Myanmar Munez

1. Overview

Myanmar has a population of 53.6 million people and is home to a variety of cultures and most dominantly Buddhism. Although the nation is wealthy spiritually, it remains one of the world's poorest countries with a poverty rate of 26 percent. Myanmar's GDP is 65 billion dollars and its GDP per capita is 1200 USD. This is significantly lower compared to countries such as Japan where the GDP per capita is 37000 USD. There is a poverty rate of 26 percent suggesting almost a third of the population is earning incomes less than poverty line. 40 percent of the country's GDP is reliant upon the agricultural sector primarily farming and this employs 70 percent of the nations' total labor force. Currently there are ethnic conflicts in the north with Rohingyas (Illegal Immigrants from Bangladesh) with Burmese locals. The military's handling of the situation labelled the actions of Myanmar as close to a genocide and showed signs of ethnic cleansing. With international pressure, the new democratic leader Aung San Suu Kyi has to battle the military, its people, and the rest of the world to push the right buttons and correct the issue. Economically, Myanmar just opened up to the world and the US lifted all sanctions on Myanmar under Obama'a last term. Japan provided 7 billion dollars in aid to build infrastructure. Tourism is a currently strong market in Myanmar and is looking to be developed. In terms of trade, Myanmar is heavily dependent upon imports and are looking forward to export more goods to generate more revenue.

2. Comparing Economic Development

Japan's life expectancy in years is considerably higher than that of Myanmar's indicating more developed healthcare. The number of child deaths in Myanmar is around 80000 whereas around 7000 in Japan. The large number of child deaths in Myanmar sheds light to bigger issues relating healthcare of children at a very young age. The income per person of Japan is 10 times than that of an average Burmese citizen's. Additionally the data suggests only a small percentage of Japan is dependent upon agriculture as a percentage of the GDP whereas almost 50 percent of the GDP of Myanmar is dependent upon the agricultural sector.

3. Domestic factors leading to Economic Development

1. Access to Education

Increased access to education for civilians of Myanmar has become a national priority and government expenditure on the field has increased to 1.3 bn dollars. Although this is only 5 % of total government expenditure, the new democratic government is looking to increase budget in the future. Part of the goal includes making public education completely free. This would require reforms in the entire infrastructure of education within Myanmar which has been corrupted by the military junta. Although Literacy Rates in Myanmar are above 90 percent, they remain a relatively closed off nation and are distant from International means of communication such as English. However the new government led by nobel peace prize laureate Aung San Suu Kyi are receiving international aid to reform the education sector. The reform of the education sector is expected to provide a more trained work force improving the economy of Myanmar within various industries.

2. Property Rights

Property Rights have been a long hard standing issue in Myanmar due to the interference of the military junta in civilian land rights. In the past the military has confiscated land and displaced civilians from their property. This unlawful seizure of the land has caused turmoil and have caused economic instability. Strengthening of property rights in the new democratic government have allowed citizens to develop and construct their land to build property and add value thus adding to the GDP of the nation.

3. The use of appropriate technology

The use of appropriate technology especially in agriculture has contributed in the nations economic development. This is because farmers in Myanmar were very reliant upon hands on technique instead of machinery to grow and refine crops. This led to huge differences between other agriculturally dependent nations such as Thailand. The use of proper machinery leads to efficient production and increased supply thus creating larger markets and in turn a larger consumer base, generating more income.

4. Access to Credit

Increased access to credit and micro finance loans have allowed small businesses and entrepreneurs to gain capital in order to develop in the respective expertise. Access to micro finance loans have been an issue in the past especially for farmers who need capital in order to purchase seeds, fertilisers, and land in order to farm. Institutions supplying these loans set a small loan limit hindering farmers from gaining al the capital needed to set their businesses running. Institutions feared that entrepreneurs would default on the loans. However private companies are collaborating in order to increase loans given to small businesses and entrepreneurs. The idea of how this promotes economic development can be understood in relation to the multiplier effect. Money injected to the economy allows producers to have enough capital to manufacture goods which are then purchased by consumers. The increased activity in this cycle allows for economic development.

