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Economy

Myanmar tries to jump-start policy with new economic team

Foreign investors play waiting game two years into Suu Kyi administration

Myanmar State Counselor Aung San Suu Kyi visited Tokyo in October to promote foreign investment in the Southeast Asian country.   © Reuters

YANGON -- Two and a half years after the Myanmar's ruling National League for Democracy, led by State Counselor Aung San Suu Kyi, took the reins of government, a ministerial-level economic team appears finally to be up and running.

The NLD government has come under fire for lacking a clear economic program. And the country's standing with international investors has suffered due to what critics, including the United Nations, say are human rights abuses against the Rohingya Muslim minority. Myanmar's security forces are accused of persecuting the Rohingyas, many of whom have fled to neighboring Bangladesh and now live in squalid refugee camps.

It is against this grim backdrop that the ministerial economic team must move forward with Myanmar's economic reforms.

Suu Kyi, Myanmar's de facto leader, visited Japan in early October, accompanied by Thaung Tun, chairman of the Myanmar Investment Commission. Speaking at a seminar in Tokyo, Thaung Tun pledged that the commission would become "a single contact point for investment approvals."

The commission screens and approves large investments by domestic and overseas companies, and applications for tax breaks. It is also tasked with attracting the foreign investment crucial to the country's economic development. Thaung Tun's promise in Tokyo was aimed at demonstrating Myanmar's determination to improve the investment climate by cutting red tape and ending bureaucratic turf battles.

The former diplomat has been on both sides of Myanmar's political divide. During the period of military rule, Thaung Tun criticized Suu Kyi's pro-democracy movement. But in January 2017, after the NLD government was inaugurated, he was appointed national security adviser. He is now one of Suu Kyi's closest aides.

Since Thaung Tun became chairman of the investment commission, "[its] activities have been revitalized beyond recognition," according to a government source. Thaung Tun has made a flurry of overseas trips, visiting China, Singapore and Japan almost monthly. He has been at the vanguard of Myanmar's efforts to court foreign investors.

Suu Kyi has focused on political challenges, such as quelling political unrest, after taking office. She has been noticeably slow to implement economic policies. But that may be changing, thanks to the formation of the economic team.

In May, the government accepted the resignation of Kyaw Win as planning and finance minister. Critics said he was out of his depth in the high-level post. His replacement, Soe Win, hails from a private accounting company. The 79-year-old has extensive international experience and is said to have a good grasp of finance.

Set Aung, the deputy planning and finance minister, is playing an increasingly prominent role in formulating and implementing economic policy. In September, the government unveiled the Myanmar Sustainable Development Plan. The plan lists 251-point policy challenges for priority treatment in the budget. Set Aung played a key part in putting the plan together.

He also served as presidential economic adviser in the pre-NLD administration of President Thein Sein and was instrumental in setting up the country's special economic zones, which provide a testing ground for economic reforms. He is also a head of the Thilawa zone's management committee. Thilawa is a joint venture involving the public and private sectors of Myanmar and Japan.

Set Aung has been chairman of the Kyaukpyu zone's management committee since earlier this year, which is led by Chinese companies. He completed difficult negotiations with China, shrinking the project to one-fifth its original size to avoid becoming overly indebted to China.

At present, the biggest obstacle to foreign manufacturers setting up shop in Myanmar is an electricity shortage. Win Khaing, the energy minister, paved the way for construction of Myanmar's first power plants fueled by imported liquefied natural gas. At Win Khaing's direction, Myanmar adopted a streamlined bidding process for projects and gave the go-ahead to two massive LNG power plant projects led by foreign companies.

Tourism Minister Ohn Maung introduced a new visa system in October, overcoming resistance from within the government. The new system, which aims to raise tourism spending, exempts Japanese and South Koreans from tourist visa requirements; Chinese nationals are offered visas on arrival.

Myanmar's new economic team is up and running, but has yet to achieve concrete results. It must now forge ahead with new economic policies and win the international community's confidence.

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