Myanmar presidential economist ‘frustrated’ with Western sanctions

Author: Lucy McNulty | Published: 5 Apr 2012

Myanmar’s presidential economists have branded the US government’s plans to instigate a targeted easing of sanctions as “frustrating” and called for more international assistance with regulatory reform.

The US today announced it was ready to ease some sanctions in the Southeast Asian country, such as a ban on US companies investing in or offering financial services to the country, in recognition of its burgeoning democratic transition.

But US Secretary of State Hillary Clinton stressed any relaxation of sanctions would begin cautiously, as Myanmar still had a long way to go to shake off years of military rule. Ear

The announcement comes as the EU, Japan and Australia revealed similar plans to ease sanctions and restrictions on doing business in Myanmar following successful by-elections in the country last week. Opposition leader Aung San Suu Kyi’s National League for Democracy party won 40 of the 45 seats at stake.

Myanmar presidential economic adviser Set Aung told IFLR this morning that the sanctions currently in place had created a monopoly environment which succeeded only in benefiting the government cronies they were intended to hinder, and harming the ordinary business man in Myanmar.

“Western governments always talk about the good of the people, but they never do anything beneficial for the people,” he said. “They need to better understand that if this country’s democratic transition is going to work, it has to link to sustainable economic development which directly benefits the people.”

“Simply shifting the goal posts by relaxing periphery sanctions but holding on to those that really matter like trade restrictions will not help achieve that,” he said. “It is really frustrating and not helping the people.”

He added that the country was “desperate” for international assistance with its regulatory reform agenda.

“Most ministers are working in areas which they don’t know much about and are therefore desperate for international consultation,” he said.

“Our focus is on equitable, inclusive and sustainable development across the economic, social and environmental spectrum, but we can’t do everything; we are struggling with the reform process at the moment,” he said.

The Ministry of Finance and Ministry of National Planning and Economic Development were most in need of assistance, he said, given the number of reforms both departments had undertaken.

He added that some Asian consultancies were currently charging $1750 per day to assist with legislative reform but this was expensive and not enough alone.

“The people of Myanmar are complaining reforms are not happening fast enough, while international governments are saying we need to slow down,” he said.

“But if our transition to democracy is going to work we need to work quickly to narrow the gap between urban and rural development,” he said.

Earlier in the week, a Bank of America report warned of over-enthusiasm and great uncertainty in the opening up of Myanmar.

One British diplomat based in Myanmar said today he expected almost all European sanctions, excluding the arms embargo, to be lifted when the EU foreign ministers meet to discuss its policy on the country on April 23.

The British embassy was likely to begin encouraging socially responsible investment into the country around the same time, he said. It was also likely to begin to play a very close role in assisting Myanmar authorities with regulatory reform once sanctions were lifted, he said. The country’s outdated Companies Act was particularly in need of revision, he said.

“The President is keen to encourage British businesses to come in,” he said. “He thinks a lot can be learnt from western companies in terms of setting business standards, such as employee treatment, environmental awareness and so on.”

But he warned the arbitrary rule of law in operation in the country meant business activity in the region was still a risk.

Set Aung said Myanmar wanted sustainable not irresponsible or unethical investment. “Early birds are going to catch more worms,” he said.


LINK : http://www.iflr.com/Article/3007914/Regulatory/Myanmar-presidential-economist-frustrated-with-Western-sanctions.html

Faith placed in Uncle Sam as neighbourhood warily welcomes China

Jessica Brown / March 29, 2012 / (Opinion)

"Even Burma's notoriously authoritarian military regime is warming to the U.S." Photo: AFP

The Defence Minister, Stephen Smith, was quick to play down suggestions yesterday that American military surveillance drones could begin operating from Australia's remote Cocos Islands.

Deep in the Indian Ocean, 3700 kilometres from Darwin, the islands are closer to major south-east Asian capitals including Jakarta, Singapore, Kuala Lumpur and Bangkok: neighbours that Canberra cannot afford to get offside.

