The World Bank Group (WBG) new Country Partnership Framework 2020-23 proposes to use the lens of “social inclusion and peace” in its support to the country’s development agenda and lending portfolio. It also factors in its post-covid19 economic recovery plans and measures announced by the government.
Three focus areas that CPF identifies include; building human capital and fostering peaceful communities; fostering private-sector led growth and inclusive economic opportunities; and enhancing climate and disaster resilience and sustainable natural resource and environmental management. In its analysis WB acknowledges that “The crisis in Rakhine State, together with intensified conflict in other states, poses a serious threat to Myanmar’s goal of becoming "a peaceful and prosperous" nation”.
Along with the already announced S$50 million loan for the Myanmar COVID-19 Emergency Response Project to help the health sector, A grant of US$8 million of under the Pandemic Emergency Financing Facility (PEF), has been allocated to Myanmar to support surge response in the health sector, with special attention on benefiting the most vulnerable groups and communities in conflict affected areas.
CPF commits continuing its lending operations in the core sectors like Health, Energy, Agriculture, Education and Community Development and the same would be reviewed to factor in COVID-19 economic recovery. IFC has also committed to lending to their existing clients (companies) affected by the outbreak of the pandemic and support to the financial institutions clients so that they can continue lending to micro, small and medium enterprises to preserve jobs and private sector activity.
The CPF has been informed by systematic country diagnostic (SCD), learning review and consultations with government and non government (including CSOs, NGOs, private sector) stakeholders, MSDP goals of Myanmar.
The systematic country diagnostic exercise has identified inclusive growth, shared prosperity and sustainability as pathways for Myanmar’s development. And MSDP also identifies pace and national reconciliation, human resource development, economic stability, job creation, private sector development, natural resources and environment protection as its goals. These perspectives have been built into the CPF with the cross cutting theme of social inclusion, including in conflict affected areas.
In its mechanisms for engagement, CPF identifies that “ to respond to the key drivers of fragility – exclusion and conflict- the CPF program incorporates cross cutting theme on peace and inclusion, This theme intends to change how the WBG engages by introducing mechanisms to better target and support undeserved and conflict-affected affected areas and by working more closely with non-state actors, including EAOs and related or affiliated ethnic service providers (ESPs).” This is a significant articulation and translating this commitment to action need to be addressed through a wide range of consultative processes involving all the stakeholders. CPF also fulfills WBG’s specific commitments of support countries affected by fragility, conflict and violence viz., job creation and economic transformation, gender equality, climate change and governance. It identifies several ongoing and new projects for community development, including Peaceful and prosperous communities project (PPCP). Acknowledging the need for inclusivity in field based community projects, it identifies few preconditions for development projects of this nature. “Investments under this project will not begin until (a) the government and EAOs have jointly agreed on geographic areas of project activities and (b) investments priorities identified by communities have been screened and endorsed at the township level through a process that will involve both EAOs and civil society organizations.” A similar approach of inclusion is being attempted in NCDDP in conflict affected townships and National Electrification Project as well.
CPF recognizes the increasing role of subnational governments for inclusive growth and peace. Accordingly capacities at this level are sought to be improved through inclusive planning, implementation of projects, management of public funds, delivery of municipal services through “Enhancing Institutional Capacity of State and Regional Governments (EICP) project”. It is important that such projects also take into consideration the prevailing complexities of governance in contested areas and accommodate diverse stakeholders including non-state actors in such interventions. Conflict sensitive approach to implementation (and do no harm) has to be one of the guiding principles while chalking out implementation strategies.
CPF identifies the need for investing in social sector portfolio. It says “The WBG program will focus on expanding inclusive access, to and quality, of education, nutrition, health and social protection services through operations that support both nation wide programs for systems building and geographically targeted interventions, as well as pandemic preparedness and response”. Ongoing project funding and new projects are sought to be identified under this objective. While its social sector portfolio is critical, one can identify CPFs limitations in terms of its focus on social protection. While piece meal, targeted social protection schemes like maternity and child benefits – using geographical targeting criteria like Multi dimensional disadvantage index MDI; cash for work (linked to DRR and in COVID-19 response), would serve limited goals, CPF could have identified the need for universal social protection programs for all. It appears to be a missed opportunity for focused interventions for strengthening social protection for the poor. Universal basic social security is the need of the hour for Myanmar as it eliminates exclusion errors and provides safety net for all informal sector population dependent on agriculture and non-agriculture sectors. The economic vulnerabilities of people due to extraneous contingency shocks (like pandemic) has brought to the fore the need for a robust safety net all. In fact the intervention logic of CPF investments in social sector identifies the inadequacy of existing social protection programs.
CPF identifies private sector led growth as sine qua non for Myanmar’s economic growth. It says “An integrated WBG program will focus on improving the conditions for private sector growth by helping lower costs for firms, strengthening links with global value chains, build entrepreneurship and innovation, and protect SMEs during times of crisis” while this is laudable goal, equally important is to ensure that interests of the workers are protected. This is especially so, due to the fact that COVID-19 led economic crisis has created considerable negative impact on the employment in both formal and informal sectors of the economy. Sectors like fisheries and garments have witnessed job losses. While protecting the firms, efforts have to be made to ensure that labour is also protected. Advocating for decent work agenda should be the focus. There appears to be little in the CPF on addressing issues of labor or workers. Measures towards PPPs, access to finance, markets, facilitative role of the government, support to SMEs, participation of Myanmar firms in global value chains, trade and investment facilitation at the subnational level and etc would become effective only with adequate measures to protect the labour, social security and promotion of skills among workers. With increasing urbanization, workers in urban unorganized sector would become important for the secondary sector. similarly, the issue of return migration of labour in large numbers due to COVID-19 also need to be factored in, while developing projects that support private entrepreneurs. Measures like skill mapping, start-up SME incubators, innovations can also be explored as part of private sector development.
Coming to infrastructure sectors, viz., energy, transport and communications, CPF provides commitment to progressively support through its varied mechanisms of financing including IDA and IFC investments. It also commits to support urban infrastructure (Yangon Elevated Express Way) and renewable energies through IFC investments. When it comes to energy sector, WBG commitment ‘not to lend’ coal based energy projects is a positive step. “ No WBG investments will be made for coal based energy and interventions will be focused to help Myanmar steer clear of investing in coal generation”. A judicious mix of energy resources and moving away from coal based power generation has been a demand of several CSOs of the country for many years. Even in hydro power generation, WBG expressed its commitment to honor the standards in terms of environmental and social safeguards. It is important also to view these investments through the lens of inclusion and peace especially in relation to the location of the projects.
CPF intends to investments for improving private sector in sectors like agriculture (productivity improvement and diversification), tourism and light manufacturing is envisaged in order to increase employment and incomes of poorer sections. Here again, ensuring creating quality jobs need to be considered as one of the objectives.
Improving government capacities in disaster relief and rehabilitation planning, management, climate resilience, sustainable management of forest resources, mineral resources and aquatic resources also feature part of its investment portfolio.