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Myanmar’s recent elections have been hailed as the most historic in a generation. Aung San Suu Kyi’s National League for Democracy (NLD) has secured about 80% of the elected seats in the country’s next national parliament and her party is set to form the next Yangon government.
As this historic power transfer from the ruling military administration takes place, the business community both in Myanmar and abroad is watching with excitement. What does the change in government mean for business and will more business lead to more IT adoption?
Myanmar’s economic recovery, after almost half a century of isolation, had already started under the military regime. In recent years, the country’s economy has been opening up, with the government relaxing rules on trade and investment, making it easier to do business in some sectors.
Consequently, foreign direct investment into Myanmar stood at $8.1bn in 2014-15 – a remarkable 25 times the figure for 2009-10.
As far as the country’s infocomm technology (ICT) sector is concerned, the administration of outgoing president Thein Sein had abolished a state monopoly on the telecommunications sector, allowing foreign companies to build new cellphone networks.
The impact was rapid: previously, a simple mobile phone SIM card in Myanmar would cost about $2,000; now one is available for as little as $1.50.
“With the euphoria over the NLD’s election win, it is easy to overlook the fact that the Union Solidarity and Development Party (USDP) government oversaw a period of wide-ranging business reform and economic development in Myanmar,” said Vikas Sharma, director, public sector and government practice at Frost & Sullivan.
“In addition to sectors such as energy and manufacturing, the tech sector has also seen tremendous investment in recent years, with telecommunications accounting for 25% of the total FDI in 2014-15.”
Read more about Asean IT
- Myanmar internet users will start benefiting from changes in the law that encourage foreign direct investment in communications infrastructures.
- Young people in Indonesia, Vietnam, the Philippines and India are driving the rapid adoption of mobile devices, with the Android operating system coming top.
- Organisations across the Asean region are using artificial intelligence technologies, with examples in the health and finance sectors.
Singapore-based Melvyn Pun, CEO at Yoma Strategic, added: “The tech space is particularly fast-changing. The new government has a strong mandate to make changes, so I expect it to be a catalyst for economic reform. We are already seeing development in the tech space to change consumer behaviour.
“Mobile penetration is also growing rapidly, much of it through smartphones. Social media and Facebook, in particular, are the most powerful sources of information and for marketing.
“I would expect the international community to positively embrace the new government, and foreign investment and aid are likely to accelerate.”
More business will mean more IT adoption in Myanmar, and there is an urgent need to train the workforce, including the ICT sector, said Rohit Gandhi, president-Asia Pac at Tech Mahindra.
“The business prospects in Myanmar appear exciting, however a major focus is needed on both technical and vocational training to take growth to the next level,” he said.
Yoma Strategic’s Pun added: “The future for Myanmar is exciting and we are at a critical juncture. But it is also going to take time for many of these developments to crystallise, and we all need to have realistic expectations on the timeframe for change.”