Overview
Before the COVID-19 pandemic, Burma’s digital economy contributed approximately 1-3 percent to the overall GDP. This figure included sectors such as telecommunications, e-commerce, digital services, and fintech. Projected growth has been moderated by ongoing political instability and infrastructure challenges and is expected to increase slightly compared to 2022 and 2023.
Market Challenges
Regulatory environment
The country is experiencing significant political instability, affecting the economy’s overall economic health and potential for the digital economy. Many sectors face inconsistent enforcement and a lack of transparent laws and regulations, creating hurdles for the growth. More broadly, electricity blackouts, fuel shortages, internet coverage restrictions, conscription laws, and brain drain all hinder the overall economy.
Digital Economy Roadmap 2030: The Ministry of Transport and Communication is expected to finalize the draft roadmap in 2025. It focuses on several areas, including infrastructure development, digital literacy, and innovation across key sectors, promoting e-commerce, fintech, and digital startups, and enhancing public-private partnerships.
Cybersecurity: The draft cybersecurity law hasn’t been finalized. It has faced criticism from activists, digital and human rights groups, businesses across various sectors, and the international community for its provision that would enable the military government’s overall control over internal and personal data.
Data Protection: Burma doesn’t have a standalone data protection law. As the digital economy is expected to show slight progress in the coming years, concerns about data privacy, security, and the handling of personal information have grown. Constant political instability and weak governance have prevented the establishment of a data protection framework. Although the draft cybersecurity law includes data protection and privacy provisions, these would grant excessive powers to military authorities. While the banking and telecommunication sectors have specific regulations related to data handling, these regulations are strictly limited in scope and do not offer data protection across all sectors.
Digital Trade Barriers
Data localization: As of September 2024, Burma does not have standalone data localization laws. Additionally, no specific localization requirements have been issued for IT firms. Ongoing discussions suggest that the current government may introduce data localization requirements as it continues to expand its control over digital infrastructure.
Technology Barriers: Some barriers include limited access to high-speed internet and mobile network coverage in rural areas amid the civil conflict, as well as slow data speeds and low digital literacy.
Third country bias/influence: In Burma, U.S. products and technology are favored for their high-tech features and quality. However, third-country products are often considered substitutes due to price advantages.
Digital Trade Opportunities
The Myanmar Digital Economy Roadmap 2030, currently in its final draft stage and expected to be launched by 2025, will focus on a range of areas, including administration, basic infrastructure, trade, education, fintech, telecommunications, digital services, and social sectors for digitalization.
Spending on IT security and risk management technology is expected to continue to expand. The key industry sectors investing in cybersecurity technologies are healthcare, financial institutions, IT and telecommunications, and the public sector. Most cybersecurity equipment and solutions are imported. U.S. equipment is perceived to be of higher quality with better technology, but the market is price-sensitive.
Digital payment platforms represent one area of opportunity. Banks and mobile financial service providers are required to utilize the Central Bank of Myanmar’s CBM-NET System.
On June 12, 2024, the Central Bank of Myanmar (CBM) issued new guidelines amending transaction limits for digital payments as part of its digital economy initiative.
Partnering with a local agent or distributor is the most effective strategy for entering the Burma market and reaching potential and reputable local buyers. Such an agent or distributor can streamline market entry by leveraging their in-depth market knowledge, established distribution networks, and relationships with key businesses and entities.
Helpful Resources:
- I&A’s Office of Digital Services Industries (ODSI)
- National Trade Estimates Report – Digital Trade Barriers
- White House CET List, e.g., Artificial Intelligence -> Machine Learning