Written by U Ne Oo on 1998-04-10

Over the years, the pro-military campaigners such as Miriam M. Segal of MMAI Inc., Mr Stephen Brooks of Asia Times, Mr K. Omei of Japan, Michael Dobbs-Higginson of Hong Kong, Ma ThaHong Kong, Ma Thane Gi of Rangoon and, of the recent, "God Knows Who" have constantly been attacking the leadership of Aung San Suu Kyi in particular and the Burma democracy movement in general. Most attacks are centered around the effectiveness of trade sanction method for political change in Burma. Of course, there is no way to accurately measure the effectiveness of any non-violent political methods, such as trade sanction etc. One certain thing, however, is the cash-starving military will be in much better behaviour than that viour than that of financially confident one. To this effect, sanctions enforced by IMF, World Bank etc are already helping to shape the causes of political events in Burma. Other trends in the attacks is manipulating the former pro-democracy campaigner such as Ma Thane Gi, in order to demoralise the people who are working in the movement -- a tactics that has been well known to all of us.

It is rather problematic in our struggle whether the pro-democracy groups should systematically engage in a proper debate or just to igbate or just to ignore those critics. Because most of them are "Creeps" (i.e. who advocate what he/she does not actually believe in, and simply to get attention from the crowd or to make money), we may as well ignore them to save our time and efforts. In addition, the cases and issues that put forward by those critics do not reflect the thinkings of top military leaders in Burma.

These kind of attacks, generally speaking, are nothing new to all of us who are working for the democracy movement, especially at the grassroots leve grassroots level. As a grassroots activist, I have often been ridiculed, pushed around or ignored by others (who are not necessarily of pro-military). On the other hand, there are people who do understand the issues of justice and human rights and willingly given solidarity. As refugees in "the other country", we are also subjected to the taunts such as, "parasites", "dole-bludgers" etc. We certainly are disturbed by it; but couldn't be much too concerned about it and not to be distracted by it. From my personal view, the most sview, the most sustainable way for a grassroots activist to move forward in the struggle is not to mess around with non-essential issues: we must always focus on major issues that are considered important to the movement. Then again, there are bullies who petty minded enough to attack one's personal space: in this case, one will have no choice but to respond.

On the other hand, we should not necessarily mind the people who criticize the movement. These attacks often remind us of a policy weakpoint in our struggle: The econotruggle: The economic transition for Burma. Because so many of us are too busy in our efforts to put political pressures on SPDC/SLORC, we tend to overlook the issues in reforming the economy. Nevertheless, it is about the right time for our pro-democracy groups to look into those economic issues.


There are people who in fact have wrong expectations that they would be able to do proper business with Burmese military. Unfortunately, there are certain fundament certain fundamental reasons the Burmese military cannot be a right partner for the international business community to work with. Firstly, the attitude of non-openness towards businesses in general and foreigners in particular by the Burmese military. It should be noted that Burma's current military leadership is primarily responsible for formulating and implementing nationalist (or more accurately, xenophobic) economic policies of the past. This non-openness to the international business may translate into the Burmese military's se military's suspicion of the businesses and the foreigners. Recent revoking of FEC trading licenses by Burmese military is a proof of this. On the one hand, the businesses that entered Burma will not be viewed by military as the partners in development. Rather, the businesses will be seen as the cash-cows that will enable the elite to sustain the ruling by the military. The second fundamental problem is about the way in which the Burmese military perceived as the "economic developments". The military do not necessarily view tcessarily view the improvement to the living standard of the larger whole of the population as a true measure of economic progress. Rather, the military refer the superficial and visible developments, such as high-rise hotels, night clubs, and white-washed cities etc as the measure of economic progress. Underlying problem, in my view, is the Burmese military leadership's lack of intellectual capacity to understand the basis of the economic issues. This inability has resulted as the major impediment to the necessary economic reform economic reforms in Burma.


Those from the other camp tend to portray ASSK and the movement as anti-development and are hostile to the business. The reason the businesses do not flourish in Burma, despite the opening up of the country in 1988-89, has much less to do with the stance of the democracy movement. The major impediments to the operation of businesses in Burma are the inability of current military government to understand the issues in transition and the incapacn and the incapacity to put forward a proper economic reform. For example, as early as in 1994, an economist has already pointed out that "...Myanmar investment laws and other government rules provide a reasonably attractive package for foreign investors. It is not the lack of incentives but the absence of a basic price mechanism and a social framework that most likely dissaudes foreign investors from coming in" 1/.

For example, the Burmese military's inability to fix a proper exchange rate has become an obstacle for potentiatacle for potential investor, as noted in the same report 1/.pp-218 as:

"... Holding onto the highly unrealistic exchange rate of 6 kyat to one U.S. dollar undermines other efforts the government is pursuing to introduce market economy. ..... The capital brought in is undervalued at the official exchange rate while profits made will not be allowed to be repatriated at the same official exchange rate. Under this restriction, a potential investor will be discouragedll be discouraged from going into a venture involving a large amount of fixed capital."

