03.09.2006
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Larry Jagan's Article on Economic Reform in Burma
_ by Ko Sala
The recent Asia's Time online article by Larry Jagan on economic reform in Burma caught many in the Burmese democracy movement by surprise. Someone who goes by the name of BNyein wrote in an e-group, "can this be true? Another false attempt?” The article did not catch me with surprise but I felt the need to make anecdotal comments on this article.
Larry is a prolific writer and he has managed to break several Burma related news since his exile in Thailand. His contact within the military government in Burma is said to be concrete enough for him to break significant news items. It is crucial to have a journalist who is influential enough to gain access within the military junta for the world to learn about the secretive junta. With enough appraisal of Larry's work in the field of Burma related journalism his article in the Asia Times did not appear to me as a substantial breakthrough news item. It is notoriously difficult to cover Burma news as the country's regime continues to rule in secrecy. In a situation as such it is extremely easy to stumble across writing a news story out usual public relations exercise press release issue by the junta.
A close study of the article did not signify any changes from General Saw Maung's regime except the release of figures on privatisation. It does claim that the policy shelved by the previous government be implemented by the current government. The mass privatisation of country's assets is not a solution but a recipe for the state to wash it's hands off from responsibilities of income inequalities and so forth and redistribute the wealth to its cronies as put it by Zaw Min a leading activist in the article. General Saw Maung came into power when the international financial institutions obsessed with market liberalisation and structural adjustment policy. As mentioned earlier in my previous articles the geo-political trend of the day during Saw Maung's reign was market liberalisation and democracy. He opted to embrace market liberalisation without democracy.
It gave rise to a hand full of oligarchs like Tycoon Tayza, U Ike Tun and several other cronies and they become a part of Myanmar Economic Enterprise. The enterprise fever in Burma was injected General Saw Maung when it first came into power. The foreign joint ventures were drawn in to receive cash surplus to buy armaments. The article dwells in details about Burma prepared to learn from Chinese economic advisers. In China, the Deng Xiopeng’s (also means small bottle in Chinese) government never embarked upon mass privatisation of State Owned Enterprises (SOEs). The leader whose name means small bottle started liberalising the economy with a small pace. He made the SOEs to compete with the private enterprises and the uncompetitive ones were forced to privatise.
In Burma, the majority of the SOEs allegedly vandalised by the BSPP and the army during the pro-democracy uprising in 1988 were simply sold off to the cronies under Saw Maung. One of the rich industrialist families bought an ex SOE cigarette factory with decapitated machinery. Their business dwindled as a result of lack of government's support for industrialisation. This family was forced to sell off their factory at a loss to Vegas cigarette which is co-owned by much more influential crony. The junta requires a proper industrialisation policy before embarking upon privatisation. It is not in the interest of the Chinese economic advisers to advise the regime on how to industrialize, as it would threaten the exports from their country. It is imperative that copying China's footstep 100% would not lead Burma into a developed state. China economic history is entirely incomparable to Burma, as it never went through agrarian economic phase to industrial phase. It leaped in industrial phase due to lack of agricultural resources.
The answer to Burma's economic problem is far much further a field than privatisation, or exchange rate mechanism. The article as usual slobbered the US sanction on Burma. It fails to ask what can Burma export to the US? The thorny issue of sanction came into the picture after 1995 when Aung San Suu Kyi called for international economic sanction. It came about after five years of rule by General Saw Maung. Any sensible government from a developing country would have accomplished their task spell out in the five-year economic development plan. In a total fairness, like any new sensible government General Saw Maung brought about major reform but not right reform.
Throughout the world the military is good in carrying out emergency task. They are extremely talented in short-term solution to the problems. Their stringent management structure allows them to carry out the task in natural disasters and provide relieve to the problems. The army can somewhat be described as NGOs. General Saw Maung saw an immediate need of money, which led him to sign agreement with the foreign oil exploration companies. It allowed the construction of new buildings in urban areas to improve the image of his government. The long term sustainability and amenities of the buildings did not matter for the junta. The long-term objectives task can only be carried out by the civilian government.
The junta wittingly or unwittingly carries out "cow boy" economic reform and it is not the solution to the problems. The balance of trade is an intrinsic problem of the country. The country unofficially imports more than it exports. The answer to the problem is on the top right hand side of the official newspaper the New Light of Myanmar. Under the four rhetoric causes of the country it mentions import substitution. One needs to make a serious assessment what can be exported from Burma. The import substitution and industrialisation programmes by the junta are rhetoric. Larry fails to notify the evidence of import substitution programme.
Privatisation of Media
It is welcoming to read the plans for the privatisation of media but it ignores the facts of censorship in the country. The privately owned media with sever censorship is hard survive in Burma. The sources close to the Mayanmar Times talk about band on writing any materials, which criticise the Chinese government. The most popular socialites page of the Myanmar Times liked by the cronies and junta often comes under attack from the censor board if they publish picture of junta family members.
It is not the US sanction to be blamed for the hampered economic development. The US companies could have invested in Burma from 1988 - 1995 and beyond by letting their Asian subsidiaries to move in. The US Economic sanction seems to a political gesture by the US administration and the US companies will avoid it if the Burma market is profitable for them. Larry fails to notice it and the more he fails to do he puts himself in danger of stumbling into re-writing military junta's press release. He must have done well to have a good working relationship with post Khin Nyunt's government.
[Editor’s Note:The views expressed in Critiques are the personal views of the authors.]
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