Mar 19, 2012

Thai firms urged to tap Myanmar rise

Thai businesses are being urged to change their mindset about Myanmar, as most still see the country as closed to foreign investment, full of obstacles and languishing under a military government.

"Such an understanding is not correct, as Myanmar is now moving very quickly to better political sentiment as indicated by the byelection to be held in early April," said Prajuab Supinee, director of the Thai Trade Office in Yangon.

"Thai businessmen should look at Myanmar as a country of opportunity, although it still lacks efficient investment-related rules and regulations. They should take the first step though business matching with local operators."

For those Thai executives who are enthusiastic about Myanmar but have only the vaguest idea of how to do business, Mr Prajuab's advice is to trust the Myanmar people, as they are not cheaters by nature and want sincere friends to work with in business.

He predicts a quick change in Myanmar over the next few years on rising demand for imported products, particularly from Thailand, as the people's economic situation improves.

Myanmar used to get 200,000 to 300,000 tourists a year, but the number rose to 1 million last year, with each tourist spending 20,000 to 30,000 baht. Hotel rooms and flights are insufficient, resulting in rising expenses for visitors.

Mr Prajuab said firms in Myanmar are controlled largely by five conglomerates _ the Htoo Group for airlines, construction and agriculture; the Yusana Group for integrated agriculture; the Asian World Group for construction and infrastructure; the Max Group for road construction (partnering with Italian-Thai Development Plc); and the KBZ Group for airlines and retail.

Ukrit Archapairoj of Kasikornbank's corporate business division said Myanmar people and Thais have similar tastes, so Thai companies able to supply similar products will have an opportunity to expand their market.
Business in Myanmar is done mostly by cash. The government must improve exchange by reducing the gap between the official and the black-market rates to create stability and generate more trade.
Mr Ukrit said Thailand is falling behind other foreign investors in Myanmar such as the Chinese, Japanese, South Koreans and Singaporeans despite being right next door.

Maung Maung Lay, a vice-president of Myanmar's Federation of Chambers of Commerce and Industry, said the US is expected to lift economic sanctions either partly or wholly after that country's November elections.

"Several Democratic and Republican representatives have visited Myanmar, and they were satisfied with the improvement," he said.

"Myanmar will move faster and try hard to develop human resources. We can't live alone. In 2014, Myanmar will lead the Asean meeting. Investment in Myanmar will be challenges and opportunities."
Maung Maung Lay said the Myanmar government's new rules and laws promoting investment and financial services will be unveiled next month.

"Thailand is closely connected with the Myanmar people, and people of the two countries share the same goal and common faith in Buddhism," he said.

"Nothing is much different, so we can stay together and work together."

Given lingering concerns about whether Myanmar will have a real opening, Maung Maung Lay said Myanmar has no way to move but forward, as the government realised the country has lagged behind the region by 50-60 years.

Source: Bangkok Post