A WALK AROUND battered, ramshackle Yangon, Myanmar’s biggest city and former capital, quickly makes it clear how far the country has fallen behind the rest of Asia over the past half-century. In large part the place is but a ghostly reminder of former glories. Under British colonial rule, before independence in 1948, Rangoon (as it was then) was a thriving, cosmopolitan entrepot, the capital of Burma, one of the region’s wealthiest countries. All that came to an abrupt end in 1962 after a junta of army officers, led by the brutal General Ne Win, seized power and launched the country on the quasi-Marxist “Burmese Way to Socialism”. Private foreign-owned businesses were nationalised, prompting the exodus of hundreds of thousands of people, many of Indian origin. The country’s tenuous attachment to democracy was broken. Myanmar, as Burma was later renamed by its ruling generals, retreated into itself. Comprehensive Western sanctions hit home from the mid-1990s onwards, only slightly alleviated by an injection of Asian money.
Yangon, with its old cars and bookshops selling textbooks from the 1950s, attests to this seclusion. The colonial-era banks, law courts and department stores, once as imposing as any in Kolkata or Shanghai, have all but crumbled away. Except for the magnificent Shwedagon Pagoda, lovingly regilded to welcome the crowds of pilgrims and tourists, most of the city seems to have remained untouched for decades. Even youthful rebellion is stuck in a time-warp. Boys are still gamely attempting to flout authority by dressing up as punk-rockers.
But now the country has seen another about-turn, almost as abrupt as that in 1962. Over the past two years dramatic reforms introduced by a new president, Thein Sein, prompted by the country’s increasingly desperate economic straits, have started a rapid transition from secretive isolation to an open democracy of sorts. The mere fact of such a change taking place has surprised the world; its speed and breadth have caused widespread bewilderment.
Even in careworn Yangon the signs are everywhere. The pavements are cluttered with traders selling an array of newspapers, newly licensed and privately owned, carrying pictures of Aung San Suu Kyi, the leader of the National League for Democracy (NLD). Less than two years ago the image of the defiant Nobel peace-prize laureate was banned; under a strict censorship system her name could not even be mentioned in the press. Now all censorship before publication has been lifted; any paper, such as the NLD’s own newspaper D Wave, can apply to publish daily; and Miss Suu Kyi’s photo festoons T-shirts, mugs and biros for sale on almost every street corner. People are still excited about being able to speak freely, even about politics, without constantly having to look over their shoulders. Some of those interviewed for this special report had never before talked to a foreigner, let alone a foreign journalist.
With greater political freedom has come economic change. Almost all Western sanctions against the country have been lifted, and the country is swiftly reconnecting with the international financial system. Visitors no longer have to wander around with so many wads of dirty old kyat, the local currency, in their pockets: the first international ATM in Yangon has recently started disgorging fresh banknotes. Some outlets are now accepting credit cards. Real Western brands, rather than pirated versions, are about to appear in a few shops. An influx of relatively wealthy foreigners and returned natives will need new offices and apartments. Prime parts of Yangon are rapidly being flattened to cater for the expected demand.
Myanmar’s transformation is the most significant event to have taken place in South-East Asia in the past decade, and this special report will argue that it will have important consequences for the rest of Asia as well. In the space of just a few years almost every aspect of life has been touched by the reform programme. Not only was Miss Suu Kyi released from house arrest in November 2010, but the vast majority of the country’s thousands of political prisoners have been freed. The NLD, harassed for decades and then declared illegal for refusing to participate in rigged elections in 2010, is legitimate once more. In April 2012 it won 43 out of 44 seats it contested in by-elections, the country’s first free and fair polls since the 1950s: its MPs, led by Miss Suu Kyi, now sit in parliament.
The blacklists barring former political opponents of the regime and “hostile” journalists have been put away. A new labour law covering private industry has encouraged the formation of new trade unions. Once a byword for bleak authoritarianism, Myanmar is now doing better than some of its Asian peers on civil and political rights.
International financial institutions such as the World Bank have returned, often after writing off the country’s old debts. Thein Sein now tours the world’s capitals much like any other leader, even if he does not get the rapturous welcome given to Miss Suu Kyi wherever she goes. And this December Myanmar celebrates its return to regional respectability by hosting the South-East Asian Games for the first time since the 1960s.
Foreign governments and multinationals have converged on a country that occupies a unique geostrategic position between the new Asian superpowers of India to the west and China to the east. Private companies are jostling to capture a share of an almost virginal consumer market of some 60m people. This special report will weigh the pros and cons of rushing into what investors are calling “the final frontier”.
Don’t cheer too soon
The new sense of optimism and confidence among Myanmar’s own people is still tinged with caution. Hopes in the past have been raised by modest doses of liberalisation, only to be dashed again. It is also clear that in easing military control, Myanmar’s reformers have provided an opening for dark forces that authoritarian rule had kept in check. Since June 2012, starting in the city of Sittwe in western Rakhine state, Buddhist mobs have killed hundreds of Muslims and razed their mosques and homes to the ground. It was not what the reformers had intended, but the effects of relaxing restrictions can be unpredictable.
The first two months of 2013 also saw the heaviest fighting yet between the Myanmar army and the Kachin Independence Army (KIA), an armed militia of the Kachin people. Like many of the other ethnic minorities that make up about 40% of Myanmar’s population, the Kachin, in the far north of the country, have been battling for decades for autonomy and against majority Burman rule. For all the past two years’ economic and political progress in the Burman heartlands in the centre of the country, much of the periphery remains largely cut off and in a state of, at best, suspended hostilities.
Thein Sein’s government has signed ceasefire agreements with most of the armed groups, but a lasting political solution still seems a long way off. It will require proper citizens’ rights to be granted to the country’s entire population, including marginalised people like the Rohingya Muslims, which all of Myanmar’s rulers since independence have neglected to do. This special report will argue that the current period of upheaval is the best possible opportunity to resolve these ethnic disputes. The Economist