Japanese logistics company Hitachi Transport System has launched a new intermodal container transport service that promises to cut in half the time it takes to move goods between Myanmar and Japan and China.
The use of trucks to link Yangon with Bangkok, and using sea connections from Bangkok to reach Japan and China, will take 30 days, according to Hitachi. That compares with a 60-day maritime transit between Japan and China and Myanmar, the company said.
Using trucks owned by its Japanese subsidiary Nisshin Transport, the “Smart My Road” service makes it easier to ship raw materials from China to Myanmar for processing, Hitachi said.
Japanese manufacturers have been expanding operations in Myanmar in recent years, notably through the Thilawa Special Economic Zone (SEZ), in which the government of a Japan is an investor. Logistics companies have been close behind, opening warehouses and offering new services in Myanmar over the same period.
For example, Japan’s largest international freight forwarder, Nippon Express, announced on May 22 that it will open a new warehouse in the Thilawa SEZ on June 1.
Japanese logistics companies are likely to continue their Myanmar expansion efforts as the country’s GDP growth is projected to accelerate this year to 7.4 percent after growing 6.4 percent last year, according to data from IHS Markit.
Strengthening trade between Japan and Myanmar is evident also in a review of destinations for Myanmar’s imports and exports, with Japan increasing its market share of Myanmar’s exports from 5.5 percent in 2000 to 6.2 percent in 2015, according to IHS Markit. Japan’s share of Myanmar’s imports declined over the same period, from 7.1 percent to 4.8 percent, as China more than doubled its share of Myanmar’s imports from 18 percent to 42.2 percent.
While Japan’s market share of Myanmar's imports declined, the value of those imports rose from $200 million to $1.2 billion.