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The Burmese Fairy Tale (r)
There are a number of points that need to be made in response to Ma
Thanegi's article in the FEER. The response of the West has not been
uniform. Most Western countries have not supported sanctions and
boycotts including Australia. Though most Western countries seem to
support the non-lending policy of the international agencies.
Supporters of the boycott campaign in the West (& Asia) do not see
sanctions or boycotts as a 'magic wand' for Burma despite the quoted
stupidity of some unnamed Western academic & diplomat. Though they do
believe that foreign investment will further entrench the military
regime prolonging the impoverishment of all the peoples of Burma. It
is foolish to suggest that supporters of sanctions are attempting to
impoverish Burma to create a 'revolution' which will instantly solve
its many economic problems. The military has shown that it does not
need 'magic wand' waving by the West to bring about a revolution
induced by economic disaster. The military has been able to achieve
this without the assistance of a sanctions campaign. The author
failed to mention that despite the isolationist policy of the
military pre-1988, the economy & the regime was propped up at various
crucial points by foreign aid. This aid may or may not have prolonged
the military regime but it certainly did not help Burma develop a
modern economy. The economy has been on the verge or in crisis during
the whole of military rule due to gross mismagement.
Sanctions & boycotts are not responsible for the continuing pathetic
state of the Burmese economy but due to the continued intransigence
of the military to undertake reasonable economic reforms. There are a
number of important points the author failed to address when
suggesting that sanctions & boycotts were helping to impoverish
Burma.
(1) The US sanctions only apply to new investment & the US has not
been one of the major investors in Burma (except for the gas
pipeline).
(2) Those countries which are the largest investors in Burma have not
imposed sanctions.
(3) Investment in Burma has been limited not mainly because of
sanctions but because Burma is not a good place to do business. The
Economist Intelligence Unit has rated Burma one of the 10 riskiest
places to do business.
(4) Investment in Burma has not been in sectors which are not high
employment creators (particularly if slave labour is used).
(5) Some investment in Burma has been linked to 'narco-traffickers'
& this has long term implications for the viability of a healthy
private sector. Burma does not need more warlords, military
commanders or Mafia style business.
(6) Investment in Burma is linked closely with the military regime.
There seem to be limited opportunities for those Burmese without
connections to partake in enterprise & trade with foreign investors.
(7) Trade with countries such as China has had a detrimental impact
on the economy, through a flood of imports, including the destruction
of the very limitedd industrial base of Burma.
(8) The opening (when it is open) of 'legal' (not really an
appropriate term) border trade with its limits on certain commodities
can only have detrimental effects on the economic well being of
those ethnic groups who live in the border regions. A moving of
economic activity from these groups to the military & their lackeys
does not contribute to economic growth but only redistributes
resources.
(9) For aid to be successful, projects need to be undertaken, that
benefit those that need it. Given the xenophobia & the refusal of
the military regime to tolerate & to allow its citizens to participate
in civil society, aid would be unlikely to benefit those in need.
Also as there is a lack of accountability it is unlikely that
reasonable assessments of these projects could be undertaken
& with the possibility that resources will be directed towards
the regime. Not an uncommon occurrence under
military regimes.
(10) The regimes use of FX from investment to buy arms with 40-60% of
the budget being spent on the military also contributes to the
impoverishment of Burma
(11) THe above is only the tip of the iceberg.
Certainly Burma's economic isolation for the last 30 years has not
benefited economic development. No nation can hope to develop when
completely isolated from the international economy., but to believe
that foreign investment is a panacea for Burma's economic problems
would be a serious mistake. There are many nations that have allowed
foreign investment and experienced no improvement & sometimes even a
decline in economic well being. Economic improvement has not occurred
under the military regime in the last 30 years & is unlikely to occur
in the future with or without sanctions as long as the present regime
continues to run Burma in its present grossly incompentent fashion.
Most Westerns who support sanctions do not do so to see the Burmese
people further impoverished but in the belief that investment only
increases the power of the military prolonging the impoverishment of
Burma. Very few are expecting quick fixes & magic wands. The biggest
fairy tale is that the present military regime of Burma will preside
over a nation undergoing economic development.
.