Democratic Voice of Burma

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• World Bank lauds Burma’s growth, but warns against inflation
• Shan dam causes waves
• Magwe rice paddies destroyed by floodwaters
• Dr Cynthia in ‘shock and pain’ after losing Australian funding
• Thai govt tries to breathe life into Dawei

World Bank lauds Burma’s growth, but warns against inflation Posted: 07 Nov 2013 04:39 AM PST The World Bank says that Burma's economy is projected to grow at 6.8 percent in 2013/14, rising to 6.9 percent in the medium term. However, it raised concerns about the country's inflation which hit 7.3 percent in August. In its first edition of the Myanmar Economic Monitor (MEM) on 6 November, the World Bank reported that Burma's growth in 2012/13 was "strong" at 6.5 percent driven mainly by performances in gas production, services, construction, foreign direct investment, and commodity exports. "The outlook is positive, with the economy projected to grow at 6.8 percent in 2013/14 and rising further to 6.9 percent in the medium- Term," the MEM said. "This will be on account of a continued increase in gas production, increased trade, and stronger performance in agriculture." It also indicated that the outlook in the short to medium term "remains positive, although there are risks, both on the domestic as well as external fronts." The report noted that inflation has been on the rise in recent months, reaching 7.3 percent in August, on account of increasing food and housing rental costs. "Rising inflation is always a cause for concern since it hurts the poor disproportionately, but economies do sometimes experience rising inflation, especially when in transition as is the case in Myanmar [Burma]," said May Thet Zin, the World Bank's country economist for Burma. "However, there is no cause for alarm yet because inflation remains in single digits in Myanmar. Nonetheless, it will be important for the authorities to keep a close eye on the situation so that it does not get out of hand." Related Stories Business Weekly China defends human rights record at UN panel Income inequality in Burma Burmese economic expert Aung Ko Ko said that inflation causes a hike in commodity prices while forcing suppliers to reduce production, inflicting losses on the country's economy. "Inflation is a significant issue that can be caused by the financial deficit which our country has been experiencing. It is important to bring it under control," he told DVB. "Because of inflation, we have to spend more in the financial sector. That's why our economy has not developed as it is should have." He said that Burma's neighbour China was able to keep inflation below three percent during its economic transition, which allowed investors to weigh up both short-term and long-term prospects. Aung Ko Ko suggested that Burma should aim to rein in inflation to under five percent, noting that to do so would signify the government's ability to manage its economy well. Another economic expert, Maung Maung Soe, was somewhat more scathing however. He said that although Burma practices a market economy, the inflation was not simply caused by changes in supply and demand, but that the Burmese government was responsible for interference. "The government is one of the responsible parties for this inflation," he told DVB. "It was they who decided to increase electricity fees and fuel prices, two sectors controlled by their cronies. If fuel prices go up, then inflation goes up; and it is usually the public who have to endure all the negative consequences." The World Bank report on Wednesday also noted that in recent months the exchange rate of the kyat has been depreciating, which helps to make Burma's exports more competitive. "However, these indicators appear to have started appreciating in August, which could erode Myanmar's export competitiveness," the report said. The MEM also noted that the various reforms recently undertaken by Naypyidaw appropriately focus on improving the environment for business in the country. "These include the removal of import and export licensing requirements on some 600 products, the approval of new regulations on foreign investment to provide greater clarity to some aspects of the new Foreign Investment Law enacted last year, the granting of licenses to private insurance companies for the first time in 50 years, and the enactment of the anti-corruption law, just to mention a few," the report said. The MEM follows a report issued less than two weeks ago which rated Burma as among the worst places in the world to do business. In its annual "Doing Business" report, the bank ranked Burma 182 out of 189 countries studied, citing its poor regulatory environment and limited protection for investors as key obstacles. "Foreign investors have flooded the country following the stripping of western economic sanctions," the 28 October report said, but warned that "archaic laws and bureaucratic systems may stifle entrepreneurship." The report said there was "considerable scope" for reform but praised government efforts to improve business regulations, including introducing corporate tax breaks under the 2012 Foreign Investment Law.

