Myanmar – The market survey report of water purifier

I have been following the Foreign Trade Associations in Yangon, Myanmar, and Mandalay since the Myanmar market began to heat up in 2010. I did this because I wanted to take a closer look at this developing country to see if there were any business opportunities. In addition, I have attended the Yangon water treatment exhibition several times and have also visited several potential customers by myself. I have done this no fewer than five or six times but have never achieved any success.

[1] National Income vs. Inflation

The average monthly national income in Myanmar is about US$120. In 2012, a mobile phone SIM card cost US$100 (at the time, people in Myanmar preferred to collect US dollars, and most shops would accept both US dollars and the Myanmar (Burmese) kyat MMK).

Businessmen from all over the world are now rushing to Myanmar for its riches, making it too late to build five-star hotels, so it is extremely difficult to find a room. The price of a room can reach US$300. I stayed at the five-star Pan Pacific Hotel in Yangon in 2019, where the rate had dropped to US$100, highlighting the significant difference.

In 2012, the Wi-Fi network in Myanmar was being developed, and only hotels provided it. Ordinary company lines provided immediate Wi-Fi, but the reception was poor.

[2] The Opening of the Market

Cars began to be imported in 2012, with the number doubling within a few years. Ninety percent of the population purchases Japanese used cars and trucks, which have the steering wheel on the right. The most unusual aspect of Myanmar is that they drive these used cars, with their steering wheels on the right, on the right-hand side of the road.

When I visited Yangon in 2012, I did not see any expensive cars or establishments such as McDonald’s, KFC, or Starbucks. However, when I visited again in 2018, I saw imported European cars on every street, and designer clothing and bags were on display in high-end shopping malls.

[3] The Problems of Power Shortages in Myanmar

Six or seven years ago, Myanmar’s national public construction infrastructure could not keep pace with the country’s economic development. Power outages were commonplace, and each store had its own generator located in front of the premises.

Yangon experienced countless blackouts daily, all without warning. Even at customs clearance at the airport, you had to wait for an hour. This was not due to inefficiency, but rather because the power cut off randomly, every few minutes or every ten to twenty minutes. The customs computers were, of course, unable to operate without power. However, when I visited Yangon in 2018, the negative impression from Myanmar’s power outages had vanished. “Myanmar” = “free electricity,” and almost all the spare generators in front of shops had been removed. On my most recent visit (November 2019) to Yangon, it was refreshing to disembark from the plane and experience the brand-new modern airport.

[4] Yangon and Mandalay Market News

People in Myanmar prefer cheap goods. Most products come from mainland China and are imported to Yangon via the Yunnan border, saving on shipping costs… making Yangon a transfer centre. Additionally, about 80% of Mandalay’s daily necessities come from mainland China; Mandalay is located on the border with Yunnan, making it easy to smuggle imported goods and evade tariffs.

I visited Myanmar in 2012 and 2013. The changes I have observed since then are akin to those seen in mainland China 30 years ago and are continuously evolving. As long as they work hard, there are opportunities for development everywhere, and young people might consider moving here if they wish to progress.

[5] Overview of Water Treatment in Myanmar

According to Aekar Company, imported water purifiers from Taiwan incur a 7.5% import tax, while another local import company stated that the import tax for goods from mainland China or Taiwan is 15%. According to overseas Chinese importers in Yangon, approximately 40% of residents in Myanmar still have no electricity, so they cannot use RO water purifiers, even if they were to purchase them. Most residents of Yangon and Mandalay buy and use bottled water for drinking. A 20-litre barrel of drinking water costs between 350 and 500 Myanmar Kyats (approximately 10 to 15 Taiwanese dollars).

I took a pressure tester to Myanmar to measure the local water pressure but was unable to obtain a reading because there was no water pressure. The tap water in the city did not have any chlorine added to it. I still remember the first time I visited Yangon in 2012; I stayed at the Orchid Hotel, where I used a transparent glass to check the bathwater. The colour was an orangey yellow, and it was actually even yellower than the waters of the Yellow River. Regarding groundwater quality in Yangon, the TDS is about 3700 PPM, while the TDS of tap water is about 30-200 PPM.

In Mandalay (the second largest city in Myanmar), the best-selling items are 10” and 20” transparent filters. The bottles come in two sizes for inlet and outlet: ¾” and 1”, and the filter core can be matched: PP pre-filter, GAC granular activated carbon, CTO block, or resin. The cost of water for daily use is 50 Myanmar Kyats per unit (approximately NT$1.7).

[6] Myanmar Water Treatment Exhibition

There is a water treatment exhibition in Yangon, Myanmar, almost every year, called the water treatment exhibition, but the scale is rather small, with only a handful of water treatment manufacturers attending. This exhibition is combined with an energy and building materials exhibition, resulting in an event where different products are displayed together.

The location of the exhibition takes place in tents and is not fixed, moving to a different site each year.

[7]Conclusions

When considering Myanmar as a market for water purification equipment, it is clear that it will take a considerable amount of time for the country to evolve into a vibrant market. The reasons for this are as follows:

The average national income is too low. People are content with basic food and drink, but purchasing a water purifier is a luxury for them. Selling to the top tier of customers presents limited opportunities.

There is a lack of vigorous promotion and advocacy from manufacturers. For people to accept the idea that drinking water needs to be filtered, education and awareness campaigns are essential.

The market in Myanmar differs significantly from those in China and Vietnam. China has experienced rapid development in just 30 years, with a swift increase in income. Additionally, manufacturers of water purification equipment now hold the top position globally, and major international brands have already entered the Chinese market, with manufacturers doing their utmost to advertise. In Vietnam, the annual income of nationals (US$ 6,450 – 2017 data) is not as high as that in mainland China (US$ 9,732 – 2018 data) but is quite comparable. Furthermore, the Vietnamese people are industrious and work hard to improve their lives. Vietnam also opened its market earlier than Myanmar, attracting foreign investment sooner and fostering longer-term relationships. The Vietnamese have strong capabilities in counterfeiting, and a relatively large number of them have started their own businesses. Most local importers have backgrounds in well-established factories that produce various products. By importing from Taiwan, they can source components, and with low entry barriers for mould production, they are likely to soon replace Taiwanese manufacturers. The most notable manufacturers in Vietnam include:

• KoriHome
• Tecomen
• TANA
• Kangaroo
• Picenza