Best of the Week
Most Popular
1.Will UK Interest Rate Rises Crash House Prices? - Nadeem_Walayat
2.Full on Crash Alert for Major World Stock Markets... - Clive_Maund
3.Gold And Silver Market Bottoming? Big Rally Imminent? Reality Check Says NO - Michael_Noonan
4.The Coming Silver Price Rally Will Outperform All Previous Ones - Hubert_Moolman
5.The Trigger For The Upcoming Stock Crash - Harry_Dent
6.Imploding Department Store Results - James_Quinn
7.Dr. Copper is Speaking, are you Listening? ... - Rambus_Chartology
8.Pandemonium in the Stock Market, Dow falls 1,000 points in a week - EWI
9.Asia's Whirling Dervish of Devaluations Has Encircled China's Exports - Keith_Hilden
10.China Weakens the Yuan; Rattles Global Stock and Financial Markets - Gary_Dorsch
Last 5 days
Crude Oil Price Forecast 2015 and 2016 - 1st Sept 15
REPO Window Hidden $Trillion QE Monthly Volume - 31st Aug 15
Silver and Warnings From Exponential Markets - 31st Aug 15
Stock Market Calls Fed’s Bluff - 31st Aug 15
Why Some ETFs Led the Stock Markets Down Last Week - 31st Aug 15
Stock Market Collapse - Take The Opportunity To Bail Before It’s Too Late! - 31st Aug 15
The Most Important Market Chart on The Planet - 31st Aug 15
Stock Market 50% Retracement - 31st Aug 15
Stock Market Crash Red Alert for 2nd Downwave... - 31st Aug 15
Independant Scotland 1 Year on, UK Civil War If the SNP Fanatics Had Succeeded - 30th Aug 15
Gold’s 7 Point Broadening Top - 30th Aug 15
The Day the Stock Market Shook the Earth: Takeaways From the Dow’s 1,000-Point Drop - 30th Aug 15
Gold Price Rally Marked by Short Covering - 30th Aug 15
Aging Stocks Bull Market - 29th Aug 15
Economic Destabilization, Financial Meltdown and the Rigging of the Shanghai Stock Market? - 29th Aug 15
The Stocks You Should Be Buying After the Market Drop - 29th Aug 15
How I Learned to Stop Worrying and Love Market Fluctuations - 28th Aug 15
China's Yuan Devaluation: Why It Was "Expected" - 28th Aug 15
Stocks Go Nuts But the Question Remains – Will the Rally Stick? - 28th Aug 15
Fed’s Stock Market Levitation is Failing - 28th Aug 15
The Eight Energy Systems Driving The Stock Market Rout - 28th Aug 15
Silver Sold, then Squeezed - 28th Aug 15
U.S. Economic Fundamentals 'Look Good' - Bullard of St. Louis Fed - 28th Aug 15
Stock Market Margin Calls Mount - 28th Aug 15
Einstein, Physics, Gold and The Formula To End Economic Decay - 28th Aug 15
The 10 Best Stocks for Options Trading Plays in This Market - 28th Aug 15
Economics of a Stock Market Crash - 28th Aug 15
Currency Wars Detonate; Gold Refuses to Budge - 28th Aug 15
UK Immigration Crisis Hits New Record, Trending Towards Becoming a Catastrophe - 28th Aug 15
The Ultimate Cash-Management Guide - 27th Aug 15
Why a Fed Rate Hike Could Be a Blessing for Gold Prices - 27th Aug 15
Why Devaluing the Yuan Won't Help China's Economy - 27th Aug 15
Stock Market Trend & Trade Signal Of the Decade - 27th Aug 15
Keep Your Eye On the Gold and Silver Bear - 27th Aug 15
Refugees Expose Europe’s Lack Of Decency - 27th Aug 15
How to Profit from China's Currency War - 27th Aug 15
How China's Currency Policies Will Change the World - 27th Aug 15
Chinese Medicine not Impressing Dr Copper - 27th Aug 15
Novel Biotech Novel Technology Platforms with Dramatic Growth Potential - 27th Aug 15
China Stocks Bear Market Crash, Are We Near the Bottom Yet? - 27th Aug 15
Stock Market Crash Black Wednesday Rally Crushes the Bears - 26th Aug 15
VIX Shorts Being Squeezed While SPX Prepares for Another Decline - 26th Aug 15
Why China's Economy is Deteriorating - 26th Aug 15
Citizenship as a Weapon: Travel Controls and What You Can Do About It - 26th Aug 15
Gold and Silver - How To Manipulate a Market - 26th Aug 15
How to Make a Quick 20% When the Stock Market Crashes - 26th Aug 15
Why We Can’t Handle A Stocks Bear Market - State Budgets Will Implode - 26th Aug 15
Stocks Bear Market, Is This 1929 All Over Again? - 26th Aug 15
The One Trading Strategy You Needed for Stock Market Crash - 26th Aug 15

Free Instant Analysis

Free Instant Technical Analysis


Market Oracle FREE Newsletter

Global Stocks Slide

"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

Biggest Debt Bomb in History