The Burmese government has initiated notable economic reforms since parliament elections were held in November 2010 and Thein Sein was named president of Myanmar in March 2011, including new policies on anti-corruption, currency exchange rate, foreign investment laws and taxation. In October 2011, 11 private banks were allowed to trade foreign currency. On April 2, 2012, Burma's multiple exchange rates were abolished and the Central Bank of Myanmar established a managed float of the Burmese kyat. In November 2012, President Thein Sein signed a new Foreign Investment Law. [Source: CIA World Factbook, Wikipedia]

Special economic zones (SEZs) are being established at Dawei and Thilwar. The Dawei development project is located only 160 kilometers from Thailand. First the deep sea port will be built and a special economic zone will be established. This will be followed by the construction of petrochemical plants, steel factories and other industries.

Reuters reported: “In March 2012 Thein Sein said It wanted to drive growth and create jobs through foreign investment in resources and manufacturing, without causing environmental harm. "Our country was left behind in the process of globalization, so we need to learn every lesson and make the best of our experience as we open our country to international society," he said. "Our historic transformation is very immense and very delicate."Thein Sein said [Source: Aung Hla Tun, Reuters, March 1, 2012]

“The Myanmar government is genuinely keen to carry out the reform and opening-up process the right way,” Andrew Gilholm of Control Risks told Bloomberg. “They want top energy companies to come in with their technology and expertise, not only to explore and exploit resources but also to pass on best practice know-how.” [Source: Rakteem Katakey, Bloomberg, September 17, 2012]

In May 2012, the International Monetary Fund (IMF) said: "Myanmar could become the next economic frontier in Asia if, with appropriate reforms, it can turn its rich natural resources, young labor force, and proximity to some of the most dynamic economies, to its advantage." In its first-ever "Article IV" review of the economy, the IMF praised the initial moves to free up its currency in recent months and encouraged the government, politically isolated for a quarter-century, to stick to the path of reform. "Myanmar's new government faces a historic opportunity to jump-start development and lift living standards," the Fund said in the milestone report.

Economic Reforms That Still Have to be Made in Myanmar and Worries About Backsliding

Despite these reforms, the Burmese government has not yet embarked on broad-based macro-economic reforms or addressed key impediments to economic development such as Burma's opaque revenue collection system. Key benchmarks of economic progress would include steps to ensure the independence of the Central Bank, provide budget allocation for social services, and enact laws to protect intellectual and real property. GDP (purchasing power parity), [Source: CIA World Factbook]

The IMF Fund cautioned the Myanmar government to take each step carefully with a focus on maintaining economic stability. "IMF economists believe that any rapid reforms on a large scale could make any potential mistakes very costly. Although planned reforms will take time to implement, prioritization is essential to deliver tangible benefits to the majority of the population," the IMF said. [Source: Paul Handley. AFP, May 7, 2012]

Rakteem Katakey of Bloomberg reported: “President Thein Sein’s attempt to open the economy to foreign investments is not the first time Myanmar’s leadership has taken steps toward restoring a democracy only to backtrack. The junta released Suu Kyi from house arrest in May 2002, prompting the UN to call it a “major development” toward national reconciliation. By June 2003, Suu Kyi was back in detention. [Source: Rakteem Katakey, Bloomberg, September 17, 2012]

Managed Float of the Kyat and Unifying Myanmar’s Exchange Rates

In April 2012, Myanmar started the adoption of a managed floating foreign exchange rate regime, moving the exchange rate from a peg of 8.5 kyat to a managed floating exchange rate. The rate was quoted at 830 kyats per U.S. dollar in June 2012, up from 818 kyat per U.S. dollar when it was first applied. Myanmar's foreign exchange rate against the U.S. dollar has been traditionally designated as around six kyat per U.S. dollar since 1975, while the market exchange rate fluctuated between 780 and 1, 000 kyats per dollar for the past several years, standing for most of the time around 800 kyat per dollar in 2011.

