Investment Opportunities in Myanmar’s Most Promising Sectors

The signing of the Bilateral Investment Treaty between Singapore and Myanmar marked another milestone in economic ties between the two countries.

January 2020 , by Naithy Cyriac

The signing of the Bilateral Investment Treaty (BIT) on the Promotion and Protection of Investments between Singapore and Myanmar marked another milestone in economic ties between the two countries. The treaty provides greater certainty and confidence to investors, promoting greater investment flows between the two countries.

Singapore and Myanmar signed the treaty on the sidelines of the 7th Singapore-Myanmar Joint Ministerial Working Committee (JMWC) meeting in Yangon which was held on 24 September 2019. The two countries share warm economic relations, as bilateral trade in goods increased by 10%, reaching S$4 billion in 2018. Singapore is also Myanmar’s largest foreign investor, with a cumulative investment of S$30.5 billion and 312 permitted investment projects in Myanmar, recorded as of August 2019.

Several key sectors are projected to drive Myanmar's economic growth and bring closer cooperation between the two countries following the treaty, including manufacturing, infrastructure and energy, healthcare and financial services. 


The manufacturing sector accounts for a large share of approved FDI in Myanmar, contributing 32% overall in FY2019 compared to only 0.3% in FY2011 by value. It is expected to transition towards more complex manufacturing driven by import substitution (automotive, machinery, construction materials) and export promotion (garments, processed agribusiness products) policies.

FDI in Manufacturing Sector

Source: YCP Solidiance Research & Analysis, Myanmar Investment Commission

The recent economic liberalization, infrastructure improvements, tax reforms and the development of special economic zones (SEZs) are transforming the country from a low-cost regional production base to an upcoming manufacturing destination with rising capacity. The country’s relatively low operating costs, favorable demographics, as well as favorable government policies offer various advantages for manufacturing investments in Myanmar.

Garment segment is one of Myanmar’s most established industries which is seeing double-digit growth. The country exported over US$2.7 billion in garments and over US$300 million in footwear in 2016 and 2017, according to the Myanmar Garment Manufacturers Association. The number represented a 28% increase in export figures from the previous year. 

Another rising segment is food and beverage production, with local and foreign manufacturers eyeing the Myanmar market for its potential growth. The country is now open to foreign goods and popular brands of soft drinks, snacks and alcohol. 


Myanmar’s construction sector is ready for large investments. Infrastructure and residential sectors account for the majority share in Myanmar’s construction, while industrial is the fastest-growing segment. The infrastructure gap in the country between now and 2030 is also estimated to be worth US$ 120 billion, according to The Asian Development Bank (ADB). All infrastructure sectors, such as roads, railways, harbors and airports need massive investments, displaying another major opportunity for foreign businesses. 

Promising Sectors in Vietnam: Manufacturing

Private construction output is largely concentrated in Yangon (30%) and Mandalay (19%) as these two cities are the primary economic centers of the country. Meanwhile, Yangon’s population is projected to grow by 3 million within the next decade, requiring massive housing investments.


Energy is a promising sector in Myanmar due to the increasingly high demand of electricity consumption as well as the government’s ambitious growth plans to double the electric power capacity by 2020-2021. Moreover, the Myanmar Investment Commission also abolished a requirement that foreign investors have to partner with the Ministry of Energy and Electricity to distribute and sell fuel in 2017. 

Power supply remains a challenge at a low national electrification rate of 47.3% with hydropower accounting for over 55% share, followed by natural gas at 42%. The government plans to implement an energy mix that includes hydropower, coal, natural gas and renewable energy to distribute electrical power sufficiently, filling the gap of energy needs. 

The government has established benchmarks to provide 47% sustainable power in 2020, 76% in 2025 and 100% in 2030. A grid electrification rollout and the off-grid program will be implemented under the NEP to accomplish this goal. The program will require a total investment of $5.4 billion, while another $40 billion will be required for investment concerning the transmission and distribution portions.  


Promising Sectors in Vietnam: Healthcare

Myanmar healthcare market largely remains untapped and provides numerous opportunities for foreign companies. Myanmar’s public health sector accounts for 86% of total healthcare services with 1,120 public hospitals accommodating 56,700 beds. Meanwhile, there are approximately more than 249 private hospitals, 200 private specialist clinics, more than 5,000 private general clinics, and 800 private dental clinics across Myanmar, according to the Department of Medical Services.  

Private healthcare sector expenditures are continuously increasing due to the rising awareness for healthcare by the growing middle class. In 2014, the government also passed legislation which allows foreign investors to invest in private hospitals, clinics,  medical devices, diagnostic centers and health-related educational facilities.

Financial Services

Due to the recent policy-driven sector liberalization, Myanmar’s financial sector is undergoing rapid growth and insurance segment has the potential to grow to a market size of US$ 2.7 billion in 10 years. Financial inclusion is also listed as one of the top priorities for the government, as Myanmar moves ahead with its economic transition. 

The country has experienced drastic technology-led changes in its banking and finance sector over the years.  People are gradually moving towards saving money in banks and using cash cards, such as ATM cards and Myanmar Payment Union (MPU) cards. Adding to that, the mobile phone connectivity rate reached 95% in 2019 from less than 10% in 2014.  The increasing mobile phone connectivity and internet penetration enable people in the country to access the digital financial services via mobile technology.

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