Myanmar (Burma)

COUNTRY PROFILE 2000

Myanmar (Burma)

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Comparative economic indicators, 1999

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Contents

3 Basic data

4 Political background 4 Historical background 7 Political forces 10 Constitution and institutions 11 International relations and defence

13 Resources and infrastructure 13 Population 15 Health 16 Education 16 Natural resources and the environment 17 Transport and communications 19 Energy provision

20 The economy 20 Economic structure 22 Economic policy 26 Economic performance 28 Regional trends

29 Economic sectors 29 Agriculture, forestry and fishing 31 Mining and semi-processing 32 Manufacturing 34 Construction 34 Financial services 36 Other services

37 The external sector 37 Trade in goods 41 Invisibles and the current account 42 Capital flows and foreign debt 43 Foreign reserves and the exchange rate

45 Appendices 45 Regional and other organisations 45 Sources of information 46 Reference tables 46 Population estimates 47 Employment by sector 47 Labour force 47 Transport statistics 48 National energy statistics 48 Government finances 49 Money supply, credit and interest rates 49 Gross domestic product 50 Gross domestic product by expenditure 51 Gross domestic product by sector 51 Consumer price index

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51 Output and yields of key crops 52 Production of livestock and fish 52 Timber production 53 Minerals production 53 Manufacturing production 54 Construction and renovation work 54 Banking statistics 54 Tourist arrivals and receipts 55 Exports 55 Imports 56 Key exports and imports (volume) 56 Main trading partners 57 Direction and composition of trade 57 Balance of payments, IMF series 58 Balance of payments, national series 59 External debt 59 Net official development assistance 60 Foreign reserves 60 Exchange rates

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Myanmar (Burma)

Basic data

Land area 676,577 sq km

Population 45.1m (mid-1999/2000 estimate)

Main towns Population in ‘000 (1983 census)

Yangon (capital) 2,513 Pegu 320 Mandalay 533 Moulmein 220

Note. In the text, places are referred to by their pre-1989 names, apart from Yangon and Myanmar. Pre-1989 names appear in brackets on the map at the beginning of this report

Climate Subtropical

Weather in Yangon Hottest month, April, 24-36°C; coldest month, January, 18-23°C; driest month, (altitude 5 metres) January, 3 mm average rainfall; wettest month, July, 582 mm average rainfall

Languages Burmese; numerous other minority languages are also in use, such as Karen and Shan

Measures UK (metric) system. Some other units are in use, for example 0.9842 long or imperial tons=1 metric tonne=1.10231 short tons. Some local measures include: 1 lakh=100,000 units; 1 crore=10,000,000 units; 1 viss or peiktha=100 ticles=1.6 kg; 1 basket (paddy)=20.9 kg; 1 basket (rice)=34 kg

Currency 1 kyat (Kt)=100 pyas. Average official exchange rate in 1999: Kt6.3:US$1; in fiscal year 1999/2000: Kt6.3:US$1; in first eight months of 2000: Kt6.4:US$1. Average free-market exchange rate in 1999: around Kt340:US$1; in 1999/2000: around Kt342:US$1; in first eight months of 2000, around Kt350:US$1 (free- market exchange-rate data are approximate, based on exchange rates in the first week of each month) Note. In the text, US dollar conversions are given at the official exchange rate followed by the free-market exchange rate

Time 6.5 hours ahead of GMT

Fiscal year April 1st-March 30th

Public holidays, 2001 January 4th (Independence Day); February 12th (Union Day); March 2nd (Peasants’ Day); March 10th (Dry Season Celebration); March 27th (Armed Forces’ Day); mid-April (New Year); May 1st (Workers’ Day); July 19th (Martyrs’ Day); December 25th (Christmas Day); plus other religious holidays such as Diwali and end of Ramaddan (Eid el Fitr) that depend on lunar sightings

Political background

Myanmar’s current ruling military junta came to power in 1988 following widespread pro-democracy protests. The main opposition party, the National League for Democracy (NLD), won the last election, held in May 1990. However, the results were not recognised by the junta, and no parliament was ever convened. The junta has ignored international pressure for dialogue with the NLD, and has attempted to sideline the NLD as a political force. Yet public opposition to the junta remains widespread. The junta also faces armed resistance from a number of ethnic minority groups seeking greater autonomy and an end to brutal suppression by the junta.

