More Thai vehicles for Myanmar
Feb 18, 2012
The Thai auto industry is gearing up to sell more vehicles in Burma, following a visit on Thursday by 40 Burmese automotive businessmen.
Chokdee Kaewsang, the deputy secretary-general of the Thai Board of Investment, told The Nation the Burmese businessmen met with 24 auto-parts manufacturers.
The joint secretary-general of the Burmese Chamber of Commerce and Industry, Moe Kyaw, said the Burmese want to form business contacts in Thailand because of the growing demand for vehicles in their country, in an article published on Friday.
The Burmese are especially interested in importing Thai pickups, in a market estimated to need 60,000 to 80,000 units per year, businessmen said.
Vehicles in Burma are highly expensive for most of its citizens. Car prices in Rangoon are among the highest in the world. A sports utility vehicle, imported for the equivalent of around US$ 50,000, goes for US$ 200,000, sources said. Illegally imported unregistered cars are cheaper – typically about half the price of registered cars.
Nonetheless, Rangoon is experiencing traffic congestion in some areas, and many Burmese are looking to replace older model vehicles. Throughout Burma roads are in poor condition, and in Rangoon often not wide enough to accommodate an increasing number of vehicles.
Most Rangoon residents rely on an extensive network of buses to get around. An estimated 6,000 buses move about the city, carrying around 4.4 million passengers a day. The total number of private vehicles is about 380,000 units, or one vehicle per 150 people. Officials say that 90 per cent of the vehicles in Burma have been in use for more than five years, and most are several decades old.
The country has begun a reform process of opening up to foreign countries and international corporations, in an effort to modernize its economy and laws, which have been among the most repressive in the world.
Burma remains one of the least developed countries in the world.
“Although the gross domestic product of Burma is five times lower than Thailand's, its growing economy will increase the purchasing power and demand for cars there,” Moe Kyaw said.
In the past, Burma has imported many used cars from Japan and parts from Thailand and China.
The total trade value between Thailand and Burma averages US$ 800 million per year. Thailand is the second-largest importing source for Burma after China.
Burma is in the process of deregulating its trade and investment rules, said Aye Tun, an executive committee member of the chamber, as well as restructuring its tax system to draw more foreign investors. However, currently the import tariff for vehicles is 165 per cent.