Best of the Week
Most Popular
1.Election Forecast 2015 - Opinion Polls Trending Towards Conservative Outright Win - Nadeem_Walayat
2.UK Solar Eclipse - End Time Sign, Judgement Day, Doomsday! - Nadeem_Walayat
3.Gold And Silver - When Will Precious Metals Rally? Not In 2015 - Michael_Noonan
4.Preparing for the Next Stocks Bear Market - Forecast 2015-2016 - Gary_Savage
5.Is a Stock Market Crash Imminent? - David Eifrig
6.Gold Price Slumps as US Dollar Soars, What's Next? - Nadeem_Walayat
7.US Dollar Forex Pairs and Gold Chartology - Rambus_Chartology
8.Election Forecast 2015: The Day Labour Lost the General Election - Nadeem_Walayat
9.The ECB Should End QE Next Month - EconMatters
10.Silver Price Poised to Surge - Zeal_LLC
Last 5 days
David Cameron Election 2015 Debate Facts Check - Employment, Immigration, Debt & Deficit - 29th Mar 15
Stock Market About Ready to Crash! - 29th Mar 15
Reflections in a Golden Eye - Gold Market Rejection, Repatriation and Redemption - 28th Mar 15
Stock Market Inflection Point - 28th Mar 15
Gold And Silver - What Moved Price? Bab el-Mandeb And Uranus Square Pluto. What?! - 28th Mar 15
Stock Market Investment Parachutes; Do You Have Yours? - 28th Mar 15
Peak Gold Misunderstanding, is Gold About to Run Out? - 28th Mar 15
Deflation Watch: Key U.S. Economic Measures Turn South - 27th Mar 15
The Hard-Earned Truth About Recreational Real Estate - 27th Mar 15
Bitcoin Price Still in Important Territory - 27th Mar 15
Stocks Bear Market Conditions - Index Market Range Warning - 27th Mar 15
BEA Leaves Q4 2014 U.S. GDP Growth Essentially Unchanged at 2.22% - 27th Mar 15
Brazil Economy Victim of Vulgar Keynesianism - 27th Mar 15
Gold to Fuel Silver Price Upleg - 27th Mar 15
Gold and Silver Stocks Will Rise Again! - 27th Mar 15
Risk of ‘World War’ between NATO and Russia on Ukraine as Yemen Bombed - 27th Mar 15
FOMC Minutes Turned The Gold Tide - 27th Mar 15
Sheffield Hallam Election Battle 2015 - Lib Dems Go to War Whilst Labour Sleeps - 27th Mar 15
Gold Effect On Mining & Shale Wasteland - 27th Mar 15
How Stock Investors Should Play the 2016 Presidential Race - 26th Mar 15
MidEast Energy Alert: Why the Crisis in Yemen Could Get Ugly Very Fast - 26th Mar 15
Stock Market Downward Spiral of Dumbness - 26th Mar 15
The Monetary Approach Reigns Supreme - 26th Mar 15
Stock Market Large Gap Down, Despite the Algos' Push Back - 26th Mar 15
Crude Oil Surges, Gold price Spikes as Middle East Tensions Escalate - 26th Mar 15
The U.S. Housing Market Recovery Is Fabricated Optimism - 26th Mar 15
Why Yemen Is The Next Saudi-Iranian Battleground - 26th Mar 15
The Crude Oil Price Crash and China Economic Slow Down - 26th Mar 15
Global Financial Markets Are More Distorted Than Ever Before - 26th Mar 15
One More Stock Market Rally and Then a Huge Drop Expected - 26th Mar 15
Danger Will Robinson - Stock Market Crash Warning - 25th Mar 15
Learn the Basics of Corrective Elliott Waves - 25th Mar 15
Why CNBC Is Hazardous to Your Financial Health! - 25th Mar 15
Will Your Retirement Accounts Survive The Coming Tax Code "Revolution"? - 25th Mar 15
US Dollar - Americas Phoenix - 25th Mar 15
California’s Epic Drought: Only One Year of Water Left! - 25th Mar 15
What’s Wrong With Silver? - 25th Mar 15
SPX Futures Appear Weak. WTIC and Gold May Be at Max Retracement - 25th Mar 15
We’re at the Dawn of a “New Energy Age” - 25th Mar 15
A Very Weak U.S. Economic Recovery - 25th Mar 15
Zero UK CPI Inflation Rate Prompts Deflation Danger Propaganda For Fresh Money Printing - 25th Mar 15
Stock Market NYSE Hi-Lo Index Aggressive Sell Signal - 24th Mar 15
Palladium Commodity Price Forecast - 24th Mar 15
Bitcoin Price Gearing Up for a Fall - 24th Mar 15
Safety Deposit Boxes In UK Being Closed By ‏HSBC – Not Closing Gold Vaults - 24th Mar 15
Japan Short Term Gains And Long Term Disaster - 24th Mar 15
China's Fragile Evolution - 24th Mar 15
David Cameron Announces Resignation Even Before Being Re-elected, Handing Labour 6 Seats - 24th Mar 15
City of London's Ownership of American Colonies - 24th Mar 15
Stock Market Reversal May Have Begun - 24th Mar 15
Casey Gathers Top Gold Experts to Share Secrets for Making Money in Any Market - 24th Mar 15
Thoughts on The Current Crude Oil Market - 24th Mar 15
U.S. Economy Still on Life Support - What Your Governments Hiding From You... - 24th Mar 15
UK Election Forecast 2015 - Budget Bribes Fail, SNP Insurgency Catastrophe - Video - 24th Mar 15
Is Stock Market Minor Top Taking Hold? - 23rd Mar 15
Greece and EU Running Out of Time as Bank Runs Intensify - 23rd Mar 15
Stock Market Slightly Negative Expectations Following Last Week's Rally - 23rd Mar 15
This Rising Interest Rates Play Could Make You a Quick 55% - 23rd Mar 15
Platinum Commodity Price False Break Low - 23rd Mar 15
The Real Reason The American Dream is Unraveling - 23rd Mar 15
Election Forecast 2015 - Budget Bribes Fail to Impress Voters, Tory's Lose Seats in Opinion Polls - 23rd Mar 15
Silver Price Reliance During U.S. Dollar Rally - 23rd Mar 15
old Price Outlook Dramatic Improvement Following US Dollar Topping Action - 23rd Mar 15

