History of Economic in Burma by otj20502

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									OFFICIAL NAME:
Union of Burma




Geography
Area: 678,500 sq km. (about the size of Texas).
Cities: Capital--Rangoon (pop. 5.5 million), Mandalay (pop. 700,000).
Terrain: Central lowlands ringed by steep, rugged highlands.
Climate: Tropical monsoon; cloudy, rainy, hot, humid summers (southwest monsoon,
June to September); less cloudy, scant rainfall, mild temperatures, lower humidity during
winter (northeast monsoon, December to April).

People
Nationality: Noun and adjective--Burmese.
Population (official 2003 est.): 52.17 million (UNFPA estimate), but no official census
has been taken since 1983.
Annual growth rate (2003 est.): 0.47%.
Ethnic groups: Burman 68%, Shan 9%, Karen 7%, Arakanese 4%, Chinese 3%, Mon 2%,
Indian 2%, other 5%.
Religions: Buddhist 89%, Christian 4% (Baptist 3%, Roman Catholic 1%), Muslim 4%,
animist 1%, other 2%.
Languages: Burmese, minority ethnic groups have their own languages.
Education (1999 est.): Literacy--male 92.60%; female 91.02% (2003 official Government
of Burma statistics); estimates of functional literacy are closer to 30%.
Health (2001 est.): Infant mortality rate—77 deaths/1,000 live births. Life expectancy—
54.22 yrs.: male; 57.9 yrs. female.

Government
Type: Military junta.
Constitution: January 3, 1974 (suspended since September 18, 1988 when latest junta
took power). A national convention started on January 9, 1993 to draft a new
constitution, but collapsed in 1996 without an agreement. The junta reconvened the
convention in May 2004 without the participation of the National League for Democracy
and other pro-democracy ethnic groups. The convention adjourned in July 2004 and is
scheduled to reconvene sometime in early 2005.
Branches: Executive--Chairman of the State Peace and Development Council (SPDC)
Senior General Than Shwe is the head of state. Prime Minister Lt. Gen. Soe Win is the
head of government. On October 19, 2004, former Prime Minister Khin Nyunt was
ousted by the SPDC senior leadership and replaced by Soe Win. Legislative--unicameral
People's Assembly (Pyithu Hluttaw) has 485 seats; members elected by popular vote to
serve 4-year terms. The last elections were in 1990, but the Assembly was prevented
from convening by the military. Judicial--Supreme Court. The legal system was based on
the British-era system, but now the junta rules by Decree and there is no guarantee of a
fair public trial; the judiciary is not independent.
Political parties: National League for Democracy (NLD) is the primary opposition party;
National Unity Party (NUP) is the primary pro-regime party; the Union Solidarity and
Development Association (USDA) is a pro-regime social organization; and other smaller
parties.
Administrative subdivisions: Seven primarily Burman divisions (tain) and seven ethnic
states (pyi nay); Chin State, Kachin State, Karen State, Karenni State, Mon State, Arakan
State, Shan State, Rangoon Division, Mandalay Division, Tenessarim Division,
Irrawaddy Division, Pegu Division, Magway Division, and Sagaing Division.
Suffrage: Universal suffrage at 18 years of age (but there have been no elections since
1990).

Economy
GDP (2004 est.): $11.7 billion (IMF figures).
Annual growth rate: actual rate is unknown, although the official 2003 rate was 13.4%.
GDP per capita (2004 est.): $225.
Natural resources: Timber, tin, antimony, zinc, copper, tungsten, lead, coal, limestone,
precious stones, natural gas, hydropower, and some petroleum.
Agriculture: Products--rice, pulses, beans, sesame, groundnuts, sugarcane, hardwood, fish
and fish products.
Industries: Types--agricultural processing, knit and woven apparel, wood and wood
products, copper, tin, tungsten, iron, construction materials, pharmaceuticals, and
fertilizer.
Recorded trade (2003 est.): Exports--$2.6 billion (natural gas – 25.3%, teak and forest
products 14.8%, garments 14.4%, beans and pulses 11.7%, and marine products 6.8%).
Major markets--Thailand 39%, India 17%, P.R.C. 10.6%, Singapore 6.4%, and Japan
5.7%. Imports--$2.4 billion (machinery and transport equipment 20.2%, refined mineral
oil 12.3%, base metals and manufactures 9.4%, artificial and synthetic fabrics 8.8%, and
plastic 4.6%). Major suppliers-- Singapore 28.8%, P.R.C. 21.4%, Japan 12%, Thailand
8.5%, and Malaysia 7%.