5. Women's empowerment

Women's empowerment in Myanmar could not have been more transformational after Aung San Suu Kyi, nobel peace prize laureate and the leader of the military opposition party became the de facto leader of the country in 2016. She sets an example for women within the nation to aspire and follow their passions. In doing so gender roles begin changing within Burmese society as women begin to pursue diverse cultures other than being a housewife.

6. Institutional and Political Factors

Up till today Myanmar remains one of the most corrupted nations in the world, ranked 28th out of 176 countries. The military overshadowing power over the parliament and their power to veto bills, and acts by the president goes to show the lack of a true democracy. Political instability has provoked and spread fear to international investors as they are aware there's no security to their investments. Certain laws pushed by an unstable government could harm their businesses and this fear of instability has led from many international firms to keeping their distance form Myanmar. Corruption in corporations from the bribery led by business elites to political officials have aroused a culture of cronies. Those who bribe the officials would get certain permits and licenses to do huge businesses and those who don't would lag behind. A new democratic government led by Aung San Suu Kyi are looking towards getting rid of such crimes and create a more secure and sustainable economy.

International Trade and Economic Development

Overspecialisation/Price Volatility

Myanmar continues to fall weak in terms of trade as there is not enough sufficient export revenue to spend it on purchasing imported goods for the nation. This is because the range of the export goods rely on primary goods. Petroleum gas, Rough Wood, and Dried Legumes are the nation's largest exporting goods. As seen they are primary products. Price Volatility of these products can occur as the world's demand for these products can fluctuate. If productivity within these industries increase, world supply increases thus reducing its prices in the long term. With reduced prices, terms of trade will likely deteriorate and the nation earns less export revenue to purchase imported goods. Myanmar still relies heavily on imported goods and overall has a weak export sector. International trade is strengthening in the sense that Myanmar has now increased trade with the west after Obama lifted all sanctions with Myanmar during his presidency.

Growth and Development Strategies aimed at Increasing Trade

Diversification and Export Promotion

The Asian Development Bank believes that Myanmar can employ successful development strategy through diversification of its exports. This is due to the fact that the country has low labour costs. Such a strategy will not only benefit international markets, it will protect the domestic markets as well. Currently the economic sector is looking towards reviving the garment industry which was previously thriving. Through the diversification of manufacturing goods, the nation

Aid, Trade, and fdi

Myanmar is the 8th largest ODA recipient in Asia where it refers to official development assistance. ODA refers to financial aid provided by governments to help reform another nation's economic or social infrastructure. Myanmar received 1380 USD million in ODA in 2013. Japan is Myanmar's largest donor followed by the United Kingdom. The largest percentage of this aid goes into social infrastructure which covers access to healthcare and education programs. The second largest portion of this financial aid goes into production and for the development of industries. It seems that aid from Japan has allowed Myanmar to simultaneously increase trade and allow foreign direct investment from Japan. In receiving aid from Japan, more economic windows are opened for Myanmar to explore. However a thorough research into the effectiveness of aid has allowed us to conclude that corruption under the previous military government has caused the misallocation of aid. Financial Aid is either used ineffectively or is used to increase the benefit of certain industries that would profit the government. However with the new government, financial aid is being more regulated and is establishing stronger connections with nations. It is causing trade and interdependence for Myanmar as a result.


Myanmar's total external debt by 2013 was 5.38 billion dollars. Debt has an impact on economic development as it serves as an opportunity cost and impedes in the nations progress. This is because debt servicing costs (the amount of interest paid from debt) is generally a substantial portion of the government revenue. Such interest repayments can be used elsewhere to promote infrastructure such as healthcare and education. To less developed countries like Myanmar itself who depends on commodity exports, volatile international markets causes imbalances in the balance of payment. If the price of rice fell, the nation would be hurt as rice is one of its largest export commodities. If the world price for rice fell, Myanmar would earn less export revenue and have increased expenditure on foreign imports.

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