Burma’s economy: Can world-class advisors make a difference?
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Burma’s economy: Can world-class advisors make a difference?

On February 11, three world-class economists including Nobel Laureate Joseph Stiglitz will be in Rangoon, addressing a local audience.  The event is co-sponsored by Myanmar Institute of Economics Graduate Association (MIEGA) – a new alphabet soup I did not at first recognize.

This will be Stiglitz’s second visit.  The first did not go too well, as the Burmese government media deleted all his “political remarks”.  This time, the visit is also arranged by George Soros’ Open Society Foundation and Dr. Myint, the Rangoon-based retired economist who got the ball rolling on all these “reforms” or at least the talk of reforms, which to me seems to be suffering from over-hype on the part of the western and Burmese exile media, will be the moderator of the session.

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Joseph E. Stiglitz. Pic: AP.

One sure sign of overhype is the use or over use of the M-word “Myanmar”, which dissidents still do not recognize.  It was shoved down our throats by the Burmese junta in 1998.  Now the M-word has become de rigueur.  Even the Wall Street Journal and the New York Times use it.  Is it “not to annoy” the Burmese regime?  Is it to engage in the mass deceit that “things are changing”?  Mrs. Clinton on her visit to Naypyidaw in December, avoided it all by saying “this country”.  I wish we could do so too.

Even some respected longtime mentors and colleagues, including some from Iran, have been taken in by this “change rhetoric.”   Even a 50-year veteran critic said, “Things have gone too far and are irreversible”.  But are they really?

U Gambira of 2007 Saffron Revolution fame said on his release on Friday the 13th January, “Don’t believe all the change rhetoric.  They learned it from Obama.”  The Maggin Monastery, ransacked and closed down in 2010, shortly after Aung San Suu Kyi’s release, because it was giving aid to HIV patients (Suu Kyi’s first foray into public was to this hospice and monastery), has been re-closed.  U Gambira and other Saffron Revolution monks had gone there, as they had nowhere else to go, and were re-ordained and trying to make the monastery habitable.  In jail they had been forcibly disrobed.

This just came in from “Monk”.

Today seeing the sayadaws (evicted monks) each carrying their little bundles and coming out of the Maggin Monastery was one of the most disturbing of my life.

The writer calls the junta “the kyant hput government” based on the name of one of its thug organizations, that came to forcibly close the monastery, and reminds the reader than anyone who merely stands by when a wrong is committed is also complicit.

http://www.irrawaddy.org/article.php?art_id=22982&page=2

Of the original over 2000 political prisoners, an estimated 1000 still remain in jail.

The Myitsone dam whose construction was halted at the orders of President Thein Sein is only halted till 2015.

In Dec 2011, Asia-Pacific Forum’s Michelle Chen interviewed Thelma Young of US Campaign for Burma, and me.  Ms. Young said, (nothing has changed except)”their PR has gotten better”.  I stressed that whether Thein Sein would be able to push through his reforms, which have sometimes been compared to Gorbachev’s, depends on how powerful he is.  There have been reports that Thein Sein in Naypyidaw, the government capital city, gave orders for ceasefires, but commanders at the front just continued shooting.

In Himal Southasian of Dec. 1, I wrote that what is signed in Naypyidaw is different from what is perceived on the ground, where stakes are higher.  Now Zipporah Sein, spokesperson for the Karen National Union, says the KNU never signed a ceasefire in Naypyidaw.  They only signed an agreement that there would be another visit.

http://www.irrawaddy.org/print_article.php?art_id=22540

The Free Burma Rangers which provides medical aid within the free fire zone states:

In some areas such as Arakan State, western Burma, where there are no ceasefire negotiations, the Burma army continues its operations. In other areas such as Kachin State .  .  . the Burma army is continuing operations with over 100 infantry battalions. In Karen State, there has been a significant reduction of fighting, but the movement of supplies and Burma army troop movement continues. In Karen State no ceasefire has yet been signed but both the Karen National Union (Karen ethnic pro-democracy resistance) and the Government of Burma have ordered their troops not to shoot.

A government negotiator says the “peace negotiations” with the Kachin could take three years.

http://www.irrawaddy.org/article.php?art_id=22913

Relevance to Burma of the economic advisors.

Dr. Ronald Findlay, in MIT’s doctoral program a student of the famous economist Paul Samuelson, was born and grew up in Burma.  His doctorate was in International Trade Theory.  According to Wikipedia he takes a political economy perspective.

http://en.wikipedia.org/wiki/Ronald_Findlay

and as a World Bank Research Observer in 1988 co-wrote “The State and the Invisible Hand”.

http://sipa.columbia.edu/academics/directory/ref2-fac.html

Wikipedia says of Stiglitz:

At the World Bank, he served as Senior VP and Chief Economist (1997 – 2000), in the time when unprecedented protest against international economic organizations started .  .  .  the Seattle WTO meeting of 1999.  He was fired by the World Bank for expressing dissent .  .  .

Stiglitz has advised American President Barack Obama, but has also been critical of the Obama Administration‘s financial rescue plan. Stiglitz said whoever designed the.  .  . bank rescue plan is “either in the pocket of the banks or incompetent.”

In addition, Stiglitz and Linda Bilmes wrote The Three Trillion Dollar War.

This is about the proverbial guns vs butter (or rice) argument, now more relevant than ever in a country like Burma or N. Korea.  Will we still pursue a nuclear program even though our people are starving and dying?  Why not?  There is no independent media and freedom of expression – so we can just control the “news” and say “There is no starvation etc in Burma.”

Stiglitz’s contributions include Information Asymmetry.

Information can be no more asymmetrical than in a dictatorship, where the dictator/junta controls all information, including economic information.  Stiglitz’s ideas are very relevant to both the Burmese economy and to (criticism of the Obama administration) that “there is too much government”.

Stiglitz wrote that  “Unemployment is driven by the information structure of employment”

I can’t find a job in the USA in 2012, because I have imperfect information about available jobs, I don’t know about all the jobs out there.  In Burma, because the junta and junta-related cronies know all the latest economic rules and regulations, in fact set them up themselves, they get all the plum jobs and employment and investment opportunities.  In 2004, a Burmese woman from a traditional business family in export said, “We only get what spills off the generals’ tables.”

According to the official invitation sent out by email, on the 11th, the three professors will talk about –

Stiglitz –Development strategies for inclusive and sustainable growth

Findlay – Prospects for Myanmar in the world economy of the 21st century.

H. Myint- Comments on rush to reform creates Myanmar burn outs.

I really look forward to who has been burned by the recent “Burma reforms.”

Banks and agents for foreign exchange outlets are complaining as there is no difference now between their exchange rate and the curbside rate, so they are in fact losing business and money with the large cache of foreign exchange that they accumulated, hoping for large profits.

In 1998 and again in 2008/9 Burmese exiles and overseas-based Burma experts tried to formulate visions for Burma’s new economic and democratic future

Now the Thein Sein administration, with the help of its advisors, is attempting to formulate its own new economic and political paradigm.

But it should be borne in mind that the reforms can reverse at any time, and right now are by no means comprehensive.