In March 2012, Bloomberg reported: “The biggest financial market policy shift since President Thein Sein took power is an attempt to unify the multiple exchange rates. The official rate, pegged to the International Monetary Fund’s special drawing rights, is 6.4 kyat per dollar, about 125 times stronger than the black market rate and available only to state- owned companies. The central bank plans to gradually unify the “various” other rates used by private enterprises and influence the market rate, it said in a statement published in the state-run New Light of Myanmar this week. The bank will publish a reference rate for its currency daily starting April 1, scrapping a 35- year fixed exchange rate, it said. [Source: Yumi Teso, Daniel Ten Kate & Lilian Karunungan, Bloomberg, March 30, 2012 ]

“Myanmar’s move to a managed float of the kyat may weaken the grip of the black market, where appreciation has been hurting exporters. “The dollar has seen some weakening pressure against the kyat and that is quite a big pain for exporters,” Toshihiro Mizutani, managing director of the Japan External Trade Organization in Yangon, said. “If they can manage to keep it from rising fast it would help.”

“China also had an artificially strong currency until 1994, when it abolished foreign-exchange certificates that had allowed state-owned companies to buy dollars cheaper than in the black market. Exporters were able to use a weaker exchange rate for the yuan when bringing dollars back to China. The official and market rates were unified at 8.7 yuan per dollar under a “floating exchange-rate system,” devaluing the yuan’s official rate by 40 percent.

“A managed float means it will be controlled around a fixed range and should benefit everyone because it creates a bit more stability,” Saktiandi Supaat, head of foreign-exchange research at Malayan Banking Bhd. in Singapore, said in an interview yesterday. “It’s going to be somewhat similar to what China is doing.” “The current market exchange rate of 800 to 820 seems appropriate as the rate was formed naturally based on market demand and supply,” Yoon Hun Sup, a Yangon-based managing director for Hyosung Corp., a South Korean chemicals and trading company, said.

“Scrapping the complex multiple-rate system would reduce constraints on growth in a country with the potential to become “the next economic frontier in Asia,” the Washington-based IMF, which has provided guidance to Myanmar. “It levels the playing field, makes life easier, more transparent, more rational,” Sean Turnell, a professor at Macquarie University in Sydney who has researched Myanmar’s economy, said in a telephone interview on March 29. “It was never possible to be entirely sure who was using what rate, and that opens the window to rent-seeking and corruption.”

Increased Transparency in Myanmar

According to the U.S. State Department: “If Burma is to develop the political economy of a modern, rights-respecting democratic state, the government will have to tackle this nexus with the tools of transparency—auditing, public disclosure, and full accountability for corruption. The Government of Burma has committed to join both the Open Government Partnership and the Extractives Industries Transparency Initiative, both of which will provide opportunities to enhance transparency and ensure broad based development. [Source: U.S. State Department, Human Rights in Burma, February 18, 2013]

Rakteem Katakey of Bloomberg wrote: “Myanmar plans to implement the Extractive Industries Transparency Initiative, which calls for governments to disclose all payments from oil, gas and mining companies, Industry Minister Soe Thane said. “Pressing the button on transparency will help attract major western companies to invest in Myanmar to a certain degree. It shows the willingness of Myanmar’s authorities to fight widespread corruption and provide much-needed regulatory clarity for foreign investors,” said Siddik Bakir, a London- based energy analyst for the Middle East and South Asia at IHS Energy. “Western oil companies interested in Myanmar’s hydrocarbons industry need safety because they know the risks involved.” [Source: Rakteem Katakey, Bloomberg, September 17, 2012]

Aung San Suu Kyi said during a visit to Europe that “transparency is the key” to attracting investments in the oil and gas sector. She cautioned companies from entering into joint ventures with Myanmar Oil & Gas Enterprise, the national oil monopoly, which she said lacked transparency.

