News

HomeMyanmarIndustry Overview

Industry Overview: Myanmar Tourism and Hotel Industry

Myanmar has more than 60 million people and occupies a strategic location between the two Asian Giants, India and China and is pipped to be one of the fastest growing emerging markets  in the near future. The political and economic reforms have also sparked a boom in its fledging tourism industry. In 2011, Myanmar posted US$ 319 Million in total tourist revenue, up from US$ 254 Million in 2010. There were 816,369 foreign arrivals in Myanmar last year, up from 791,505 in 2010. Of the total last year, 425,193 were border tourists. With so many business people and tourists suddenly flocking to Myanmar, the city's underdeveloped hotel industry is feeling the strain with hotel rates reaching almost US$ 400 per night and hence there is an urgent need to increase foreign investment in this sector. Currently, many Hotels and Tour operators are scrambling to meet the growing demand from visitors who are eager to witness the country in the midst of a major transformation.

Recognizing this need the Government has allowed foreigners a 100% investment in hotels and restaurants, but foreign investors cannot obtain land ownership and their businesses must operate on a 45-year land lease period. Myanmar President, Thein Sein  has also recently approved a five-year short-term development plan from fiscal year 2011 to 2015 that aims for average Gross Domestic Product (GDP) growth of 7.7% and for a three-fold increase in per-capita GDP. This move will again see a lot of global investors visiting the country.
 
Over the years the tourism and hotel business in Myanmar has improved with the presence of foreign invested hotels and is expected to grow further as more investment flows into the country. According to Maung Maung Swe, Chairperson of the Union of Myanmar Travel Association, investments from Singapore were the highest in the hotel industry at about US$ 597 Million, followed by Thailand with US$ 263.25 Million, Japan with US$ 183 Million, Hong Kong with US$ 77 Million and Britain with US$ 3.4 Million. At present, Myanmar has about 20 foreign-invested hotels in Yangon out of 35 of its kind across the country, but there are plans to build 19 hotels in Naypyitaw, the capital, in anticipation of the upcoming 27th Southeast Asian Games set for the end of 2013. He also added that there are plans of building a new international airport, 15km from Yangon over the next few years. 
 
Prominent Global Hoteliers HAG & Land from Vietnam, Accor Group from France and Oberoi Hotels & Resorts from India are also eyeing a slice of Myanmar's hotel industry due to the explosive growth rate of tourism in the country. In fact HAG & Land which is the first prospective investor, is expected to invest 300 million U.S. dollars in Myanmar's hotel sector.
 
Myanmar has the competitive advantage of being rich in natural resources and having a strong cultural heritage, which is an attractive tourism product. In the immediate future, many foreign airline firms are expected to open more direct international routes to Myanmar, thereby putting the country on the global map  and thus boosting the tourism and hotel industry. 
 
(Source: Insight Alpha)
Tags

Myanmar Travel Association