 mln (2013)

Working population(age 15 & above)

31 mln (2013)

Youth population(age 15-24)

20 mln (2013)

Tourist arrivals Over 2 mln (2014)

Local system Common law

SME size 126,237 (99.4%)

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In US Dollar in Million

No TOP 10 Exports Value

1 Natural Gas 2,522.5

2 Jade 2,204.9

3 Matpe ( Black Gram Bean ) 458.6

4 Garment 381.1

5 Fish 306.0

6 Rubber 302.0

7 Teak Log 292.3

8 Green Mung Bean 291.3

9 Hardwood Log 282.0

10 Rice 194.4

In US$ Million

No TOP 10 IMPORTS Value

1 Petroleum Products 1,463.0

2 Machinery & Spare Parts 873.7

3 Iron & Steel Construction materials 430.4

4 Plastic Raw Materials 202.1

5 Palm Oil 198.8

6 Vehicles & Spare Parts 197.1

7 Pharmaceuticals 188.3

8 Ships, Boats 180.4

9 Cement 167.8

10 Fertilizers 162.6

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Myanmar’s Exports & Imports

FDI in Myanmar by Sector, as of 31/10/2014

Sector Particulars

Permitted Enterprises

NumberApproved Amount

(in Usd mln)%

1 Power 8 19,324.54 38.48

2 Oil and gas 132 15,177.32 30.22

3 Manufacturing 416 4,640.91 9.24

4 Mining 69 2,863.18 5.7

5 Transport & communication 27 2,858.04 5.69

6 Hotel & tourism 57 2,154.59 4.29

7 Real estate 28 2,120.15 4.22

8 Livestock & fisheries 32 441.318 0.88

9 Agriculture 16 240.645 0.48

10 Industrial estate 3 193.113 0.38

11 Other services 22 169.697 0.34

12 Construction 2 37.767 0.08

812 50,221.27 100

Source: HKMCC

Myanmar’s Foreign Investments

Myanmar’s Priorities- in regard to itself

• Rural development and poverty reduction

• Agriculture development and industrialization

• Energy sector development

• Telecommunication development

• Micro-finance for rural people and SMEs

• Education and health sector development

• Human resource development

• Infrastructure development

• Building the Bangladesh-China-India-Myanmar

land bridge

• Counting Myanmar in building smooth, secure and efficient ocean routes to connect the major sea ports along the ROAD

• Including Myanmar in strengthening infrastructural connection, trade, investment, resource exploration, finance, ecology, culture, maritime development

• Maintaining the Ruili (Yunnan) – Kyaukpyu (Myanmar) oil and gas pipeline, 2013

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China’s Priorities - in regard to Myanmar

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MCL’s Priorities- in regard to Myanmar

Opportunities

Myanmar’s Market Development- relative to other Asean countries

11

• High value merchanise

• Daily necessities

• Low value merchandiseLaos

Cambodia

Myanmar

Indonesia

Philippines

Vietnam

Malaysia

Thailand

Myanmar’s Minimum Wage Level- relative to other Asean countries

12

• Myanmar : Usd100

• Cambodia : Usd140

• Vietnam : Usd156

Myanmar’s Import Sourcing- general merchandise

Yiwu inZhejiang

Guangzhou inGuangdong

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Myanmar’s Other Opportunities

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Other Import Logistics Opportunities

Myanmar Plaza

City Mart Holding

Myanmar Parkson

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MITT

MITT is about 25km

from city area

Yangon - Thilawa - MTT

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SEZ - 2,400 hectares

MITT

Yangon Thilawa－ MITT

Foreign Investment Law

100%

foreign

owned

Joint

venture

Any “system”

Included in

the Mutually

Agreed

Contract

1

2

3

18

A citizen or

concerned

Government

organisation

Starting Up Business - MMCL

• Documents requirements

Business Permit

Company Registration

• Capital requirement

Min. USD50,000

19

MMCL Team in Yangon

20

Myanmar’s Transport and Logistics

Supply Chain Integration

1960s 1970s 1980s

PhysicalDistribution

LogisticsConcepts

Supply Chain Management

Finance

ProductDevelopment

Customer Development

www.vietnamsupplychain

Logistics Plus

• Logistics services

22

LCL FCL

Land, Air, Ocean Freight

Break Bulk Out of Gauge

• CFS / Warehouse

23

Logistics Plus

Logistics Plus

• Value added services (import to Myanmar)

Supply Sourcing PO Management Cargo Inspection

LCL Consolidation

FCL

Customs ClearanceInspection/QuaranteeLandside Delivery

MMCL’s Overseas Network

China & Hong Kong

Japan & Korea

ASEAN

Italy

Australia & New Zealand

Challenges

27

Congested Roads & Terminals

YangonDown Town

YangonInner Port

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Monkey

Point

HTD (Hteedan)

AWPT

MIP SPW NANTHIDA BSW ICD 1 & 2

International wharveso Yangon Port – 17 wharveso Thilawa Port – 6 wharves

Total – 23 wharvesICD – 3 Depots

Yangon Inner Harbour – Terminals & ICDs

Competition- general merchandise logistics

Competition

from existing agents in China

30

Competition- FMCG logistics

Resources?

31

Myanmar’s Business Transaction- still cash based

Myanmese People and Culture

33

Government Effectiveness

Putting into perspective

Strengths 1. Strategic geo-political & commercial

location2. Opening up for business & investment3. Pragmatic leadership 4. Peaceful foreign policy5. Large and young population 6. Rich in natural resources

Weakness 1. Complex bureaucratic regulations & legal

issues 2. Rudimentary financial market 3. Inadequate infrastructures4. Limited industrial diversification5. Lack of international exposure 6. Insufficiency of skilled labour

Opportunities 1. On the Maritime Road2. Last frontier in ASEAN3. Connectivity with end-markets4. Strategic interest to China & USA5. Investment in infrastructure, tourism,

trade & commerce, education & ecology (the “green” vision)

Threat 1. Risks associated with reforms – economic,

social, and political 2. Negative impact on environment resulting

from massive industrialization3. Inflationary pressure resulting from rapid

economic expansion4. Conflict with ethnic minorities 5. External political forces impacting internal

political, social and economic stability 35

SWOT Analysis - Myanmar

36

On balance…

Put a Marker on this Land of Opportunities

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Communication

Shenzhen Shunde

Yangon

To follow up…

Myanmar Star

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www.mclhkg.com.hk

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A New Chapter in Myanmar

One Belt One Road

P P(People) (People)

G G(Government) (Government)

B B(Business) (Business)2

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Questions & Comments