Free Instant Analysis

Free Instant Technical Analysis


Market Oracle FREE Newsletter

US Economy Still on Life Support

"If I Could Put All My Money in Myanmar, I Would"

Stock-Markets / Emerging Markets Dec 07, 2012 - 12:56 PM GMT

By: DailyWealth

Stock-Markets

Chris Mayer writes:

The Governor's Residence in Yangon is a richly restored teak mansion set in the leafy embassy quarter of the city. Now a luxury hotel, it was once the home of the governor when the British ruled Burma.

I met Mai Nguyen on the verandah for breakfast, under lazily spinning ceiling fans, amidst lush gardens and lotus pools. Mai is a Vietnamese transplant from Saigon. She is also an associate director at Yoma Strategic Holdings. Listed in Singapore, Yoma is a direct proxy for Myanmar's booming property market and one of the key opportunities I wanted to vet while I was here.
 
As regular readers know, I traveled the Golden Land, visiting Yangon, Bagan, Mandalay, and Ngapali. Mai was my first meeting in the country, and what follows is another glimpse at the extraordinary opportunities here.
 
Mai works for Serge Pun, who owns 50% of Yoma and is one of Myanmar's famous dealmakers. Pun left Myanmar in 1965 and spent nearly 30 years in Hong Kong and China. He came back to his home country in 1991 to found businesses in real estate, agriculture, automobile dealerships, and more. Yoma is primarily a real estate play with an enviable land bank of 12 million square feet in Yangon.
 
Just how valuable that land bank might be is easy to guess: very. There has been practically no development for 50 years in Yangon. This is the largest city in Myanmar, with a population of 4 million. The first chart of the nearby pair shows you how Yangon stacks up in population against its fellow members of the Association of Southeast Asian Nations.
 
 
The second chart shows you something of the growth potential of the city. It shows you the amount of office space in Yangon compared with regional peers. Consider that Hanoi, a city with half the population of Yangon, has nearly 17 times as much office space.
 
 
As Myanmar has opened up, prices have spiked. Through September, the average rental rate for office space per square meter is up 55% on the year. Vacancy is virtually nothing. For this example, I chose office space. But I could just as easily have picked hotel rooms, apartment units, or retail space. They all tell the same story. For Yangon, or Myanmar as a whole, these markets barely register as flyspecks. For developers of new properties – if you have the land – there is a fortune in the offing.
 
Mai helped fill in some details over hot bowls of mohinga. (This is a classic Burmese dish of fish soup and rice noodles, topped with split pea fritters, boiled egg, coriander leaves, dried chilies, and a squeeze of lime juice. You find it everywhere in this country.)  
 
She also shared valuable research with me about Myanmar and anecdotes about what it was like to live there.
 
Mai told me about Yoma's signature Pun Hlaing Golf Estate development. Pun Hlaing has over 600 acres of prime real residential estate. It sits on a peninsula between the Hlaing and Pan Hlaing rivers, about eight miles west of Yangon. Mai promised to arrange a tour of the property for me. I thanked her and dabbed at my forehead with a napkin. The spicy hot mohinga and humidity were making me sweat. I was often sweating in Myanmar.
 
