Myanmar’s explosive economic growth and untapped potential have led many investors to dub the country as “Asia’s final frontier.” The “opening up” of the country, first set in play in 2011 with a set of transformative economic and political reforms by the previous government of Thein Sein, caught much of the world off guard – and with good reason.
After decades of isolation and a ruinous period of brutal military dictatorship, Myanmar finally came in from the cold. To the world’s further surprise – and to give context to just how fast the pace of reform has been – nationwide democratic elections last year pushed the military-backed Union Solidarity and Development Party (USDP) from power, with a government led by Aung San Suu Kyi’s National League for Democracy (NLD) taking office in April; Myanmar’s first truly civilian-led government in over half a century. In less than six years, the country has come from international isolation, pariah status, and a 2010 general election that the UN dubbed “deeply flawed” to become Asia’s newest fledgling democracy and the world’s fastest-growing economy, according to the IMF.
Despite breakneck economic growth of around 8 percent year-on-year, the country faces serious challenges and a lot of catching up to do. Sixty years of economic isolation and mismanagement has left a mark. Myanmar is the poorest country in Southeast Asia, has the lowest life expectancy, and the second-highest rate of infant and child mortality. Basic infrastructure also presents a huge challenge, with just one-third of the population having access to electricity and road density standing at just 220 kilometers per 1,000 square kilometers of land, according to figures from the World Bank. A lack of clear land ownership, difficulties accessing commercial credit, poor port and road infrastructure, and a large skills gap also top the laundry list of investor gripes.
The Clock Is Ticking
The challenges may be many, but the opportunities are greater still. Young demographics, cheap labor costs, huge untapped domestic consumption with a population of around 60 million, and the geographic advantage of being the largest country in mainland Southeast Asia – sandwiched between the Asian giants of China and India – make Myanmar well positioned to reclaim its crown as a regional trading hub. Colonial Burma was once the richest and most advanced country in Southeast Asia, with Rangoon serving as Britain’s primary trading port and transport gateway to the region. A rich endowment of natural resources – including minerals, oil and gas, teak wood, and agricultural products – add to the bright prospectus for adventurous investors and entrepreneurial businesses seeking new markets and areas of growth.
Robert Easson, CEO of the British Chamber of Commerce in Myanmar, is bullish on the country’s potential and scathing of investors who continue to “wait and see,” saying that foreign investors and businesses are “now running out of excuses” not to do business in and with Myanmar.