Mizzima News

After Burma’s first election in more than 20 years, Mizzima explores the key issues facing the Burmese people and what political parties plan to do about them. The second in the series discusses job creation.

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Burma will have to develop key sectors of the economy if it is to address extreme poverty, the plight of the working poor and outmigration of workers — skilled and unskilled. To create more jobs with decent pay and conditions it will need significant investments in private and public sectors. The new Hluttaws (parliaments) must address the exploitation of farmers and their lands, the situation of traders and the plight of the urban, working poor.

What some candidates say:

Ohn Lwin (People’s Assembly candidate) National Political Alliances League, Bogalay, Irrawaddy Division “We explained to the people that the military government is disliked by big countries such as America, Britain and the [those of the] European Union. If the government is chosen by the people, all these big countries will support the chosen government of the people. Foreign investment will increase. Additionally, the World Bank and Asian banks will lend money, which may be combined with our national resources. Our country could quickly become a rich country. We need a government chosen by the people. When the civil administration is separated from the military, our country and economy will benefit and job opportunities will increase.”

Hla Thein Deputy vice-chairman, National Democratic Party for Development “Industrial businesses and foreign investment must be encouraged. When factories open as a result of foreign investment, there will be job opportunities for all citizens. Currently, there are not enough factories to provide jobs for everyone. Even though salaries are frequently increased, the salaries are insufficient because of the fluctuation of the currency, high living costs and low incomes. If the economy is not stable, there will be no progress. So the stability of the economy is the first problem to be solved.”

Than Than Nu General Secretary, Democratic Party (Myanmar) “The economy is our first priority to address. People have suffered economic difficulties for many years that can't be solved immediately. Also, it relies on the willingness of the people. When we talked to [voters] during campaigning, they talked most about the need for education; we need to redesign our educational system. A second issue is health, as well as the lack of regular electricity, and pollution.”

The United Nations Economic and Social Commission for Asia and the Pacific (Unescap) outlines three important ways that Least-Developed Countries in region — including Burma — can reduce poverty and stimulate jobs creation. Firstly, increased investment in education and technical skills development results in greater capacity and output within the labour force. Secondly, create conditions that promote self-employment and entrepreneurship, and thirdly, improve access by the self-employed to credit markets.

While that might be a clear and straightforward-sounding agenda, Burma is not a straightforward case.

Analysts point out it is far behind the ball in terms of industrialisation, and its manufacturing industry is small and underdeveloped. Legal protection is weak and the military regime has for decades dominated the economy. The informal economy is huge and unregulated, while most of the country operates on a black market economy.

Many see Burma’s lack of infrastructure and the small manufacturing sector a major flaw, and a barrier to creating jobs. Addressing the problem will be, like most things in Burma, a challenge.

The biggest issue facing the country may well be access to electricity supply.

Use energy revenues wisely Professor Joseph Stiglitz, Nobel-Prize-winning American economist, on a visit to Burma late last year, emphasised that revenues from oil and gas could be used by the Burmese government to “open up a new era” of opportunities for stimulating the economy and investing in infrastructure and public services. Source: Noleen Heyzer, Myanmar’s [Burma's] Political Transition: Opportunities for Economic and Social Development? http://www.unescap.org/oes/opeds/2010/myanmar-political.html

“It’s difficult for Burma to attract foreign investment in manufacturing due to the poor state of its infrastructure, notably the unreliable electricity supply,” Dr. Alison Vicary of Burma Economic Watch, a think tank at Macquarie University in Sydney, said. “You can’t have a manufacturing sector if supply is not assured.”

Even if there were a constant supply of electricity, the existing manufacturing sector has numerous problems, including lack of regulation and abysmal occupational health and safety standards. The garment industry is a case in point, criticised over its low pay and exploitative conditions for its predominately female labour force.

Vicary said there were many other barriers to economic development and job creation.

“There is also the appalling state of Burma’s ports, notably in Rangoon,” she said. “Exporters need to be able to get their goods out of the country as quickly and cheaply as possible. If the ports and roads are antiquated, this increases costs, decreasing the competitiveness of Burma relative to other low-wage countries.”

However, the list of challenges is longer. The opacity of the Burmese economy has facilitated high levels of corruption and resulted in a system in which businesses and investors are unable to rely on stated rules on the conduct of business. Consequently, success in business depends on personal relationships with military leaders and their cronies.

Party policies

National Democratic Force (NDF) The party's economic policy states that they aim to implement a market-oriented mixed economy and co-operate closely with international economic organisations such as the IMF and the World Bank to ensure Burma’s economic recovery. The NDF will also enact laws to prevent elites monopolising business. They will ensure that profits gained from the sale and use of natural resources are distributed evenly across Burmese society and will work to reduce unemployment and create jobs. They will also support local and rural enterprise to increase domestic consumption power and build a stronger domestic market.

National Unity Party (NUP) According to policy documents, the NUP has adopted a “Free National” economic policy, under which businesses will operate in a free-market, export-oriented economy. The party will ensure equal resources and welfare distribution to individuals, minority groups and majority groups in order to build social harmony. It will also develop greater “economic and financial stability for steady social and economic development”, manage natural resources responsibly so that future generations may continue to benefit from them, and stimulate foreign investment in a way that ensures technology transfer. The party will also follow international rules and regulations on business and trade.

Union Democratic Party The party will further develop an open market in Burma, but also support and increase the number of domestic business owners. By providing incentives to foreign investors and businesses, the party aims to transform Burma’s rural-based economy to an industrial one with an emphasis on mining, agriculture, forestry and fisheries. The party intends that income generated from sale of natural resources will be negotiated and shared between the Union and the States, who will also negotiate and implement environmental protection policies.

Another difficulty in achieving economic development and jobs creation will be combating the monopolies of state-owned enterprises within the domestic market. Opening up the economy domestically, developing better rules, and ensuring people’s access to lines of credit, economists argue, will stimulate the creation of more jobs.

But even if all of these challenges were addressed, “decent” work is still not guaranteed for Burmese people. To achieve this, Burma will need to develop and implement labour standards — such as occupational health and safety, benchmarks on working hours and overtime, freedom to establish unions and legislative protection of labour rights — and develop ways of effectively policing those standards.

Too great a focus on manufacturing and industry when considering how to create jobs and improve wages, draws attention away from the area that may need the most attention from policymakers in the new parliaments — agricultural sector reform.

A change in the role of the military in the economy is suggested, not only at the top. As Vicary explains, the large number of soldiers stationed in border areas stifles and distorts economic activity.

What is decent work? According to the United Nations workers' rights body, the International Labour Organisation, decent work “involves opportunities for work that is productive and delivers a fair income, security in the workplace and social protection for families, better prospects for personal development and social integration, freedom for people to express their concerns, organise and participate in the decisions that affect their lives and equality of opportunity and treatment for all women and men.”

She said: “These soldiers are not adequately supported by the central government and are in effect living off the labour of the locals. This impedes economic activity and diverts resources and income to the military,” she said.

She draws attention to the system of arbitrary taxation that at once boosts military income, and further pressures locals.

Arbitrary and unlawful tax collection, she stated, occured at “common checkpoints that litter the roads, ports, bridges and rivers … this decreases the number of economic exchanges [that are possible] and means jobs are lost or not created alongside the decrease in income”.

“These taxes levied at checkpoints need to be removed. So far there is no indication that any new government will have the power to remove these checkpoints,” she said.

A related issue with implications for employment are the restrictions placed on subsistence and small-scale farmers.

“Farmers and their agents should be able to transport agricultural produce to market, not having to rely on traders licensed by the military state,” Vicary said.