The people of Burma weren't offered an explanation but such an irrational and nonsensical decision is not entirely surprising coming from one of the most repressive regimes in the world. 

Naypyidaw translates to "Seat of the King" or "Abode of Kings" and the time for it's relocation was selected by Than Shwe's team of highly coveted astrologers. Some believe that the situation is a reflection of the ruler's dementia or simply his delusion considering the audacious name as well as the fact that he believes himself to be the reincarnation of Burmese King Kyannsittha from the 11th Century. On the other hand some strongly believe that the Junta's growing fear of a US amphibious military invasion allowed paranoia to trump logic thus the city was moved from the southern coast to the geographic center.