PEOPLE
A majority of Burma's estimated 52 million people are ethnic Burmans. Shans, Karens,
Arakanese, Kachins, Chins, Mons, and many other smaller indigenous ethnic groups
form about 30% of the population. Indians and Chinese are the largest immigrant groups.

Although Burmese is the most widely spoken language, other ethnic groups have retained
their own languages. English is spoken in the capital Rangoon and in areas frequented by
tourists. The Indian and Chinese residents speak various languages and dialects of their
homelands: Hindi, Urdu, Tamil, Bengali, Mandarin, Fujianese, and Cantonese.

According to the 1974 Constitution, Buddhism is the official religion of Burma. An
estimated 89% of the population practices it. Other religions, Christian 4%--Baptist 3%,
Roman Catholic 1%--Muslim 4%, and animist 1%, are less prevalent.

Much of the population lives without basic sanitation or running water. In 2000, the
World Health Organization (WHO) ranked Burma among the lowest countries worldwide
in healthcare delivery to its citizens. High infant mortality rates and short life
expectancies further highlight poor health and living conditions. The HIV/AIDS
epidemic poses a serious threat to the Burmese population, as do tuberculosis and
malaria. In 2004, the UNDP’s Human Development Index, which measures achievements
in terms of life expectancy, educational attainment and adjusted real income, ranked
Burma 132 out of 177 countries.

There are numerous documented human rights violations, and internal displacement of
ethnic minorities also is prevalent. Several million Burmese, many of them ethnic
minorities, have fled for economic and political reasons to the neighboring countries of
Bangladesh, India, China, and Thailand to seek work and asylum. More than 160,000
Burmese live in the nine refugee camps in Thailand and the two in Bangladesh while
hundreds of thousands of other Burmese work and reside illegally in the countries in the
region.



HISTORY
Burma was unified by Burman dynasties three times during the past millennium. The first
such unification came with the foundation of the Pagan Dynasty in 1044 AD, which is
considered the "Golden Age" in Burmese history. It is during this period that Theravada
Buddhism first made its appearance in Burma, and the Pagan kings built a massive city
with thousands of pagodas and monasteries along the Irrawaddy River. The Pagan
Dynasty lasted until 1287 when a Mongol invasion destroyed the city. Ethnic Shan rulers,
who established a political center at Ava, filled the ensuing political vacuum for a short
time.

In the 15th century, the Toungoo Dynasty succeeded again in unifying under Burman rule
a large, multi-ethnic kingdom. This dynasty, which lasted from 1486 until 1752, left little
cultural legacy, but expanded the kingdom through conquest of the Shans. Internal power
struggles, and the cost of protracted warfare, led to the eventual decline of the Toungoo.

The final Burman royal dynasty, the Konbaung, was established in 1752 under the rule of
King Alaungpaya. Like the Toungoo Kings, the Konbaung rulers focused on warfare and
conquest. Wars were fought with the ethnic Mons and Arakanese, and with the Siamese.
The Burmese sacked the Siamese capital of Ayuthaya in 1767. This period also saw four
invasions by the Chinese and three devastating wars with the British.

The British began their conquest of Burma in 1824, expanding their holdings after each
of the three wars. At the end of the third war in 1885 the British gained complete control
of Burma, annexing it to India. Under British control, which lasted until 1948, Burma
underwent enormous change. The British established strong administrative institutions
and reorganized the economy from subsistence farming to a large-scale export economy.
By 1939 Burma had become the world's leading exporter of rice.
Burmese nationalists, led by General Aung San and 29 other "Comrades," joined the
Japanese forces in driving out the British at the outbreak of World War II. However, the
Burmese Army switched sides in mid-1945 and aided U.S. and British forces in their
drive to Rangoon. After the war, the Burmese, with General Aung San at the helm,
demanded complete political and economic independence from Britain. The British
Government acceded to these demands. A constitution was completed in 1947 and
independence granted in January 1948. General Aung San was assassinated with most of
his cabinet before the constitution was put into effect.

