Interview: Daw Win Win Tint
How has the retail sector adjusted to recent political and economic changes?
DAW WIN WIN TINT: We started to notice a change two years ago when, after the elections, it was not clear in what direction the country was headed. At the time, everybody was a little suspicious that the elections were a sham, but when the new government took office and we heard our president’s speech for the first time, there was a belief that the country was ready for change.
Foreign investors became excited about the direction in which the country was going; at the same time, government was introducing reforms, it began to ease foreign currency flows as well as import and export flows. These changes, and others, have made operating within the retail sector much easier.
How reliant is Myanmar on imports? What potential exists for manufacturing on a larger scale?
WIN WIN TINT: Myanmar is a very rich country. However, during the decades of isolation, manufacturing industries were almost non-existent. All factories were state-owned and manufactured products were of poor quality. The consumer class in search of basic products would buy imported goods from the surrounding region – the majority of these goods (approximately 80%) came from Thailand. This was a result of the government restricting international trade.
Today we can trade with the rest of the world, with the majority of our imports coming from the ASEAN region and China. The West is also a trading partner, although on a smaller scale. As a result of the lack of infrastructure, such as electricity and logistics, many manufacturing companies are not willing to come in yet. Myanmar does, however, have a lot of natural resources and an abundance of human resources, so manufacturing should be a key sector in the future. With regards to labour-intensive manufacturing, there is already a lot of interest in setting up operations in Myanmar, particularly in the garment sector, which is the fastest-growing in the country at this time.
Myanmar has human resource capacity for the private and public sector. Unfortunately, the skill level is not of a high standard yet, due to the poor quality of education. Whoever comes into Myanmar to do business must realise that human resource training is vital, not only as an investment in the business but also as a key contributor to the bottom-line.
How would you assess local competition? What impact do you expect foreign firms to have?
WIN WIN TINT: There is only local competition in retail. At present there is no foreign competition, but there will be soon. In terms of local competition, everyone is doing better – not only with sales, but also by offering better service. As a local player, the government has put in place some protection. When the government was preparing the Foreign Investment Law (FIL) there was a fear that not enough protection would be in place for local players. All the retailers came together and reached a consensus that there should be no entrance of foreign retailers before 2015. The government listened to our concerns and applied them to the FIL. So, from 2015, they may enter through a joint venture with a local company and from 2020 they will be allowed 100% ownership. This gives us time to prepare for more experienced international competitors.
What plans are being made to introduce a credit system within retail stores?
WIN WIN TINT: Currently all payments within our stores or supermarkets are cash payments, but from 1994-2000 debit and credit cards were in use. At one point that made up 4% of our total revenue. The banking crisis ended the use of these credit facilities. There are many banking reforms taking place, which have brought the re-emergence of debit cards or Myanmar Payment Union cards. As the banking sector continues to modernise I expect these facilities to expand as well. Our hypermarkets will benefit from these new credit card and credit facilities, especially for sales of white goods.
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