Shan dam causes waves Posted: 07 Nov 2013 02:48 AM PST Residents from 23 villages in southern Shan state, who have been relocated to make way for the Upper Paunglaung Dam project, have urged the government to keep its promise in providing them with compensation and basic facilities in their new location. Around 8,000 villagers from Pin Laung township which sits along the Paunglaung River, a tributary of the Sittaung River, were relocated after plans were announced to construct a massive hydropower dam on the river. At a press conference in Rangoon on 4 November, their representatives voiced their disappointment with the government for failing to keep a promise: to provide them with adequate compensation, and access to electricity and drinking water in their new locations; and to build roads for better transportation between the villages. "They didn't pay us compensation for our farmlands, only for the crops," said Nyunt Win, a villager from Kyaungkabar village. "As farmers who make a living from and cherish the land we inherited from our ancestors, we are calling on all parties to consider our rights." Related Stories Shan locals petition against Thai coal mining company Thilawa residents draw lots for 'substitute' lands Namhkam festival cancelled in wake of bombings The Burmese government previously pledged 20 billion kyat (US$20 million) in compensation for the villagers. However, many farmers were later dismissed from compensation claims when they could not provide the necessary paperwork, such as householder lists and land deeds. A student from Pin Laung said the villagers were living in hardship due to poor transportation access and a shortage of clean water to drink. "Some people have died because it takes so long to get to the hospital," said the young woman. "We also need wells and additional compensation." Meanwhile, the Kayan New Generation Youth civil society group said it will send a letter to the Burmese president urging him to help ensure the villagers receive the compensation they were promised. The 140 megawatt dam, being constructed with assistance from Swiss-based AF-Colenco Ltd and UK-based Malcolm Dunstan and Associates, is scheduled to be completed in 2014. The Paunglaung River region is inhabited by Pa-O, Karenni and Burman peoples, most of whom make a living as farmers. Nearly 2,500 households and 12,000 acres of farmland were forcibly confiscated to make way for the dam which, when completed, will submerge the entire Paunglaung valley.

Magwe rice paddies destroyed by floodwaters Posted: 07 Nov 2013 02:34 AM PST More than 2,000 acres of rice paddies have been destroyed by storms and heavy rains which submerged farmlands in Magwe division's Pwintbyu township during the last week of October. Farmers in the village tracts of Legai, Hpalantaw, Kanswe and Kyauksitpon told DVB said they will be unable to make an income this season as the rice was almost ready to harvest when the storms hit. They say they face further financial headaches because many are expected to repay agricultural loans. "We will have a tough time repaying our bank loans when they are due as we won't be making any profit from our farms this year – we don't know how we will deal with it," said a local farmer. Related Stories Stop arresting farmers, says 88 Generation China, India look to Burma's abundant rice fields Parliament approves farmers' bill Another said that the moisture left behind in the soil by the floodwaters will also hinder growth of any winter crop, the most common of which in Magwe is chick peas. "For now, we cannot plant seeds because of the amount of moisture in the soil," said a local farmer. "We will have to wait and see if it dries out by the end of the month." The affected farmlands were recently inspected by Magwe division's Chief Minster Phone Maw Shwe, however he made no comments with regard to the farmers' concerns. Total foreign investment in Burma reached a record US$1.6 billion for the first six months of this fiscal year, more than the $1.4 billion that was invested during the entire 12 months of 2012-13. However, a meager 0.43 percent of that figure was spent on the agricultural sector.