When I got to see it, I was not disappointed. Pun Hlaing Golf Estate is gorgeous, an oasis from the traffic and noise of the city outside its gates. An 18-hole Gary Player golf course wends it away around high-end bungalows. There is a lot of water – 18 lakes, the brochure says. The grounds are immaculate and you can see the famous Shwedagon Pagoda in the distance. Next time, I'll bring my clubs.
 
Tun Tun Lin, the sales director for the project, showed me around. There are 326 properties already built, and 220 families reside on the estate year-round. We looked in a number of these – villas, condos, and apartments. They would be high-quality anywhere in the world. There are also tennis courts, a swimming pool, a spa and salon, a gym, and a comfortable clubhouse overlooking the 18th green where we had dinner.
 
It's good to visit places like this, to see the best that one can achieve in a country. I would see the full spectrum while in Myanmar. In the big-picture sense, the country is poor. Per capita income is only $900. Compare that with $1,400 in Vietnam and $5,000 in Thailand.
 
As I've mentioned in other places, this disparity is due to 50 years of evil dictatorial oppression. Go back before World War II. Myanmar (then Burma) was perhaps the richest country in Southeast Asia. I see no reason why, as long as the country continues to move toward freer markets, it can't again at least move closer to neighboring Thailand. This "catching up" idea is at the heart of my book World Right Side Up: Investing Across Six Continents.
 
There are plenty of risks. Myanmar's economy is not an inevitable sunrise. The thuggish generals and their cronies still have power. And there is ongoing ethnic and religious violence in the west between Muslims and Buddhists. Other parts of the country have similar troubles.
 
In reading as much about Myanmar's history as I could get my hands on, it's worth remembering that it has often been a fractious country with chieftains holding sway over areas as large as Scotland or strongholds as small a single hilltop. There are a bewildering number of tribes beyond the Irrawaddy River Valley, from the "giraffe women" of Padaung to the former headhunting Wa. But in terms of pure upside potential and size (with a population of about 60 million), there is nothing like Myanmar in the world.
 
It seems like people are interested in the story. When I got home, I sat for an interview with Lauren Lyster on the TV show Capital Account in Washington, D.C. And I also did a 40-minute interview with one of Myanmar's English-language business magazines, MZine+. People wanted to know what I thought and what my impressions were.
 
Later, I saw Lauren interview Jim Rogers, the prescient globe-trotting investor and author. In that interview, he said: "If I could put all my money into Myanmar, I would." 
 
Unfortunately, for a public stock market investor, it isn't easy to invest in Myanmar. Jim Rogers admitted as much, which made me feel better about my inability to turn up a good actionable idea despite my best efforts. (At least, not yet.) Yoma is really it – and its price, I have to say, reflects that.
 
Still, the market has a way of manufacturing what people want. And already I've had brokers and promoters send me information on tiny mining or oil and gas companies trying to raise money and do something in Myanmar. I'd avoid these. But good funds and ideas will come.
 
Regards, 
 
Chris Mayer

Editor's note: Chris Mayer is the editor of Capital & Crisis, a monthly advisory considered required reading around the DailyWealth offices. Chris consistently provides contrarian investment ideas you won't find anywhere else. Click here to learn more.

Further Reading:

It's not easy to invest in Myanmar just yet. But earlier this year, "the Tokyo Stock Exchange announced it would help Myanmar develop its stock market," Chris writes. "Many companies are already trying to elbow their way in Burma." Get the full story here: The Next Big Story in Asia.
 
"China affects so much of the world economy, especially as it relates to commodity prices – and your commodity stocks," Chris wrote a few months ago. Learn what he calls the two most important questions every commodity investor must ask here.

http://www.dailywealth.com

The DailyWealth Investment Philosophy: In a nutshell, my investment philosophy is this: Buy things of extraordinary value at a time when nobody else wants them. Then sell when people are willing to pay any price. You see, at DailyWealth, we believe most investors take way too much risk. Our mission is to show you how to avoid risky investments, and how to avoid what the average investor is doing. I believe that you can make a lot of money – and do it safely – by simply doing the opposite of what is most popular.

Customer Service: 1-888-261-2693 – Copyright 2011 Stansberry & Associates Investment Research. All Rights Reserved. Protected by copyright laws of the United States and international treaties. This e-letter may only be used pursuant to the subscription agreement and any reproduction, copying, or redistribution (electronic or otherwise, including on the world wide web), in whole or in part, is strictly prohibited without the express written permission of Stansberry & Associates Investment Research, LLC. 1217 Saint Paul Street, Baltimore MD 21202

Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.

Daily Wealth Archive

© 2005-2015 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

Free Report - Financial Markets 2014