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Myanmar hotels are full, but it forbids host families because of naughty aliens - Quartz
Myanmar's passion for its new, open market has overtaken the country's young tourism facilities and kept the number of rooms very low. In the former capitol Yangon there are only 8,000 rooms and only 1,500 to 2,500 meet global standard. Foreign nationals "don't really stick to Myanmar's traditions, such as sleep to the west, and don't like it when a host families eats soups with a scoop from a dish," the Myanmar Times told the secretary.
Said an exemption would only be made in the countryside without hotels. "Myanmar's peoples do not have the right manner of behaving," he added. Concerns of the authority may also have to do with its capacity to keep track of overseas guests; by act, hotel guests must report to the locals.
For the time being, therefore, Myanmar's visitors must find one of the few rooms in one of the most pricey property stores in the country or risk the anger of the authorities with a room under the desk (or not so under the desk) in a home.
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Myanmar, also known as Burma, is a supreme state in Southeast Asia bordering Bangladesh, India, China, Laos and Thailand. Myanmar, the second biggest nation in Southeast Asia, has a surface area of 676,578 km2 and 1,920 km of coast bordering the Andaman Sea and the Bay of Bengal.
In 2005 the main town was transferred to Naypyidaw, from the former capitol and the biggest trading town Yangon. Following phases of stagnant economic development and domestic conflict, the "Land of the Golden Pagoda" is embarking on a new phase of agelessness. The Myanmar project has set itself the goal of explaining the present tourist and catering sector in Myanmar and highlighting the most important market areas to look for in the years to come.
In Myanmar, the slippery victory of the NLD under the leadership of Aung San Suu Kyi in the November 2015 election has resulted in a smooth passage from the military-backed regime in place since 2011 to the present pro-democracy one. It has reaffirmed its engagement for peacemaking, intergovernmental consensus and prosperity and is taking a reconciliatory stance in developing a transient process of tranquillity.
Myanmar is also of interest to the world, and the US has approved a transient relaxation of penalties against Myanmar. Due to the general bullishness of the new administration and global awareness in an undeveloped sector, the tourist sector has the capacity to profit by opening up the sector and investing in infrastructures.
One example is the reciprocal treaty between Myanmar and Singapore on the exemptions for up to 30 day missions. It can be the first stage in collecting more in-bound trips to Myanmar, whether for personal or work. Myanmar's economic development has been remarkable in recent years.
In May 2016, the Economist Intelligence Unit (EIU) forecast that Myanmar's gross domestic product (GDP) will grow by 6.8% in 2015 and 7. For 2016/17 to 2020/21, significant macroeconomic expansion is forecast, driven by large scale investment financed by international investment. With the introduction of regulation and legislative reform, FDI in this emerging country will further grow.
Myanmar has introduced a range of policy and macroeconomic reform measures since 2011 to prepare the way for democratic transition and the ensuing improvement has led to greater expansion of Myanmar's tourist industries, as demonstrated by high double-digit increases in government arrivals and tourist revenues. Today, travel is considered an important driving force behind Myanmar's economy.
The Myanmar Ministry of Hotel and Tourism Master Plan for Myanmar, 2013-2020, stated that the government had established a number of ambitions, 7. The number of global visitors will reach 48 million annually by 2020. As a result of this aggressively growing market, overall tourist sales are projected to rise from USD 534 million in 2012 to USD 10.
While the service industry represents only about 38% of Myanmar's GNP, there is plenty of room for expansion given Myanmar's enormous tourist industry capacity. World Travel and Tourism Council estimates the overall share of travel in Myanmar's GNP to be 5.9% in 2016 and 7.8% per year until 2026.
Turism, with its many different tourist destinations and culture, has the capacity to become one of the most rapidly growing sectors in the near to midterm. In spite of recent high tourist rate increases, Myanmar faces the challenge of sustaining this rate of expansion in the coming years, as it still has many problems to solve, including finite institution capacity, infrastructural bottlenecks and poor interconnectivity.