The World Bank's report in 1995 has also concluded that current Burma's economic policy *2/ is not conducive to a sustainable growth pattern. The report concluded 3/.pp-xiv:

"...this report concludes that the pace of economic growth is still not rapid enough ..... and its sustainability is uncertain. The current reform efforts are, therefore, unlikely to push the Myanely to push the Myanma economy to a higher growth path on which the bulk of the population would enjoy substantially better living standard."

The World Bank report also has pointed to several areas in which the reform should be taken (I will make efforts to send to the Net of some part of the report for our friends. For non-economists like myself, it is quite difficult to read such economic report which uses many technical terms. Nevertheless, with the help of a good dictionary on economics, we would atlics, we would atleast be able to find out what the economists are saying. MAYKHA-L may be more appropriate forum for those postings on economics.)


Some of the business advocates who criticize human rights principles tend to believe that the operation of businesses can be separated from any of fundamental human rights issues. This is certainly a wrong perception. In a free-market economy, the businesses must be protected by the rule of law - which will atleast guarantee atleast guarantee the right to property -- together with an impartial and competent judiciary. The business operations must also be guided by a transparent economic policy. In the absence of these fundamental infrastructure, anything could happen to the businesses and their operations. We have already seen the worst of these scenarios in Burma. For example, Peregrine in 1995 had lost all its investment money in joint venture with MMAI in Burma when the parties fell out (some Burmese generals were involved). Those businessmen who cominessmen who completed deal -- some who possibly have bribed all their way through -- with previous trade minister, Tun Kyi, are in a limbo when the internal rift in the regime brought that trade minister down last November. These kind of losses can be avoided or at least be minimized if the government is democratic one and there is the rule of law to protect the business interests. From my view, the underlying reason of the Western (free-market oriented) societies given more emphasis to the Civil and Political Rights (some viewedhts (some viewed as individual rights) rather than the Economic, Social and Cultural Rights is that those rights are compatible with the free-market polity.

It is generally true, in a democratic system, that things are done in a much slower pace for the businesses than the other systems. For example, to get a license or a permission for a development project in a democratic country, the businesses may necessarily have to go through proper channels - i.e. through examination of appropriate committees, the debate in parliamentbate in parliament etc. However, such slowness can be weighted in balance with the overall stability of a democratic society. The authoritarian regimes, on the other hand, are not stable - especially this Burmese military.


The subject of transition from command to market economy has been of intense interest by both economists and politicians after the period of the collapse of many communist regimes in Europe and elsewhere. The studies have shown that es have shown that there are four basic elements in implementing such transition 4/.5/.:

(1) macroeconomic stabilization;

(2) price liberalization;

(3) easing trade and investment barriers and rationalizing of the exchange rate;

(4) reform of property ownership regime, including legalization of private enterprises and privatization.

(It worth noting that SPDC/SLORC have not implemented, despite its opening-ups and free-market rhetorics, market rhetorics, most of these reform measures. We have not seen even the simplest of the reforms: the exchange rate!) The term "Big bang" and "Gradualism" comes from the way in which --i.e. how much and how fast-- these four elements are implemented at one time. The initial economic conditions, i.e. the industralized or agricultural based, may also dictate upon which the approach a country should take in its transition.

Currently, there are quite a few countries, both in Asia and Europe, that have been going through this refo through this reform process. Within Asia, we can look examples in China, Mongolia and Vietnam that are undergoing the transitional process. China in particular has been praised by the economists for its gradualist approach to transition. Burma, as one of the agricultural based economy, may be more receptive to the gradualist approach. Also for those of us who desire a Burma Federal Union, the China's Special Economic Zone approach to economic liberalization may offer good lessons for managing our own transition. Various reform measious reform measures, such as price liberalization, creating incentives to speed up investment and trade, may be more manageable -- and is likely to be successful -- if undertaken in designated federal State or Division.


One encouraging observation is that the impact of economic transition in those agricultural based economies are much milder in comparison to that of industralized economies. However, there is no guarantee that the so-called market-forces alone will be abls alone will be able to shape the transition. It will also be erroneous to think the 'laissez-faire' or free-for-all policy is the best approach to economic transition, the economists have warned. In the transitional period, it is desirable to have a comprehensive economic and social policy that is politically sustainable.

We on the pro-democracy side have quite a few economists for our help. The initiatives are needed from our part to move on economic policies. Many of the issues for Burma's economic transition have been addtion have been addressed in the 1995 World Bank report. Starting from that report, we can look into the practically feasible steps that should be taken in the future. Hopefully, some economic policy for Burma might be shaping up as a result of all your inputs.

With best regards, U Ne Oo.


1. Khin Maung Kyi, "Will Forever Flow the Ayeyarwady?", South East Asian Affairs 1994 pp-219-230.

2. To my understanding, the Burmese military junta simply do not have an economic policy. Whan economic policy. What happening in Burma is not a conscious implementation of a particular economic policy by the authorities, but it is simply the junta making short-term responses to any economic situation on the ground.

3. The World Bank, "Myanmar: Policies for Sustaining Economic Reform", Report No.14062-BA, October 16,1995.

4. J. Sach, W. Woo, S. Parker, "Economies in Transition: comparing Asia and Eastern Europe", MIT Press, 1996.

5. Ian Jeffries, "A Guide to Economiies in Transition", New York; Routledge 1996.

Economic Transition in Burma