Why Myanmar could be the next Asian tiger
Dan Steinbock says special economic zones can boost nation's growth
After almost half a century of isolation, Myanmar could emerge as Asia's next tiger - with the right policies. After meetings with government representatives, senior executives and think-tank leaders in Myanmar, I spent some time exploring the beautiful nation.
In Yangon, Myanmar's window to the world, you quickly get an idea of the debilitated infrastructure, the poverty and the searing heat - and the ingenuity of ordinary people and their dream of a better future.
Economically, Myanmar has lost half a century of progress and prosperity
Since taking office, President Thein Sein has significantly improved Myanmar's ties with Washington and European countries, which has unleashed a rapid inflow of Western capital. In the Traders Hotel favoured by foreign executives, for example, the cheapest overnight stay costs more than US$300 - even as ordinary people struggle to live on US$1-US$2 per day.
The government has embarked on a series of bold reforms to direct the country toward democratisation, a mixed economy and reconciliation. With most international sanctions suspended and despite bitter ethnic tensions that continue to escalate, the reform momentum remains strong. However, the transition will take time and is not devoid of risks.
Economically, Myanmar has lost half a century of progress and prosperity. In the 1960s, it was a major rice exporter, with average prosperity 10 per cent higher than in China, as measured by GDP per capita. By the onset of the global crisis of 2008, average prosperity was 55 per cent lower than in China.
In the past four years, Myanmar's real gross domestic product has been growing at an estimated 5-6 per cent. In the next five years, it could sustain a growth rate of 6-8 per cent. But the starting-point is very low. Myanmar's per capita GDP is barely US$1,400, and nearly a quarter of the 48 million people live below the poverty line.
