Friday, 6 June 2014

Extended sanctions put Myanmar’s burgeoning economic development at risk

Myanmar, which has undertaken sweeping democratic reforms since 2011, is still suffering international pressure. The US recently extended some economic sanctions against Myanmar for another year, citing concerns that the country's reforms may stall. There are worries that this will strike a blow to the democratically transforming country, which is wooing foreign investors. How are the reforms going in Myanmar? How will this apparent US "carrot and stick" approach affect Myanmar? Global Times reporter Yu Jincui interviewed two scholars on these issues.

Kanbawza Win, a specialist on the political situation in Myanmar for over 30 years as a journalist, civil servant, activist, scholar and author of several books on Myanmar and Asian affairs

In the past three years, there have been very visible changes in the country for the better, and nobody can argue about this.

But it is confined mostly to the cities and the elites, while the majority of the working people, especially in the areas dominated by non-Myanmese ethnic nationalities, have a hard time making ends meet.

The trickle-down policy is not so effective. Crony capitalism is not working so well. It's necessary to set up a well-founded institutions and an executive.

The US decision will deter big foreign investments, especially in terms of macroeconomic aspects, because it will demonstrate that the country is far from stable and the investment climate is not favorable and conducive for investment.

The economic figures of Myanmar show that US investment is at the bottom of the ladder when compared to other countries.

This will in turn very much slow down the reform process because the transnational corporations, the only ones that can implement the long-term investment for development, will not go into the country, and only medium and short-term companies that solely aim for profits, such as extractive industries, will go in. The country's development will be slow.

It is correct that the past three years have witnessed a series of moves that improved the US-Myanmar relationship. But they were based on quid pro quo conditions.

For example, political prisoners were released in a piecemeal manner whenever the US was about to make a major decision on Myanmar.

Not because the regime wanted to release them, but because the regime knew very well that as long as the political prisoners were held, there would be little or no hope of getting concessions from the US.

Nonetheless, the continued sanctions will not make the bilateral relationship backslide, because from the very beginning the US has made it clear that it's going to watch the regime's movements and will make moves as it progresses.

Michael Kugelman, senior program associate for South and Southeast Asia at the Washington-based Woodrow Wilson International Center for Scholars

The US has been increasingly concerned in recent months as the situation of ethnic minorities has worsened in Myanmar.

Some of the increased goodwill in bilateral relations had begun to subside even before the Obama administration's sanctions decision was announced.

Therefore, there had been some backsliding even before this decision.

Still, US-Myanmar relations have improved to a point that this decision will not in any way threaten the ties. US-Myanmar relations now enjoy a relatively stable foundation that they did not enjoy in previous years.

Given where Myanmar was only a few years ago, we have every reason to be hopeful. Unless there is some major and unexpected change, such as a change of leadership, then we can assume that Myanmar will continue on a path to democracy.

However, this path will remain slow and often quite rocky.

There are no guarantees, and certainly an unhappy Myanmar may use the sanctions decision as a justification for slowing down its pace of reform.

However, given the new interest Myanmar has in engaging the world and pursuing good relations with countries around the world, it may feel a need to make more of an effort to reform, because this is the direction the international community wants it to take.

The international society should give Myanmar more support.

The best thing the international community can offer is investment.

Development assistance is a way forward. Many foreign governments, however, will likely wait until there is more progress in reforms before providing this support in a major way.

source: Global Times
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