Historical background

From colony to On January 1st 1886 Burma (as Myanmar was known until the current junta independent country changed the country’s name in 1989) came under British control, after three Anglo-Burmese wars. A nationalist backlash against British colonial rule led to the creation of the pro-independence Anti-Fascist People’s Freedom League (AFPFL), under the leadership of Aung San and U Nu. The AFPFL won a landslide election victory in April 1947. In July that year, when independence negotiations with the British were well advanced, Aung San was assassinated; U Nu subsequently became the prime minister of the Union of Burma when it gained independence on January 4th 1948.

A long history of The AFPFL won two further elections, and apart from a two-year period under a military rule military caretaker government headed by the army chief-of-staff, General Ne Win, Myanmar enjoyed 12 years of democratic government. However, this came to an end in March 1962, when General Ne Win launched a coup, replacing the government with a military-run revolutionary council. In 1972, in the face of growing discontent, General Ne Win and his senior commanders retired from the army, but remained in control of government.

In 1974 a new constitution declared Myanmar to be a socialist one-party state, ruled by the military’s Burma Socialist Programme Party (BSPP, or Lanzin Party). The BSPP embarked on the so-called Burmese Way to Socialism, an odd mix of Buddhism, Marxism and nationalism, of which the central elements were economic self-sufficiency and political isolation. Myanmar remained shut off from the outside world, a policy that resulted in economic stagnation.

The pro-democracy In October 1987, as the economy deteriorated further, student demonstrations movement was crushed were held in the capital, Yangon. Widespread protests began in March 1988, in 1988— increasingly focused around the leadership of Aung San Suu Kyi, the daughter of the independence-era leader, Aung San. In July 1988 General Ne Win resigned as chairman of the BSPP, and was succeeded by General Sein Lwin, who declared martial law in Yangon. But the protests gathered strength until, on August 8th 1988, troops were ordered to fire on unarmed demonstrators. Several thousand civilians are estimated to have been killed and many more injured in the ensuing bloodbath.

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—and a new military Despite this crackdown, demonstrations continued, forcing General Sein Lwin council formed to resign within weeks of coming to power. His successor, a civilian, Maung Maung, lasted less than one month, during which time a multiparty election was planned. On September 18th 1988 the military again formally took power, nominally under the leadership of General Saw Maung—although with General Ne Win’s involvement behind the scenes. The junta formed a military council, called the State Law and Order Restoration Council (SLORC), to rule the country. The junta also dismantled the socialist one-party order, and bowed to the demonstrators’ demands for an election to be held.

The junta has clung to More than 200 parties registered for the 1990 election. The main contenders power despite losing the were the National Unity Party (NUP, a renamed BSPP), the NLD (of which 1990 election— Aung San Suu Kyi was secretary-general), and the larger of the ethnically based parties. Although Aung San Suu Kyi was placed under house arrest, the election resulted in an overwhelming victory for the NLD, which won 60% of the vote—this would have translated into 392 seats in the 485-seat legislature. The pro-junta NUP won only ten seats. However, the junta refused to accept the result, later insisting that the election had been held simply to select a body to draft a new constitution (see Constitution and institutions).

The junta has remained in power ever since (with Senior General Than Shwe, the commander-in-chief of the army, succeeding General Saw Maung as chairman of the junta’s ruling council in 1992). On November 15th 1997 the junta was reshuffled and renamed the State Peace and Development Council (SPDC; see Constitution and institutions), but there was no marked change in its policies.