During the weak constitutional period from 1948 to 1962 Burma suffered widespread
conflict and internal struggle. Constitutional disputes and persistent division among
political and social groups contributed to the democratic government's weak hold on
power. In 1958, the military was invited in temporarily by Prime Minister U Nu to restore
political order. The military stepped down after 18 months; however, in 1962 General Ne
Win led a coup abolishing the constitution and establishing a xenophobic military
government with socialist economic priorities. These policies had devastating effects on
the country's economy and business climate.

In March 1988 student disturbances broke out in Rangoon in response to the worsening
economic situation which evolved into a call for regime change. Despite repeated violent
crackdowns by the military and police, the demonstrations increased in size as the general
public joined the students. During mass demonstrations on August 8, 1988, military
forces killed more than 1,000 demonstrators. It was at a rally following this massacre that
Aung San Suu Kyi, the daughter of General Aung San, made her first political speech and
assumed the role of leader of the opposition.

On September 18, 1988, the military deposed Ne Win's Burmese Socialist Program Party
(BSPP), abolished the constitution, and established a new ruling junta called the State
Law and Order Restoration Council (SLORC). In an effort to "restore order," the SLORC
sent the army into the streets to suppress the ongoing public demonstrations. An
estimated additional 3,000 were killed, and more than 10,000 students fled into the hills
and border areas.

The SLORC ruled by martial law until national parliamentary elections were held on
May 27, 1990. The results were an overwhelming victory for Aung San Suu Kyi's
National League for Democracy (NLD) party, which won 392 of the 485 seats, even
though she was under house arrest. However, the SLORC refused to call the Parliament
into session and imprisoned many political activists.

The ruling junta changed its name to the State Peace and Development Council (SPDC)
in 1997, but did not change its policy of autocratic control and repression of the
democratic opposition. In 2000, the SPDC announced it would begin talks with the
political opposition led by Aung San Suu Kyi, who had been released once from house
arrest in 1995, only to be detained once more. These talks were followed by the release of
many political prisoners and some increase in political freedoms for Aung San Suu Kyi
and the NLD. On May 6, 2002, she was allowed to leave her home and subsequently
traveled widely throughout the country. On May 30, 2003, Aung San Suu Kyi and a
convoy of her supporters were attacked by a group of government-affiliated thugs. Many
members of the convoy were killed or injured and others remain unaccounted for. Aung
San Suu Kyi and other members of her party were detained, and the military government
forcibly closed the offices of the NLD. Although NLD headquarters is open, all the
party’s other offices remain closed and Aung San Suu Kyi and NLD Vice Chairman U
Tin Oo remain under house arrest.

On October 19, 2004, hard-line members of the senior leadership consolidated their
power by ousting Prime Minister Khin Nyunt and removing him and his allies from
control of the military intelligence apparatus. In late November 2004, the junta
announced it would release approximately 9,000 prisoners it claimed had been
improperly jailed by Khin Nyunt’s National Intelligence Bureau. As of early December
2004, it was unclear how many of the 9,000 had actually been released. However, of
those who have been released, fewer than 50 appear to have been prisoners held for their
political beliefs. One of those released was Min Ko Naing, a key figure in the 1988
demonstrations.

The central government has had a contentious relationship with ethnic groups calling for
autonomy or secession for their regions since the country's independence. In 1948, only
the capital city itself was firmly in control of the Rangoon authorities. Subsequent
military campaigns brought more and more of the nation under central government
control. Since 1990, the regime has signed a series of cease-fire agreements with
insurgent groups, leaving only a handful still in active opposition.

GOVERNMENT AND POLITICAL CONDITIONS
The Union of Burma (or Myanmar as it is called by the ruling junta) consists of 14 states
and divisions. Administrative control is exercised from the central government at
Rangoon through a system of subordinate executive bodies.

Power is centered on the ruling junta--the State Peace and Development Council, or
SPDC--which maintains strict authoritarian rule over the people of Burma. The Prime
Minister is appointed directly by the SPDC. Control is maintained through the strict
censuring of information, repression of individual rights, and suppression of ethnic
minority groups.

Today the SPDC continues its harsh rule and systematic human rights abuses. Any future
political transition will have to be negotiated among the SPDC, the political opposition,
and representatives of Burma's many ethnic minorities.

