Yangon - Economy

Economy

Yangon is the country’s main center for trade, industry, real estate, media, entertainment and tourism. The city alone represents about one fifth of the national economy. According to official statistics for FY 2010–2011, the size of the economy of Yangon Region was 8.93 trillion kyats, or 23% of the national GDP.

The city is Lower Burma’s main trading hub for all kinds of merchandise – from basic food stuffs to used cars although commerce continues to be hampered by the city's severely underdeveloped banking industry and communication infrastructure. Bayinnaung Market is the largest wholesale centre in the country for rice, beans and pulses, and other agricultural commodities. Much of the country’s legal imports and exports go through Thilawa Port, the largest and busiest port in Burma. There is also a great deal of informal trade, especially in street markets that exist alongside street platforms of Downtown Yangon's townships. However, on 17 June 2011, the YCDC announced that street vendors, who had previously been allowed to legally open shop at 3 pm, would be prohibited from selling on the streets, and permitted to sell only in their townships of residence, presumably to clean up the city's image. Since 1 December 2009, high-density polyethylene plastic bags have been banned by city authorities.

Manufacturing accounts for a sizable share of employment. At least 14 light industrial zones ring Yangon, directly employing over 150,000 workers in 4,300 factories in early 2010. The city is the centre of country's garment industry which exported US$292 million in 2008/9 fiscal year. More than 80 percent of factory workers in Yangon work on a day-to-day basis. Most are young women between 15 and 27 years of age who come from the countryside in search of a better life. The manufacturing sector suffers from both structural problems (e.g. chronic power shortages) and political problems (e.g. economic sanctions). In 2008, Yangon's 2500 factories alone needed about 120 MW of power; yet, the entire city received only about 250 MW of the 530 MW needed. Chronic power shortages limit the factories' operating hours between 8 am and 6 pm.

Construction is a major source of employment. The construction industry has been negatively affected by the move of state apparatus and civil servants to Naypyidaw, new regulations introduced in August 2009 requiring builders to provide at least 12 parking spaces in every new high-rise building, and the general poor business climate. As of January 2010, the number of new high-rise building starts approved in 2009–2010 was only 334, compared to 582 in 2008–2009.

Tourism represents a major source of foreign currency for the city although by Southeast Asian standards the actual number of foreign visitors to Yangon has always been quite low—about 250,000 before the Saffron Revolution in September 2007. The number of visitors dipped even further following the Saffron Revolution and Cyclone Nargis. The recent improvement in the country's political climate has attracted an increasing number of businessmen and tourists. Between 300,000 to 400,000 visitors that went through Yangon International in 2011. However, after years of underinvestment, Yangon's modest hotel infrastructure—only 3000 of the total 8000 hotel rooms in Yangon are "suitable for tourists"—is already bursting at seams, and will need to be expanded to handle additional visitors. As part of an urban development strategy, a hotel zone has been planned in Yangon's outskirts, encompassing government- and military-owned land in Mingaladon, Hlegu and Htaukkyant Townships.