Economic Reforms in 2013

On new reforms launched in January 2013, aimed at appeasing donor countries and international organizations and improving the lives of Myanmar citizens, Reuters reported: “A wide-ranging “Framework for Economic and Social Reforms” set out broad initiatives to achieve those goals by 2030 plus more immediate priorities for the next three years. Saying Myanmar was “way behind neighboring countries,” it touches upon the liberalization of trade and investment, health and education, transparency and infrastructure.[Source: Reuters, January 20, 2013 ^]

“Improving the environment for foreign investment is a central aim of the latest proposals. The unification of exchange rates, already undertaken by the government, will be bolstered by further liberalization efforts, such as removing all exchange and non-tariff restrictions on imports “as a matter of urgency.” The government says it will give priority to a new central bank law that will grant it operational autonomy. ^

“A new foreign investment law was passed at the end of last year, but left many questions open about how it would work. “Feedback from the business community suggests that it is particularly important that the law and procedures are specific as to which sectors are restricted with respect to foreign investment and does not allow for discretion with respect to implementation,” the reform document said. ^

“Further efforts at transparency will be made in the natural resources sector. The government will disclose the revenue it gets from oil, gas and mining assets, and companies must publish what they pay to the state. In the telecoms sector, the government will aim for an 80 percent penetration rate for mobile phones by 2015. The rate in 2011 was less than 3 percent. The tourism industry, which requires “immediate adjustments,” will receive a boost from looser visa rules, modeled on those of successful holiday destinations such as Thailand. ^

“Fiscal proposals include raising the threshold for income tax and introducing a value-added tax, and the government will look at how it can make the national budget more transparent. As one of the “quick wins” to help ordinary people, the government will improve public transport in the commercial capital, Yangon, perhaps by lifting restrictions on motorcycles, and banks will be able to start offering mortgage financing. ^

“At the same time these reforms were announced Myanmar President Thein Sein said the government wanted “a modern, industrialized country,” but also stressed the need to develop the agricultural sector and narrow development gaps between the regions.He told the donors the government wanted their help to raise living standards and skills of its people. “This will also help us undertake political reforms that are aimed at transforming the country into a modern, developed democracy,” he said.”

Results of the Myanmar Economic Reforms

After the economic reforms were launched foreign investments increased from US$300 million in 2009-10 to a US$20 billion in 2010-11 by about 667 percent. Large inflow of capital results in stronger Burmese currency, kyat by about 25 percent. In response, the government relaxed import restrictions and abolished export taxes. After the completion of 58-billion dollar Dawei deep seaport, Burma is expected be at the hub of trade connecting Southeast Asia and the South China Sea, via the Andaman Sea, to the Indian Ocean receiving goods from countries in the Middle East, Europe and Africa, and spurring growth in the ASEAN region. [Source: Wikipedia]

According to the Asian Development Bank: “Policy reforms stimulated economic growth in Myanmar in 2012 and are expected to drive further development. Inflation is projected to remain moderate. Improved economic prospects have sparked a surge of interest from foreign investors. Achieving the country’s potential depends on maintaining momentum on the government’s reform agenda. [Source: Asian Development Bank]

Growth in Myanmar's gross domestic product (GDP) quickened to an estimated 6.3 percent in fiscal year 2012 (ended 31 March 2013) compared with an average of 5 percent in the previous 5 years. This figure compares to growth rates of 4.4 percent in Malaysia, 5.6 percent growth in Vietnam, 8.2 percent in China and 6.1 in Indonesia in fiscal year 2012. The pickup reflects business optimism buoyed by the government’s steps since 2011 to liberalize the economy and prospects for further reform. A modest slowdown in agricultural growth in FY2012, partly reflecting floods in August 2012, was more than offset by increases in industrial output and services. Economic growth is forecast to rise gradually to 6.5 percent in FY2013 and 6.7 percent in FY2014. Projections assume the government will maintain momentum on policy reform over the medium term.

