Baker & McKenzie LLP, the world’s second-largest law firm by revenue, opened an office in Myanmar to serve foreign investors entering an economy emerging from five decades of isolation.
“First movers” across the telecommunications, energy, mining and infrastructure industries are already active in one of Asia’s poorest countries, Chris Hughes, head of the office in Yangon’s Sakura Tower said in an interview.
The former military regime’s move to democracy under President Thein Sein since 2010 has attracted companies such as as Coca-Cola Co., General Electric Co. and Norway’s Telenor ASA. Annual economic growth could double to 8 percent, according to a McKinsey Global Institute report last year. Myanmar remains under scrutiny from multilateral agencies ahead of elections scheduled for 2015, Hughes said.
Baker & McKenzie’s Yangon office should reach break even and be “moving to cruising altitude,” after that, said Eduardo Leite, chairman of the law firm’s executive committee.
“Myanmar is a new frontier for everyone after all these years as a closed economy,” he said. “We’re prepared to be patient.”
Hughes, previously a Sydney-based partner, heads a team of six other lawyers in Yangon including five from Myanmar. It is Baker & McKenzie’s 16th office in the Asia-Pacific region and 75th worldwide.
The Chicago-based firm was the first international one to open in markets like Russia in 1989, Leite said, and has experience with the “ups and downs” clients can face such as the Latin American debt crisis of the 1980s, Asian crisis of the 1990s, the recent Arab Spring and aftermath, and the Euro zone crisis.
“When we opened our Seoul office tension with North Korea was very high, I didn’t tell my wife that missiles had been pointed at Seoul. That’s part of life,” he said.
The firm is looking at developing its capabilities in Africa but has no plans for any further offices this year, Leite said.
New York-based Herzfeld & Rubin and Philadelphia-based Duane Morris LLP, both smaller than Baker & McKenzie, opened Yangon offices last year.
Myanmar may attract as much as $100 billion in foreign direct investment over the next two decades if it spends enough to achieve its economic growth potential, McKinsey said in a May 30 report.