Myanmar was for years a country by, of and for the military. In 2011, the military junta officially dissolved itself, opening the way for a democratic transition under the government of President Thein Sein, a former general. A central policy of the regime is to attract foreign investment into the impoverished country, whose national product amounts to $2 to $3 a day per person for a population of more than 60 million. At issue now is whether Myanmar’s transition will be more than a ploy to draw in foreign money to fatten the military.
The military junta had run an isolationist foreign policy and Soviet-style economic planning with disastrous consequences. In the late 1990s, the United States, Europe, Japan and others imposed economic sanctions on Myanmar for its gross violation of human rights. The sanctions eventually led to the dissolution of the military junta, accompanied by the promise of press and other freedoms, as well as the release of political prisoners, notably Daw Aung San Suu Kyi, the pro-democracy activist and 1991 Nobel Peace Prize laureate.
Since then, Myanmar has established substantially more open foreign investment laws. The Asian Development Bank opened an office there last year. And foreign investors, including many garment manufacturers, have been lured by very low labor costs to set up shop. Still, a quarter of government expenditure goes to the military, and expenditures for education and health are negligible. Most of the local partners that foreign investors team up with are companies run by the military. And the military still appoints a quarter of the members of Parliament.
Basic infrastructure — like roads, airports and the electricity grid — is woefully inadequate, and the military is clearly expecting foreign investments. But as they consider such investments, the primary investor states — the United States, Europe, Japan — must make sure that they are not merely enabling a transition from a military dictatorship to military-run crony capitalism.
