The Tourism Industry of Myanmar

Last update: April 10, 2024

The hotel market in Myanmar.

From bust to boom to ... bust?

Myanmar used to be an obscure, unloved, forgotten country, located right between two of Asia's major tourist destinations: India and Thailand. During the peak tourist season just a few hundred thousand people would bother to travel there, put off by the boycott, the complicated border and travel restrictions and the difficult currency situation. However, a transformation has occurred since 2010, propelling Myanmar from a state of decline to one of rapid expansion in a span of a few years.

For many years Myanmar had between 200.000 and 250.000 tourists arriving at Yangon airport every year. Starting from 2011, visitor numbers began to surge dramatically, causing shortages of hotel rooms during high season. The pinnacle of high room prices was reached in 2013. The hotel situation in Myanmar has since improved due to the construction of numerous new accommodations. However, recent years have witnessed a steep decline in tourist arrivals due to political unrest and the COVID-19 pandemic.

In summary, during the past decade the tourism surge took off like a rocket, and led to a doubling and even quadrupling of hotel numbers. But that tourism boom has gone bust after a period of explosive growth. The worldwide outbreak of the coronavirus crisis resulted in the evaporation of tourists, and the final blow was dealt by the 2021 coup, inflicting substantial damage upon the tourism industry. Despite a slow recovery in 2022 and 2023, the industry's revival has been minimal.

 


Tourist arrivals at the international airports.

The overall picture is that the steep rise in tourist number stopped in 2016. The reason for the dip in visitor's numbers in 2016 and 2017 is due to the hostilities in Rakhine and the Northern Shan region. The graph below shows the number of tourist arrivals at the three international airports (left) and the total number of hotel rooms in Myanmar (right). These tourism statistics exclude land-border tourists.

Myanmar Tourism statistics
Myanmar tourism chart/graph from 2008 until 2022.
Left: tourist arrivals (red line) at the international airports.
Right: total number of hotel rooms in Myanmar (blue line).

Myanmar tourist arrival data.

year airport arrivals rooms comments        
2008 193.000 20400
2009 245.000 21000
2010 319.000 23500
2011 391.000 24000
2012 593.000 28000
2013 904.000 35000
2014 1.130.000 43000
2015 1.288.000 50000
2016 1.208.500 56500
2017 1.304.000 64000 Rohingya exodus to Bangladesh.
2018 1.344.839 68167
2019 1.792.000 79855
2020 330.000 89730 Start of Corona pandemic.  
2021 18.500 92000
2022 90.000 94860

DATA: Ministry of hotels and tourism statistics.
The arrival numbers exclude land border tourists.

 


The new Hotel Zones

To Zone or not to Zone?

The new Hotel Zones which the Myanmar government has planned and developed around Mandalay and Inle lake have not been very succesful. For example, in 2012 the government launched a hotel zone project in the hills around the south-eastern part of Inle lake. This new hotel zone, easily visible from Google Earth by the new roads on the bulldozered hills is more than twenty kilometres from Nyaung Shwe and thus rather isolated. In 2017 there are only two new resorts and its clear that this hotel zone is not a great success. Farmers have protested at being bought out at very low ground prices; and farmland and a hillside have been destroyed; leaving a large open wound which is easily visible from the lake. Any replanting of greenery or trees has not happened.

Similar problems have arisen at the new Tada-U hotel zone near Mandalay. Quote from "Sustainable destination plan for the ancient cities of upper Myanmar, Mandalay, Amarapura, Inwa, Sagaing, Mingun (2016-2021)":

The location for the Hotel Zone of the Mandalay region is a large area in the township of Tada U, near Inwa, around 10 km north of Mandalay’s international airport. The planned complex covers an area of around 22 square km. (almost a quarter of the size of modern-day Mandalay). From the point of view of scale and the enormous sacrifice of farmland and of rural landscape, the project seems exaggerated.

It reminds one of the enormous scale of Naypyidaw, which is also difficult to navigate for tourists. The Tada U hotel zone is 10 km north of Mandalay’s international airport and ... 25km away from central Mandalay town (the railway station and Zaycho market). It might be a suitable industrial area, or a large residential area, but for a tourist it would the worst place to stay in Mandalay. It seems that hotel developers are in some cases better off when they ignore these government zones.

Another serious problem is that farmers get very little compensation when a hotel zone is developed, usually the profits are made higher up. Protesting usually resolves nothing; as farmers are on the bottom of the food chain and can do little against the authorities. Therefore, the hotel zones have drawn a lot of criticism in Myanmar for mismanagement and bad planning.

The new Hotel Zone in Bagan is in an awkward position, 5 km south of New Bagan, and is quite remote from Old Bagan, as well as far from the airport and bus station.

Now that the Myanmar hype is over some of these zones are no longer needed in the foreseeable future. The popular destinations in Myanmar (the Big-Four) have an abundance of hotels and some of the hotels that have been built in remote hotel zones may find it hard to fill their rooms.

 


The hotel situation from 2011 to 2020.

In the last eight years the number of hotel rooms has increased more than threefold in the main destinations (the Big-4), except in Bagan where the authorities are restricting the building of new hotels in the Bagan archaeological zone.

town 2011 2019 PCT
Yangon793423558297%
Mandalay318111153351%
Bagan20084345216%
Nyaung Shwe937 3388362%
Mawlamyine1941129582%
total rooms 1425443573306%

Hotel room numbers from 2011 - 2020
DATA: Ministry of hotels and tourism statistics.

