Myanmar’s economic reforms during the last seven years have been impressive, with GDP growth between 6.4% and 6.8% in 2018 and 2019. The country is also one of only three in the region to expect positive economic growth in 2020. However, Myanmar still faces challenges on many fronts, especially given the severe blow caused by the COVID-19 pandemic.
In October 2020, the Myanmar government announced the drafting of the Myanmar Economic Recovery and Reform Plan (MERRP) aimed at rebuilding the economy over the longer term. As the country awaits the release of the MERRP, we pinpoint four factors we see as critical to building Myanmar’s economy and a better future for its people.
Improve healthcare and accompanying infrastructure
At the time of writing, the rollout of COVID-19 vaccines is starting in several countries around the world. In Southeast Asia, Singapore has announced plans to offer free vaccinations to its citizens and long-term residents.
We believe the next test of Myanmar’s leadership will come in its ability to procure sufficient vaccines and distribute these quickly and efficiently across the entire nation.
The rollout of a successful domestic vaccination programme will demand a rapid improvement of infrastructure, equipment and logistics. The Pfizer-BioNTech vaccine, for instance, needs to be stored at temperatures of around -70°C for up to 10 days while still unopened.
This would require specialist, ultra-low temperature freezers, skilled personnel for handling the shipments, and a stable power supply.
Double down on human capital development
In our view, Myanmar’s underdeveloped human capital remains the biggest impediment to realising its true potential.
We hope to see the Myanmar government allocate more public sector resources to improve key sectors that contribute to human capital development.
They should consider collaborations with the private sector, for example public-private partnerships that will develop the country’s human capital.
Accelerate efforts to develop Myanmar into an industrialised nation
The country has huge potential to be a leading regional manufacturing hub thanks to its strategic position between Asia’s biggest economic powerhouses, China and India, as well as its role as the only land bridge linking ASEAN to South Asia.
This is likely to be strengthened by shifts in global supply chains because of COVID-19.
For Myanmar to rise to the challenge and take advantage of these disruptions, it needs to improve the reliability of its power and logistics infrastructure.
Continue promoting digitalisation as a key transformation pillar
Myanmar has always had the potential to leapfrog the digital evolution. With COVID-19, digitalisation has accelerated, with digital tools becoming commonplace to access information and do business. In Myanmar, this has enabled students to continue their education via e-learning and for people to earn an income despite the lockdowns.
Yet much more can be done in this area. We believe it is essential for the government to leverage on digital technologies across all sectors to drive economic growth and private sector development.
As a firm deeply invested in the long-term sustainable development of the country, we look forward to supporting the continued rebuilding of the economy to the benefit of Myanmar and its people.