Myanmar: Creating Economic Opportunity in a Nexus of Political and Social Upheaval

January 23, 2015 

Host: Carnegie Endowment for International Peace
Speaker: Stephen P. Groff, Vice President, Asian Development Bank

Endowed with a wealth of natural resources, surrounded by affluent neighbors, and now emerging from political and economic isolation, Myanmar (also known as Burma) seems to have all the necessary components to become a major political and economic force in rapidly developing Southeast Asia.

This simplistic assumption though – that affluent neighbors and an abundance of resources will equal national success – fails to underscore the challenges that will inevitably surface as the country transitions from a centralist, military controlled, government and economy into an open, democratic, and free market society. While there is ample need for international investment in the country’s beleaguered infrastructure – only about 40% of the Myanmar’s roads are paved and 70% of the population lacks access to consistent electricity – reforming the country’s economic landscape is just one of several large-scale challenges currently facing Myanmar.

Currently ranked 150th out of 166 countries on the Human Development Index, Mr Groff described Myanmar as suffering from a “historic underinvestment in education and health.” Further, years of centralized leadership have left the country divided; with affluent and educated businessman and state owned/supported companies thriving in the country’s urban centers while its rural population largely languishes in poverty. Given this scenario, the Asian Development Bank (ADB) and other international institutions must work in a socially divided environment.

A key challenge now facing the ADB and other international institutions is not so much finding capital to invest in the country’s development and generating economic growth, but instead is finding a way to share that growth and open up the country’s economy to the local, largely undereducated and impoverished, population. In order to promote greater accessibility and inclusivity, Mr. Groff described the ADB’s recent focus (from 2012-14) as being focused exclusively on building up the country’s human and governmental capacities.

Rather than just bringing in trained workers from abroad, the ADB is working with local NGO’s and companies to develop programs that will teach local residents technical skills and will allow them to work in the country’s new economy and also empower them to make decisions regarding political and economic decisions. As Mr. Groff explained, the country’s history of military dictatorship has resulted in inexperienced local leaders and officials who, in the past, never had to make decisions or analyze policies. With the decision making power no longer in the hands of just a few military commanders, local leaders need to learn how to lead. While addressing this problem may be a time consuming process, it is crucial for social, economic, and political reasons that the country possess the capacity and skills to utilize and manage its resources as its people see fit.

While Mr. Groff warned that reforming the country is a “nonlinear process,” and will undoubtedly be met with challenges, it is also the best hope for instilling long-term stability and prosperity. With presidential elections scheduled to take place later this year, the democratic process is underway and the Burmese people are already beginning to shape their own future. The goal now, both politically and economically, is to involve all of the country’s people and create opportunity for all, rather than the select few.

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23. January 2015 by Will Houstoun
Categories: Economics, South Asia | Comments Off