General election results, May 1990

% of vote No. of seats National League for Democracy 59.9 392 Shan Nationalities League for Democracy 1.7 23 Arakan League for Democracy 1.2 11 National Unity Party 21.2 10 Mon National Democratic Front 1.0 5 National Democratic Party for Human Rights 0.9 4 Chin National League for Democracy 0.4 3 Party for National Democracy 0.5 3 Union Paoh National Organisation 0.3 3 Kachin State National Congress for Democracy 0.1 3 Others 12.8 28 Total 100.0 485 Source: Press reports.

—and is taking steps In 2000 the NLD continued to push for the result of the 1990 election to be to entrench itself recognised. The NLD refused to disband the ten-member Committee still further— Representing the People’s Parliament (CRPP) that had been formed in September 1998 to take decisions on behalf of arrested NLD deputies. The CRPP (comprising NLD members, including Aung San Suu Kyi, and one ethnic

minority party representative who has subsequently been arrested) has been able to do little except issue statements, and form some policy committees. However, it is a symbol of the junta’s 1990 defeat and the demands of the opposition forces.

In September 2000 the NLD took a further step, announcing that it would begin work on a new constitution. The junta has long pledged to hold another election once a new constitution had been completed (see Constitution and institutions). However, work on the junta’s version of the constitution—which will enshrine a central place in political life for the military—has progressed at a glacial pace. The National Convention, the body tasked with drafting the constitution, has not met for years. Yet some within the democratic opposition fear a junta-appointed committee could unveil a constitution, clearing the way for a fresh election.

—including efforts to Angered by the NLD’s bid to develop a constitution of its own, and by renewed dismantle the NLD— efforts by senior NLD leaders to travel to party meetings outside the capital, Yangon, the junta escalated its harassment of the NLD in late 2000. In September 2000 Aung San Suu Kyi and other party leaders were placed under virtual house arrest, with their telephone lines cut and access to most visitors denied. While the junta has not yet dared to make the NLD illegal, most normal political activities are severely restricted, and NLD members and their families have been subjected to severe harassment, including imprisonment and torture.

At the same time, the junta has continued to build up the Union Solidarity Development Association (USDA) into a 12m-member support base. The junta has also resisted calls from other countries and international bodies to begin dialogue with the NLD (see International relations and defence).

—but opposition remains The junta continues to be widely feared and disliked. In addition to the NLD, widespread the junta faces opposition from three broad groups—students, monks and ethnic minority groups. Students played a prominent role in organising the 1988 protests, a fact that has led the current junta to close the universities for much of its 12 years in power. The junta risked reopening many university classes in 2000, but remains jittery; many classes have been shortened or moved far from town centres to prevent students gathering. Religious leaders also played a key role in the pro-democracy movement of 1988, and have also been involved in subsequent protests. Finally, Myanmar has for decades faced armed opposition from a web of ethnic minority groups in the border states.

To counter these sources of opposition, the junta has developed a vast network of informers in most institutions—including the civil service and colleges. Even the fire brigade has been developed into a pro-junta group. Almost all information is controlled and heavily censored. The result is what Aung San Suu Kyi has termed a “blanket of fear” over the country. However, there is probably very little real support for the junta within the USDA and other notionally pro-junta groups. The increasingly desperate political and economic situation may also have weakened support for the junta within the rank and file of the armed forces.

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Important recent events

September 1988: The junta seizes power and forms the State Law and Order Restoration Council (SLORC).

May 1990: An election is held. The National League for Democracy (NLD) wins conclusively, but the results are not recognised.

July 1995: The leader of the NLD, Aung San Suu Kyi, is released from almost six years of house arrest.

November 1997: The SLORC is reshuffled and renamed the State Peace and Development Council (SPDC), but there is no change in policy.

May 1998: The NLD demands that parliament is convened. Hundreds of NLD members are detained.

September 1998: The NLD forms a ten-member committee to take decisions on behalf of the arrested elected deputies.

September 2000: The NLD announces plans to draft its own constitution. Aung San Suu Kyi and other senior leaders are placed under virtual house arrest.

