Where is Coca-Cola Building Its Newest Plant?

Coca-Cola Co. (NYSE:KO) has announced it will be opening a plant in Myanmar in an effort to compete with PepsiCo Inc. (NYSE:PEP) for business in Southeast Asia.

Myanmar is attempting to increase its economic, military, and political ties with Western nations after 50 years of military rule that left the country’s 64 million citizens among the poorest in the world. Myanmar’s economy was socialized after a military coup in 1962. Most investment by U.S. companies in the country was banned after economic sanctions were placed against the junta that took power in 1988 due to the regime’s repressive policies. The country’s transition to democracy last year prompted the U.S. to ease sanctions on business with Myanmar.

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Coca-Cola, the world’s largest soft-drink maker, left the country about 60 years ago, and Coke Chief Executive Officer Muhtar Kent compared the company’s return to Myanmar with another important historical transition to democracy. “It’s a great moment in history, just like it used to be when we opened up our business in east and central Europe in the former Soviet Union right after the fall of the Berlin Wall,” Kent said. “We can retain and grow our leadership that we already have in this market today.”

“As important as price, it is availability, it is serving the product in the right conditions, making it available, making it at arm’s reach of desire,” Kent said. “We have plans to ensure that we have the best, most modern 21st century consumer distribution system in the country.” Kent said the investment will help create more than 22,000 jobs in the country over the next five years.

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The company announced plans for its business in Myanmar at the ceremonial inauguration of the bottling plant, which is located in Hmawbi Township, a suburb of Yangon, the country’s biggest city.

Coca-Cola will focus on distribution to win over the nation’s consumers, which have had more recent contact with Pepsico products. Pepsi, the world’s largest snack maker, didn’t pull out of the country until 1997 when it came under fire from human rights groups for supporting the country’s military dictatorship. Kent says Coke will invest $200 million in the country in the next five years and will open another plant there within a month.

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