Kyaukphyu Brick Businesses Face Closure, Allege Unfair Competition

Eleven local concrete block production businesses at Kyaukphyu in Rakhine state have stopped their operations because of competition from cheaper bricks produced with prison labour, alleged local brick makers.

The Directorate of Prisons under the Ministry of Home Affairs sell cement bricks produced by prisoners at K60 for one brick, while local brick producers can only sell at K75 for one brick, making them unable to compete fairly.

As losses mount more businesses are facing closure, the brick makers said.

U Tun Chay, a local brick producer, said, “The shape and quality of bricks produced by us and the Department of Prisons are the same. The Department gets sand and stones for free and has no labour costs either. The only production cost that they have to bear is only for cement. Discussions with the officials of the Department to fix the price of bricks has not been successful.”

However, one official of the Rakhine state regional government, said, “We will arrange to negotiate between local brick producers and officials from the Department to specify the same price as soon as possible.”

Another official of the regional government said fired ceramic bricks require too much fuel and labour to produce, therefore cement bricks are produced and sold in the market.

U Tun Chay said that the price of one cement bag is K6,500 and 170 to 180 bricks can be produced from that. The cost to produce one cement brick is K50 including the costs of sand, stone, cement and labour.

“We can’t compete with the Department because we can’t sell at the same price as them. The Department can sell as many bricks as possible for K60. Construction firms buy cheaper bricks because the quality is the same.

“Every brick maker is in a very difficult situation. The five or six brick producers that are left are still continuing because they have some money left, but this won’t last for too long,” he said.

Source: Myanmar Business Today

NB: The best way to find information on this website is to key in your search terms into the Search Box in the top right corner of this web page. E.g. of search terms would be “property research report”, ”condominium law”, "Dagon City", “MOGE”, “yangon stock exchange”,"MECTEL", "hydropower", etc.

To learn about the business opportunities in Myanmar click here

To evaluate the various segments of the market that you could possibly enter base on your competencies you can do a Custom Market Entry Strategy Research. You can see a sample report at page "Actual Sample of Client Report”. Click here to go to page.

Do you know that IE Singapore is giving up to SGD 20,000 support for Singapore company to venture into Myanmar? To learn more click here