Growth will get a lift from the European Union’s proposed reinstatement of preferential access for Myanmar’s exports under the Generalized System of Preferences and the United States’ suspension of its ban on imports from Myanmar. Two large gas fields, Shwe and Zawtika, are expected to come online in FY2013, more than doubling gas production and raising exports to the People's Republic of China (PRC) and Thailand. Higher gas exports, greater access to international markets, and faster economic growth in key markets such as the PRC will support growth in exports. Visitor arrivals are likely to post further large gains.

Bloomberg reported: Growth was 5.5 percent in 2011, the IMF said in its April 2012 World Economic Outlook Report. In 2011, the gross domestic product of Myanmar, with a population of 62 million, was $54.8 billion, while Singapore with 5.2 million people had $180 billion. Back in 1969 Myanmar’s GDP was about $6 billion, compared with $8.8 billion for Singapore, according to World Bank and International Monetary Fund data. Inflation is adding to the economic burden, with the price of rice, for example, up by 30 percent over the past year alone.[Source: Rakteem Katakey, Bloomberg, September 17, 2012]

Real GDP growth was driven by commodity exports and higher investment, supported by robust credit growth and improved business confidence. "We see certainly a strong reform momentum coming out of Myanmar,"Meral Karasulu, IMF mission chief for Myanmar told AFP. “The progress is very tangible." Karasulu said the Myanmar government's move to put the kyat currency on a managed float at the beginning of April was a key beginning. "There are still many informal market exchange rates," Karasulu said. Karasulu said the government has moved away from simply printing money to fund its deficits, which together with distorted exchange rates has fuelled extreme inflation in recent years. [Source: Paul Handley. AFP, May 7, 2012 ==]

Paul Handley of AFP wrote: The IMF has seen a "significant decline" in so-called deficit monetization, by "about half," she said. That has helped calm price rises: inflation that averaged nearly 33 percent in the fiscal year that ended in March 2008 was down to 8.2 percent in fiscal 2010-11, and 4.2 percent in the year just ended. ==

Increased Investment in Myanmar as Sanctions Are Lifted

At the time he economic reforms were being launched, political reforms were also taking place and Western governments were dropping or easing sanctions and international firms were moving quickly into the country to exploit its vast resources, cheap labor and new consumer markets. As mentioned above foreign investments increased from US$300 million in 2009-10 to a US$20 billion in 2010-11 by about 667 percent.

Western investors kept out of the picture by the sanctions are sizing up Myanmar’s opportunities. "If sanctions were lifted Myanmar would be of interest to mining, natural gas, agribusiness, tourism, financial services and telecommunications. Everything from ports to telecoms," said Douglas Clayton, a former hedge fund manager, told Reuters. He is now chief executive and managing partner of Leopard Capital, a private equity fund specializing in frontier markets. Clayton, who runs a $34 million fund in Cambodia backed by overseas investors, said he would quickly set up a Myanmar fund if sanctions ended and expects the investment scale would be in "billions of dollars rather than millions". [Source: Martin Petty, Reuters, November 19, 2010]

Meral Karasulu, IMF mission chief for Myanmar told AFP the government could help the economy more by allowing the state banks and insurance companies to invest more of their reserves in state bonds. Currently both groups face tight restrictions on such purchases. While the country still owes several billion dollars to bilateral and development lenders it defaulted on years ago, the IMF said the government's finances are fairly stable and show promise in the macroeconomic environment. With a surge in foreign investment sparking a rise in imports, the country's current account shortfall is expected to widen. Even so, Myanmar's reserves were $7.1 billion in September 2011, and "are expected to remain comfortable" this year. [Source: Paul Handley. AFP, May 7, 2012]

