The market for Myanmar packaging is expected to grow at a CAGR of 5% during the forecast period. Increasing demand from the end-user industries such as food, beverage as well as House Hold Chemicals is driving the market growth.
– Myanmar packaging Market gains an advantage from its strategic location between the two biggest emerging markets in the world: India and China. With low minimum wages of approximately USD 3.60 daily, tax incentives and Special Economic Zone benefits, the region has become an attractive destination for manufacturers of products such as garments, value-added Production of Food and beverages.
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– Myanmar agriculture industry contributes 30% of national GDP, witnessed an increase in exports of fresh produce. According to the Ministry of Commerce, Myanmar’s exports of agricultural products between 1st October and 3rd April in the 2022-2031 financial year have risen to USD 2.16 billion from USD 1.75 billion in the corresponding period of the 2018-2022 Financial Year, an increase of USD 406 million. This will likely promote investment in packaging and logistics industry related to agriculture paper and paperboard packaging.
– The E-commerce industry in Myanmar is at the budding stage. Internet penetration is primarily driven via smartphones while nearly 40 million of the country’s total population use mobile phone and approx 80 percent have access to smartphones,with increasing internet penetration, growing middle-class population across the country along with government efforts like the formation of Digital Economy Development Committee (DEDC) to boost the digital economy, will accelerate e-commerce growth across the country and support corrugated packaging primarily use in the e-commerce industry.
– Customs duty is zero for all the goods to be exported from Myanmar as well as zero import duty in various countries makes it an attractive place for setting manufacturing plants for global players in the packaging industry.
Key Market Trends
Growing Demand in Food and Beverage Industry
– Due to the improvement in foreign investment climate is the new Companies Law 2017 and growing middle-class Myanmar is increasingly becoming an attractive destination for foreign food brands this includes brands like KFC, Gloria Jeans Coffee, Café Amazon, Coffee Bean & Tea Leaf, Swensens, Burger King and Dominos. This is expected to boost the demand for paper cups, bowls and bags packaging used in restaurants.
– GDP per capita in Myanmar witnessed rapid increases between 2014 and 2022, boosting growth in food and beverage sales. The number of bars and restaurants is increasing, particularly in large cities like Mandalay and Yangon, where Myanmar citizens and most business expatriates frequently enjoy a bustling nightlife. Rising disposable income and optimistic consumer sentiment will be key drivers for growth in Food and Beverage sales and in turn the packaging industry
– In the food processing industry, until June 2022, there were 29,118 food and beverage companies registered, which is 57% of the total manufacturing companies. The food-processing sector consists mainly of instant noodles, coffee, tea, ready-to-eat traditional foods and bakery products.
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– Domestic production of beverages including beer,spirits and soft drinks is growing fast, primarily due infusion of foreign direct investment.
Increasing Investment in Manufacturing through FDI
– The region witnessed a continues increase in investment through FDI particularly in manufacturing, transport and communication sectors, The manufacturing sector witnessing increasing opportunities due to the significant growth in the domestic market of Myanmar as well as direct access to the strategic markets of southeast Asian countries as well as to India and China Myanmar also has comparatively low labor costs, abundant natural resource, and a diverse agricultural base for value-added production to encourage the growth of the manufacturing sector. This has boosted demand for corrugated and heavy-duty packaging in the region.
– Due to growing real GDP, increasing consumption, and untapped market opportunities, many Packaging firms are investing in Myanmar through direct investment or Joint venture. For Instance, in 2016 Daibochi Plastic and Packaging Industry Bhd announced to invest RM29 million for a 60% stake in the joint venture company with Myanmar Smart Pack Industrial Company Ltd (MSP) to establish a production facility in Yangon, Myanmar to manufacture, sell and distribute flexible packaging products within the country, as well as to export and invested about RM23.6 million for capital expenditure over a three year period to enhance the facility’s production capacity, quality and efficiency.
– Further increasing demand for construction chemicals and pesticides in the agriculture industry is driving Chemical industry investments in the region. For Instance, in 2018, BASF opens its first manufacturing plant in Myanmar, producing chemicals for local market Evonik, a Germany based chemical company is also considering an investment in Myanmar. These investments will further boost the chemical industry packaging demand in the region.
The Myanmar packaging industry is moderately competitive and consists of several players. With the rising demand for packaging applications, along with technological advancements across the economy, many foreign players are increasing their market presence by expanding their business footprint across different end-user industries.
– September 2022 – Daibochi Berhad is targeting to commercialize several new sustainable, flexible packaging solutions for its multinational consumer brands clientele in the Financial year 2031.
– April 2022 – Can-One Bhd subsidiary Can-One International Sdn Bhd announced the acquisition of Kian Joo Can Factory Bhd by acquiring a 95.88% stake in the company through open offers. In 2016 Kian Joo had invested about USD 23 million to build two plants in the Thilawa Special Economic Zone near Yangon, Myanmar.
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