Political forces

The junta is backed by The junta’s ruling council, made up of senior military figures, is the dominant the military political force (see Constitution and institutions). This junta is backed by a large armed force; according to the International Institute for Strategic Studies, the armed forces (including police and militias) expanded from 170,000 in 1988 to 429,000 by mid-1999. The military’s reach is extended by a widespread military intelligence network.

One threat to the junta comes from weakening support among the military rank and file, where poor conditions and low pay may be affecting morale. There are also occasional reports that some officers have been arrested for expressing support for the NLD.

Political parties Only nine of the 93 parties that contested the May 1990 election are still legally recognised. Of the 485 deputies elected in 1990, the majority have been detained or disqualified, resigned under pressure, or gone into exile.

The NLD The most important source of opposition to the junta is the NLD. The NLD remains a legal party, but operates under severe restrictions: its leaders are prevented from travelling and from speaking in public; party meetings are permitted only rarely; and most party material is illegal under Myanmar’s draconian publishing laws. Harassment of the NLD, which intensified in 1998- 2000, has taken a heavy toll. Many thousands of members have resigned and numerous party offices have closed.

The lack of political change since 1990 has also resulted in some tensions within the NLD itself, including occasional criticism of the tactics of senior NLD leaders. However, there seems to be no threat to the core NLD leadership.

The USDA The military junta established the USDA in 1993, initially to undertake public works projects. In 1997 the junta explicitly recognised the USDA as its political wing and called for its members to be trained as the “next generation” of leaders. The junta’s head, General Than Shwe, is head of the USDA.

Since early 1997 mass rallies have been held to boost USDA membership— recruitment is heavy-handed, and civil servants and high school students are pressured into joining. By 2000 membership had risen to around 12m (constituting over 35% of the population aged 15 and older), organised in local groups throughout much of the country. USDA members act as the junta’s eyes and ears, while some USDA members have also received military training. However, real support for the junta from within the USDA is believed to be limited.

Main political figures

Aung San Suu Kyi: Secretary-general of the National League for Democracy (NLD). Daughter of the independence hero, Aung San, she is extremely charismatic and her personal popularity remains very high.

Tin Oo: Vice-chairman of the NLD, and one of Aung San Suu Kyi’s closest allies. A former military man.

Senior General Than Shwe: Chairman of the State Peace and Development Council (SPDC), prime minister, defence minister and commander-in-chief of the armed forces. Seen as mediator between factions within the junta. Rumoured to be in ill health and on the brink of retirement.

General Maung Aye: Vice-chairman of the SPDC, deputy commander-in- chief of the armed forces and army commander. In theory, second in line to General Than Shwe. Regarded as a hardline opponent of dialogue with the NLD.

Lieutenant-General Khin Nyunt: Secretary-1 of the SPDC. Has a background in military intelligence. Those loyal to either General Maung Aye or to General Khin Nyunt form perhaps the two most powerful factions within the junta.

General Ne Win: Came to power in the 1962 coup and did not give up his last official post until July 1988. Some think that he is still the ultimate power in the land. Rumours surface periodically that he is seriously ill; his death may precipitate a power struggle within the junta.

Others to watch: There is a large number of pro-democracy, student and ethnic minority leaders active both within the country and in exile. Some may play important roles in the event of any political upheaval in Myanmar.

Ethnic groups are still The question of the degree of autonomy to be given to Myanmar’s many fighting for autonomy ethnic groups has never been adequately settled, and at times more than

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40 ethnic insurgent groups have been active. In 1989 a series of ceasefires was concluded with some of the 29 groups that were thought still to be active at that time. However, some of these ceasefires have unravelled in recent years. In 2000 the junta continued to meet armed resistance from ethnic splinter groups.

The most important group not to have signed a ceasefire is the Karen National Union (KNU) and its armed wing, the Karen National Liberation Army (KNLA). The KNU has lost its key bases, and in 1997 the junta regained control over much of the border region. However, armed resistance is continuing.