Most of the information in the reports comes from the Ministry of Hotels and Tourism's offical touristic datas. By 2015, the overall number of visitors to Myanmar was about 4.68 million, with 28% of visitors arriving via airport and 72% via checkpoints. In comparison to 2014, the number of people arriving in 2015 rose by 52%.
The increase was 15% for airports and 73% for borders. Because of the low number of basic arrivals, incoming traffic has been growing at double-digit levels over the last four years. Overall, Myanmar profited from rapid tourism expansion with an average yearly increase in tourism (CAGR) of 34% from 2010 to 2015.
Please note that due to the type of crossing (i.e. regular shorts, repetitive daily excursions, restricted activity in the frontier area, etc.), these flights cannot make a significant tourist impact and can increase the number of tourist destinations in all. Therefore, the number of people arriving at the airports may be a better indication of the speed of developments in Myanmar, especially when measuring the interest of travel internationally.
Currently there are 28 major global and 11 local carriers flying to Yangon Int'l and Myanmar's most important aviation centre. Overall airfields arrived (of all airports) reaching 1. 3 million in 2015 and has obtained a 27% confidence level in the 2010-2015 reporting year. The opening of the new Yangon lnternational Port in March 2016 and further projects to turn Bagan lately in November 2016 into an l'international destination will allow both cities to offer more cosmopolitan services that will help to accommodate the growth in traffic to and from the city.
As Burma's tourist industry experiences remarkable expansion, there are still constraining elements such as policy unstability, high travel spending and infrastructural pressures that can hinder accelerating it. By 2015, Myanmar had totaled some $2.1 billion in tourist spending. In comparison to the year before, the overall tourist spending rose by 19% with a six-year AAGR of 42%.
Consistent with rapid year on year increases, there has also been a significant rise in the last six years in per capita and per diem spending, with a rise from $102 in 2010 to $171 in 2015. Please note that this is the most likely exclusion of day-trippers from the journey to the frontiers.
By 2015, most of Myanmar's visitor numbers came from Asia, with Thailand (16%) the most important Asia originating markets, followed by China (11%). Burma recorded the highest growth in visitor numbers from China with a 17.8% growth compared to 2014. Myanmar remains the most important regionally sourced travelers, as it became known as a travel destinations in Europe early on.
By 2015, the number of people arriving via the Yangon, Nay Pyi Taw, Mandalay, Mawlamyine and Myeik gates had risen to a whopping 1.31 million. Yangon is the major traffic junction, accounting for 91% of all flights to the city. Myanmar's annual travelling expenses can be regarded as high in comparison to other tourist attractions in the area.
In 2015, for example, the daily per visitor rate will be 140 US dollars in Thailand, 154 US dollars in Indonesia and 126 US dollars in Vietnam. Combined with a long mean length of time in Myanmar, travelling can be seen as costly for its touristic produce at this time. However, this has a positive effect in the near to midterm as some travellers, especially recreational travellers, may be deterred from visiting Myanmar because the destination's value contribution does not warrant the relatively high costs.
By 2015, around 2.6 billion US dollars had been invested in the expansion of hotels and tourist com-plexes. That was a staggering 9,132 rooms in 48 properties, 69% of which were completed, 25% underway and 5% approved by the Myanmar Investments Commission (MIC).
In comparison with 2014, the number of rooms rented abroad has decreased by 3%, while the overall amount of investments has risen by 5%, leading to an 8% rise in annual investments per room in 2015. Although investments continue to rise, the pace of economic expansion has slower than in prior years.
To a large extent, the deceleration in FDI in 2015 can be traced back to investors' reluctance before the 2015 Presidency election, policy changes, floods, persistent institutional pressures and so on. In the long term, however, greater FDI into the tourist sector is needed to create the necessary infrastructure to sustain further tourist development.
In 2016/17, as Myanmar's economy and policies change, personal investment is projected to increase with the transmission of Myanmar's policy override. By 2015, there were 1,279 registered hotels in Myanmar, representing a combined 49,946 rooms.
Yangon still has the biggest number of hotels in the state, accounting for 30% of all of them. In the top ten towns by number of rooms, the Yangon hospitality industry is mainly powered by industrial demands, in Mandalay by recreational demands and in Nay Pyi Taw exclusively by the state. Between 2014 and 2015, the number of hotels rose by 15.