But Smith might have to worry more about convincing sceptics at home. South-east Asian countries, worried about the effect a rising China is having on the regional power balance, welcome America's presence in the neighbourhood more than many Australians realise

Even Burma's notoriously authoritarian military regime is warming to the US. Byelections this weekend are a welcome sign that the brutal dictatorship may be inching towards democracy. But, perhaps importantly for Smith, the Burmese generals' newfound taste for reform has a strategic element too.

Burma has long been a Chinese client state. It now hopes that political reforms will lead to closer engagement with the West, particularly the US.

Burma's strategic shift is the most dramatic but not the only such realignment taking place across south-east Asia.

The region's historical relationships with China and America vary wildly. But the uniformity with which they are moving towards the US in response to China's rise is striking.

All south-east Asian countries have close relationships with China, and all want to take advantage of China's economic rise. Yet none wants China to be in a position where it can dominate the region strategically.

The US has long been the preponderant military power in the region, whose nations, by and large, are happy for it to stay that way. They tolerate US primacy, because it has proved to be benign, and welcome its presence because it preserves the balance of power, enabling them to get on with the job of economic development without costly wars.

Like Australia, south-east Asian countries want to maintain the status quo for as long as possible, allowing them to free-ride on the US's implicit security guarantee while being lifted by the rising tide of China's growth.

Yet they know that is far from assured: they worry about a future where their major economic partner may come into conflict with their security guarantor.

South-east Asian strategies for dealing with this dilemma should be instructive for Australia, as we ponder what the ''Asian century'' might look like and our place in it. Although south-east Asian countries have remarkably different strategic outlooks, their strategy for dealing with regional security is essentially the same.

All pursue relationships with China and the US (although for Burma, and its neighbours Laos and Cambodia, these relations are in their infancy). They know that close ties with both is the best insurance against conflict emerging with (or between) either. And while countries such as Thailand and the Philippines have formal links to the US, they certainly don't want to be alienated from China in case it does grow to become the region's leading political power.

Paradoxically, some know they need to shift their own policies to preserve this status quo. Burma is the most striking example; Vietnam is another.

The emerging economic powerhouse of Vietnam shares a border with China, and the two countries are involved in a series of territorial disputes over islands in the resource-rich South China Sea, off Vietnam's coast. China stoked tensions last year when it reportedly cut cables being dragged by a Vietnamese oil exploration ship in the disputed waters.

Anxious about China's increasingly assertive posture in the sea, Hanoi has shifted noticeably closer to the US. The enthusiasm with which Vietnam has welcomed America's attention is an arresting symbol of just how much maritime south-east Asian states, spooked by the spectre of conflict in the South China Sea, hope the US will help keep China's naval ambitions in check.

Burma's case is quite different, but much of the thinking is the same. In October, the Burmese government cancelled a wildly unpopular Chinese-backed dam project, in the first sign that the regime wants to push back against China's dominance of their economy, and increasingly, their security policy.

In Australia, there is debate about whether the US should cede some power to China and accept its strategic rise - a debate fuelled by the musings of the new Foreign Affairs Minister, Bob Carr, about the wisdom of US troop deployments in Darwin. But there are bigger questions about whether the rest of Asia would support such a concession.

South-east Asian governments see overt conflict between China and the US as their worst nightmare, so the Australian government could quickly alienate its neighbours if it supported moves that stoke tension between the two major powers. (Hence the warning in Australia last week from Indonesia's Foreign Minister, Marty Natalegawa, about the danger of resorting to ''traditional alliances and fault lines'' in response to China's rise.)

But, ultimately, south-east Asian governments like Beijing know Australia and the US have a long-standing and close relationship. What's more, they are working carefully to build their relationships with the US too.

South-east Asia - even Burma - welcomes America's substantial presence, not because it changes the status quo but because it helps preserve it.

Jessica Brown is a research fellow at the Centre for Independent Studies. Her report Southeast Asia's American Embrace is released today at cis.org.au.

Link : http://www.watoday.com.au/opinion/politics/faith-placed-in-uncle-sam-as-neighbourhood-warily-welcomes-china-20120328-1vyqo.html#ixzz1qQ7dHLC7