Less Chance to bargain for Myanmar Tours

For anyone planning a trip to Yangon soon – start saving.
Hotel rates in the once-reclusive Southeast Asian nation have continued to shoot up in the past few months, largely due to sweeping political and economic reforms initiated by Myanmar’s government that have enticed investors and tourists to Yangon. Many economists fear the jump in rates could be one of the first signs of broader inflation as Myanmar’s economy opens up more to the outside world.
There are few hotels in Yangon that currently cater to international business travelers, a result of decades of heavy economic sanctions and Myanmar’s limited appeal to investors. But following high-profile visits of politicians and large business delegations recently from Japan, Singapore and elsewhere, some tour operators are finding it hard to locate inexpensive rooms for their clients, with room rates at some hotels increasing by as much as 200% in recent months.
“As we are just in from the cold and [a] tsunami of visitors is pouring in, demand [is] so high!” said Maung Maung Lay, a member of the executive committee of the Union of Myanmar Federation of Chambers of Commerce and Industry. He added that lower-end hotels, too, were benefiting from the influx of visitors and noted that many tourists and business leaders have expressed dissatisfaction at the high rates.
Yangon’s Traders Hotel, for example, now offers rooms starting at about US$220 a night, according to its website. Part of the Shangri-La Group of hotels, the centrally-located landmark hotel was offering rooms for as low as US$80 a night before the latest reforms in Myanmar.
According to the most recently-available statistics from the country’s Ministry of Tourism and Hotels, Yangon has about 181 hotels, compared to almost 700 in Bangkok. According to a report in the Myanmar Times, tourists and tour operators feel the most-squeezed from the recent hike in room rates, as many hotels are raising rates with business travelers – who tend to travel on expense accounts – in mind.Some local business leaders say the new rates aren’t particularly shocking, since hotel rooms in Myanmar have largely remained much lower than similar properties in other Southeast Asian cities over the last decade.
“We’ve enjoyed relatively low rates in the past decades… it simply depends on demand and supply,” said Nay Zin Latt, an official at the Myanmar Hotelier Association. “At the moment, the market is a bit distorted.” Mr. Nay Zin Latt added that his organization will try to ensure rates stay comparable to international rates for four-star hotels, though he didn’t elaborate on steps the association could take.
Business leaders in Yangon say that four star hotels are the most highly sought after, and that they have encouraged hotels to stabilize their prices for the rest of the year to avoid more inflation. Representatives from prominent hotels in Yangon, including the Traders Hotel and Parkroyal, were not immediately available for comment.
For international hotel groups, of course, the surge in prices is great news, especially after many suffered through low occupancy rates over the past decade. Mr. Nay Zin Latt noted that many hotels are now eager to set up shop in Yangon, and his association recently hosted a group from Singapore keen on exploring tourism opportunities in the country.
A number of U.S.-based hotel chains have also expressed interest in expanding into Myanmar, though they are still restricted by American sanctions that block most U.S. investments in the country. U.S. officials have signaled they intend to ease those sanctions if Myanmar’s reforms continue.
“Myanmar potentially represents a unique and fascinating travel destination,” said a spokesman from Marriott International in a recent interview. “However, we’re not involved in development projects there and current U.S. government regulations make it unlikely that we would be able to pursue such projects there at this time.”
Other hotel groups have said they are still looking out for the best local partners to team up with in Yangon – a process they said will take time, which means the high rates could be around for a long time to come.