Currency Crunch in 2011 Tests the New Myanmar Government

In July 2011, Aung Hla Tun of Reuters wrote: “Promises of economic development and pro-business reforms from Myanmar's new civilian government ring hollow for entrepreneur Tin Maung, a fisheries exporter whose once-thriving firm is now on the brink of bankruptcy. Myanmar's kyat currency has appreciated 20 percent in the past year, more than any other Asian currency, squeezing traders and exporters like Tin Muang, who are struggling to break even as inflation pushes up costs and the new government does nothing to tame the currency's rise. The strong kyat and high food and fuel prices are a major test for the four-month-old government, not just economically, but politically, and analysts warn its failure to tackle bread and-butter issues may anger the public and lead to its downfall.[Source: Aung Hla Tun, Reuters, July 22, 2011 **]

“The biggest and bloodiest uprisings against military rule, in 1988 and 2007 were sparked by discontent over soaring inflation and fuel prices respectively, and former government officials say more of the same could be on the way. "It's a political time bomb for the government," said a retired senior government official. "It was livelihood issues, not a thirst for democracy that pushed people onto the street before and things couldn't be worse now." **

“The government's inaction over the kyat's strength and rising food costs is alarming exporters, farmers and employees earning dollar-pegged salaries. Businesses are closing, salaries are cut and jobs are being lost as production costs rise. Exporters who hoped for better times are hurting badly, with the kyat currently trading at around 785 to the dollar on the black market — which covers nearly all transactions — compared with more than 1,000 a year ago. "We're in a real dilemma. We're fighting a losing battle because of the soaring costs," said Tin Muang, 42, who reckons more than 20 farms and processing plants in the fisheries sector alone have closed in recent months."We've had to sell all we were breeding in the local market at low prices. It will have a very negative impact on our traditional export market." **

“The government has made no public acknowledgement of its currency crisis and its cut in export tax from 10 to 7 percent, effective this month, is a measure seen as too little, too late. "I don't think the government is much interested in the worsening situation with the kyat," said a retired commerce ministry official, who requested anonymity. "They seem complacent and focused on the huge proceeds from gems emporiums and foreign investment." **

Factors Behind the Currency Crunch Myanmar in 2011

Aung Hla Tun of Reuters wrote: “Private economists point to the dollar's weakness as the main driver of the kyat's appreciation but say many other factors have come into play, including increased inflows from timber and energy exports, mainly to China and Thailand, which is boosting demand for kyat. Gems such as jade, rubies and sapphires worth $5.7 billion were sold at three emporiums in the past eight months alone. Dollar inflows also increased with the repatriation of funds held offshore by wealthy Burmese to buy up state assets and property in a mass pre-election sell-off last year. [Source: Aung Hla Tun, Reuters, July 22, 2011]

“Sean Turnell, an expert on Myanmar's economy at Australia's Macquarie University, said another major contributor to the kyat's strength was sales of illicit opium and methamphetamine, of which Myanmar is one of the world's biggest producers. Drug money was converted into kyat to pay opium growers and workers in illegal drug factories, he said. The rest was laundered through banks and businesses or put into Myanmar's booming real estate market, with transactions paid in kyat. **

“The lack of reliable data or transparency in Myanmar's economy and banking system allows Burmese tycoons — many of whom are targeted by Western sanctions due to their alliances with former junta leaders — to continue to boost their wealth. **

“Economists see no signs that policy makers with a history of fiscal mismanagement will take any action to intervene in the currency."In other countries, the central banks normally intervene, but we can't expect this sort of thing to happen here," said Maw Than, a retired rector of Yangon's Institute of Economics. "Unless effective measures are taken immediately, it will have widespread negative impacts on the economy." **

“Myanmar's government wants to boost exports but that is being inhibited by the kyat's appreciation. Rice shipments, for example, dropped by almost two-thirds in 2010 despite increased production of the grain, mostly because the strength of the currency made it uncompetitive. One exporter said 25 percent broken rice fetched $390 per tonne, but after tax and transaction fees his income was just $2 dollars per tonne higher than the local price, so exporters in various sectors were selling off stocks on local wholesale markets to try to keep their businesses afloat. "It's already had a grave impact on us, from the primary producers and exporters to consumers," said Hla Maung Shwe, a prominent businessmen and vice-chairman of the Myanmar Federation of Chambers of Commerce. "The more we sell, the more we lose." **

