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Suu Kyi urges investment in Rohingya crisis' epicenter

Myanmar leader keen to boost rural economy as 2020 election looms

The economic potential of Rakhine State "remains untapped," Myanmar's de facto leader Aung San Suu Kyi told investors and businesses last week.
The economic potential of Rakhine State "remains untapped," Myanmar's de facto leader Aung San Suu Kyi told investors and businesses last week.   © Reuters

THANDWE, Myanmar -- Aung San Suu Kyi, Myanmar's de facto leader, has chosen impoverished Rakhine State as a venue to issue a new call for foreign investment, even as her government faces international criticism for failing to stop persecution of the Rohingya Muslim minority there.

"Much of Rakhine's economic potential still remains untapped," Suu Kyi told more than 600 business representatives at a forum on Feb. 22 at southern Rakhine's Ngapali Beach resort. She pointed to a range of promising fields, including tourism and aquaculture.

The event was part of her effort to demonstrate the government's commitment to economic development -- a drive some see falling short of expectations.

Myanmar's state counselor has been touring rural areas to drum up support ahead of the November 2020 election, in which her ruling National League for Democracy will face challenges from parties representing ethnic minorities as well as the military-linked Union Solidarity and Development Party.

In January, Suu Kyi toured hydroelectric plants and other infrastructure in the states of Kachin and Chin. In February, her agenda also included stops in the eastern state of Shan and Tanintharyi Region in the south.

Outlying regions of Myanmar have been left out of the infrastructure buildup in big cities like Yangon. Suu Kyi and her team have a limited time to attract investment in those regions to show voters prospects for a better future. Support looks more likely from businesses and investors in eastern Myanmar than in the west, where Rakhine is located.

Support looks more likely to come from Asian businesses and investors rather than the West.Foreigners made up about three-fifths of the crowd at the investment fair. Japan was the most heavily represented country, with more than 50 people, followed by Thailand, South Korea and China. While Western countries have censured the Nobel Peace Prize-winning Suu Kyi over the Rohingya crisis, accusing her government of human rights violations, Tokyo has sought to distance itself from this criticism. Japan "will stand with Myanmar's government to address the problem," Foreign Minister Taro Kono has said.

China sees Myanmar as a crucial partner in its Belt and Road infrastructure drive, and is taking the lead in developing central Rakhine's deep-sea port of Kyaukpyu.

"For too long, the international community's attention has been focused narrowly on negative aspects related to problems in North Rakhine, rather than on the panoramic picture that shows the immense potential of this state for peace and prosperity," Suu Kyi said in her opening remarks on Feb. 22.

"The situation is not right to invest on a large scale right away, but we'll take this as an opportunity to begin doing business, and we hope it will eventually lead to investment projects," said an attendee from a Japanese trading company who declined to be named.

Suu Kyi and other leaders showed the "political will for moving Rakhine's development forward," said Ken Tun, CEO of Myanmar's Parami Energy Group.

Acknowledging the doubts that surrounded holding an investment fair while the Rohingya crisis continues, Tun said, "Of course we have challenges, but it is a matter of whether you do nothing, or do something to make the situation better."

Expanding investment will contribute to improving circumstances for Rakhine, the CEO said, arguing that a lack of jobs and education makes residents "emotional."

Despite its strategic location on the Indian Ocean with ample beaches and marine resources, Rakhine ranks among Myanmar's poorest states. Its per capita gross domestic product in fiscal 2017 was 1.3 million kyat ($844 at current exchange rates), less than half of Yangon's 3 million kyat, based on government data.

The state's plight was exacerbated by outbreaks of violence against the Rohingya in its northern reaches bordering Bangladesh, after militants from the Muslim ethnic minority clashed with state security forces in August 2017. Since the end of last year, Rakhine has grown even more dangerous amid fighting between national military forces and the Arakan Army, an insurgent group based in the state.

Investment in Myanmar as a whole has ebbed in the face of international condemnation over the government's handling of the Rohingya crisis.

Rakhine -- where ethnic strife has eroded both governance and security, and economic policies have stalled -- can be viewed as a microcosm for all of Myanmar. Besides the Burman majority, the country is home to many ethnic minorities, and has faced internal struggles between the Burman-led central government and minority militants ever since independence from British rule in 1948.

Even Suu Kyi's government, which took power in 2016 and is seen as a symbol of democratization, has had to put political stability first. It was only recently that the government began working at full steam on measures to invigorate the economy, such as the companies law that took effect last year.

At January's Invest Myanmar Summit in the capital Naypyitaw, Suu Kyi vowed to "continue to strive to improve the investment climate."

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