Myanmar goes from undersupply to oversupply of hotels

Yangon's skyline

Myanmar is currently grappling with hotel oversupply as a swathe of properties continue to open while tourist arrivals fall short of the country’s target.

Su Su Tin, managing director of Sanctum Inle Resort and Yangon Excelsior Hotel – slated to open in July – said the limited room supply during the sudden tourist boom between 2011-2013 triggered a surge in interest from investors looking to fill the gap.

Hotels are continuing to pop up even though tourists are not arriving fast enough; Yangon’s skyline pictured

The influx in investment was further fuelled by the Ministry of Hotels and Tourism’s (MoHT) announcement in its 2013 tourism master plan to attract 7.5 million international visitors by 2020.

However, Yangon International Airport welcomed 5.9 million passengers in 2017, of which 66 per cent were international. While this represents an 8.5 per cent increase year-on-year, it is far from the predicted growth of arrivals.

Edwin Briels, managing director of Khiri Myanmar, said: “There will be an undersupply of tourists. For example, Bagan had 380,000 tourists last year; that’s nothing, we need to get more tourists to these destinations.”

Figures from MoHT reveal that as of March 2018, there were 1,628 hotels and guesthouses with 65,470 rooms across the country. More properties by major players are slated to open their doors this year.

Bertie Lawson, managing director of Sampan Travel, said: “Many of these hotels thought tourism was going to boom. When they, (the boom in tourism did not happen) and it’s causing a lot of stress for hoteliers.”

Despite this, the industry remains positive. Su Su Tin said the result is more competitive prices, attractive packages and an increase in quality of services – all positive selling points for tour operators.

May Myat Mon Win, Myanmar Tourism’s marketing chairperson and Chatrium Hotel’s general manager, said that moving forward, it is vital that expansion of hotel rooms should be in line with destination planning.

“What is the current capacity? What do we expect? For example, Hpa An is a rising destination but it’s a small town. If we suddenly have a load of five-star hotels cropping up, it will change the landscape. I am confident the situation will balance out in the future, but these new destinations need to be planned properly,” she said.

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