As Currency Floats, Myanmar's Banks Rise Again

In April 2012, Reuters reported: “Every table and much of the floor at Co-Operative Bank in Myanmar's commercial capital is stacked with thick bricks of the local kyat currency. Money counting machines clatter. Workers carry sacks of cash slung over their shoulders. A few blocks away, brokers in a small colonial-era building leaf through bundles of cash, part of an ancient "hawala" money transfer network used widely in Asia and the Middle East, and one of the only ways to get cash out of Myanmar. "I have no doubt that the banks can catch up very fast," Serge Pun, chairman of SPA Group, a Myanmar investment company whose holdings range from real estate to financial services, told Reuters in an interview. "But we need the regulatory authorities to be ahead of us." [Source: Reuters, April 2, 2012]

“Myanmar's dysfunctional banking system took a big step into the 21st century with the floating of the kyat, the most dramatic economic reform yet by a one-year-old civilian government and one that promises to transform trade, banking and public finances at a critical time. It coincides with a scramble at Myanmar's long-isolated banks to prepare for what many see as inevitable: a wave of foreign investment and the lifting of Western sanctions. For 35 years, the kyat was pegged to the International Monetary Fund's special drawing rights at 6.4 kyat per dollar, a rate only available to state-owned companies and about 125 times stronger than the black-market rate of 800 to 820 kyat used for most transactions. A new reference rate, set at 818 per dollar, is the first phase of a plan to gradually unify rates used by private enterprises and create a market rate, according to central bank documents, simplifying foreign trade and investment.

“It could also build confidence in a banking system tainted by money-laundering allegations and cut off from the global financial system. Anticipating the changes, Myanmar's banks have quietly begun an overhaul. Some are sending staff for training in Singapore and other financial centers, rolling out new technology and plotting branch expansions. Global banks such as Standard Chartered and Singapore's United Overseas Bank are watching closely. So Lay Hua, managing director of transaction banking at UOB in Singapore, senses opportunity. Her bank recently helped train Burmese bankers in currency trading and risk management, and she is encouraged by a possible end to sanctions. "Regional banks with strong institutional franchises such as UOB will have opportunities to contribute to Myanmar's future economic growth," she says. Standard Chartered is also considering re-entering the Burmese market. "We are watching developments with interest," said a spokesman. Standard Chartered began operations in Myanmar in 1862 but shut its representative office in 2003 during the latest of several Burmese banking crises.

Aung San Suu Kyi and Worries About Capitalism and Over-Optimism

William Pesek of Bloomberg wrote: “In a world of turmoil and gloom, Aung San Suu Kyi is a beacon of optimism. Lately, though, the Burmese pro-democracy icon is sounding like a killjoy. Suu Kyi cautions markets and executives against “reckless optimism” about Myanmar’s prospects, a position at odds with her impoverished nation’s efforts to court them. Fellow Nobel laureate Joseph Stiglitz speaks for the economic intelligentsia when he calls her “excessively pessimistic.” [Source: William Pesek, Bloomberg, June 28, 2012 ]

“Yet there’s an element to her concerns that isn’t getting enough attention: the dangers of the very capitalism that economists say will save Myanmar. The few out there who are wary of rushing into Asia’s newest frontier question the sincerity of President Thein Sein’s political reforms. Is it an elaborate head-fake? The fear is that billions of dollars pour in amid promises of change that never comes as military rule returns. Clashes in western Myanmar involving Muslim Rohingyas already have human-rights groups crying foul.