Dr Cynthia in ‘shock and pain’ after losing Australian funding Posted: 07 Nov 2013 01:41 AM PST The Australian government has announced that it will cut its 13 million baht (US$420,000) funding for the renowned Mae Tao Clinic, which has provided life-saving treatment to Burmese migrants and refugees on the Thai-Burma border for more than 25 years. The news comes on the same week that its founder Dr Cynthia Maung received the prestigious Sydney Peace Foundation prize in recognition of her tireless humanitarian work spanning several decades. The award is dedicated to people "whose life and work has demonstrated significant contributions to the promotion of human rights, peace and justice", with past recipients including Archbishop Desmond Tutu and Prof Noam Chomsky. Dr Cynthia, who set up the clinic shortly after the 1988 military crackdown in Burma, said she hoped that the award would draw greater international attention to the plight of ethnic minorities in Burma. But according to a report in Karen News, she expressed personal "shock and pain" at the news that the Australian government has subsequently decided to terminate its funding to the clinic by the end of the year. Their annual contribution has made up nearly a quarter of the clinic's income, funding programmes on HIV care, child health and training for midwives. Dr Cynthia insists that cutting funding is premature and places thousands of lives at risk. Related Stories Mae Tao Clinic to relocate Mae Tao Clinic snubs gov't request to return to Burma Gov't peace team visits Mae Tao Clinic "Australia should be scaling up support for community health networks, rather than abandoning them," she told Karen News. "Cutting vital health services to the ethnic peoples is not the way to build trust in Burma's peace process." In 2012, the clinic recorded over 150,000 patients, mainly migrant and refugee populations who do not have access to healthcare services in Thailand or Burma. Thousands of people make the perilous journey across eastern Burma by foot, navigating conflict zones and landmines to reach its doors. But the Australian government is redirecting its development aid into mainland Burma, where a series of democratic reforms have won international praise. "The government is encouraging the refugees [to] return from the border area and want projects that support that overall policy," Kate Lee, executive officer of Union Aid Abroad, the clinic's Australian partner organisation told Devex. Several donor countries and organisations have already slashed funding for aid groups operating on the Thai-Burma border, squeezing essential services and care. Some 130,000 refugees, mainly from Burma's ethnic Karen population, are estimated to live in camps in western Thailand. But even though Karen rebels and the government have inked tentative peace deals, locals say it is too early to begin repatriating refugees – the vast majority of whom say they don't want to return to Burma. "There have been ongoing ceasefire talks, but on the ground … people are still suffering, [and have no access] to health services," Dr Cynthia told Radio Australia. "Education and protection issues are still not addressed." Burma currently spends less than 4 percent of its annual budget on healthcare, compared to some 20 percent on the military. Poverty in rural areas has been identified as a leading cause of child deaths in Burma, where over 56,000 children under the age of five die every year.

Thai govt tries to breathe life into Dawei Posted: 06 Nov 2013 08:47 PM PST The Thai government has named a special task force headed by Energy Minister Pongsak Raktapongpaisal in its latest move to kick-start the massive Dawei project in eastern Burma. Thai Deputy Prime Minister and Commerce Minister Niwatthamrong Bunsongphaisan said Mr Pongsak will lead a team to Burma today [7 November] together with officials from the Finance and Interior Ministries and the National Economic and Social Development Board. The visit is aimed at settling issues with the project before a meeting of the Joint Coordinating Committee in Bangkok later this month, said Mr Niwatthamrong, who also chairs the JCC. Related Stories Business Weekly Thai pharmaceutical company steps up Burma presence Business Weekly A Thai Government House source said the government has asked Mr Pongsak to push for progress in the stalled project. “Project development has been stuck because of different ideas between Italian-Thai Development Co’s Dawei Development Co (DDC) and the Burmese government,” the source said. ITD, Thailand’s biggest contractor by market value, has been granted the concession to develop a deep-sea port and special economic zone in Dawei, also known as Tavoy. As energy minister, Mr Pongsak will play a significant role in the Dawei project, as the government wants Thai state-owned enterprises to invest in power plants to supply industrial projects in Dawei. Thailand and Burma initially agreed to carry out the first two projects -­ a small port and a road linking the Thai border to the site in Dawei. DDC, which was set up by ITD to develop the Dawei project, wants the port and road to be part of Dawei SEZ Development Co. But the idea is opposed by the Burma government, which says DDC must ask for a licence from concerned agencies. DDC also plans to develop 28,000 rai (11,000 acres) as an industrial estate, but Burma wants a first phase of 6,000 rai developed first. The source said the JCC meeting on 21 November could be postponed if the task force is unable to settle the two pending issues. Mr Pongsak will ask Burma to allow investment in the project without waiting for Dawei SEZ Development Co to be established. Thailand and Burma have yet to sign an agreement setting up the company. The two countries have proposed Japan as a third partner in the concern. But Japan has not made a decision on the issue and has asked for more time to study the feasibility of the project. Meanwhile, Burma has agreed to seek loans from the Asian Development Bank to develop infrastructure for the Dawei project.   This article was first published in the Bangkok Post on 7 November 2013.

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