Tuesday September 25, 2012
SMEs urged to enter Myanmar market
By SHARIDAN M. ALI
PETALING JAYA: Small and medium size enterprises (SMEs) should take the opportunity to enter the Myanmar market as there is little competition from multinational corporations (MNCs) at present, said CIMB Asean Research Institute chief executive officer John Pang.
“Many MNCs are interested to get into Myanmar as it is the fastest growing economy in the region, but they aren't able to enter the market as yet pending the establishment of foreign investment regulatory framework.
“Thus, SMEs have better chances to be present in Myanmar now as compared to MNCs because smaller businesses are more agile and able to operate in a slightly more uncertain environment,” he told StarBiz on the sideline after his presentation entitled Myanmar: The New Silk Road at the CIMB Asean SME Forum yesterday.
Pang anticipated Myanmar's economy to grow by 6% this year, 6.3% next year and 8% in the subsequent years after 2013 with the right macro management.
“Even without reform, they are growing very fast potentially at 8% in a few years, and that's a lot. What I find encouraging is that the political will behind this they want a reform and it's very clear,” he said.
In his presentation, Pang said Myanmar would be the biggest economic story this year and in the years to come.
“It's the last economic frontier in Asia where a new civilian government took over in March 2011 after 50 years of military rule.
“It's opening up politically and economically. And it is not so much a political risk issue but a capacity issue to enact law quickly,” he said.
In a little more than a year, the country has taken a dramatic series of economic and political reforms under the new government. Sanctions have been lifted, diplomatic ties renewed, international organisations are re-engaging with the country and international investors have been flocking to get into Asia's newest emerging market.
And for SMEs, Pang said, there were opportunities in retail, trading, tourism and services.
“But, it's not clear-cut on how to conduct business there. Some sectors you may need a local joint-venture partner until their foreign investment law is up but in some areas there are special exemptions.”