Myanmar's GDP down sharply in 1998-

[celsus@xxxxxxxxxxx]

Subject: Re: Myanmar's GDP down sharply in 1998-99

Those GDP figures that were cited in the Xinhua news story seem to be what
economists call the 'constant' or 'nominal' GDP figures.   Fortunately for
the Burmese people, the recorded GDP figures do not tell the real story of
the internal economy of the country.  But they do offer some clues as to
the direction the 'real' economy is heading.  Here's what I've cobbled
together about the 'constant' GDP from several reports that I have on file.

1992-3   	54.8 billion kyat
1993-4   	58.0 billion kyat			Up by 		5.8%
1994-5		62.0 billion kyat			Up by 		6.8%
1995-6		66.7 billion kyat			Up by 		7.5%
1996-7		70.6 billion kyat  (est)		Up by 		5.8%
1997-8		74.3 billion kyat			Up by 		5.2%
1998-9		45.1 billion kyat			Down by          39.3%

Note the leveling off of the increases in  the mid-nineties, the drop off
in 96-7 and 97-8 and the real tailspin in the fiscal year that ended in
March 99.  This is without taking into account inflation, loss of value of
the kyat, unrecorded economy and all the other 'ifs', 'ands' and 'buts'
that economists throw into the ring.

These figures should also be considered in relation to the cement
production data for the first six months of this year (not clear whether
'calendar' or 'fiscal') that were circulated by Xinhua a couple of weeks
ago, indicating a drop off of 23% in production over the similar period
last year.  Construction activity always a clue to the expansion and
contraction of an economy.

The figures do show that all those comments last year by David Abel and
company that the Burmese economy had been shielded from the major impact of
the Asian financial crisis were pure posturing.  Interesting to see that
'sanctions' are being blamed for the fall-off.  Just a month or so ago,
Abel was saying that US and EU sanctions had hardly affected the economy at
all.

One thing that's not included in GDP figures is the amount contributed to
the economy by wages and 'mom and pop and kids' gifts that are sent home
from abroad.  A sizeable amount in the case of Burma.  The 700,000
'illegals' in Thailand are feeding the Burmese economy in one way or
another.  So are the exiles in other countries.

ES
----------
> From: David Arnott <darnott@xxxxxxxxxxx>
> Subject: Myanmar's GDP down sharply in 1998-99
> Date: November 1, 1999 10:32 AM
> 
> [NOTE FROM DAVID ARNOTT: THIS REPORT USES AN EXCHANGE RATE OF KYAT6=US1,
> WHEREAS ELSEWHERE (SEE ENCLOSED 27 OCTOBER XINHUA REPORT) A RATE OF
> KYAT300=US$ IS USED. IF THE 300/1 RATE WERE USED HERE, BURMA'S GDP WOULD
BE
> VALUED AT  $150,438,000. -- $US150MILLION. ISN'T THIS A BIT LOW, EVEN FOR
> BURMA? THERE MUST BE SOMETHING WRONG WITH THE FIGURES OR MY ARITHMETIC.
> COULD WE HAVE SOME EXPERT COMMENT FROM OUT THERE, PLEASE]
> 
> Myanmar's GDP down sharply in 1998-99
> 
> Xinhua, Yangon 1 November 1999. Myanmar's national gross 
> domestic product (GDP) was valued at 45.1314 billion kyats (7.521 billion
> U.S. dollars) in fiscal 1998-99 which ended in March, down by 39.28
percent 
> from the previous year's 74.329 billion kyats (12.38 billion dollars),
> according 
> to official statistics available here Monday. 
> 
> The sharp fall is seen mainly due to the impact of the asian financial
> crisis which 
> started in july 1997. The statistics show that Myanmar received only
29.45
> million 
> dollars of foreign investment in the 1998-99, accounting for only 3.78
> percent and 
> 1.04 percent of those drawn in 1997-98 and 1996-97. Myanmar has admitted
that 
> due to the effect of the Asian financial crisis, foreign investment from
> member countries
> of the Association of Southeast Asian Nations fell by 70 percent.
Moreover, as 
> impacted by the financial crisis, a lot of foreign companies have
withdrawn
> from Myanmar. 
> 
> The sharp drop of GDP is also seen to be linked with the economic
sanctions
> imposed on 
> the country by the United-States-led Western countries since may 1997 as
> well as by some 
> international financial organizations including the World Bank. 
>