May 7, 2012

Myanmar - A time for informed decision making


MYANMAR’S political landscape is changing. The speed of change is debatable; for some it is too fast, while for others it is too slow and nothing has changed on the ground. I believe that as long as commitments to reforms are followed through on a continual basis, speed of change should not matter so much.

The challenge for Myanmar is not the speed of change but the types of changes that are introduced. While reforms are introduced to bring democracy, how can Myanmar maintain its cultural and traditional characteristics and social values? Will the unique cultures of its many ethnic groups be preserved? How can Myanmar make sure that its cities do not become run-of-the-mill Southeast Asian metropolises?

It is one year since a new chapter began in the contemporary history of Myanmar with the transition of power to a mostly civilian government consisting of many ex-military officials. It was seen as a farce by almost everyone inside and outside the country. But the sweeping political reforms introduced by this new government caught everyone by surprise. It is clear that the seven-step Roadmap to Democracy was implemented as planned. The new government is firmly committed to addressing the shortcomings in governance and administration of the former military regime. Myanmar is gradually facing up to its development challenges. There is still scepticism in some quarters and this is unlikely to disappear any time soon. But it is time for the international community to move on and accept the fact that changes taking place in Myanmar are real. This must be taken at face value.

Over the past few decades the world has seen a massive shift in international development policy. The neo-liberal concept of democracy, individual freedom and a free market economy have been marketed globally as an interlinked commodity without which mankind could not survive. China, which was treated as a pariah state and is still criticised for its Communist political system, is now the biggest international lender and holds shares in almost all major multinational companies. Malaysia and Singapore have also flourished with a governance system that is distinctly different from the Western concept of democracy. Vietnam is yet another case where a country has defied some widely held democratic principles but still made economic progress.

As Myanmar opens its doors to the international community – especially for political dialogue, trade and commerce – there is a need to take rational and not emotional decisions to entice investors. As we have discovered in recent years, democracy promoted as a package with free trade and a market economy has simply promoted individualism, inequity, and an economic survival of the fittest. The problems of Greece, Ireland and Iceland are glaring examples of the failures of modern-day economies tied to free trade and democracy. For Myanmar, as a newcomer to the democratic stage, there are many examples from which it could learn – and avoid becoming subservient to the preachers of democracy and neo liberal free market economists, a fate that many have succumbed to.

Myanmar has always been a recipient of low levels of official development assistance. Despite six decades of neglect by the international community, Myanmar’s infrastructure and social indicators, while not without problems, still compare favourably to countries with similar economies in Asia and Africa where billions of dollars have been invested.

Now that Myanmar has embarked into political and economic reforms, greater development efforts are bound to appear. Myanmar's leadership must make sure that the negative impacts of these programs are mitigated and minimised to the largest extent possible by putting in place strict regulatory mechanisms. It might put off some foreign governments and activist groups, but that is the price Myanmar has to pay.

The neo liberal economist recommends excess choice in the name of freedom to choose but this only encourages excess consumerism, widens social division and relies upon linear growth (which is impossible) without consideration for the spread of wealth. Myanmar has great potential to grow on its own as it has abundant natural resources for which there are competing buyers. There are many companies that will soon be on Myanmar’s doorstep to sell their products. Myanmar needs technical know-how and high-tech products to develop its industries and benefit its population. Myanmar should not fall into the trap of consumerism.

Protection of indigenous companies and the environment is unfortunately not part of the free trade model. Selling natural resources and in return importing finished product would be suicidal for Myanmar. As Myanmar liberalises its economy, the focus must be on job creation and fair trade. This job creation must aim at medium to high end products for both local and export markets and not exploitative jobs for teenagers to languish in sweatshops. With labour costs climbing in China, Myanmar would easily be the next target for cheap labour but this is something Myanmar must try and avoid.

The first step for Myanmar should be to create a legislative environment that protects its natural resources, people and investors on equal terms. Myanmar still has time to take control of the situation and make a balanced decision. This may be difficult because many will want to make a quick buck, including those local business owners who plan to partner with external companies. The government is sure to be criticised as going back to its old habits. This is the criticism that the government will have to live with in order to build its economy and protect its citizens in order to achieve long term benefits. Actions taken now will protect Myanmar from long term negative consequences for generations to come.

In developing countries, the development of private companies and civil society organisations is seen as a cure-all. Civil society organisations are certainly important as they complement the efforts of the government but providing basic services to the public is primarily the government’s responsibility, especially when it comes to health and education.

Myanmar needs to fix some basic issues as an urgent priority. There is a wide gap in transition from primary to secondary to higher education. Myanmar needs to prepare a human resources development plan that realistically complements the president’s stated vision for a knowledge-based society. The basic infrastructure exists for the primary education but massive investment is needed to improve the quality of secondary and tertiary education. Similar investment will be needed in the health sector. To develop and maintain democratic governance a strong and skilled middle class will be required, and it can only be built through high-quality education.

Myanmar’s mosaic of 135 ethnic groups, each with their own traditional practices, cultures and languages, must be preserved. The recent past may not have created the best environment for collaboration and cooperation but there is little choice for Myanmar as a union. The recent ceasefires with some of the most heavily armed ethnic groups are encouraging. All ethnic-based leaderships must develop a political agenda that includes cooperation with the national and state governments. Thus far we have seen mostly a push for independence or autonomy to gain financial control in the areas under their jurisdiction. The current level of loose association based on local economic interest is no longer sufficient to build a union as declared in the constitution. There must be give and take from all parties concerned. There are also still many spoilers – external and internal – who are benefiting from a divided Myanmar. The blind support that these groups have received from the international community despite their lack of political will to settle the differences must come to an end.

The promulgation of the new constitution with decentralised administration is a good step that will allow for the devolution of authority to clean and transparent governments at the region and state level. These local assemblies must exercise their authority in the interests of the nation and their constituents. However, the central government needs to ensure that income from natural resources is shared equitably with regional governments to fuel their development agendas. This kind of distribution of wealth is essential to encourage fairness and build trust.

No government can fully meet the expectations of its people and Myanmar will be no exception. There will be high expectations, there will be external pressure to do more and there will be pressure to open up for trade and investment. All decisions must be rational and informed. Emotions and pressure should not get in the way of making the right choices. The government must take the time to bring about proper regulatory mechanisms and legislation before taking serious decisions on trade, investment and other national policies.

An immediate national issue is energy. Myanmar needs a huge supply of energy to sustain industrialisation and economic growth for the millions of people whose homes are dark every evening when the sun goes down. Myanmar immediately needs a national energy policy to make sure that its hydropower potential is fully utilised both for domestic consumption and for export of excess power generated to neighbouring countries. This national policy need to make sure that proper environmental assessments are conducted and mitigation measures introduced. There should be a proper compensation plan for people who are likely to be displaced as a result of these projects. I believe that these issues are already in the minds of bureaucrats and technocrats, who are the custodians of Myanmar’s future. There will be opposition from environmentalists but we need to use our heads and not our hearts for some of these hard choices.

The bottom line is that Myanmar has to move on but at its own pace and with the welfare of its 60 million people in mind. Short-term benefits should not be sought at the expense of long term economic gains and political stability.

Ramesh Shrestha

(Ramesh Shrestha is the representative of the United Nations Children’s Fund in Myanmar.)



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