With the rapidly growing tourism sector and a critical need to address the subsequent demand for capital amongst domestic developers to enter the industry, a Tourism Development Bank will be founded shortly in Myanmar. Having already secured government approvals to commence operations, the bank will primarily be aimed at supporting and improving the nation’s tourism sector by assisting entrepreneurs and providing loans and technical aid to local hotels and tour companies. Between 2010 and 2013, Myanmar saw an increase in tourist arrivals from 79,000 to 2.04 million at a CAGR of 37%. The number of hotel properties in the same period increased by 34%, from 691 to 923, with a consequent increase in total number of rooms from 235,000 to 348,000 (+49%). Foreign investment in hotels and commercial complexes have however seen little change, with merely 3 additional projects being added to the existing 36, reflective of the precautious stance adopted by international investors owing to the political situation in the country. Moreover, this initiative which is likely to boost hotel development by locals may further increase barriers to entry for foreign investors.
HVS APAC HOSPITALITY NEWSLETTER.