Myanmar’s Metamorphosis – The Impact of Internal and External Reforms on Myanmar’s Business Outlook
Myanmar’s opposition leader Aung San Suu Kyi’s National League for Democracy (NLD) has claimed a parliamentary majority in Myanmar’s historic elections. This win is backed by tremendous support from both local and foreign parties – ex-President Thein Sein has promised that his government “will respect the people’s decision and choice and will hand over power as scheduled,” while U.S. president Barack Obama praised what he called Ms. Suu Kyi’s “tireless efforts and sacrifice over so many years to promote a more inclusive, peaceful, and democratic Burma.”
Myanmar is poised to undergo sweeping political and social reforms that are expected to improve its already positive growth outlook. AmCham’s ASEAN Business Outlook Survey established that Myanmar is a priority market for future business expansion in the ASEAN region, as almost all (87%) respondents in Myanmar indicate that their companies plan to expand. Since Myanmar’s move towards democracy could facilitate the further lifting of U.S. sanctions, this will most likely be a catalyst for increased foreign investment in Myanmar, as more than 90% of survey respondents there stated that the sanctions have played a significant role in their investment decision. Taken together, these factors predict an increasing American presence in Myanmar which will promote the forging of stronger ties and increased cooperation between the two countries.
Besides internal restructuring, the attractiveness of the Myanmar market will also be strongly affected by the transformation of the ASEAN region due to the realization of the ASEAN Economic Community (AEC). Two-thirds of Myanmar-based survey respondents believed that ASEAN integration would support their efforts to conduct business in the region. Myanmar-based companies, in particular, could benefit from the introduction of business-friendly measures such as the ability to move key personnel around the region and reductions in transaction costs. Thus, the general consensus among respondents was that these measures would have an important impact on their business activities.
Consequently, Myanmar appears to have a unique position in the ASEAN region, as it will be experiencing both internal and external reforms. For American companies, the pace of change in Myanmar could be even swifter as approximately 70% of survey respondents cited positive sentiment towards the U.S. as a key strength for doing business in the country, significantly higher than the ASEAN average. Therefore, Myanmar might be the most rapidly improving destination in Asia for American companies.
For more information on AmCham’s ASEAN Business Outlook Survey, click here.