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Foreign businesses hold on tight as economy grows at breakneck speed
When Singapore lawyer Chester Toh starting working in Yangon 18 months ago, his commute to the centre took 15 minutes. Now it’s a 45-minute slog through increasingly clogged streets.
Call it the price of progress – or reform, to be more exact.
“Back then, the roads had old rickety vehicles moving at a really slow pace, not much traffic,” said Toh, a partner at law firm Rajah & Tann. “Now you see a lot of brand new vehicles, roads being clogged up.”
Toh’s traffic woes reflect the rapid changes taking place in Myanmar. After decades of military rule, the country is beginning to enjoy political freedom and more liberal economic policies. The freer climate has attracted increasing numbers of overseas firms, including Rajah & Tann, which set up shop this year.
Yangon’s heavier traffic is not necessarily a bad thing. As Toh, 36, notes, it is a direct sign of growing business activity and wealth in Myanmar.
KPMG’s Anurag Chaturvedi agrees, though increasing traffic congestion has affected his movements around the city too. Chaturvedi, a director at the accounting giant, leads its advisory business in Myanmar, which now has 14 staff.
“Towards the end of last year, it took 15 minutes [to get downtown], but now, on a good day, it takes at least half an hour to one and a half hours.”
And these are not just any old vehicles jamming the streets. Chaturvedi, 39, says he is seeing more and more Ducatis and Lamborghinis.
Burgeoning business has also lifted office rents to levels comparable to Singapore.
Toh says for the three commercial buildings in Yangon – Centrepoint Towers, FMI Centre and Sakura Tower – which are popular with multinationals, rents can be “as high as US$75 [Bt2,400] per square metre, and still rising”.
This is why firms like Rajah & Tann and KPMG have chosen offices outside the downtown area.
KPMG and Rajah & Tann are among many professional services firms that have had to ramp up their presence in Myanmar to meet demand after just a few months of operations.
Telecommunication infrastructure has caught up as well.
“Our Sakura Tower office now has fibre optic connection, and most Internet lines here are good enough for Skyping,” says Cheah Swee Gim, one of two directors of law firm Kelvin Chia Yangon.
For all the changes Myanmar has seen in the past year or so, the country is still old-fashioned in some ways.
Toh notes that he gets local clients coming in carrying sacks of banknotes: “Just wads and wads of cash,” he laughs.
