Wednesday, June 25, 2014

As Logistics Group Opens Up Facility - is Myanmar Secure Enough for Investment by Freight Community?

Future Can Only Be Bright if Countrywide Conflicts Cease for Good
Shipping News Feature

MYANMAR – Since international sanctions were lifted in 2012, Myanmar has established itself as a new frontier market, with potential to become a major sourcing country and consumer market for global freight customers in the near future. With the country’s strategic location lodged between three drivers of international economic growth, China, India and Southeast Asia, many freight agencies are looking to include themselves in the picture and third party logistics provider, Damco, has become the latest forwarder to enter the emerging market. Burmese commercial skies however are not necessarily as blue and cloudless as many wish to believe.

Damco, has started operations at a new 4,000 square metre warehouse and Container Freight Station (CFS) facility in Myanmar, making it the first international company to commence such operations in the country, according to the Maersk subsidiary. The facility is Customs-Trade Partnership Against Terrorism (C-TPAT) compliant and strategically located within 15 kilometres from Yangon ports and major industrial locations. It is suitable for import/export activities for Fast Moving Consumer Goods (FMCG), consumer electronics, apparels, components, machinery and project cargo. Kiattichai Pitpreecha, Managing Director of the Thailand, Malaysia & Myanmar region, said:

“Damco is the first global logistics company in Myanmar. After acquiring an operating license in 2013 and opening a new office in Yangon, we have strengthened our position in Myanmar by being the first international logistics company in the country to start offering own-operated CFS/warehousing services. This state-of-the-art, international standard CFS facility enables us to provide superior service to our customers through direct control and management of the entire operation and service delivery process.

“Emerging markets have always been one of Damco’s focus areas and core strengths, with many of our key customers sourcing their products from or operating in these markets. These customers can now rely on Damco as their logistics partner in Myanmar. They will benefit from the same service quality for cargo shipped out of Myanmar as any other country in which we operate. In addition, we have proved again that we are one step ahead of the competition by proactively establishing this CFS operation in Myanmar.”

There are those of course who feel that, despite the current public perception, and with Western eyes turned toward other potential and current trouble spots, Syria and the Middle East in general spring to mind and Thailand more locally, that the situation in what was formerly Burma is a lot less settled than that being portrayed in much of the media.

Last week there were reports of clashes between Burmese troops and two ethnic armed groups with whom the government have failed to sign cease fire agreements, including the Kachin Independence Army (KIA) just as the groups political wing sat down for peace talks, and pessimism reigns locally as regards maintaining the peace with those factions which have been quiescent of late, particularly as reports arrive that government troops have killed at least one member of the Karen National Liberation Army (KNLA), with whom they do have a hard won accord, after years of conflict.

Government troops have historically launched quite brutal offensives against a multitude of independent provincial interests and now stand accused of ignoring what many view as virtual genocide, with Buddhist interests waging a campaign to eliminate local Muslims such as the Rohingya. It will be in everybody’s interests if the many conflicts can be resolved but in a country where over 100 languages, plus a plethora of local dialects, are spoken by around 60 million people it remains to be seen if the country remains stable enough to promote safe, countrywide investment and supply chain infrastructure.

Photo: A pre World War ll shot of the quayside, Yangon