RJE Global sparking Myanmar's drive to 100 per cent electrification
For RJE Global – an Adelaide-headquartered engineering and construction company with a vibrant energy business – Myanmar represented a commercial opportunity too good to resist. The country's plan to deliver electricity to 50 per cent of the country by 2020 and 100 per cent by 2030 warranted a significant on-the-ground presence.
The opportunity emerged in early 2015 when RJE Global's owner met some Myanmar officials while visiting China. These officials impressed on him the large volume of opportunities available and the country's ambitious electrification targets. They also discussed the small number of Australian companies working in Myanmar on infrastructure and construction projects.
RJE Global then worked closely with Austrade and the Australia-Myanmar Chamber of Commerce to learn more about the Myanmar market, including its regulatory and legal frameworks.
'Following that, we undertook two or three fact-finding missions where we met local officials and business leaders,' says Paul Moynihan, General Manager, RJE Myanmar. 'Those exercises confirmed the opportunity and solidified our decision to establish a permanent presence in the country.'
The move represented a major step forward for RJE Global's ASEAN strategy. The company had an office in Singapore and participated in projects to install more than 600 MW of electricity generation in Indonesia in partnership with GE. However, RJE Global had typically entered markets purely to complete individual projects.
RJE Global established RJE Myanmar, a business focused on infrastructure and grid reinforcement projects such as power plants, transmission lines and substations.
'We offer a full range of services ranging from full turnkey design and construction to training and development and consultancy,' Moynihan says. 'Our vision is to partner with the Myanmar Government to assist in the large-scale electrification of the country.
'Myanmar is currently at 39 to 41 per cent electrification approximately (estimates vary) so there's a long way to go to meet ASEAN and international electrification ratios,' he adds. 'We very much see ourselves as part of the solution to that issue.'
RJE Myanmar ran development courses and technical seminars for local officials during its first six months of operation. These sessions helped the company gain credibility with the government and the market at a low cost.
'We impressed upon the officials that we would have full-time, permanent technical staff based in Myanmar who were just a phone call away,' Moynihan says.
While the company has faced challenges finding skilled labour and tradespeople and working capital support, its approach is sparking success. From employing three team members and completing one project in its first year of operation, RJE Myanmar has grown its employee numbers tenfold, increased revenue by 400 per cent and as at October 2017, was completing its sixth project.
RJE Myanmar has maintained a strong relationship with Austrade following the initial assistance provided by the commission. 'We still have a good working relationship with Austrade,' Moynihan says. 'They've been very helpful every time we've had questions about business sentiment or government policies.' Furthermore, Austrade officials have attended some of RJE Myanmar's higher-profile meetings with the Myanmar Government, adding significantly to the credibility of the business.
Moynihan points out that there are considerable opportunities for Australian businesses in Myanmar and elsewhere in ASEAN if they are prepared to invest time and resources.
'Australian technology, business and capital has a very good reputation in Myanmar,' he says. 'There is a real appetite there for what Australian businesses can deliver in areas such as infrastructure.'