The digital economy in Southeast Asia is on track to hit $240 billion by 2025, which is $40 billion more than previous estimates, according to the latest e-Conomy Southeast Asia 2018 report from Google and Singapore-based Temasek, which manages investments and assets for the government. The report said the internet economy in Southeast Asia “hit an inflection point in 2018,” thanks in part to the most engaged mobile internet users in the world, as well as industries like ecommerce, online media, online travel and ride-sharing, which grew at never-before-seen rates. As a result, the region’s internet economy will hit $72 billion this year alone, which means it will have more than doubled since 2015. And, the report said, investor confidence in the region is growing as startups raised $9.1 billion in the first half of the year, which is almost as much as they raised in all of 2017.
(Source: Adweek, December 4, 2018)
Myanmar’s robust development is fueled partly by the adoption of ICT and the development of e-commerce. Business accelerators, venture capitalists and the ever-increasing number of tech start-ups are clear evidence that Myanmar’s e-commerce scene is booming – albeit from a low level - and Myanmar is no longer considered a frontier market when it comes to digital innovation. While the country’s e-commerce future looks bright, a considerable amount of work for the government remains, particularly in improving and updating the legislative and regulatory framework (addressing consumer protection, privacy, security of transactions, cybercrime, and other concerns in an online environment,investment and to promote domestic investment in industry. ICT and payment infrastructure.
A recent report about inclusive business in Myanmar has been published by the Facility and the UK’s Department for International Development (DFID), supported by the Directorate of Investment and Company Administration (DICA) and the Directorate of Industrial Supervision and Inspection (DISI). The report offers an opportunity for businesses, investors, NGOs and the government to examine the transformational potential of inclusive business and starts to map a way forward to a more inclusive and sustainable business environment in Myanmar. Inclusive businesses create triple wins: for the poor, for companies, and for government. They also contribute to the government’s agendas of reducing poverty, making a more inclusive economy, and achieving Sustainable Development Goals.
(Source: The Myanmar Times, December 3, 2018)
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The latest World Economic Forum Global Competitiveness Report survey indicates a mixture of weak institutional, policy, and economic fundamentals topping the list of obstacles to development in Myanmar. Although some improvement is evident in the recent data, the report suggests that local market participants rank their business environment poorly, especially on problems in access to financing,policy instability and an inadequately educated workforce. Overall, the government needs to take a more holistic approach to private sector development and provide a range of systemic support measures, including improving the regulatory environment, investing in physical and social infrastructure, building human capital with a focus on strengthening the skills of the young, strengthening and deepening the banking sector and financial markets, and improving labor relations. Investment is an important gauge of successful private sector development. Significant government support aimed at removing barriers to business at the policy level and providing quality infrastructure will be essential to attract foreign
Hong Kong companies are looking for investment opportunities in Myanmar, especially infrastructure and logistics support, according to Stephen Liang, assistant executive director of the Hong Kong Trade Development Council. “We are very much looking forward to more incentives for Hong Kong companies and are keen to look for investment opportunities,particularly to strengthen factory capability and support,” said in Hong Kong on November 22. The official led a trade mission of 37 executive from 27 companies to visit Yangon from November 25 to 28. The mission, which included many Hong Kong companies engaged in manufacturing garments and footwear, was particularly attracted by Myanmar’s good supply of low-cost workers, and improving business conditions, industrial infrastructure and logistics support, he said.
(Source: The Myanmar Times, December 4, 2018)
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The lack of basic hard and soft infrastructure remains the key bottleneck to mid- to long-term economic growth. Sustained economic growth requires the development of a private sector-based economy with enhanced industrial development and export competitiveness. According to World Bank, although it is one of the priority sectors for exports, productivity in the agriculture sector in Myanmar remains among the lowest in the region due to weak infrastructure and horticultural practices. The infrastructure and logistics gap also constrain export competitiveness in the manufacturing sector. On these issues, upgrading the infrastructure for electricity, transportation and telecommunication is critical to boosting output. In particular, insufficient and unreliable electricity supply has hindered the development of industries across sectors in the economy. In terms of human capital, while Myanmar enjoys the advantage of young demographics, most of the labor force is unskilled. The rule of law and the legal framework could be further strengthened in order to foster confidence and support the development of the private sector in Myanmar.