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Press release: Survey finds the manufacturing sector remains instrumental for Myanmar’s economic growth and transformation

YANGON, MYANMAR and HELSINKI, FINLAND – A new report published by the Central Statistical Organisation (CSO) and the United Nations World Institute for Development Economics Research (UNU-WIDER) says that Myanmar’s manufacturing sector is more productive in 2019 than it was in 2017. 

This is mainly explained through investment in the capital stock intensity. The largest firms have achieved both the highest growth in capital intensity and the largest positive change in full-time employment from 2017 to 2019.

Firms interviewed for the survey continue to report highly localised sourcing and selling patterns, especially smaller firms. Medium and large firms have an increasingly international outlook, with a greater proportion of transactions taking place across country borders.

The report, titled Myanmar Micro, Small and Medium Enterprise Survey 2019, is the second quantitative report of the Myanmar Enterprises Monitoring System (MEMS) project. The first report, released in 2018, was the first of its kind in Myanmar’s history. The new report covers 2,268 enterprises, which participated in both phases of the study. 

The Danish Ambassador to Myanmar, Mr John Nielsen said, 'Myanmar’s transition to a market-based economy will at the core include rapid development of the private manufacturing sector, which has large potential for improving economic growth. But future advances will greatly depend on the policy and business environment in which manufacturing activities take place. Denmark is pleased to  support the MEMS report, and we look forward to seeing how the data and research will be used towards better and more informed policy making in Myanmar.' 

According to the report, a well-functioning and productive industrial sector has the potential to generate poverty-reducing employment, fuels growth through enhanced productivity and improve the opportunities for trade in a globally connected economy. However, the shifts in productivity, investment and finance, and employment leads to a need for renewed policies that support economic transformation.

The study also finds that employment in the manufacturing sector is characterised by high levels of both gross and net turnover, indicating that worker instability and job security may be a concern. On the other hand, this can be an indication of a flexible labour market with low search costs. 11 per cent of employees are domestic migrants.

Regarding wages, the report shows that average monthly salary has increased from 147,898 Kyats in 2017 to 177,518 Kyats in 2019. Salaries tend to increase with firm size. The salaries of male employees are substantially higher than female salaries, even when account is taken of education and industry sector differences.

The Director General of CSO U San Myint highlighted that, 'Since private sector development is dominant for the country, the availability of high-quality data on privately owned businesses is vital. The CSO is determined to generate the necessary data and statistics for evidence-based policy, planning and plan implementation in Myanmar.'

Finn Tarp from the University of Copenhagen and UNU-WIDER stated that, 'The present report is a major analytical achievement. The breadth of data and information is unprecedented, and it allows all of us to carefully examine enterprise performance and the business environment in Myanmar in depth. We wish that the report will provide yet another stepping stone in contributing effectively to the ongoing improvement of the quality of economic policy in Myanmar.' 

The report can be downloaded from here.
 

Notes to editors:

• The Myanmar Enterprises Monitoring System (MEMS) survey is part of the project ‘Towards Inclusive Development in Myanmar’, initiated by the Central Statistical Organisation (CSO) of the Ministry of Planning and Finance and Industry of Myanmar.
• The project is supported financially by the Government of Denmark, with technical cooperation provided by the United Nations University World Institute for Development Economics Research (UNU-WIDER) and the Development Economics Research Group (DERG) of the University of Copenhagen. The project aims to strengthen evidence-based policy-making and analysis and help underpin Myanmar’s move through a challenging structural transformation and development process.
• Download Myanmar Micro, Small and Medium Enterprise Survey 2019