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Myanmar at a glance

Despite being a "cast-away" market in Asean, Myanmar is still an attractive market with many promising sectors for foreign investment.

Why bother with Myanmar?

  • An untapped regional hub in a largely fast maturing ASEAN region
  • Wholly new consumer market
  • Many promising sectors providing attractive returns
  • Large and educated workforce, investment incentives
  • Positive political and economical reforms
  • Proximity to other major Asian markets
  • Rich in natural resources
  • Attractive labour costs
  • Fast GDP growth

Current state of business

  • Lack of responsive, transparent and accountable regulatory framework
  • Many major industries still owned by the state; privatization underway
  • IP protection virtually non-existen
  • Low managerial talent supply
  • Rising rents and service industry talent costs
  • Repeat power cuts. Crumbling infrastructure
  • Asia to dominate investment to Myanmar
  • Manufacturing relocation from Thailand & China to Myanmar

Foreign investment and trade

  • Existing investors: China, India, Indonesia, Japan, Malaysia, Singapore, Thailand
  • ~60% of Myanmar’s exports & ~50% of imports are to/from Asia
  • Key exported goods: gas, agriculture, timber, and minerals
  • Key imported goods: machinery, chemicals, parts, FMCG
  • Investment priorities: power generation, urban development, hospitality, transportation, ICT

What to look for on the horizon

  • Significant improvements in foreign investment law
  • Further country opening-up, yet the army to retain a firm grip
  • Creation of Industrial Zones and Special Economic Zones
  • Privatization of state-owned industries
  • Sanctions disappearing, Myanmar back to global scene
  • Myanmar leveraging Thailand's internal difficulties
  • Stable growth for the next 20 years

Remaining questions

  • Will further structural reforms be introduced to encourage private enterprise and more FDI?
  • Will Yangon learn from Bangkok, Manilla, & Jakarta's lack of urban plan development?
  • Can the country resolve its long-running ethnic conflict and illegal substance crops?
  • How will the economy respond to a flood of foreign investment?
  • How fast can the infrastructure be built & developed?

Myanmar Energy & Power Industry

The electrification ratio in Myanmar is 13%, significantly below other South East Asian nations. 70% of energy is generated from hydro power plants. Due to poor connectivity to the power grids, many rural areas still rely on diesel generators. Electricity demand is projected to grow at an annual rate of 12% over the next 10 years. Myanmar plans to meet demand through the development of more power generation units, in particular, hydro power plants.

Playing catching up

Much of Myanmar’s development is held back by its poor power infrastructure, but its improvement is a top government priority and major international investment is expected.

As of 2009, the electrification ratio1 stood at 13%, significantly behind its South East Asian neighbours. In 2012, Myanmar had an estimated installed power capacity of 2,254 MW that has grown annually at a rate of 10% since 2007.

Up to 70% of the power generation capacity is from the 18 hydropower plants which generate up to 1,270 MW during the rainy season and 1,000 MW during the dry season. Hydro generated electricity is comparatively cheap (sale price to Ministry of Electric Power is 20 kyats/kWh) compared to combined-cycle gas turbines (at 130 kyats/kWh).

Diesel generated power is the key source of power in many parts of rural Myanmar that lack utility grids. However, diesel fired generator sets also cater to the power requirements of urban areas during power outages. In May 2012, the Myanmar government bought 52 heavy duty generators from multinational companies such as GE, Caterpillar and Japanese firms as a result of the nationwide rolling blackouts.


It will take many years for Myanmar’s power infrastructure to match that of its ASEAN peers. Until then, privately-owned generators will be necessary to run much of the country.

Thilawa, Kyauk Phyu and Dawei are the first three Special Economic Zones (“SEZ”) to be set up in Myanmar. To meet the energy requirements of the 3 SEZs, Myanmar is currently constructing (and planning for further) numerous hydro power plants. Many of these hydro power plants will be in the north, hence high voltage transmission lines will also be built to supply energy to the main economic centres in the south.


A deep sea port and industrial estate which includes a coal-fired power plant, oil and gas refinery and storage, downstream petroleum industry and also a medium and light industry zone.

Kyauk Phyu

A deep sea port and a gas pipeline project to Kunming, China.


An industrial estate that is located close to Yangon.

Projected demand and future projects

Myanmar will meet most of its increased power demand through hydro projects. The country’s valuable coal and gas are primarily used for trade with countries like China.

Myanmar Electric Power Enterprise (“MEPE”) projects for annual consumption to grow at a CAGR of 12% in the next 10 years or so. This is based on the assumption that GDP grows 10.5% per annum with a population growth rate of 1.1%.

To cope with the expected increase in annual consumption in the next 3 years, MEPE will be launching specific measures including:

  • Increasing energy purchased from hydro power plants
  • Increasing generation capabilities of existing hydro power plants
  • Construction of transmission lines from generation sources to demand drivers
  • Hiring of mobile gas turbines
  • Construction of new hydro power plants and gas turbine combined cycle (”GTCC”) plants

In the long term, MEPE expects 5 hydro power plant projects (which are already under construction) to be completed after 2016, which will collectively supply an additional 5,527GWh.

Myanmar Oil & Gas Industry

Myanmar’s gas reserves are relatively small, but privatization of oil refineries will attract foreign investors.


Foreign investors are targeted because local businesses lack experience and technology. Myanmar has already awarded 10 of its 18 onshore oil and gas blocks. Development of Myanmar’s energy resources will provide new source of energy for the region. Gas is already Myanmar’s biggest export.


Offshore operating companies may face political risks when they transfer their product onshore. Local communities gain no benefits or compensation.

Government regulations

Foreign companies need to create joint ventures with local partners to receive a license for exploration. Myanmar’s new foreign investment law permits foreign companies to lease land and grants them legal protection from nationalization.

