Myanmar Policy NewsPolitics News
Goverment unveils 12-point macroeconomic policies
On 29 July, the authorities presented their long-awaited macroeconomic policies and stressed the importance of the development of a market-oriented system "in all sectors" and the creation of an industrial environment in order to promote the process of domestic reconstruction. While some considered the three-page paper too obscure to be useful, others were rather indulgent, realising that the administration had only been in office for four month and had no timeframe to draw up elaborate strategy documents.
Daw Aung San Suu Kyi presented politics to the diplomatic, business community and donor community on 29 July. The Myanmar Times has a longer English-language paper explaining some of the most important points. Politics focuses on achieving a" fair balance between the mobilization and distribution of resources between states and regions".
Ensuring that the production of resources is predictable and sustainability, the Extractive Industries Transparency Initiative will be extended to the extractive industries and the cost and benefit of policy across the state. On its second point, the goverment says it wants to promote competitiveness and a dynamic retail trade.
Thirdly, the National League for Democracy's commitment in its business proclamation to strengthening the administration of state finances and working on budgetary discipline and regional and local governments' ability to achieve a stable macro economy is developing. It is also planned to combat trafficking or "fully record Myanmar's currency revenues", in particular by selling off Myanmar's physical assets, to tighten the taxation system in order to increase the country's revenue and to help fund the increasing budgetary deficits, which are projected to hit K3.76 trillion by the end of this year.
Fourthly, on infrastructural developments, the paper notes that the authorities are in the process of drawing up an infrastructural strategy focusing on the generation and distribution of energy, the construction and maintenance of country streets and the improvement of ports. Fifth, the Chinese authorities will help the agricultural and animal sector to foster integrated economic expansion, improve nutrition alertness, improve export and raise livelihood.
Growers are given full freedom of expression, while the state supports high added value in crop and animal husbandry. It is said that there will be more loans for growers, increased ownership of property and improvements in the productive chainsectors. Sixthly, the authorities say they will concentrate on creating jobs to alleviate internal levels of destitution and disparity and encourage migrants and IDPs to come back from abroad.
Most employment is generated in SEZs and through infrastructural schemes, particularly in the countryside. Seventhly, the Chinese authorities welcome FDI. The Commission is drafting a more comprehensive guide on the subject, but in short, it will encourage the improvement of ownership laws and the constitutional state by providing a robust framework in which businesses are safe to engage in investments.
Eighthly, it concerns the issue of personnel resources and is committed to the development of a qualified work force to fill employment in the processing and service industries. In order to achieve this objective, the state will enhance health care, academia and training while at the same time implementing internationally accepted labor-laws. At the moment, the undeveloped finance industry is excluding large parts of the economies, but will soon be liberalized to promote it.
The Commission will examine restrictions on banks' loans, allow the use of portable banks, allow the entry of international insurers into Myanmar and seek state creditworthiness. Tenthly, the GoG will be reforming state-owned businesses to make them more responsible and to raise their awareness of the general public and, where appropriate, privatise them. On the eleventh point, the administration says it will help small and medium-sized businesses by enhancing opportunities for doing more in Myanmar, enhancing accessibility to finance and creating a more qualified labour force.
Last year, Myanmar came 167th out of 189 in the World Bank rankings. Lastly, the administration says it will foster integrated macroeconomic expansion and developpment "to allow our nation to emerge from impoverishment and to attain the wealth our peoples deserve". "It states that ³cDemocracy, the Rule of Justice and the advancement of fundamental freedoms are an end in themselves and do not require any form of commercial or other defence.
Politics was generally well accepted by economic giants, although some were frustrated by its shortness. Maung Maung Lay, vice-chairman of the Union of Myanmar Federation of Chambers of Commerce and Industry, said it was a good first move. It is necessary to draw up and define policies, guidelines and laws," he said in an e-mail sent to us last night, underlining the importance of universal assistance.
Every individual should do their part to help Myanmar recover its former glory," he said. Myanmar leader Sunil Seth of the multi-billion dollars Tata Group, one of India's biggest corporations, said he was satisfied with the new policies. "Although it leads the way on a wide scale, it encompasses all major industries such as energy production, infrastructural developments, farming, mining and small and medium-sized enterprises," he said.
Kyaw Hlaing, Chairman and Chief Executive Officer of the Smart Group of Companies and Chairman of the Myanmar Oil and Gas Service Society, agrees that the policies are generally good. "But there are many different issues that raise the issue of whether or not everything can be achieved," he said, noticing that three points should have received more focus - good governance, service and the production of physical ressources.