Myanmar - Views from the region

2016 was a year of change and challenges. In April 2016, Myanmar’s newly elected government came to power while major floods in July and August significantly affected Myanmar’s agricultural yield, However, economic growth remained impressive, with an estimated 7% over full-year 2016, according to the World Bank. The bank expects this number to pick up to 7.8% over 2016-17 and 8.2% annually over the medium term.

During the election process, a plan for economic reform based on five key areas was presented: fiscal prudence, lean and efficient government, monetary and fiscal stability, functioning infrastructure, and revitalizing agriculture. The first signs of these objectives being turned into action have now appeared.

In 2016, the number of government ministries was reduced from 36 to 21, providing savings that will be re-invested in education. Other changes include legislative initiatives such as finalizing the 2002 Investment Law and modernizing the “ancient” Companies Act, which dates from 1914. Turning to the pharmaceutical sector, Myanmar remains one of the least developed markets in Asia, with low per capita spending on medicines (US$7.5/annum/2016, according to BMI Research) accounting for a total pharmaceutical market of US$410 million.

However, pharmaceutical sales are expected to grow ahead of the overall economy. An increase of 13.4% is forecast over 2017 (BMI), taking the overall market close to US$470 million, with double-digit rises for the foreseeable future.

Growth will continue to be driven by pharmaceutical imports as Myanmar’s local pharmaceutical manufacturing capabilities are limited. The market currently relies heavily on out-of-pocket payments. World Bank findings have indicated that more than 92.7% of total healthcare expenses were out of pocket in 2012. W

hile overall reliance on out-of-pocket expenditure remains, some decrease is believed to have taken place in recent years. This is expected to continue as the government seems committed to keep increasing healthcare spending and has a long- term vision to implement universal healthcare coverage by 2030. Overall, 2017 is set to be a year of overall growth and further reform, continuing to put Myanmar on the map as one the world’s most dynamic, fastest-growing economies.