The Association of Southeast Asian Nations is a coalition of ten diverse nations, which enjoyed a remarkable economic progress in recent years. Viewed as a single entity, the region would rank as the sixth largest economy in the world, and the second largest destination for foreign direct investment (FDI).
Between 2000 and 2014, the ASEAN's real GDP growth rates averaged at 5.3% per year, compared to the global average of 3.9% per year. As a consumer market, ASEAN is a growing hub of consumer demand with total consumer expenditure rising by 115% between 2000 and 2014, reaching a market value of US$ 1.4 trillion in total consumer expenditure.
After the opening up of its economy and the establishment of a new democratic government in 2016, Myanmar now represents a key consumer market in the ASEAN region.
According to our report, "The Next Growth Wave: Rising Consumerism in Myanmar", Foreign Direct Investments in the country increased to an astonishing figure of 9.5 US$ 9.5 billion in 2015-2016.
After years of economic deprivation and exclusion from the global ecosystem, the young Myanmar population will have access to better jobs, global brands and digital world; representing not just a young and aspiring workforce but also a strong consumer base.
The 10-29 age group represents 36% of the population, followed by the 30-49 age group at 27%.
Even though GDP per capita continues to be the lowest among ASEAN countries, driven by a growing young population it is estimated that it will reach US$ 2.211 in 2020. Currently only 24% of the population earns more than US$ 120, however it is expected that this number will increase to 48% by 2022.
The FMCG sector is one of Myanmar's fastest-growing markets, with a growth rate of 15% from 2010-2014. Food and groceries represent the largest percentage of an average Myanmar households consumption, followed by personal care and household products. Due to the impressive increase in smartphone penetration, which reached 93% in 2016, mobile devices have been the most popular electronics products, with consumers preferring Android devices for affordability. The clothing market is also expected to grow, with international players started to enter the country in recent years.
Over the past years the slow financial sector development and the adoption of debit and credit cards represented a key barrier to the consumer market growth. However, the "connected" generation, those aged above 22 and characterized as 'voracious consumers', have a better affinity with international brands and will drive consumer spending in the coming years.
While traditional wet markets and road-side hawker stalls are still the primary retail channel for bulk of rural population, there has been a transformation of purchasing processes and decision making, especially across urban areas where consumers are switching to modern retail channels, such as convenience stores and supermarkets.
