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87 the national bureau of asian research nbr special report #45 | march 2014 MEREDITH MILLER is Senior Vice President of Trade, Economic, and Energy Affairs & Outreach and Director of the Washington, D.C., office at the National Bureau of Asian Research. She can be reached at . Myanmar’s Emerging Role in the Regional Economy Meredith Miller EXECUTIVE SUMMARY This essay assesses how Myanmar’s economic trajectory will shape its future international standing and regional relationships. MAIN ARGUMENT Although Myanmar stands to benefit tremendously from its geographic location and natural endowments, the country faces significant challenges in navigating the current period of intense political and economic change. High domestic expectations and amplified international attention have placed increased pressure on the government to make effective economic reforms. This economic evolution will take decades to unfold, but if successful, Myanmar’s economic re-emergence will enlarge Naypyidaw’s role on the world stage and strengthen the region as a whole. POLICY IMPLICATIONS • Myanmar’s opening and ambitious reform agenda were sparked by the desire to diversify and expand the country’s economic relationships, and economic progress is essential to legitimize the political reforms. This means that an immediate focus on areas where tangible livelihood improvements can be realized is critical for strengthening the political reform agenda. • Economic and geopolitical trends in Asia have converged to heighten Myanmar’s attractiveness as an economic partner. Sustained momentum on political and economic reforms would allow Myanmar to develop into an important hub for deepening the region’s economic integration and would also boost the credibility of the Association of Southeast Asian Nations (ASEAN). • One immediate result of Myanmar’s opening has been the increased voice of civil society in economic policy, particularly with respect to large-scale infrastructure projects such as the suspended Myitsone dam. This adds an important new dynamic to the country’s relationships with foreign investors, particularly China, and could be a catalyst for a more balanced economic relationship. 89 MYANMAR’S EMERGING ROLE IN THE REGIONAL ECONOMY u MILLER M yanmar is blessed with abundant natural resources, has low population density, and is located at the heart of Asia. Situated between China and India, which have two of the largest and fastest-growing economies in the world, and also sharing borders with Thailand, Bangladesh, and Laos and coastal waters with Malaysia and Singapore, Myanmar should be a hub for East, South, and Southeast Asia, but its role has been limited in the postcolonial period.1 Economic and political isolation, a lack of investment, and armed insurgencies in its border regions—combined with the fact that Myanmar’s borders with China and India lie far from those countries’ capitals and centers of development—have diminished Myanmar’s economic influence and contribution to Asia’s rapid growth. However, several of these limiting factors have changed. Since coming into office in 2011, President U Thein Sein’s government has pushed ahead on a wide array of reforms, including national reconciliation between ethnic groups, in order to lay the groundwork for future economic growth and to entrench as much reform as possible ahead of the 2015 parliamentary elections.2 Political reforms have allowed for most international sanctions to be lifted, facilitating a rapid surge in bilateral aid and the resumption of loans and support from international financial institutions. Myanmar’s opening comes at a time when Asia has firmly established itself as the engine of the global economy. Steady GDP growth in Asia’s developing countries during the 2008 financial crisis and recessions in the United States and European Union demonstrated that the region has become an important center of demand in its own right and encouraged Asian countries to accelerate their efforts to deepen regional economic integration.3 The Association of Southeast Asian Nations (ASEAN) has sought to position itself as the driving force behind Asia’s economic integration. Myanmar’s membership in ASEAN has taken on new significance as the country assumes the 2014 chairmanship at a key moment in ASEAN’s development. The organization is intensely focused on meeting the goal of establishing the ASEAN Economic Community (AEC) by 2015—transforming its member countries into a single market and production base—partly to help Southeast Asia compete with the large markets that China and India offer investors. Myanmar has a central role to play in the viability of the AEC, particularly by putting its own economic house in order so that it can play a meaningful role in ASEAN’s economic development. For...

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Additional Information

ISBN
9781939131317
MARC Record
OCLC
883820168
Pages
112
Launched on MUSE
2014-07-16
Language
English
Open Access
No
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