Although the SPDC changed the name of the country to "Myanmar," the democratically
elected but not convened Parliament of 1990 does not recognize the name change, and
the democratic opposition maintains use of the name "Burma." Due to consistent,
unyielding support for the democratically elected leaders, the U.S. Government likewise
uses "Burma."
Principal Government Officials
Chairman of the State Peace and Development Council--Senior General Than Shwe
Prime Minister--Lt. Gen. Soe Win
Minister of Foreign Affairs--Major General Nyan Win
Ambassador to the United States--U Linn Myaing
Ambassador to the United Nations--U Kyaw Tint Swe

Burma maintains an embassy to the United States at 2300 S Street NW, Washington, DC
20008, tel.: (202) 332-3344; fax: (202) 332-4351.

ECONOMY
Burma is a resource-rich country with a strong agricultural base. It also has vast timber
and fishery reserves and is a leading source of gems and jade. Tourist potential is great
but remains undeveloped because of weak infrastructure and Burma's international
image, which has been damaged by the junta's human rights abuses and oppression of the
democratic opposition. The economy has been affected by U.S. sanctions, including 2003
bans on the importation of Burmese products into the U.S. and the export of financial
services from the U.S. to Burma.

Long-term economic mismanagement under military rule has prevented the economy
from developing in line with its potential. Burma experienced 26 years of socialist rule
under the dictator, General Ne Win, from 1962-1987. In 1988 the economy collapsed,
and pro-democracy demonstrators took to the streets. The military government violently
put an end to the civil unrest and pledged to move toward a market-based economy.
Although some aspects of economic policy have changed, the state remains heavily
involved and additional, much needed reforms have not been forthcoming.

The regime's mismanagement of the economy has created a downward economic spiral.
The vast majority of Burmese citizens now subsist on an average income that equates to
about $225 per capita. Inflation, caused primarily by public sector deficit spending,
stagnant wages, and the eroding value of the local currency (the kyat) have undermined
living standards. The limited moves to a market economy have been accompanied by a
significant rise in crony capitalism. A handful of companies loyal to the regime has
benefited from policies that promote monopoly and privilege.

Agriculture, light industry, and transport dominate the private sector of Burma’s
economy. State-controlled activity predominates in energy, heavy industry, and the rice
trade. The military, through its commercial arms, also plays a major role in the economy.

Burma remains a primarily agricultural economy with 54% of GDP derived from
agriculture, livestock and fisheries, and forestry. Manufacturing constitutes only 9% of
recorded economic activity, and state industries continue to play a large role in that
sector. Services constitute only 8% of GDP.

Foreign investment increased markedly in the early to mid-1990s, but has declined
precipitously since 1999 due to the increasingly unfriendly business environment and
mounting political pressure from Western consumers and shareholders. The government
has tried hard to conserve foreign exchange by limiting imports and promoting exports.
Published estimates of Burma's foreign trade (particularly on the import side) are greatly
understated because of the volume of off-book, black-market, illicit, and unrecorded
border trade.

In the near term, growth will continue to be constrained by poor government planning
and minimal foreign investment. A number of other countries, including member states of
the European Union, Canada, Australia, Japan, and Korea, have joined the United States
in applying some form of sanctions against the regime.

Government economic statistics are unavailable or very unreliable. According to official
figures, GDP growth has been over 10% annually since FY 1999-2000. However, the real
numbers are likely much smaller. Burma's top export markets include Thailand, India,
China, and Singapore. Burma's top export commodities include clothing, natural gas,
wood and wood products, and fish and fish products.

Burma was the world's second-largest producer of illicit opium in 2003. Burma also has
been the primary source of amphetamine-type stimulants in Asia, producing hundreds of
millions of tablets annually. The Burmese Government has committed itself in recent
years to expanded counternarcotics measures.

FOREIGN RELATIONS
During the Cold War, Burmese foreign policy was grounded in principles of neutrality,
often tending toward xenophobia. Since 1988, however, Burma has been less
xenophobic, attempting to strengthen regional ties. It now is a member of the Association
of Southeast Asian Nations (ASEAN), Bangladesh, India, Myanmar, Sri Lanka, and
Thailand Economic Cooperation (BIMSTEC), and several other regional organizations
and initiatives.

