Local founders are excited about economic reform which will lift sanctions, bring in foreign investment and boost the tech sector overall
In Southeast Asia’s final frontier market last week, the people have spoken. Or at least the 30 million, out of a population of 53 million, who were eligible to vote. Aung San Suu Kyi has won Myanmar’s first “free” election in 25 years that was held on November 8.
Led by Suu Kyi, the National League for Democracy (NLD) has won enough seats to choose the country’s new President, but they’ll still have to collaborate with the military, who has kept 25 per cent of seats for themselves.
Despite the win, the presidential post won’t be taken up by Suu Kyi who is barred from the job — but the Nobel Peace laureate insists she’ll be running the country anyway.
Change for Myanmar began to come about in 2011, with Western sanctions easing and foreign telcos Ooreedoo and Telenor arriving on the scene. All of a sudden, a country under military rule for five decades was catapulted into the digital age — with everyone including monks roaming the streets totting smartphones.
Foreign investment, which has reached US$8 billion, and newly-minted tech infrastructure are two key pillars in the foundation for Myanmar’s infantile startup ecosystem. But can tech scene growth be accelerated by a new government? We had a chat with our sources in Yangon’s tech scene to gauge whether the NLD landslide victory also spells a win for Myanmar startups.
Positive energy on the ground
According to Yan Naung Oak of Phandeeyar, the atmosphere in Yangon is optimistic, people are expecting a peaceful transition of power and the startup community is emboldened to step up and make their mark.
“I think on a more basic level, the results of the elections have boosted people’s confidence and signaled to them that each one of them has the power to take action and bring about change. This is in drastic contrast to the mentality that pervaded in the past where people rarely have the agency to take charge and make things happen,” he said. Phandeeyar organised hackathons with voter education groups months ahead of the general elections.
More importantly, Oak believes that the new administration will bring on more business-friendly legislation. “Especially interesting would be finalising the regulatory framework for mobile payments and mobile money,” he said. “This is currently a major hurdle for tech startups because its not easy for them to accept payments from end users.”
For Thet Mon Aye, Co-founder and CEO of express bus ticket platform Star Ticket, the election results will bring much needed change to a nascent but massively promising tech sector.
“This is the change which most people from our country really wanted.”
“As a tech entrepreneur, I believe it will transform the tech sector completely by making proper laws and protection to foreign NGOs, companies and potential investors who are interested in our country. In comparison with other Southeast Asian countries, Myanmar is not touched in terms of the tech sector yet and it will leapfrog in consumption of new technology by knowledge-sharing and long-term investments from developed countries,” she said.
Opportunities will come with challenges
The election results will make it generally easier to do business in Myanmar, including raising the prospect of further lifting US sanctions which has been limiting foreign investment in Myanmar. Steven Phyo, Co-founder of B2B trading platform BaganTrade is looking forward to the economic reform that the new government will bring, which will benefit the average worker.
“As per geological location, Myanmar is situated between the two most populated countries China and India. Manpower cost is very low. If the new government can modify the laws for foreign businesses, more foreign direct investment will come in and create more job vacancies. Then, individual income will be higher,” he said.
But he sees both opportunities and challenges arriving hand in hand as with foreign interest, comes competition. “It’ll be easier for startups to work with improved infrastructure and more investors will invest in those startups. On the other hand, more experienced international competitors will come in and skilled labor costs will be higher.”
Still, Phyo says to bring it on as he believes Myanmar founders have the ‘unfair advantage’ of local expertise and homegrown startups enjoy a good challenge.
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