Myanmar hopes to be the next Asian winner of US-China trade war as Vietnam nears capacity

Vietnam pulled ahead in the race to lure producers, but other neighbours including Thailand and Indonesia are stepping up efforts to attract them

One advantage for Myanmar – where about one-third of the population lives in poverty – is that Europe and the US offer preferential export terms

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Workers at a garment factory in Myanmar. Photo: SCMP Pictures

Published: 2:47pm, 11 Nov 2019Updated: 2:56pm, 18 Dec 2019

Myanmar expects to attract more investment as manufacturers seeking to relocate production from China to skirt US tariffs encounter capacity constraints in Vietnam.

The Southeast Asian nation aims to woo a total of US$5.8 billion in foreign direct investment this year and cut back the red tape that deters some companies, according to a senior government official.

“When it comes to relocation, Vietnam might be preferable but it’s already congested,” said Aung Naing Oo, permanent secretary at the Ministry of Investment and Foreign Economic Relations. “So, investors are now eyeing Indonesia and Myanmar.”

One advantage for Myanmar – where about one-third of the population lives in poverty – is that Europe and the US offer preferential export terms to boost growth, according to Aung Naing Oo. At the same time, the US$71 billion economy continues to face traditional obstacles such as insufficient supplies of electricity and industrial land.

Recent evidence suggests Vietnam has pulled ahead in the race to lure producers but neighbours including Thailand and Indonesia are stepping up efforts to attract them.

Clogged infrastructure is one of the risks for Vietnam, where shipping container capacity will need to grow at almost twice its 10-12 per cent pace of the past decade to keep up with new demand, Bloomberg Intelligence research shows.

Myanmar workers assemble lacquerware trays at a factory in Bagan. photo: AP

Myanmar hopes to be the next Asian winner of US-China trade war as Vietnam nears capacity

Vietnam pulled ahead in the race to lure producers, but other neighbours including Thailand and Indonesia are stepping up efforts to attract them One advantage for Myanmar – where about one-third of the population lives in poverty – is that Europe and the US offer preferential export terms

Vietnam pulled ahead in the race to lure producers, but other neighbours including Thailand and Indonesia are stepping up efforts to attract them

One advantage for Myanmar – where about one-third of the population lives in poverty – is that Europe and the US offer preferential export terms