WASHINGTON - As multilateral lending
agencies prepare to seriously re-engage with
Myanmar for the first time in decades, observers
at the spring meetings of the World Bank and
International Monetary Fund (IMF) are warning that
a poor understanding of ground conditions in the
country could jeopardize many of the early
opportunities created by government-initiated
reforms.
While international economic
sanctions, particularly those put in place by the
United States and European Union, have
significantly limited the ability of multilateral
agencies to operate in Myanmar, recent weeks have
seen several governments move to ease these
measures. This week the US announced a second
round of
loosening, while
officials in both Australia and the EU are engaged
in similar discussions.
The decisions
follow a year of controversial reforms in Myanmar,
where a new quasi-civilian parliament in early
2011. Since then, led by President Thein Sein, the
government has allowed an unprecedented series of
openings, including the release of hundreds of
political prisoners, a relaxation of media
censorship, and a strengthening of opposition
political parties.
This culminated in
highly anticipated parliamentary by-elections on
April 1, in which the long-jailed opposition
leader Aung San Suu Kyi won a seat.
Although Myanmar has been an IMF member
since 1955, until last year the fund engaged in
nothing more than routine annual meetings with the
government. The last major World Bank project
ended two decades ago.
Both the bank and
fund, as well as the Asian Development Bank, are
laying the foundation for re-engagement. The IMF
has been ramping up preliminary technical
assistance since February, when the US began to
relax its sanctions regime. Since then, the IMF
has been invited by the Myanmar government to
advise on changes in laws regarding the country's
monetary and foreign exchange transactions.
While the details of any new multilateral
engagement with this resource-rich country remain
to be decided upon, observers are clear on what
should not take place. According to Sean Turnell,
a long-time Myanmar observer, financial assistance
itself should not be considered at this time.
Myanmar, or Burma as it is also called,
and its government "do not lack money," Turnell
told a forum on the sidelines of the World
Bank-IMF spring meetings on Wednesday. "It's
currently pulling in about US$3 billion from its
gas reserves, which has allowed foreign reserves
to be close to $8 billion. That's going to
increase dramatically next year, once a new gas
pipeline comes onboard."
Myanmar does not
need technical solutions, Turnell, an economics
professor, said. "What it does need is an attack
on the fundamental problems that are really
holding the country back - not a lack of financial
resources but a lack of will."
The issue
of will goes to the heart of the highly debated
reforms process. For the moment, Turnell and many
others have noted, those reforms have not only
been relatively meagre but, more importantly, have
been confined mostly to the realm of economics.
"The current reforms have not addressed
security and justice issues, and I think that's
going to cause a major challenge for all of the
international community," notes Khin Ohmar, the
coordinator of Burma Partnership, an umbrella of
civil society organizations, based along the
Thai-Myanmar border.
"We are very
concerned with the prospect of foreign direct
investment, (international financial institution)
re-engagement, peace-building, etc., going forward
without a real understanding of the deep-rooted
problems of our country," she said.
While
Ohmar concedes that local-level consultations have
begun as the IMF and others have re-entered
Myanmar, she warns that a "pattern of
selectiveness" has appeared, in which foreign
missions are relying only on government-registered
non-governmental organizations for views on ground
realities.
Particularly notable has been
an absence of representation from within Myanmar's
conflict areas, where most of the country's ethnic
minorities live.
In Karen state and other
such areas, "People are still living in fear,"
says Paul Sein Twa, executive director of the
Karen Environmental and Social Action Network.
"Withdrawing troops from these areas would
immediately help people to go back and farm -
without waiting for any money from the
international community or the government."
Instead, Sein Twa contends, the
government's focus in dealing with armed ethnic
groups has been simply to "secure" the areas for
large- scale economic projects, including the
creation of special economic zones, several of
which are currently in the works.
"The
government gives allowances to companies to own
large areas of land, which leads to conflict
between the local people and the government," he
says.
Similar outbreaks of violence have
erupted when foreign companies, acting with the
government's permission, have moved construction
materials into or through areas claimed by armed
ethnic groups.
Assuming that Myanmar's
economy and broader society continue to open for
the first time in more than a half-century, the
worry for many is that a rushed focus on
macroeconomics over - or instead of - issues of
more relevance to local communities could lead to
a continuation or even exacerbation of conflicts
that have lasted for decades.
For any new
multilateral programmes, however, the critical
process of prioritization will depend on the
Myanmar government's own priorities - and few
claim to know where exactly those lay.
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