Myanmar’s telecom dividend

Myanmar starts to see the development of its telecom sector after decades of inactivity, the investments by multinational businesses are creating an opportunity for new jobs for skilled Myanmar workers, especially those who have some kind of experience abroad.

Telenor of Norway and Ooredoo of Qatar have promised to fill many job opportunities, and their arrival has energised people since they received their mobile licences last year after a hotly contested bidding process.

Both operators have been hiring many local employees in recent months, while other telecom businesses have been setting up shop in Yangon to support future development of the industry.

Ericsson, one of the world’s largest telecom infrastructure providers, estimates that the mobile communications industry will employ approximately 66,000 full-time employees in Myanmar, with an additional 24,000 full-time jobs created in the wider economy as a result of interactions with mobile network operators.

All of the new activity has led to the telecom sector topping the table of foreign direct investment in the country, with about 20% of the total, according to the Myanmar Investment Commission.

Total FDI to Myanmar, which only began opening its economy to the world four years ago, is likely to reach at least $4 billion by next year, according to a commission spokesman.

Telenor, which paid $500 million for its 15-year licence, has declared that it aims to provide mobile network coverage for 90% of the population within five years, while OOoredoo has already started building its 3G network.

The Myanmar Investment Commission expects that more companies will enter Myanmar to support the mobile operators’ needs for infrastructure including towers, optical-fibre lines and other equipment.

Just last month Sweden-based Ericsson announced a framework agreement to supply a combination of 2G and 3G equipment for Telenor’s mobile network, suggesting upgrade requirements would need to be met as well.

“We are pleased to add Ericsson to the group of global partners we will be working with as we develop the Telenor Myanmar telecommunications network,” said Petter Furberg, the CEO of Telenor Myanmar.

In preparation for network deployment, Ericsson said local hiring would continue over the next few months, and that those already on board were already being trained.

Jan Wassenius, country manager of Ericsson Myanmar, said, “We can create a robust infrastructure for Telenor that will give Myanmar citizens a rewarding mobile experience. We hope the deployment of this infrastructure will have an enormous positive impact on the economy of the country and on the lives of its citizens.”

In 2012, Ericsson commissioned a study to assess the potential economic impact of mobile communications in Myanmar. It estimates that the total economic impact of the mobile sector in the country will be between 1.5% and 9% of GDP over the first three years after licences are issued.

In late March, Ericsson advertised job vacancies for local people, with a special focus on those with international experience. Since the middle of last year, many Myanmar nationals who have been working abroad (especially in Singapore, Thailand and Malaysia) have been returning home to pursue new job opportunities offered by foreign companies.

Aye Chan Moe, an electrical engineer who works in Australia, is planning to return to Myanmar in late April and hopes to get a job with either Telenor or Ooredoo.

“I am applying for jobs with both telecoms as I have plans to return to Myanmar,” he told Asia Focus. “It’s good for those of us who have work experience abroad, but conditions and salaries for foreign workers and local workers are still different in Myanmar.

“A lot of FDI is flowing into the country, so the government should fix minimum wages for Myanmar workers, and also workers need to push for better salaries in line with their skills.

“If foreign workers earn $2,000 a month, Myanmar workers should have at least $1,500, but I’ve heard that in some areas, foreign and local workers’ salaries are quite different even though their responsibilities may be the same.”

In addition to closing the salary gap, he said employers should welcome and encourage local workers’ creativity.

Ma Khin Ye Thilar Aye, who joined Ooredoo as a marketing specialist a month ago after working as a manager in Singapore, said she was being treated equally to foreign workers at the Qatari-owned company.

“I just came back to Myanmar because there are a lot of job opportunities awaiting us,” she said. “I’ve received better treatment here, just like Singapore. We can learn the latest technology and can improve our abilities through work experience, so now there are many job opportunities attracting Myanmar employees.

“Being home is better than being a second-class citizen abroad; that’s why many Myanmar employees from abroad are planning to come back.”

However, with foreign telecom companies offering experienced local employees more than double the prevailing salaries, local telecom companies including state-owned Myanmar Post and Telecommunication (MPT) are facing problems.

One MPT employee said that when the government announced in 2012 that foreign firms could compete for mobile licences, some government employees switched to telecom companies including Jamaica-based Digicel and France-based Orange. When they failed to win bids, the employees jumped to Ooredoo and Telenor.

“They paid more than double the salaries to local employees; even the minimum wages started from 500,000 kyat (16,750 baht) a month,” said the worker, who asked not to be named. “I heard some local employees who have working experience abroad are earning $1,500 per month.”

Bangkok Post

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