How to tackle Burma’s economy!

DVB Debate: How to tackle Burma’s economy

Even though the growth index is positive in Burma, the country’s economy is still driven by entrepreneurs who have connections to those in power. A recent World Bank report warned that conditions were ripe for high inflation.

Even though the growth index is positive in Burma, the country’s economy is still driven by entrepreneurs who have connections to those in power. A recent World Bank report warned that conditions were ripe for high inflation.

On DVB Debate’s panel to discuss measures to tackle the Burmese economy were Aung Naing Oo from the Ministry of Planning and Economic Development; Vice President of Myanmar Women’s Entrepreneur Association Dr Thet Thet Khine; and consultant to the Ministry of Commerce Dr. Maung Aung.

Entrepreneur Thet Thet Khine highlighted the problem of corruption and warned that it will continue if staff are not paid more. She emphasized that smaller enterprises need to be a part of the economic success.

“All SME’s – small to medium enterprises – such as ours are pretty much inward looking; competing against each other in this rather small market which has no opportunity to grow any larger”, she said.

She added that it is for the whole country to work on building up credibility for the products labelled ‘Made in Burma’, and to gain knowledge on how to get market access overseas.

Aung Naing Oo said that one problem is very few experts understand the existing laws enough to be able to change them.

“It takes a long time to amend laws, but the government realizes that this is a ‘must’. Though our country is supposed to practice an open market system, the SEE Law – State-owned Economic Enterprises Law – imposes restrictions on it. They say that according to the law, foreign investment will be allowed.”

The SEE Law specifies 12 economic activities that are closed to private investment and can only be carried out by the government.

Maung Aung said he thinks the economic situation in Burma is encouraging compared to other countries in the region. However, according to the recent World Bank report Burma is one of the most difficult countries in the world to conduct business in, ranking 182 among 189 countries.

“I mean that in comparison with former times it is the right time to develop the country. But as you said, we can’t change the situation instantly to make it easy to do business and enjoy ‘economic freedom’”, Maung Aung explained.

Special guest was Dominique Causse from the French embassy, who pointed out there have been very many good reforms in Burma.

“I would say from our point of view that they are all extremely good. But the bureaucracy needs to take time to be able to implement them. There is a need to build capacity. It’s not easy. At the same time, a heavy rush of investments would not be so good for the economy because it would overheat”.

The World Bank report warns that inflation has reached 7.3 percent, higher than the country’s economic growth. Maung Aung said one crucial point for both the economy and the development of the country is to keep society stable.

“What interrupts our country’s development is not the land prices or the infrastructure. What is critical is stability. Without stability, major investors will reconsider their investments. The stability of the State depends not only on the government but also on each and every citizen.”

In conclusion, despite various problems such as corruption, the limited market and complicated laws, the panelists generally agreed that the future of the economy looks bright and that Burma is on the right path – as long as development continues in a controlled manner.

Ref:dvb.no