Chiang Mai (Mizzima) – Burma’s state-owned enterprises incurred massive losses in at least five successive years, according to a diplomatic cable sent from the US embassy in Rangoon to Washington, published online by WikiLeaks.
The whistle-blower website WikiLeaks began releasing late last month more than 251,000 leaked United States embassy cables, in what it called “the largest set of confidential documents ever to be released into the public domain. The documents are giving people around the world an unprecedented insight into the US government’s foreign activities”.
Burma’s state-owned enterprises (SOE) lost 436 billion kyat (about US$436 million) in the fiscal year 2006-07, representing the smallest loss compared to other fiscal years, the leaked cable said.
In fiscal 2005-06, the enterprises lost 549 billion kyat, 800 billion kyat in fiscal year 2007-08, 601 billion kyat in fiscal year 2008-09, and 484 billion kyat in fiscal year 2009-10, the cable said.
The International Monetary Fund (IMF) had urged Burma to modify its tax structure in 2008 to reduce the budget deficit, according to the cable. Although the Burmese government had replied to the IMF that one of its goals was to reduce the budget deficit by addressing the main causes: weak revenue collection, losses from inefficient SOE, unrestrained government spending and budget expenditures for non-productive uses such as defence and construction, but they had failed to implement that promise, the cable revealed.
Moreover, the cable said corruption at all levels remained a problem in Burma, which affected the government’s ability to collect revenue. Corruption was rife especially at the Internal Revenue and Immigration departments and involving the Rangoon City Development Committee.
It went on to say that Burma’s economic future would remain troubled because of the uncontrolled spending by senior leaders and state-owned enterprise losses.
In response, economist Khin Maung Nyo said that the junta had actually tried to control inflation in the fiscal year 2008-09.
“That can be seen in the government’s official figures. In the past, the government concentrated only on developmental projects. They spent lavishly on them, they said. But since four years ago, they concentrated on both the developmental projects and controlling inflation. The Central Bank of Myanmar submitted its plan of controlling inflation to the joint-meeting conducted by the World Bank and IMF, Which is why I say the government tried to control inflation,” Khin Maung Nyo said.
He added that the government needed to fix the currency-exchange rate.
“I advised the government about it a long time ago. I know they will implement my advice but I don’t know why they haven’t implemented it yet. Anyway, they’ve accepted the idea,” he said.
The junta’s privatisation commission early this year announced that it was selling more than 110 state-owned properties including clothing and food factories, cinemas and buildings as a part of its privatisation drive.
According to the junta official statistics, 260 state-owned buildings, factories and land plots were privatised last year.
