May 26, 2000

Myanmar needs surgery, not cosmetic changes Commentary Analysis

by Lee Kim Chew

TOMORROW is the 10th anniversary of an election Myanmar's military government would rather forget but cannot erase from the history books.

On that day -May 27, 1990 -the Myanmar people voted overwhelmingly for the National League for Democracy (NLD) but the generals refused to honour its landslide victory and transfer power over to the civilians.

Ten years on, the impoverished country remains trapped in a political gridlock that has all but paralysed it.

The generals want to destroy the NLD, while its leader, Nobel Peace laureate Aung San Suu Kyi, opposes anything which bolsters their rule, from Asean membership to foreign investments and tourism in Myanmar.

Politics has become a zero-sum game, with each side bent on annihilating the other. What hope is there for Myanmar?

Professor Khin Maung Kyi and a group of Myanmar economists, who conducted a study under the auspices of the National University of Singapore, have sketched out their vision and strategy in a book -Economic Development Of Burma -to seek deliverance for their country.

Theirs is a clinical assessment of what has gone wrong -and a bold prescription to revive the comatose economy.

They offer no magic formula. Rather, it is going back to the basics to open up Myanmar and let market forces operate freely.

That simple? Yes, but it is easier said than done in Myanmar's case, because such a move has profound ramifications. It is, in fact, shifting Myanmar's backward economy into a new paradigm.

To start with, Myanmar lacks the institutional basis of a market economy, which was destroyed by 26 years of misrule under the previous socialist government.

As the economists put it, "whatever market flourishes in Burma these days exists more by default than by design ...

"The laws enacted to restrict trade under the previous regime are still operative. The authorities can exercise control at their will ...

"The civil service, once recognised as a stalwart of social change, is in complete disarray ...

"The legal system, including the laws, courts and judges needs to be drastically revived and revamped ...

"With the proliferation of line ministries each administering its own sector as a fiefdom without much coordination among themselves, the highest state apparatus resembles a collection of feudal warlords."

Although the military government talks about a new openness to market forces, in reality, it retains a battery of controls over the economy.

"The alleged openness is highly selective and, in effect, is only with enterprises in which the military regime participates either directly or indirectly."

Myanmar needs desperately to make up for its lost generation, the economists concur. It has to scrap the fictitious official exchange rate, abolish state monopolies in rice and teak, modernise agriculture, liberalise trade and promote investments.

"Burma, having been so long dominated by economic nationalism, socialist ideology and the resultant isolation -the switch to an economic calculus will not be an easy change. We expect that adjustments, compromises and new adaptions will have to be made."

There is no "quick fix", the study concludes. The political and economic systems need major surgery, not cosmetic changes.

"Politically, there must be a genuine dialogue and eventual consensus on the outline of a new constitutional framework that is not dominated by the military and which respects the rights and concerns of all the people, including all the ethnic minorities."

A new mindset is needed, but there are no reformers in the military government.

The generals have already rejected a World Bank report which links foreign aid with political reforms, even though they have neither the means nor the expertise to overcome the country's problems.

Undaunted, the economists urge the junta and its pro-democracy opponents to reconcile and make peace. "Are we going to let ourselves sink into a deeper morass of poverty and inconsequence, just because each side thinks that one is so right and the other so wrong?"

Well said. This, alas, is how things are in Myanmar's repressive and unyielding political climate today.

The writer is Chief Regional Correspondent of The Straits Times.