The Inle Lake region in particular (Taunggyi & Nyaung Shwe) posted the highest year-on-year increase of 23.2%, boosted by higher recreational demands in the region, while Yangon and Mandalay lag slightly behind with 17%. Please note that most rooms throughout the entire state are in the budgetary to mid-range segments and are brand-free (managed by regional owners/operators).
As a result, the hotels may not be of the same standard across the state. The majority of the world' s top hotels are in Yangon and Nay Pyi Taw to meet business needs and the demands of the state. Brand hotels' occupancy in recreational locations is restricted, as these stores have only recently opened up and have won widespread acceptance among travellers from all over the world.
Yangon, Myanmar's former capitol, is located in the south of Myanmar, where the Yangon and Bago River meet. Despite the government's move to Nay Pyi Taw in November 2005, Yangon is still the biggest and most important economic town in the state. Yangon, Myanmar's main trading and transport centre, is generally the first port of call for Myanmar's global population.
By 2015, Yangon International Airport, with long distance flights to Hong Kong, Kuala Lumpur, Singapore, Seoul, Tokyo and Bangkok, accounted for around 91% of all aircraft and 81% of all registered travelers to Myanmar. The Yangon hospitality industry saw an upturn in 2013-14, driven by storms of investments and an expansion in tourist activity, with demands well above supplies.
The ensuing rise in the number of hotels on offer and the unsustainably high ADR ( "average day rate"), however, weighed on overall performances in the years 2015-16. Although this is primarily powered by trade demands, it has decelerated due to policy changes as businesses take a backward move and wait for a more clear operating climate.
Recreational demands also declined due to the rise in ADR, the shorter length of time spent in the cities and the increasing preferences for other recreational locations such as Mandalay. By the end of 2015, Yangon will have 324 registered hotels with 15,424 rooms. The number of rooms is set to rise by 8.5% between 2016 and 2018, which would enable Yangon to retain the biggest volume of hotels in the state.
This has had a short-term impact on the hotels' operational efficiency as the overall capacity utilization has declined by 12% and that of ADR by 4% since June 2016, as the demand has not yet absorbed the rise in demand. Situated in the centre of Myanmar, Inle is Myanmar's second biggest fresh water reservoir with an area of 116 sqkm.
Because of the lake's inherent bio-diversity, it is Myanmar's first declared site of the World Network of Biosphere Reserve. It is also 45 min drive from Heho International Heho International Heho International Fair. The Heho International Airfield is the major airfield for the Inle Lakes area and currently operates only inland flights.
The most important flying targets are Yangon, Bagan, Mandalay and Thandwe. By 2015, the total number of passengers arriving at the terminal was 160,000, an 7.8% rise from 2014. The Inle See is a favourite recreational area for its distinctive pile construction heritage. By the end of 2015 there were 109 registered hotels with 3,302 rooms in Taunggyi and Nyaung Shwe, the two areas around the Inle Lake.
The majority of hotels are national hotels run by regional owners/operators, there are international brand hotels such as Novotel and MGallery, which are under building. A special hospitality redevelopment area on the southern shore of Lake Inle is envisaged, but short-term developments are not foreseen.
In the medium to long run, we see that although there is an increasing level of consumption, supplies are either unforeseeable or will slow down. Ngapali Beach is seven kilometres from the state of Rakhine's cities of thanwe, a large port and a citieship and is a prime Myanmar traveler.
Towards the end of the 1990', the development of hotels was encouraging Ngapali Beach to become a key travel area. At the moment Thandwe is the region's principal regional airfield and only operates national flights. The most important flying targets are Yangon, Bagan, Mandalay, Heho and Sittwe. Possible round-trip flights to Thandwe are being examined.
Although the Ngapali Beach is called after the town of Thandwe, it is closer to Ngapali Beach (5 to 20 minutes driving time, according to the position of the accommodation). By 2015, an expected 54,219 people had arrived, an upturn of 6.5% over 2014, 71% of whom are visiting from abroad.
