Investment Opportunities for Telecommunications and ICT Sector

in Myanmar

U Kyaw Soe

Principal

Telecommunications & Postal Training Centre

Myanma Posts and Telecommunications

14.9.2012Nay Pyi Taw 1

National Telecoms & IT Policy

Redrafting of existing laws and regulations relating to Posts, Telegraphs and Telephone in accordance with current system and situations and getting the approval.

Allowing and promotion of more investment from domestic and foreign companies in the construction , and providing of communication services for Posts, Telegraphs and Telephone with the Public , Private Partnership (PPP) model .

Searching for means and ways of attracting international investment in order to provide communications services in accordance with international quality standards.

2

Cooperation with well experienced internationally recognized telecom companies.

Step by step reduction of prices and deliver mobile telephone services to the people according to international standard and cooperate with internationally experienced telecom companies to provide the mobile telephone services for the rural citizen.

Providing the proportionate investment opportunities both for foreign and local investors in telecommunications equipments manufacturing.

3

National Telecoms & IT Policy(Contd)

Development of service quality for domestic and international postal services byapplication of ICT,using of modernized equipments, and cooperation with private sector

Upgrading of Telecommunications and Postal Training Centre to produce skilled and qualified technicians and staff.

4

National Telecoms & IT Policy (Contd)

Telecommunications Services

Internet & E-mail Services

Telegraph Services

Postal Services

Services Provided by MPT

5

MPT Organization StructureTelecom Statistic : Graphic

Year 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 (Aug)

Mobile & Fixed

194,468 213,751 233,698 274,541 291,130 353,579 423,086 523,353 648,311 793,111 1,033,771 1,607,644 2,130,323 4,559,086

1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 -

500,000

1,000,000

1,500,000

2,000,000

2,500,000

3,000,000

3,500,000

4,000,000

4,500,000

Fixed Mobile Mobile & Fixed

Tele Density : 7.5 %

PrivatizationShrinking the State-own

business sector and encouraging privatization.

Privatization covered by the second phase of reform strategy doesn’t mean a big sell-off of government-run businesses

Increase the ratio of private ownership in these sectors as per the international rules and practices followed by the government encouragement for efficiency promotion

Reform StrategyUnion ministry must adopt

and implement a Reform Strategy to determine exactly which functions of its sectors and businesses need reforms

7

President U Thein Sein delivered an address with regard to processes of reforms for development of the State

Loan with calculated riskMinistries should take the responsibility of evaluating the amount of loan for an investment and degree of sector-wise development the investment can bring

If the sector under their responsibility sounds economically viable, the Union ministers should take loans from abroad and must take bold measures through calculated risk

8

President U Thein Sein delivered an address with regard to processes of reforms for development of the State

Telecommunication Infrastructure must cover to rural area.

Upgrading of existing training institution to produce high skilled technicians and engineers

•Priority sector according to socio-economic needs•Electricity•Telecommunication•Monetary and credit institution 9

President U Thein Sein delivered an address with regard to processes of reforms for development of the State

Telecom Sector Reform

Plan

10

2012 June 26 From MPT Centered to People-centered communication services

Ministry of Communications, Posts & Telegraphs

Posts & Telecommunications

Department

Myanma Posts & Telecommunications

Yatanarpon Teleport Co, Ltd

Current Organization Structure

• Telecommunication Laws• International Telecommunication Union Concerned Activities• Taxation

• Telecommunication Business• Telecommunication Services• Mobile Phone Services• Auto Phone Services• Telecom Network Services• International Telecom Services• ICT Services

• Mobile Phone Services• Internet Services • Others

11

Telecom and IT sector reform plan and its target

Supervision with rules and regulations

Supervise MPT, Yatanarpon Teleport and Local and foreign telecom companies to contribute for the Telecommunication sector revenues according to the newly established/ promulgated rules and regulations

Posts and Telecommunications

Department

Ministry of Communications, Posts and Telegraphs

Corporatization

Myanma Posts and Telecommunications

Yatanarpon

Teleport

Telecommunications Corporation Yatanarpon

Telecom Co.,Myanma Posts and Telecommunications will restructure into a new

corporation with Non state budget support .

~ Myanmar Telecom Co., will operates its Telecom services with its own budget and it will also function and work with the technologies , loans and aids from the international organizations.~ Promotion of competition for the telecommunications services among Myanmar Telecom , Yatanarpon Teleport, and one or two other Operators in accordance with the law, rules and regulations.

