Why indeed? Look at the high cost of real estate. Consider the high tax levels, including the now rarely mentioned PST. It is hard to find people with enough skills to fill the high paying jobs and no one wants to take the low paying ones.
Myanmar (formerly Burma) might appear more suited for investment, as I discovered on a recent visit. It is the least developed country in Asia. Unlike other Asian countries, its standard of living has been stagnant for decades with many people, especially in rural villages, living in conditions that can only be described as biblical.
The villages have no access to electricity, have houses with straw mats for walls and thatch for roofs and virtually no furniture on the bare wooded floors. Water hauled by hand from walls or the river is stored in hand made clay pots. The river provides water for bathing and washing. In the 21st century, women still sit by the river beating the clothes clean on rocks.
Most people go to school to Grade 5, giving them basic literacy and even a few words of English. However, this level of education does not get you much more than basic unskilled work such as carrying bags of construction material on your head. The pay for this work is $3 per day. Infant mortality is 10 percent and 40 percent of five-year-olds are malnourished.
Even given this low base, there is great hope and optimism in the country.
The brutal military dictatorship which has suppressed the country and its people for decades is being replaced by a newly elected government under the leadership of Aung San Suu Kyi, a long-repressed heroine of the people. Her picture with the title Our Leader appears everywhere.
Myanmar is now open to foreign visitors and foreign investors. Change is palpable and very visible. In the three weeks I was in the country, I saw sidewalks appear in Rangoon where there were none before and traffic tied in knots by the simultaneous construction of roads, bridges and overpasses.
Given the potential for growth, you might think opportunities for new businesses abound. But, in fact, B.C. and Canada start to look good by comparison. Yes, Myanmar’s military dictators have taken a step back, but corruption and kleptocracy have by no means disappeared. As well, foreign companies operating in Myanmar must still have 51 percent Myanmar ownership.
In practice, this means that companies that want to come in and invest in Myanmar have to give more than half their company and its profits to dominant Myanmar citizens, often militarily connected, and for which they get no return.
Operating a successful and growing business today requires a basic level of infrastructure. Although it is working hard to catch up, Myanmar still falls short on these needs.
Rangoon is the only capital city I have ever flown into where the roads one could see as one approached the airport were still unpaved. Electricity is not available in many parts of the country and is unreliable. Internet access is only available in the largest centres and, even there, demand often exceeds capacity. Medical care is wanting. The hospital in Mandalay, Myanmar’s second largest city with a population of 1.2 million, does not provide patients with either nurses or food and requires all entering to remove shoes and socks.
Although workers are cheap, educated and skilled workers are scarce. This is at least partly compensated by a young population with many very eager to learn and advance. There is also, in this very Buddhist country, the tendency to use savings to donate to monks and nuns and to buy gold to decorate temples.
B.C. and Canada, by comparison, are better places to start a business. We don’t have to donate half our business to a corrupt government or its cronies. We have a politically stable environment and the rule of law. Our infrastructure – highways power, water, connectivity and medical systems – are in place and functioning. Our population is educated and skilled; prepared to work in 21st century conditions.
Finally, people here are both willing and able to spend any money they earn to buy the goods and services that a new business can produce.
Troy Media columnist Roslyn Kunin is a consulting economist and speaker.