In addition to the hotels, there is a shortage of business premises and tourist amenities in the municipality and on the Ngapali beaches. There are high-end hotels in the seaside area that do not generate a great deal of slack. More than 90% of the total needs of hotels along Ngapali Airport include recreational destinations. By the end of 2015 there were 25 registered hotels with 863 rooms in Ngapali.
Since the beginning of the development of the hotels in the end of the 1990' the offer has increased modestly, but the increase was limited in time and an excess offer is not to be observed at present at the marketing. Please note that the number of rooms in the individual hotels will remain low. The Ngapali has gained acceptance as the leading seaside resort in Myanmar and has seen strong increases in recent years, particularly in the recreational sector.
Due to the monsun season from June to October, however, most hotels only operate for six to seven only. Situated in central Myanmar on the eastern shore of the Irrawaddy River, Mandalay is Burma's second biggest town and last imperial capitol. Around the King's Palace, the town is the commercial and spiritual center of the Myanmar uplands.
The Mandalay Internacional Airport (MDL) is one of the biggest and most advanced Myanmar Airport with a passenger traffic volume of up to 3 million per year. The MDL offers mainly internal services, with few intercontinental services to four intercontinental routes such as Kunming, Bangkok and Chiang Mai via Asia and Bangkok Airways (which account for approximately 8% of all intercontinental services to Myanmar).
Myanmar's old Mandalay charms have attracted more and more interest internationally as the country's most rapidly expanding recreational area. Most hotels in Mandalay are on the northern side of Mandalay Palace with a large number of hotels in the area between Mandalay Palace and Mandalay Railway Station.
At the end of 2015 there were 168 registered hotels with 6,788 rooms in Mandalay. Economical and medium-sized hotels take up almost 82% of Mandalay's entire range of hotels, and there is currently a shortage of brand awareness internationally. Due to the changed approval and building codes, the number of hotels on offer will rise only slightly over the next two years.
As these are mainly locally managed mid-range hotels, we expect rising demands to keep up. Bagan, one of Myanmar's most important recreational destinations, offers a 6,000 hectare antique city with over 2,200 surviving Pagan Kingdom buddhistic shrines. Bagan, together with Mandalay, has become the most important recreational resort for Myanmar's foreigners.
Bagan's nearest airfield is Nyaung U, which currently only offers national flights. It is about four kilometres from the city of Nyaung U. By 2015, the total number of passengers arriving internationally is expected to reach 247,140, an 7.4% rise from 2014. More than 80% of the region's needs are met by hotels arriving internationally.
As a result of the increase in tourist activity, a considerable number of people have been lured to the region. Whilst the fundamental tourist infrastructures are in place, the industrial estates are still underdeveloped and there is little request. By the end of 2015 there were 78 registered hotels with 2,565 rooms in Bagan. Because of a prohibition on building hotels in 2016 and changes in the zonation of hotels, the new range of hotels that had been scheduled after the election could not be put into operation on time.
These include 30 to 40 new hotels in various phases of building. There is no idea when the prohibition will be repealed, but given that further legislation will be adopted, developments in the identified areas are likely to go on. Given the rising recreational demands in Bagan, there may be a shortfall in the peak period.
Conducting operations in Myanmar can be a challenge for newcomers. Because of its complexity, new companies find it difficult to open and expand in Myanmar. The World Bank's Doing in Myanmar 2015 survey rated the lightness of operations in Myanmar as 177th of the 189 global economi... The biggest challenge in starting a company in Myanmar has been the need for minimal contributions (6.190% of per person income), expensive processes (156% of per person income) and long delay (72 working hours on average).
Especially for the development of hotels, these problems are associated with legal uncertainties and regular updates of the rules. One of the latest launches is the launching of an on-line registry site for the tourism and hospitality industries. From July 2016, requests and extensions for hotels, operator licences, tourist guides and tourist transport licences will be available on this plate.
As a new tourist resort in Southeast Asia, Myanmar has largely unexploited natural resources. We are seeing gradual steps to support the proper functioning of the tourist industries, but it would take a while for the administration to make the changes, and there is still a long wait for the policy to become clear. But as the commercial and tourist environments continue to brighten, new investments are expected, especially in recreational locations.