BANGKOK — The Asian Development Bank (ADB) says Burma is well placed to benefit from Asia’s dynamic growth, but the country needs to ensure development is inclusive and sustainable.
In a report released Monday, the bank said Burma will benefit from Asia’s growing influence as it throws off decades of economic stagnation.
Cyn-Young Park, an ADB assistant chief economist, says Burma - also known as Myanmar - is buoyed by its strong natural resources such as oil, gas and mining as well as its key geographic location.
“Myanmar is poised to accelerate growth on the back of its rich natural resources, strong youthful population and geographical advantages," said Cyn-Young Park. "It’s very strategically located between the region’s rising giants - China and India. It is also bridging between South Asia Asean [Association of South East Asian Nations] and India and China. So the growing regional and the really vibrant regional economic dynamics could help Myanmar to rise faster.”
The growth has come from a low base. Burma’s military took over in 1962 but almost 50 years of economic mismanagement and corruption have left the economy one of the poorest in Asia.
Individual annual incomes are lower than regional neighbors Cambodia and Vietnam. One in four people live below the poverty line. Infrastructure is well below the regional standard with just 30 per cent of rural residents having access to electricity.
But Burma is well endowed with natural resources. Gas reserves stand at eight trillion cubic feet with two billion barrels of oil. The ADB says Burma also has ample forest, water and agricultural resources.
The assessment comes as Burma’s Parliament has approved new foreign direct investment laws setting limits on foreign investment in key areas between 35 and 49 per cent foreign control.
But Park says in the long term, foreign investor confidence will depend on the government’s commitment to reforms.
“The government does need to provide much more confidence in the investor. In Myanmar’s case this is the beginning," said Cyn-Young Park. "It is really going to take a while before the investors do believe that this reform [program] is sincere and the government is not going to retract. So the commitment is a strength for Myanmar now but at the same time a lot like a lot of these strengths it could turn into a weakness very quickly.”
Stephen Groff, ADB vice president for East Asia South East Asia and the Pacific, said after holding talks with opposition leader Aung San Suu Kyi Sunday, she was cautiously upbeat but emphasized the need to generate employment.
Suu Kyi had earlier warned foreign investors to avoid “reckless optimism” over Burma’s development prospects and ability to cope with a flood of investment.
“She’s cautiously optimistic," said Stephen Groff. "She feels that the government must continue to be held accountable for the decisions it makes and that there’s a long way to go but she struck me as optimistic about the possibilities.”
Burma has a large percentage of people under 30 - some 25 per cent of the population, or 13 million people.