 

Timeline of tourism and the hotel market development.

Between 2012 and 2013, hotel rates in Myanmar more than doubled and then tripled compared to 2011 due to an increase in tourist arrivals. However, in 2014, the number of hotel rooms increased by 44%, leading to stabilization in hotel prices.

In 2015, the number of new hotels in Yangon caused a decrease in hotel occupancy rates, and prices began to go down. By 2017, hotel prices had dropped by around 30%, and the number of tourists from Thailand and China increased while the number of Western and European tourists decreased. In 2019, hotel prices bottomed out and became more reasonable, with some new hotels even offering discounts that may not be sustainable.

Naypyidaw is an interesting case: after government offices moved to Naypyidaw many hotels started popping up with the expectation that many international delegations would visit. This has caused an enormous oversupply; in 2016 Naypyidaw had 5100 rooms in 63 hotels, but far fewer than 1000 rooms were occupied. More: www.irrawaddy.com (“Taking a look at a hotel industry in Naypyidaw, I feel like the Titanic is sinking.")

 



Hotel market analysis.

Most first-time visitors of Myanmar tour the "Big 4"; Yangon, Mandalay, Inle lake and Bagan. These 4 destinations are where hotel chains and Burmese investors have built many new hotels during the last eight years. In Mandalay, Bagan, and Inle lake many hotels have opened, and the hotel shortage has completely disappeared. Overall, Myanmar has been focusing on luxury, upmarket tourists during the tourism boom, not on backpackers and flashpackers. That trend, of mostly upmarket travellers, has changed since the Rakhine unrest in 2016 - 2017.

Hotel room rates (in US-dollars) have been edging down the last 6 years; the hotel rates in Myanmar have become comparable to those in other Southeast Asian countries like Thailand and Cambodia. Hotels in all price ranges are now plentiful, but hostels are a relatively new phenomenon. The luxury hotels in Yangon and Mandalay that tripled their room rates in 2013 have lowered their room rates significantly. Room rates for mid-range hotels have been dropping as well, and there are very good online discount deals to be had. In the budget hotel market, there has been relatively less expansion; few budget hotels have been built.

Outside of the "Big 4" the situation is different, and in many places good affordable hotels are difficult to find. For example, very few new hotels have been built in Kengtung, Loikaw, Myawaddy, Taunggyi, and Sittwe; and hotel prices remain rather high there. Due to the unrest in Northern Rakhine state during the first half of 2019, nearly a dozen hotels have closed in Mrauk-U.

Many new hotels opened in Pyin-U-Lwin, but there was no significant decrease in room prices. In Mawlamyine many new hotels were opened in the suburbs, quite far from downtown Mawlamyine, which is the area between the long pagoda dotted hill East of town, and the Strand road on the riverside.

After the Western and European tourist inflow showed a decline; Myanmar has been shifting its tourism promotion towards the Chinese and South-East Asia markets. In 2018 the government rolled out a visa on arrival (VOA) for tourists from mainland China, Hong Kong, and Macao. Most other nationalities still need a normal visa or E-visa. From 1st October 2019 onwards, visitors from Italy, Spain, Russia, Germany, Switzerland, and Australia can also get a Visa on arrival.

The total number of tourists increased by 33% in 2019, primarily due to the promotion of Chinese tourism. This led to a surge in Chinese tourist numbers, in line with the increase in other Southeast Asian countries. However, the average stay decreased from 9 to 6 days, largely because Chinese tourists tend to take a quick tour of the country. As a result, there was no increase in total tourism revenue, as the increased number of tourists was offset by the shorter duration of their visits.

The big slump and slow recovery of tourism in 2024.

Over the past 10 years, Myanmar has added hundreds of hotels and thousands of rooms, with around 60000 rooms added in the last decade. However, the rise in tourist numbers stopped abruptly in 2020. Since the COVID-19 crisis, tourist numbers have plummeted. Myanmar officially reopened for travel in 2023, but the recovery of normal tourism is likely to be very gradual due to the ongoing unrest throughout the country.

According to the Myanmar Tourism Federation, there are over 1900 hotels with 80000 rooms across Myanmar. Hundreds of hotels in Myanmar’s most popular destinations, like Yangon, Mandalay, Bagan, Chaungtha, Ngwesaung, and Shan State, are reportedly in the process of being put up for sale. Apart from a significant drop in the number of foreign travelers, frequent power outages and inflation have also taken a toll on hoteliers.

 

Over the past decade, Yangon has witnessed the rise of many grand luxury hotels, including the Melia, Pullman CenterPoint, Novotel, Savoy, Lotte, and Rosewood hotel, among others. However, despite their five-star status, the demand for these establishments has dwindled, as Yangon has lost its status as a premier luxury destination.

Among the dozen five-star hotels in Yangon, half have shuttered their doors due to a significant downturn in international tourism. The imposing Sule Shangri-La hotel, formerly known as the Traders Hotel, located on Sule Pagoda Road, has remained closed for several years, emblematic of the challenges facing the hospitality sector.

In response to the decline in demand, some luxury hotels, such as the Novotel-Yangon-Max, have resorted to slashing prices in an attempt to attract visitors. Despite these efforts, the luxury hotel market in Yangon continues to face a long-term decline in tourism numbers. There is no relief in sight in the forseeable future.

 


Myanmar Hotel Market links

 


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