Natural gas: proven reserves - cubic meters (trn)

Source: CLSA Asia Pacific Markets.

Myanmar Construction industry

Myanmar’s construction boom actually began half a decade ago but is expected to continue to grow for years to come.

Key Myanmar Construction market insights

The construction industry in Myanmar is currently valued at approx. US$ 2.8 billion and is expected to grow at a CAGR of roughly 9% until 2016 to reach US$4.2 billion.

Industry growth was robust in the past 5 years because of increased investment opportunities in energy and public infrastructure projects with inflow of FDI from Thailand, Vietnam, China, Singapore & Malaysia.

The growth from 2012-16 will be driven by investments across all segments – rising interest in residential construction, government’s focus on infrastructure development, construction of office buildings and hotels (especially since the 2013 Southeast Asian Games and 2014 Asian Summit will be held in Myanmar) as well as construction of industrial zones and SEZs to support industrial development.

*1 USD = 850 Kyats

Expect Myanmar’s urban skylines to change as high-rise residential building becomes the norm. Supermarkets, hypermarkets, and shopping malls are now possible following a regulation change.

Residential / Commercial Sector

Residential construction market constitutes about half the industry value at roughly $1.4 billion in 2011. There is tight supply and strong demand in residential, office, hospitality and retail sectors. Both foreign and local investors are building low-cost housing projects initiated by the government (such as Ayeyar Wun and Yadana housing projects). Construction of high-rise buildings – both office buildings and residential condominiums - is on the rise with increasing foreign investment. While most construction companies used to build 12-16 storey buildings – recent projects extend up to 35 storeys.

Key Takeaways

  • Foreign companies are not allowed to buy land in Myanmar, they can only lease it
  • Average land prices of Downtown, Inner and Outer city regions in Yangon range from ~US$90-190 per sq.ft
  • A new Central Business District (CBD) is proposed near the Yangon Airport and is considered a key commercial area in the coming times
  • New Yangon international airport will start functioning from 2018 – It is located 70km north of the current airport

Public infrastructure

Key issues

  • Significant investments are needed to repair transport, energy and telecommunications
  • Severely underdeveloped transport, logistical links and power
  • Ethnic rebel groups continue to attack government infrastructure

Government regulations toward investment

  • The Special Economic Zone (SEZ) Law and the Dawei Special Economic Zone Law plan to make doing business easier by offering incentives like tax exemptions
  • Basic infrastructure projects with short time frames, local community benefits, and low environmental impact will face lower regulatory and contract risk


  • Infrastructure development will create opportunities for busses and trains as the country modernizes its public transport systems
  • Myanmar welcomes institutions with experience in urban development and planning
  • Sustainable urban development can be a differentiating factor for architectural firms
  • Foreign investment in infrastructure projects may lead to a boom in the property market




Myanmar’s public infrastructure will require tremendous investment, but opportunities for international firms to participate directly may be scarce.




Source: The Diplomat

Myanmar Growth Strategy

With an unstable global economy, fast changing emerging markets and a renewed focus on growth, how can multinationals capitalize on potential Myanmar opportunities to increase their revenues in this unfamiliar part of the Asia? Here are a set of key issues Solidiance can help to resolve.

Key questions to address before committing serious capex in Myanmar.

  • Is the market in Myanmar large enough for us to enter? If not, when will the Myanmar market be ready for our products?
  • What are the typical revenue volumes and profit margins we can expect in Myanmar for our products?
  • How different are Myanmar consumers when compared to their ASEAN counterparts?
  • Should we manufacture in Myanmar for Myanmar consumers?
  • Are local SOEs potential competitors or clients in Myanmar, if not who is?
  • What is the Myanmar consumer propensity to spend on my product?
  • Our products are available in Myanmar, yet we did not sell them. What channels are currently being used in Myanmar for my products?
  • Are there reliable distributors in Myanmar? How do we avoid the usual channels conflicts in Myanmar?
  • How do we organize our distribution channels in Myanmar?
  • What Myanmar go-to-market strategy options do we have?
  • How do we navigate the Myanmar government maze to get things moving?
  • In which Myanmar industrial zone should we locate our upcoming plant?
  • What kind of organization do we need to build to be successful in Myanmar?
  • How would we measure our success in Myanmar?
  • What kind of alliances do we need to build in Myanmar to be successful?
  • How do we operate a take-over or an M A in Myanmar?

About Solidiance


Myanmar Work

We help multinational clients to leverage Myanmar's growth. We work side-by-side to advise CEOs on make-or-break deals, define new Myanmar business models, and deliver growth strategy in Myanmar.


Myanmar Focus

Our Myanmar experience is centered on power, energy, construction, chemicals, automotive, machinery, manufacturing, and automation. Our Myanmar market entry and growth strategy services provide the required facts-based insights and the necessary roadmap to capture a profitable market share in Myanmar.


Myanmar Specialties

Myanmar marketing & competitive strategy, Myanmar market intelligence, Myanmar market entry, Myanmar distribution strategy, Myanmar M&A, Myanmar growth strategy


Beyond Myanmar

On top of a presence in Myanmar since 2011, Solidiance has offices in China, India, Indonesia, Malaysia, Singapore, Thailand and Vietnam.

Our Clients

Solidiance has a strong track record helping multinationals identify new avenues of growth in Asia. But don't take our word for it...Read what our clients actually have to say about our work.

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    Strategy Manager - Caterpillar

  • "Thanks to Solidiance’s work, we have been able to move smoothly forward in the Asean region. Solidiance’s know-how has greatly helped DuPont in making its strategic choices."

    Global Emerging Region & Global Channel Manager - DuPont

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