PepsiCo set to fizz again on Burmese market after 15 year absence

By Ben Bouckley

- Last updated on GMT

Related tags Indra nooyi Pepsico

PepsiCo set to fizz again on Burmese market after 15 year absence
PepsiCo has signed an agreement with Diamond Star to distribute its beverage brands in Burma, granting the latter exclusive rights to sell and distribute the Pepsi Cola, 7-Up and Miranda brands in the country.

PepsiCo said today it also plans to explore opportunities to invest in agricultural development projects in Burma (Myanmar), as it returns to do business in the country for the first time since 1997.

Earlier this year the US State Department encouraged companies to explore opportunities in the country. As a result, PepsiCo said it plans to evaluate other opportunities in the Burmese market, including the potential for local manufacturing operations. 

The Diamond Star deal follows several years of strong growth for PepsiCo in developing and emerging markets, as PepsiCo nearly tripled its business in developing and emerging markets from $8bn in annual revenue in 2006 to $22bn in 2011. 

Myanmar has 'great potential'

PepsiCo chair and CEO Indra Nooyi said:"PepsiCo has a strong and growing business that spans more than 200 countries and territories around the world, and we are constantly looking for new growth opportunities that will put our food and beverage brands in the hands of more consumers,"​   

She added: "Myanmar is a market with great potential, and our agreements with Diamond Star and UNESCO are important first steps towards expanding our presence in the country.  Over time, we believe we can build a strong business in Myanmar and play a positive role in the country's continued development."

Native company Diamond Star has traded in Burma for nearly 50 years, and has built distribution capabilities and relationships throughout the country's retail sector. 

Accordingly, PepsiCo said its beverages were now available to consumers in parts of the country and product availability would increase in coming weeks. 

Separate agreement with UNESCO

The recently signed agreement involves Diamond Star buying and importing products from PepsiCo's Vietnam operations, and it plans to promote PepsiCo's brands in Burma with a sampling campaign and outdoor advertising.

"Diamond Star is extremely proud to be associated with PepsiCo," ​Diamond Star MD Ko Ko Gyi said. "PepsiCo is a world-class company that emphasizes an exemplary code of conduct and a sustainable approach to business with a focus on people at its center." 

PepsiCo said it had also signed a memorandum of understanding with the United Nations Educational, Scientific and Cultural Organization (UNESCO) to partner on vocational training initiatives in Burma. 

The food and beverage firm said it would work with UNESCO to provide programs focusing on managerial skills training to "support the country's development, empower its people and strengthen the workforce as PepsiCo looks to expand its business in the future".

PepsiCo's move follows the Coca-Cola Company's announcement in mid June that it was developing plans to start a local business in Burma​ as soon as the US government issues a general license allowing American companies to invest in the country.

Related topics Markets PepsiCo Emerging Markets

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