“What if the real risk isn’t the generals, but impatient investors betting on overnight transformations and quick profits? “These are the hypes that we are currently facing,” Maung Maung Lay, vice president of the Union of Myanmar Federation of Chambers of Commerce and Industry, said in Bangkok last week. So great is the “tsunami of potential investment” that Maung says he can’t print business cards fast enough to meet demand. Tremendous Pressure All the excitement is putting tremendous pressure on Myanmar to implement broad reforms as the economy tries to catch up with the pace of political change. As Maung points out, the time difference between Myanmar’s biggest city, Yangon, and Singapore is 1 1/2 hours. In terms of economic development, though, they are 30 years apart.

“The sudden influx of dealmakers already has locals complaining about a property bubble in Yangon (formerly Rangoon) and the capital, Naypyidaw. One would expect costs to rise a bit when a former pariah state suddenly gets nibbles from Coca-Cola Co., General Electric Co., Honda Motor Co., Standard Chartered Plc, Tata Motors Ltd., Unilever (UNA) and WPP Plc subsidiary Ogilvy & Mather. The mere specter of Myanmar becoming too expensive even before the economy is formally opened to the world is reason for concern.

“Myanmar’s boom will only be sustainable if it finds the right policies. The question is whether foreigners know that they themselves are also a vital part of that “if.” It’s hard to recall the last time investors were so bullish on a frontier market. They must be patient and give Myanmar the space needed to rebuild itself — to modernize its rudimentary banking system, devise a credible judicial apparatus and improve infrastructure.

“Than Nyein, Myanmar’s central bank governor, has his own lengthy to-do list: creating internationally respected legal, regulatory and supervisory frameworks. “We need to reform our markets and foreign-exchange system, too,” he said in Bangkok last week. “We need to change.” That need is all the more pressing if Myanmar is to handle the crush of money waiting at the border. Enforceable laws must be in place if Myanmar is to avoid the commodities curse that befalls many developing nations. Asia is rife with examples of countries struggling to spread the benefits of vast natural resources. Too often, they enrich corrupt public officials and their cronies, not the masses.

“Worried about a similar fate in Myanmar, Suu Kyi is calling for investments that promote democracy, transparency and the development of a vibrant private sector rather than those that strengthen the government’s hand. “Burma has been a command economy for far too long and we have never prospered along that rule, so that now we are opening up we want to make sure that we are opening up in the right way,” she said recently. Acting as stakeholders, not just shareholders, may be what’s needed if Myanmar is to avoid the “time bomb” of youth unemployment that worries Suu Kyi. How, and when, will the world know if Myanmar’s renaissance is for real? To Burmese tycoon Serge Pun, it all comes down to three words: 1 million jobs. “If we create them soon, it will transform our nation,” he said. “From there, you will see great changes coming. If not, we will have some explaining to do about where all that optimism went.”

Myanmar Economy as of Early 2004

Roughly three years after President Thein Sein kicked off Myanmar’s political transformation and economic reform agenda, the country’s growth record has been mixed. From April 2012 to April 2013, Myanmar’s GDP grew at a fairly impressive 6.5 percent largely fueled by increased exports of gas and commodities, according to official statistics (which some observers question). Yet significant barriers to investment remain. The World Bank’s “Doing Business” report for 2014 ranked Myanmar near the bottom: 182 out of 189 countries. Particularly thorny areas included “starting a business,” “enforcing contracts,” “protecting investors,” and “getting credit,” according to the report. [Source: Christina Larson, Bloomberg, January 15, 2014]

Image Sources:

Text Sources: New York Times, Washington Post, Los Angeles Times, Times of London, Lonely Planet Guides, The Irrawaddy, Myanmar Travel Information Compton’s Encyclopedia, The Guardian, National Geographic, Smithsonian magazine, The New Yorker, Time, Newsweek, Reuters, AP, AFP, Wall Street Journal, The Atlantic Monthly, The Economist, Global Viewpoint (Christian Science Monitor), Foreign Policy,,, Wikipedia, BBC, CNN, NBC News, Fox News and various books and other publications.

Last updated May 2014

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