Why foreign investors are attracted to Myanmar

Downtown Yangon, Myanmar, is an increasingly attractive investment destination. Credit: Sean Pavone

Way back in October, we took a look at Myanmar's potential for hotel development. A growing economy is leading to improved airlift which is leading to improved tourism numbers—making the country ripe for tourism-related investment.

International investors are clearly paying attention: As of last month, Myanmar's hotel and tourism sector has received foreign investment of more than $2.687 billion.

The sector is the seventh-most popular industry for foreign investment, accounting for 3.87 percent, the Directorate of Investment and Company Administration reported. A full 67 industry-related businesses in the country had received investments, the Directorate claimed, and there has been an increase in the number of joint venture businesses.

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For example, Myanmar’s Eden Group is planning to spend an estimated $130 million on two hotels in partnership with Hilton Worldwide in top tourist destinations of Bagan and Inle Lake, as early as 2018. Kempinski, Amara, Centara, Dusit, Melia, Shangri-La, Tangram, Hilton and Best Western are just a few of the brands that have invested in Myanmar. The Sheraton Yangon, the chain’s first in the country, is expected to open next summer. 

In 2015, foreign investors dropped $2.6 billion of foreign investment was made for the development of hotel and tourism-related commercial complexes, mostly routed from Singapore, a fellow member of the Association of Southeast Asian Nations (ASEAN). This amounted to a total of 9,132 rooms across 48 projects, of which (as of October) 69 percent were complete, 25 percent were under construction, and 5 percent had received approval from Myanmar Investment Commission. 

For context, as of January 2017, foreign investment volume in Myanmar reached $22.4 billion from 154 projects in the oil and gas industry, $20.3 billion from 12 projects in the energy sector, $7.6 billion from 711 projects in the manufacturing sector, $8.12 billion from 44 projects in the transport sector, and $3.8 billon from 39 projects in the real estate development industry.

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