The Asia Foundation Releases Myanmar Business Environment Index 2019

New tool measures economic governance for private sector development

Yangon, June 11, 2019 — Today, The Asia Foundation released the Myanmar Business Environment Index 2019 (MBEI) as a diagnostic tool to better understand the local business environment. The government of Myanmar has recognized the importance of private sector development, yet many Myanmar enterprises continue to face a challenging business environment. The MBEI, funded by UK Aid through the DaNa Facility, serves as the first step for providing Myanmar’s Union and state/region governments with the evidence base to pursue widespread decentralized economic governance reforms.

The MBEI reflects the views of private enterprises across Myanmar based on a nationwide survey of 4,874 businesses in the services and manufacturing sectors. The study measures 10 components of good economic governance and provides insights and analysis that government may use to further improve Myanmar’s business environment. The report focuses in particular on the experience of Myanmar’s many domestically-owned small and medium-sized enterprises (SMEs), aiming to identify constraints in Myanmar’s business regulatory environment and provide a tool for identifying reform opportunities that encourage growth.

“MBEI represents the voice of private businesses from across Myanmar,” said Diana Fernandez, deputy country representative for The Asia Foundation in Myanmar. “The new tool is designed as a resource for the Myanmar government to assist in making decisions about how to improve Myanmar’s business environment at the local level.”

“We know that inclusive economic growth is the most powerful tool we have to address poverty and create a prosperous society,” said Tom Coward, team leader for the Inclusive Growth team of the UK’s Department for International Development.

“A growing and thriving private sector is at the heart of this,” Coward added. “We want to create an environment where responsible business is regulated in a way that means it can invest and grow, and which will create jobs and economic opportunities for the people of Myanmar.”

Key Findings

  • 85% of Myanmar businesses have at least one documented proof of formalization; in most cases it is an operating license from the township or City Development Committee.
  • Regulation and administrative procedures for businesses after they have become legal to operate are not terribly burdensome by international comparison.
  • Many SMEs in Myanmar are in sectors that could be impacted by environmental harm and therefore show a strong preference for a clean environment.
  • Recruitment of qualified workers, particularly technicians and managers, is a major challenge for businesses in Myanmar.
  • Quality of infrastructure is a severe concern for businesses, particularly with respect to road and electrical infrastructure.
  • Critical documents for business planning, such as local budgets, are often unavailable to the average business owner.

“The MBEI demonstrates that Myanmar’s states and regions each have different strengths and weaknesses with respect to the business environment, and it serves as an added source of information for government on how to pursue reforms,” said Jon Keesecker, project manager for the Myanmar Business Environment Index.

The Asia Foundation is a nonprofit international development organization committed to improving lives across a dynamic and developing Asia. Informed by six decades of experience and deep local expertise, our work across the region addresses five overarching goals—strengthen governance, empower women, expand economic opportunity, increase environmental resilience, and promote regional cooperation.

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Related locations: Myanmar
Related programs: Good Governance
Related topics: Economic Governance Indices

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