Burmese-Thai relations have been tainted by a long history of protracted border conflicts,
sporadic hostilities over narcotics trafficking, Burmese insurgents operating along the
Burmese-Thai border, and the large number of Burmese who cross the border to work
illegally or claim refugee status. In fact, the Burmese Government closed the Burma-Thai
border for several months during the summer of 2002. However, official and unofficial
economic ties between the two nations are significant, and the current Thai and Burmese
Governments seem eager to reach a new, more cooperative, level in their bilateral
relations. Despite their often-contentious history, Burma and China have grown closer in
recent years, though most Burmese remain suspicious of China's economic influence.
China is quickly becoming Burma's most important partner, offering debt relief,
economic development grants, and soft loans used for the construction of infrastructure
and light industry. China also is purportedly Burma's major supplier of arms and
munitions. Burma’s ties with India are also growing.
In 2004, the junta continued to refuse requests by UN Secretary General Kofi Annan’s
Envoy Razali Ismail and the UN Commission on Human Rights Special Rapporteur for
Human Rights Paulo Sergio Pinheiro to visit the country.

Burma is involved in the Asian Development Bank's (ADB) Program of Economic
Cooperation in the Greater Mekong Subregion. As such, it participates in regional
meetings and workshops supported by the ADB. Burma joined ASEAN in 1997, and has
participated in that regional forum, even hosting a number of seminars, conferences, and
ministerial meetings. Burma is scheduled to take over the rotating chairmanship of
ASEAN in 2006. Due to difficulties in reforming its economic and trading system,
Burma has requested extensions on compliance with the ASEAN Free Trade Agreement
(AFTA). As one of ASEAN's least developed members, Burma also has an extra five
years (until 2008) to comply with most of AFTA's liberalization requirements. Burma
also is a member of the World Trade Organization.

Most Western foreign aid ceased in the wake of the suppression of the democracy
movement in 1988. The World Bank reports that aid now represents only about $2 per
capita (compared with $53 per person in Laos and $33 per person in Cambodia).
According to the United Nations, official development assistance totaled only $76 million
in 2000. Burma receives grants of technical assistance (mostly from Asia), limited
humanitarian aid and debt relief from Japan and China, and concessional loans from
China and India.

Burma became a member of the International Monetary Fund (IMF) and World Bank in
1952, the International Financial Corporation (IFC) in 1956, the International
Development Association (IDA) in 1962, and the ADB in 1973. Since July 1987, the
World Bank has not made any loans to Burma. Since 1998 Burma has been in non-
accrual status with the Bank. The IMF performs its mandated annual Article IV
consultations, but there are no IMF assistance programs. The ADB has not extended
loans to Burma since 1986. Technical assistance ended in 1988. Burma has not paid its
loan service payments to the ADB since January 1998. Burma's total foreign debt now
stands at over $6 billion.

U.S.-BURMESE RELATIONS
The political relationship between the United States and Burma worsened after the 1988
military coup and violent suppression of pro-democracy demonstrations, and remains
estranged.

The United States has imposed broad sanctions against Burma. Many of the sanctions in
place are applied under several different legislative and policy vehicles. In 2003, the
Congress adopted and the President signed into law the Burma Freedom and Democracy
Act (BFDA), which includes a ban on imports from Burma, a ban on the export of
financial services to Burma, a freeze on the assets of certain Burmese financial
institutions and extended visa restrictions on Burmese officials. Congress renewed the
BFDA in July 2004.
In addition, since May 1997, the U.S. Government has prohibited new investment by
U.S. persons or entities. However, a number of U.S. companies exited the Burma market
even prior to the imposition of sanctions due to a worsening business climate and
mounting criticism from human rights groups, consumers, and some shareholders
because of the Burmese Government's serious human rights abuses and lack of progress
toward democracy. The United States has also imposed countermeasures on Burma due
to its non-compliance with the recommendations of the Financial Action Task Force on
money laundering.

For its particularly severe violations of religious freedom, the United States has
designated Burma a Country of Particular Concern (CPC) under the International
Religious Freedom Act.

The United States downgraded its level of representation in Burma from Ambassador to
Chargé d'Affaires after the government's crackdown on the democratic opposition in
1988.

Principal U.S. Embassy Officials
Chief of Mission--Carmen Martinez
Deputy Chief of Mission--Ronald McMullen
Political/Economic Affairs Officer--W. Patrick Murphy
Public Affairs Officer--Mary Ellen Countryman
Consul--Kerry Brougham

The U.S. Embassy in Burma is located at 581 Merchant Street, Rangoon (GPO 521)
mailing address: Box B, APO AP 96546, tel: [95] (1) 379880; fax: [95] (1) 256018.

								
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