Myanmar Insider presented the results of second quarterly economic survey and the resulting index to public this month. The objective is to provide information on business environment in Myanmar for all stakeholders, especially the government, the investors and the business people.
The followings are our findings:
1) The current economic situation in the country is still bad or very bad, with more than 83% of the respondents saying the economy is in the bad or very bad territory at present. In fact, the economic situation is worse than the previous quarter, comparing the survey results. It also somehow validate our respondents’ forecast in the previous quarter (Q4 of 2017) survey which clearly highlighted the fact that most of our respondents expect the economy to get worse in Q1 of 2018. It actually got worse, based on 2018 Q1 survey results, even though the respondents were not the same.
2) For the forecast for the next quarter, business leaders are getting more optimistic, as more than 50% expect the business environment to get better in Q2 of 2018.
3) For confidence level on business prospects, 70% of respondents answered they are confident in current survey even though 84% of respondents answered confident in last survey. Optimistic sentiment above have not translated into the confidence in their own businesses, as confidence levels have dropped compared to the last survey.
4) In terms of business opportunities, more business leaders are seeing slightly better opportunities now than three months ago.
5) In terms of actually making more investments, the results are the same as the previous quarter, the majority of the respondents being unsure whether to make additional investments.
6) For key economic indicators, M y a n m a r I n s i d e r a s k e d t h e respondents to give their forecasts on economic growth, inflation and exchange rates. For economic growth and exchange rates the forecast is the same as the previous quarter, around 70% expecting both indicators to get worse. For inflation, the respondents in the current quarter expects it to get a lot worse i.e., business people are expecting higher inflation in the coming quarter. The indication is that they may be adjusting their selling prices in line with this inflation expectation.
7) Based on survey, the economic confidence index for the present quarter is negative 25 points, significantly worse than the previous quarter of negative 14 points. 8) In terms of issues that businesses are facing, more than 63% sited the cost of doing business, including taxes. The sentiment among the businesses is that the government is concentrating too much on collecting taxes instead of improving the economy.
9) On the issue of democracy versus the economy, no one (zero respondents) is saying democracy being somewhat more important than prosperity in current survey.
10) For areas of focus, about half of the companies are concentrating on cost management in the coming quarter, instead of seeking new markets or products.
11) In current survey, a new question about recommending respondents’ business friend to invest in Myanmar at present is added. 2/3 of the respondents (about 66% of respondents) would not recommend their overseas associates to invest into Myanmar.
12) In the final question, we asked respondents to compare the current and previous governments in terms of management of the economy. As a sign of people getting frustrated with the current government management of the economy as time passed by, 67% are now saying current government management of the economy as bad, compared to 59% in the Q4 2017 survey. People are getting impatient with NLD government producing no visible economic results. M y a n m a r I n s i d e r e c o n o m i c sentiment survey results are provided by 50 respondents representing business owners, “C” level executives, directors and senior managers of businesses and companies that employ ten to thousands of staff.