It looks like Myanmar (also known as Burma) is poised for growth and reform that may bolster the country’s economy, said Asian Development Bank’s Vice President for Southeast/East Asia Steven Groff at a National Press Club Newsmaker event on Tuesday, June 25th. “There are many challenges that the country faces, but our analysis suggests that if the government continues on the path that it is on, Myanmar’s economy could triple by 2030,” he explained as he spoke of changes occurring in the country.
Myanmar has recently undergone a governmental reform from a military junta towards democratic government. The reform is being championed by Myanmar’s current president, Thein Seing, who is widely regarded as a reformer despite ties with the former regime. “The international community was surprised by the change that happened and how quickly it happened,” the VP said. “I think it’s fair to say the people in the country themselves were surprised by the speed with which this reform process began and the speed with which it has continued,” he added.
Groff indicated that Myanmar’s economy has already seen a rise in its Gross Domestic Product, stating they had a 6.3% growth last year, expect 6.5% this year and 6.7% next year. He projects that there will ultimately be an average growth in GDP of approximately 7-8% per annum.
Groff noted that Myanmar is rich in mineral resources but emphasized that a major part of the growth is expected to occur in rural areas. He also mentioned that China and India have established trade routes that will be helpful to Myanmar as they expand their international trade.
Growth won’t be cheap or easy, as the infrastructure is not in place. Groff said that ADB is assisting in a wide range of Myanmar’s development, such as energy, transport, agriculture-related issues, education, the financial sector and possible tourism initiatives.
Myanmar has other significant challenges and obstacles to overcome, Groff warned. He said they will need to develop economic mechanisms, such as a banking sector and capital markets, which will need to include policy and rules. Groff also indicated that the country lacked a judicial sector.
He mentioned that a Myanmar official announced at the President World Economic Forum last year that they were considering a federal system and talked about some of the nation’s struggles as leaders work towards fleshing out the details of the inner workings of the new government. Groff cited corruption and the need for transparency among other problems that need to be addressed.
It is possible that Myanmar’s GDP may grow to match that of Thailand today, he explained. It appears that the global community is willing to make the investment, including businesses such as ADB, who re-established their relationship with the Myanmar government this year after a 25 year haitus due to millions of dollars owed to the bank by the Myanmar government.
Groff recognizes that there is a lot of work ahead and the risks are great, but believes that Myanmar has great potential.