Home Insider Insider Analysis Economic Potential – Yangon 2018

Economic Potential – Yangon 2018

Yangon is the nation’s main centre for trade, industry, business, media and entertainment. It is the major hub in lower Myanmar for all kinds of merchandise from basic food stuffs to high class luxury products. Total land area of Yangon is 1,535 square kilometers with GDP growth of 6.8%, waterways of 1,280 kilometers (world’s 10th longest) and vehicle ownership of 10 cars per 1,000 people.

Yangon future vision 2018 is to be an attractive international port and logistics hub, a city of blue, green and gold. International logistics hub city includes international port, inland water transport, economic corridors, SEZ and industrial development. Wellmanaged infrastructure city would contain integrated public transport, infrastructure development, public safety and risk management, social service and health care. Goodgovernance city is formed of rule of law, social benefit, financing and taxation, action-oriented.

New urban development consists of four major sectors; sub-centers, new towns, railway stations and industrial zones. Sub-sectors are Mindama sub-center, Yankin sub-center, Thilawa SEZ subcenter, Dagon Myothit sub-center and Dagon Seikkan sub-center. New towns are Thilawa new city, Southwest new city, Dagon east new city and Dala new city. Railway station area development includes Yangon Central, Kyee Myin Daing, Insein, Yegu, Mingaladon and Danyingone. Industrial and logistics development includes existing industrial zones, Thilawa SEZ and three new industrial zones.

The population of 2040 is expected to 10.7 million with annual growth rate of 2.6%. Many people from provinces moved to Yangon to search for employment opportunities and to start new businesses. In this way, Yangon becomes the largest and most densely populated city of the nation. Therefore, Yangon region government is trying to solve the problem of high population density and traffic jams.

Trades and Logistics Development

“Yangon regional government is planning to establish Yangon special economic zones and deep sea ports”, said Phyo Min Thein at Yangon Investment Forum on May 9. All the ports in Yangon are not available to use 24 hours a day due to traffic jam in Yangon except Thilawa SEZ at the east side of Yangon river. However, it is not economical for industrial zones such as Hlaing Thar Yar and Shwe Pyi Thar to ship goods to Thilawa SEZ because land transport requires a 40 miles drive. For water transport, it is only 21 miles away. Yangon regional government is planning to ship goods by water transport and establish inland port in Ngway Pin Lal. Proposed location for special economic zone and deep sea port is 50,000 acre. “New Yangon deep sea port will be strategic area for foreign and local investments in Southeast Asia regions”, Phyo Min Thein added. The neighboring countries of Myanmar are inland countries and if goods from these countries can be shipped through Yangon deep sea port to their destinations, goods from these countries can be available easily in Yangon. Yangon is naturally situated on the path of the flow of goods. Water transport is also the least costly mode of transporting goods.

Industrial development

There are altogether 30 industrial zones in Yangon including Thilawa SEZ. Yangon regional government is planning to upgrade them by providing power supply, infrastructure and waste management solutions. Thilawa SEZ is the most successful economic zones among three SEZs in Myanmar; it is situated at the other side of Yangon river. “Establishing special economic zones in Yangon is the most promising because a lot of investors are interested to run businesses in Thilawa SEZ”, Phyo Min Thein said at Yangon Investment Forum 2018. Urban Public Transportation Development Yangon regional government is trying to solve the problem of traffic jam. They¬†implemented Yangon Bus Service (YBS) under the NLD government with the Yangon Region Transport Authority. The Chief Minister is planning to introduce card system with YBS passengers to provide payment services, Master card, VISA card, cash transfer and other banking services.

He is also trying to upgrade the taxi services systematically. The total number of taxi in Yangon is about 70,000. He plans to build traffic control centre to solve the heavy traffic problem timely, to handle the abundance of vehicles and to deal with the vehicle crimes and illegal vehicles. CCTV cameras will be set up all parts of Yangon in order to raise up security and to create a smart and digitalized city. It is also the investment opportunity for the IT companies.

The next step is to upgrade the railway stations and commuter trains to improve the public transport and related facilities. Furthermore, Yangon water bus transit project is in operation now for water transport around greater Yangon region through Yangon river, Bago river and Pazundaung Creek.

New City Development

Yangon Chief Minister is attempting to build South West new Yangon city with the objectives of reducing the heavy traffic jams and population density, creating a second residential place and opportunities for citizens and at the same time avoiding the problems of the old city. He has formed the new Yangon Development Co., Ltd (NYDC) to build a new city west of Yangon river that will be twice the size of Yangon. “The regional government will take responsibility for the project in order to reduce red tape. West of Yangon river is less developed, we will strive to develop it with this project. We will industrialize the area and create job opportunities. The main objective of the project is to provide around two million jobs”, Phyo Min Thein said. The infrastructure project will include two bridges, roads, an industrial zone, a power plant, power stations, and water and sewage treatment plants, according to NYDC. What would be achieved within the remaining two years of NLD government term is up to anyone’s guess.

Energy Sector Development

Yangon regional government is trying to develop power plants in cooperation with the electrical and energy ministry. They will permit power generation with competitive pricing from LNG, LPG, HFO, solar and waste-to-energy up to 50MW per plant under management of Yangon regional government. During the next two years, 1,000MW electricity will be transmitted from Irrawaddy division and 500MW from Thanintharyee division to Yangon. If the electricity is sufficiently available with the reasonable prices, infrastructure and industry will be dramatically developed. With the development of energy sector with total utility of 3,000MW during the next two years, local and foreign investments are expected to increase in Yangon.