Nobel Prize winner Aung San Suu Kyi’s NLD Party has just won a landslide victory, marking a crucial turning point for a country whose military alone has called the shots for half a century. Now, the military-backed USDP will have to share power, but that could mean some uncertainties for foreign investors, at least in the short run.
Ironically, many foreign investors did not object when the outgoing regime of Thein Sein was in charge, despite ongoing problems with human rights and freedom of speech and press. But now it remains unknown whether the NLD will make foreign investment a major priority, and what the NLD’s policies on the economy will look like.
“You had a road map, you knew exactly what they wanted (under the former government). With the NLD all this is much less fully formed and much more opaque,” Richard Cockett, author of the new book “Blood, Dreams and Gold, the Changing Face of Burma,” told Borderless.
He contended that the NLD’s economic team is not particularly good and noted that there is no designated finance minister yet.
“There’s nobody to call up and ask about all this,” he said. “A lot of investors find this very frustrating and off putting” he said.
While Myanmar remains underdeveloped, the country has seen a surge of foreign investment of around 20 fold to around $8 billion since its economy opened up five years ago after decades of isolation.
While both parties want foreign investment, Aung San Suu Kyi will be expected to ensure investment that does not infringe on peoples’ rights. Her party will have to make sure land is not being improperly confiscated from smallholder farmers and that social and environmental protections are in place for resource extraction projects, Christina Fink, professor of practice in international affairs at George Washington University, told Borderless.
But Cockett said key is where the balance between rights and business regulations are drawn. Will the new government construct a business environment that is so overladen with regulations and environmental concerns that it dissuades foreign investments from coming in? Or will there be absolutely no regards to environmental concerns or labor rights, as has often happened in the past? Or somewhere in between?
Cockett, also a correspondent for The Economist, said the NLD’s plans for the economy are more obscure and certainly less developed than those of the military. Aung San Suu Kyi and the NLD have given little indication on how she views foreign investment in Myanmar, aside from producing a brief document on the economy, he noted.
Moreover, critics have blasted Aung San Suu Kyi for failing to build a fully developed party that is ready to govern, as nothing gets done without her personal involvement, and that could hinder the party’s efforts on numerous fronts going forward.
On the other hand, the NLD having achieved what it set out to do – i.e. win the election –may now quickly shift gears from politics and elections to focus on the economy, some experts surmised.
But at least for now, they two parties seem to diverge on the type of legislation they are prioritizing.
The NLD would like to amend the constitution, but the military has been opposed to the constitutional amendments that were proposed in the last couple of years. These included changing the requirements for who can become president – i.e. making it possible for Aung San Suu Kyi to become president, as she is barred on grounds that her sons are British – and removing the military’s veto power over amendments. They also included allowing chief ministers of the ethnic state governments to be elected rather than appointed by the president, Fink said.
The NLD cannot change the constitution without support from military members of parliament, so this could be a big challenge, Fink said.
Aside from all these issues, there remains the unresolved problem of the Specially Designated Nationals (SDN) list, which bans American companies from business involvement with those on the list, who stand accused of human rights infringements and corruption. Many American companies would like to see these restrictions lifted, as many of those on the list have tentacles throughout the whole of Myanmar’s economy, and Cockett argued the list stymies investment.
The United States has said that if the generals cooperated with the transfer of power in Myanmar, then Washington would look again at the list.
“I think if the transition is smooth… then I think you’ll see some of those sanctions being softened or even withdrawn,” Cockett said.
The views expressed are solely those of the interviewee(s) and not necessarily those of Borderless News Online or any person or organization associated with Borderless News Online.
All content on this website belongs exclusively to Borderless News Online and is copyrighted and may not be re-printed, re-written or re-distributed in any form without the express written consent of Borderless News Online.
The article may be cited, but the citation MUST include a link to this article on this website.
No material may be fully re-printed or re-broadcast without the written permission of Borderless News Online.
