International Finance Corporation (IFC), a member of the World Bank Group, is providing a USD 25 Million loan to City Mart Holding Company Limited (CMHL). The loan is meant to support CMHL's expansion plans, boost the country's retail sector and create much needed jobs along the supply chain.
The funding will help CMHL build 20 more supermarkets and hypermarkets all across Myanmar within the next 3 years. Founded in 1996, it currently has over 150 retail outlets and the expansion will enable producers, micro and SME's as well as other suppliers to integrate into the supply chain and distribution networks. CMHL expects to increase its domestic purchases sixfold, reaching around USD 150 million per annum by the year 2021 and create nearly 4,000 new jobs, out of which half will be for women.
Win Win Tint, Managing Director of CMHL told Crossroads that " IFC's investment is a sign of confidence in our business plan as well as the potential of Myanmar's retail sector. Apart from funding, IFC's expertise on food safety, good social and environmental practices and corporate governance will help us take the company up to the next level."
Myanmar's USD 12 Billion retail sector is predominantly informal, with formal retailers holding less than 10% of the market. However, the recent economic growth and opening up of the markets after decades of isolation have boosted public demand for consumer goods.
Vivek Pathak, IFC's regional director for East Asia and Pacific told Crossroads that IFC supports the development of a modern retail sector in developing countries like Myanmar as it spurs growth and job creation. Furthermore, it helps develop supply chain and logistics infrastructure and support small and medium enterprises. He said that, we[ IFC ] will be delighted to work with CMHL to improve efficiency and standards to become a modern retailer in Myanmar. Currently, IFC is working together with both Goverment and Private sectors in Finance( Banking), Hotels, Agriculture, Power and Telecommunications Infrastructure projects. He further stated that reform is an evolutionary process and overnight success should not be expected; with patience being asked of the people.
He continued that IFC is willing to support viable enterprises with a focus on employment generation and financial inclusion. There are several deals under discussion and about 10-12 [Myanmar] companies should receive funding from IFC within the next 18 months. His take on Myanmar's progress(based on what he have seen around Yangon) is that there is robust activity and that the large number of construction projects going up is an indication of confidence.