Supervision with rules and regulations

Supervise MPT, Yatanarpon Teleport and Local and foreign telecom companies to contribute for the Telecommunication sector revenues according to the newly established /promulgated rules and regulations

Posts and Telecommunications

Department

Ministry of Communications, Posts and Telegraphs

Telecommunications Corporation

Yatanarpon Telecom

Co.,

Myanmar Telecom Co.,

Other Operator Co.,

Other Operator Co.,

Promote Competition in Telecom Services such as Mobile, PSTN, IT, Internet Services

Telecom and IT sector reform plan and its target

We need an Internationally experienced Telecom Co. to cooperate and work jointly with Yatanarpon Telecom Co.

Moreover, we also need Internationally experienced Telecom Co in place of other operators, they need to compete in the international telecommunications tender process.

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1. Selection of Consultancy Services is in progress and now in final stage.

2. Selected Consultant will cooperate for tender preparation, invitation and evaluation and will give suggestions to the International Telecommunication Tender Selection Committee.

3. Selection of the most suitable Telecom operators will be done by International Telecommunications Tender process and also need the approval and confirmation of Myanma Investment Commision.

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When will we invite international telecommunications

tender?

Myanmar Telecom

INTERNATIONAL GATE WAY

Other Operator

Inte

rnati

on

al

Telephone Connection Routing Diagram for

Telecom Operators

Sta

te O

wn

Nati

on

al B

ackb

on

e N

etw

ork

In

frastr

uctu

reYatanarpon Telecom

Other Operator

Other operators including Yatanarpon Telecom Co can share National Fibre Backbone Network before construction of their own network.

Other Operator

Other Operator

Yatanarpon Telecom

N

ati

on

al B

ackb

on

e N

etw

orkMyanmar

Telecom ISP

ISP

ISP

ISP

INTERNET GATEWAY

Internet Connection Routing Diagram for Telecom Operators

• Regulatory body has the right to give permission for construction of new Fibre

Backbone Network infrastructure for other operators.• Other operators can apply for separate ISP to Regulatory Body.• But, not allow for National Gateway.

Glo

bal In

tern

et

Myanmar Telecom Reform Model

- Liberalization and full

competition

- Phase in competition and

Privatization

- Regulatory reform and

Corporatization

Telecom and IT sector reform plan and its target

Targeted Expansion of Telephone Density

Increase of

39.5 million phones

Telephone Density(2012-2013) – 10%(2013-2014) – 27%(2014-2015) – 50%(2015-2016) – 75% to 80%

GoalTo increase telephone density up to 27 % in 2013-2014, 50 % in 2014-2015, 75% to 80% in 2015-16 and giving the right of selection and preferred telecom service choice for citizens in telecom and internet services.

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Model and AimExisting model ---

MPT Centered Telecommunication ServicesReform model ---

People Centered Telecommunication Services with fair competition

The aim of the MCPT isTo provide quality service together with affordable and cheaper price and

giving the right of selection and preferred telecom service choice for the development of direct socio-economic benefit of the people.

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Can MPT do it alone?

To implement our telecom reform plan successfully , we need the good competition partners in order to reach our goal of 75% to 80% phone density in 2015-2016 .

Our National Fibre Backbone Network is ready to share with other telecom operators.

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Opportunities & Constraints

Opportunitiesan untapped one of Southeast

Asian markets of 60+ million people75 %to 80% Density target in

2015-2016Constraints

Experienced?Foreign Direct Investment LawNational Fibre Backbone

Risks?????????

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ConclusionVirgin MarketDynamic Growth Sector60 million peopleNothing to worry about labor supply Our Reform is irreversible .Triple WinInvestors friendly sector!

Bright future for All!

24

Myanmar Telecom Co.,

Myanmar Post Co., Ltd.

Corporatization

Corporation

Ministry Of Communications , Posts & Telegraphs

Ministry Of Communications , Posts & Telegraphs

Myanma Posts & Telecommunications

Myanma Posts & Telecommunications

The Myanmar Post, which was carried out postal

services as monopolized since long long ago, is being

changed into Public Private Partnership way in order to

promote freely competition and to provide better

services for entire people as their choice.

The First Step of Reform Plan of Myanmar Post

“ Public Private Partnership ”

The First Step of Reform Plan of Myanmar Post

“ Public Private Partnership ”

Affordable Prices

At all points in the Territory

Quality-Based Postal Services

Myanmar Postal Service for Everyone

Myanmar Postal Service for Everyone

Welcome International Experienced Companies.

State-owned

Enterprise

Reform with Int’l experien

ced private

company

Myanmar Post Co.,

Ltd

Goal ofMyanmar Postal Service

Goal ofMyanmar Postal Service