This is a best prospect industry sector for this country. Includes a market overview and trade data.
Last Published: 7/25/2017
Myanmar has three international airports, 30 domestic airports and 36 dormant, altogether 69 airports.  Air traffic on international and domestic flights is increasing rapidly. In order to accommodate increasing demand, airport infrastructure will need to be renovated.  According to the Myanmar Department of Civil Aviation (DCA), the number of international air passengers rocketed between 2010 and 2016.  In 2016, the number increased nearly to 6.65 million and by 2030, it is expected to rise to 30 million passengers.  The number of domestic air passengers also increased from 1.2 million to 4.6 million between 2010 and 2015.

According to the one-year journey of Ministry of Transport and Communications summary, 48 agreements were made to spread the airport wings for international flights, as well as framework agreements between Cambodia, Laos, Myanmar and Vietnam were also made.  What’s more, the flight agreements between Myanmar and Bhutan, between Myanmar and Netherlands and draft agreement between Myanmar and Indonesia were made.  The country currently has 32 international flights and eleven domestic flights.  Myanmar’s flag carrier, Myanmar National Airlines- MNA was transformed into corporation.  MNA now runs international and domestic flights, chartered flights and fixed base operations in order to earn more money.

The aviation market in Myanmar is competitive, especially among the local airlines.  The private airlines own a small number of aircrafts.  Currently, the market is oversaturated and preventing private airlines from achieving economies of scales and lowering cost.  The GOM has invested US$37 million for corporatizing, rebranding and expanding the services of the Myanmar National Airlines to make it more competitive internationally. The airline is expected to face heavy competition with foreign carriers in the market.  The number of people traveling with planes has increased year on year but the growth in air travel still has not kept pace with the growth of the service providers.  The country’s aviation market might experience consolidation after several years of consistent growth.  Myanmar’s Department of Civil Aviation (DCA) intends to strengthen the aviation sector and its new strategic plan includes improving infrastructure, promoting the airline business and securing or updating air service agreements with international partners, including the United States. There are now 11 local licensed airlines in Myanmar. Myanma Airways International (MAI) is entirely an international operator.

The rebranded Myanma National Airlines (previously Myanma Airways) is working on restructuring, corporatizing and rebranding with AviaSolutions which is the consulting branch of GE Capital Services (GECAS).  In 2014, MNA ordered six new ATR 72-600 planes from ATR to support its domestic expansion.  To facilitate its international expansion, MNA signed a US$1 billion deal in 2014 with GECAS to lease 10 Boeing 737-800 planes, including six current generation aircraft and four 737 MAX 8s. Some planes have already been delivered to Myanmar and the rest of the deliveries will continue through 2020.  MNA is exploring routes to Malaysia, China, Japan and South Korea.  MNA is the largest domestic carrier in Myanmar which serves over 30 destinations with 18 aircrafts.

Thirty two foreign airlines serving Yangon covered 85% of the total international traffic in 2016 and accounted for about 80% of the share of Myanmar’s international market in 2015.  Thailand is currently the largest foreign share of the Myanmar aviation market followed by Singapore.  Thai Airways/Thai Smile has the highest market share of 12% followed by Bangkok Airways with 11%, Thai Air Asia with 8%, Thai Nok Air with 6% and Malaysia Air Asia with 5.5%.  These airlines have secured significant shares of the Myanmar international travel market mainly because of the connections from their hubs, ability to offer lower fares and brand recognition.  As MNA plans to expand in North Asia, it is likely to experience the same uphill battle against Japanese, Korean, and Chinese air carriers which already serve Myanmar market.  Singapore Airlines (SIA) Group currently has 62% share of the total seat capacity and 23 of the 40 weekly flights between Myanmar and Singapore are on SIA carriers, including nine flights offered by Silk Air, seven offered by Singapore Airlines and seven by Tiger Air.
Leading Sub-Sectors

Airport Infrastructure: One of the major objectives of DCA’s strategic plan is to strengthen Myanmar’s aviation infrastructure.  Currently, Yangon International Airport is estimated to have the annual capacity of 2.7 million passengers.  In 2014, the GOM contracted Pioneer Aerodrome Services for a US$150 million upgrade on Yangon International Airport. The first phase of the project opened in March 2016.

The Ministry of Transport selected a consortium, comprised of Singapore’s Yongnam Holdings, Changi Airport Planners and Engineers and Japan’s JGC Corporation to build the airport located at a 9000-acre (3642-hectare) site in Bago Region, 850 kilometers from the center of Yangon.  Hanthawaddy International Airport, set to be the largest airport in the country, will cost approximately $1.1 billion to develop and will accommodate 12 million passengers per year in phase 1 and 30 million passengers per year in phase 2.  The new airport is expected to be fully operational by the year 2022.  For the NLD Government, Hanthawaddy is quiet far from Yangon so they planned to build an airport in southern Yangon Region.  The first phase of Hanthawaddy, with capacity for 12 million passengers a year, costed about US$1.4 billion in 2014.  It is assumed that Hanthawaddy is the airport of the future that Yangon needs.

In 2014, 46 firms responded for the Request of Interest (ROI) for upgrading 30 domestic airports. Tenders for additional domestic airports will be launched to international and local firms phase by phase.

The Rakhine State government will invite tenders for the construction of an airport in Mrauk-U to avoid any delays which could happen if the goverment relied solely on state funds to build it, according to Mr. Kyaw Aye Thein, the state Planning and Finance Minister.

In order to implement all the planned airport infrastructure projects, DCA is strengthening its policies and drafting the Myanmar Airport Authority law.  The law will regulate airport services and enable the privatization of airports.  DCA also aims to strengthen the businesses of local carriers by developing better safety standards and quality of service.  U.S. firms are invited to help develop standards, quality of general aviation and airport infrastructure in Myanmar.

Aircrafts and Parts: The total value of imports for civilian aircraft, engines, equipment and parts to Myanmar from the U.S. in 2012 was US$25 million.  In 2015, the value of imports increased to over US$98 million which clearly shows that there is a strong demand for U.S. aircrafts and spare parts in Myanmar.

DCA has a strategic plan to further expanding the aviation sector with four objectives which are to pursue the liberalization of economic regulations in the aviation sector, to strengthen air linkages, to promote airline businesses and to improve infrastructure.  Opportunities related to these areas are open to the U.S. firms.  

Web Resources
Department of Civil Aviation (DCA)
Ministry of Transportation and Communications (MOTC)
Myanmar National Airlines (MNA)
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