Myanmar has been touted as the next exciting country to see rapid economic development. Being a skeptic, I wanted to observe it myself and the only way is to set foot onto the busiest city in Myanmar, Yangon. Please note that this personal account was not a comprehensive view of Myanmar, or even Yangon, as I only spent four days mostly in the Chinatown region of Yangon.
A few fun facts first
Road directions were built for left-hand drives, but cars are mainly right-hand drives. Myanmar used to be a British colony and should have their road built for right-hand drive like the rest of the Commonwealth countries. However, apparently the roads were already laid in Myanmar since the advent of automobile and it has always been left-hand drive directions. President Ne Win in 1970 set the traffic law to switch to right-hand drive cars subsequently with reasons unknown. Hence, Myanmar ended up in a weird situation today.
Myanmar has shifted their capital from Yangon to Naypyidaw on 6 Nov 2005. Whatever we learned in school can change and it was a good update on my Geography.
Citizens of Myanmar are also called Myanmar. There’s no such names such as Myanmese or Myanmarese. You can also refer them as Burmese but technically, Burmese is a major ethnic group in Myanmar and not all Myanmar are Burmese.
Myanmar (people) have no surname but a given name only. The people who are born in a particular day will follow a certain naming, and by the name they will know which day the person is born in. This is possibly more useful for them as Buddhists because there is a symbolic animal to pray to for the day that you are born.
In Myanmar, you would not fail to notice the ladies have yellow substance applied on their faces. This yellow substance is the powder of Thanaka tree bark. The purpose is to keep the skin cool and was believed to keep the skin smooth. Moreover, there is a scent that is similar to sandalwood.
Myanmar was under U.S. sanctions and many big American corporations have not infiltrated the business scene in Myanmar yet. Many sole proprietors tend their stalls, be it news stands, provision shops, fruit and vegetable stalls, and tea shops. There aren’t many beggars in the streets during my trip but it may just be a very localised area. Oxfam, a non-profit organisation who fights against poverty, was holding meetings at the hotel that I was staying. So I believe there are many Myanmar living below poverty else unlikely the organisation has been stationed there.
Myanmar is opening up to foreign investments and businesses. The very first U.S. fast food chain, KFC, was opened in Yangon just last month. It was very popular among the locals and the restaurant crowds. The franchise was operated by Yoma Strategic, which is listed on SGX. I got a two-piece meal at 3,500 kyats, which is equivalent to S$3.90. Half the price of what you can get in Singapore.
While there were no McDonalds’ and Starbucks, there were quite a number of Singapore brands that I have observed in Yangon. The three local banks (DBS, OCBC and UOB) have presence there. I saw Ya Kun outlet at the airport and spotted Charles & Keith at a mall. Tiger beer and Super were amongst the Singapore brands in the supermarket. This article was pretty much aligned to what I have observed in Myanmar.
I am not sure whether there is an indeed rising middle class in Myanmar to patronise these businesses. I see iPhones in the hands of locals but it isn’t a common sight. The joint venture among Yoma, Parkson Retail Asia (listed on SGX) and First Myanmar Investments (FMI in short, owned by Serge Pun, who owns a big conglomerate in Myanmar), established a Parkson departmental store in Yangon. I visited the store and it was extremely deserted. It was a weekday and I am not sure if the sales are also dismayed during the weekends. But my point is, I do not see how the locals are buying things from these businesses.
I somehow believe these businesses are more likely to serve the expats, who are coming to Myanmar to operate businesses, in the hope of new opportunities. It is unlikely to serve tourists because tourism in Myanmar has not been a big contributor to their GDP. I hardly saw any tourists during the visit. ASEAN statistics showed that Myanmar only did 900,000 visitor count in 2013, ranked second from the bottom of the 10 ASEAN countries.
Singaporeans are require to apply for Visa prior to visiting Myanmar by the way.
If the wealth is not transferred to the Myanmar people, there will be no spending power to support these businesses. How the elections unfold and how the government manages the country would be a key factor whether these foreign direct investments will prove to be profitable.
Culture – Food, Transport, People
Most do not know how to speak complete sentences of English but are able to understand and respond with a few words.
Food is cheap is probably an understatement. Dinner for two was about 2,300 kyats (S$2.60), inclusive of one plate of fried rice and one plate of fried noodles, cooked in ‘zi char’ style in Singapore which would have cost at least S$7 in total. A typical meal is about S$1+ and your expenses in Yangon is going to be extremely low during the tour. The cuisine are similar to any other Indochina country.
Beer is cheap too, cost less than S$1 for a can. The top beer is Myanmar beer. There are other local beer brands like Andaman, Mandalay, Yoma (by Carlsberg) and imported Tiger Beer. Heineken is venturing into the market soon. Being devoted Buddhists, I wondered how many locals are frequent consumers of alcohol.
The locals mainly travel by bus and train. In Yangon, there is a metro train known as the circular train. Tourists pay for 1,000 kyats (S$1+) and the locals pay lower than that. The ticket is valid for the whole day. The train will take 3 hours to go through all the stations and end up in the Yangon Central Railway Station.
The train is old and the tracks are uneven. I could feel the train roll side to side all the time. It is definitely poorly maintained. The train stopped in one of the stations nearing the end point and many passengers decided to get off and take alternative modes of transport to reach their destinations. I am not sure how often that happens. Since no one complained I assume it is a common sight.
There were numerous Japanese signs in the cabin and I suspect some of the trains were previously used in Japan and handed over or sold to Myanmar.
What was more disturbing was that the journey around Yangon were scenes of poor people staying in dilapidated houses with poor sanitation. Heaps of rubbish piled along the rail track. Due to heavy rain, some of the houses also experienced flooding.
Toyota rules the roads in Myanmar and taxis are aplenty. I could easily flag down a cab anywhere and relatively cheaper fares than most other countries. There is no meter and fares have to be negotiated. A short trip less than 5km can be as low as 1,500 kyats (S$1.60). Rarely the drivers would quote an unfair price. There was even a kind driver who drove back to return the umbrella that I left in the cab.
If tourism is to boom in Myanmar, taxi fares and food prices are likely to increase. The neighbouring Thailand would offer a good price level of what Myanmar can cost in the future with the rise in tourism.
Conclusion – Is Myanmar worth investing?
You should have got the hint as you read through this article.
In terms of potential, Myanmar has a lot of it as many areas are undeveloped and many Multinational Companies have no presence in this country as yet. Most of the people are making money as sole proprietors of their own businesses. When more big brands come into Myanmar, they must be able to create jobs for the locals and pay them fairly. The former is always a given but the latter is not.
In exchange, the locals will have greater wealth to spend on goods and services provided by these businesses. When the big firms succeed and the level of wealth increased, the sole proprietors would lose their businesses. The Government would then have a widening rich-poor gap to deal with.
But first, putting people to jobs and ensuring wealth is transferred to them is already a daunting task to begin with. The election at the end of the year would be the focus of many people, not just the locals. But election is one thing, more importantly is the governance after the election that matters.
CEO of Dr Wealth. Built a business to empower DIY investors to make better investments. A believer of the Factor-based Investing approach and runs a Multi-Factor Portfolio that taps on the Value, Size, and Profitability Factors. Conducts the flagship Intelligent Investor Immersive program under Dr Wealth. An author of Secrets of Singapore Trading Gurus and Singapore Permanent Portfolio. Featured on various media such as MoneyFM 89.3, Kiss92, Straits Times and Lianhe Zaobao. Given talks at events organised by SGX, DBS, CPF and many others.