Myanmar, or known as Burma, is the largest country in mainland Southeast Asia, covering 676,578 square kilometres. It is populated with 54 million population, according to the latest census held in 2017. Myanmar is considered by most to be the last frontier economy in Southeast Asia region. The country has alienated themselves from foreign business for decades due to the lasting military occupancy in the country.
The tables have now turned as Myanmar has implemented initiatives to open up their border for foreign businesses and investors. Myanmar currently undergoes rapid transformation in its economies and industries. This burgeoning market now offers many untapped opportunities that can be utilized by regional and even global players. Foreign businesses are now able to enter, grow, and expand their businesses in the country.
Due to the economic and political instability that Burmese population experienced, the Myanmar population has been traditionally regarded as an investment and savings oriented population. Compared to Thailand consumers who spend 70% of their income, the typical Burmese spends just the 45% of the monthly average income. This may be due to the substantial difference in the average income, as the average Burmese earns approximately one-fifth of Thailand's average worker, and the financial gap in the retail and financial sector development. The typical Myanmar consumer saves a substantial proportion of their monthly income towards investment in properties or gold, and accumulates cash at home for emergencies.
The biggest share of the Myanmar total average consumer spending is represented by Food & Beverage expenses, accounting for the 15%, followed by Personal Care and Household products at 7%. Healthcare and education are not provided for free by the Myanmar government and consequently are two key expenditures for the average Burmese consumer, with the former accounting for the 2% and the latter for the 4%.
The telecommunications sector, currently represents the 2% of the total Myanmar consumer spending, however this percentage is likely to grow in future years as the country is experiencing a rapid digitalization. As a saving oriented population eating out does not represent a big expense for Myanmar consumers, it currently accounts for the 1% of total spending. However, the rapid growth of International franchises, such as Burger King, Pizza hut and Hard Rock Cafe is encouraging population to eat out more frequently.
Myanmar has shown prominent growth in its economy since they opened up their economies to the global market in 2011. Since then, foreign direct investment has been growing at a staggering pace, reaching USD 9.5 billion between 2015-2016. Pushed by the increasing foreign investment and domestic consumption, the economy of Myanmar is expected to grow about 6.8% by 2020 according to the Asian Development Bank, hence consumer spending levels are likely to become to higher in future years.Download White Paper