Jan 11, 2013

S'pore companies see potential business opportunities in Myanmar

Myanmar's recent political and economic reforms have made it a popular destination for Singapore businesses looking to venture overseas.

Experts said local firms would do well to explore business opportunities in sectors such as tourism, hospitality, infrastructure and manufacturing.

Singapore-based company Kino Biotech has partnered a distributor to enter Myanmar's S$490 million health and beauty market.

The firm expects its new business to grow 30 per cent annually.

The company said finding a reliable local partner is key to help it navigate the unfamiliar market.

Kino Biotech's executive chairman Ting Yen Hock said: "The immediate challenges would be the regulatory framework, getting our product registered and the process. All this is in the black box because we're learning and whether it will change overnight, we're not sure.

"We are very fortunate to work with a distributor that is very knowledgeable. At this point of time, there're not many competitors out there so we have the first mover advantage being out there first."

Besides regulatory concerns, economists said the lack of infrastructure in various essential services such as transport, power supply and telecommunication may hamper Myanmar's growth.

Meanwhile, experts said there are investment opportunities in hospitality, utilities and industrial infrastructure.

Companies looking for a low cost production base could also consider expanding into the country.

Edward Lee, a senior economist at Standard Chartered Bank, said: "There is a huge potential in terms of labour supply which is really cheap. So if you're an industry that is looking to sell or meet consumer demand or if you're company looking for manufacturing base that is relatively low in cost, these are potential opportunities besides their natural resources and mining advantage."

According to StanChart, Myanmar's economy is expected to grow by 6.4 per cent in 2013, compared to 6.2 per cent in 2012.

Source: Channel News Asia