The junta has tried to stamp out support for insurgent groups with harsh policies including forced relocation of ethnic minority villages and the use of forced labour. International agencies, including the UN, have criticised the torture, rape and extra-judicial killings of ethnic minority members, who are accused by the junta of sympathising with insurgents. As a result of such policies and the continued fighting, there are around 120,000 ethnic minority refugees in camps in Thailand—and an unknown number of ethnic minority people displaced from their homes inside Myanmar.

There are no direct links between these ethnic insurgent groups and the NLD. However, a number of the ethnic minority political and insurgent groups have voiced support for the aims of the NLD and the restoration of the 1990 election result.

Political groups in exile A number of pro-democracy political groups operate outside of Myanmar. Two prominent groups include the following.

• The National Coalition Government of the Union of Burma (NCGUB), a government-in-exile comprising those elected in 1990. Dr Sein Win, a cousin of Aung San Suu Kyi, holds the post of prime minister.

• The All Burma Students Democratic Front (ABSDF), composed of students who fled the 1988 massacres, which fought against the junta alongside some of the ethnic groups. The ABSDF has formed a political bloc to campaign for change from its base in Thailand.

Constitution and institutions

No new constitution—yet In 1988 the junta suspended the 1974 constitution and abolished all state institutions, including the Pyithu Hluttaw (People’s Assembly) and the civilian courts. Myanmar still operates without a constitution, although a National Convention has drawn up the principles for a new one, and a junta-controlled committee is continuing to work on a new draft. In September 2000 the NLD announced plans to begin work on its own draft of the constitution, a move strongly resisted by the junta.

The National Convention

The junta claimed (after the event) that the 1990 election had been held solely to elect representatives to a body assigned with the task of drawing up a new constitution, called the National Convention. The National Convention first met in January 1993. However, of the National Convention’s 702 members only 106 (15%) were elected representatives, the rest being appointed by the junta. In November 1995 the National League for Democracy (NLD) was expelled from the convention for protesting against tight restrictions on debate. Without the NLD representatives, the number of delegates who had been elected in the 1990 election was reduced to less than 3% of the total.

By March 1996, at the close of its most recent session, the convention had identified 104 basic principles, covering, among other things:

• a central role for the armed forces (Tatmadaw), to be guaranteed by a range of measures including reserving for the army one-quarter of the seats in both a lower and upper house of parliament; the military will also have the right to make appointments to key government posts (such as the ministries of defence and home affairs); and

• the effective exclusion of Aung San Suu Kyi as head of state (by requiring that the head of state should have been resident in Myanmar continuously for the previous 20 years and should not have been married to a foreigner).

Although the National Convention has not met since early 1996, the National Convention’s Convening Committee has held frequent meetings, and work on the constitution seems to be continuing.

The military junta has In November 1997 the ruling military council was renamed the SPDC. been reorganised— However, the four most senior figures retained their posts in the new line-up. Senior General Than Shwe and General Maung Aye remained as chairman and vice-chairman respectively. Lieutenant-General Khin Nyunt retained his post as the council’s Secretary-1, and Lieutenant-General Tin Oo remained as Secretary-2. The newly created post of Secretary-3 was given to Lieutenant- General Win Myint. The size of the council was reduced from 21 to 19. The 12 regional military commanders (six of whom were newly appointed) and heads of the navy and air force were appointed as the remaining 14 members of the council.

—but still controls The SPDC, rather than the cabinet, takes all key policy decisions. In 1998-99 the country new committees were set up to oversee agricultural policy, industrial policy and trade and foreign exchange—the latter seem to be under the control of General Maung Aye. The regional military commanders also wield considerable power in the areas under their command.

The inner workings of the junta are little known; it is highly secretive, and even senior diplomats in Yangon have limited opportunities for meaningful contact. There are believed to be divisions within the junta, particularly between the army commander, General Maung Aye, and the intelligence chief, Lieutenant-General Khin Nyunt (see Main political figures box). General

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Maung Aye seemed to re-assert control over policymaking in 1999-2000. By late 2000 there were rumours that General Than Shwewidely believed to hold the balance of power between the two factionswas in ill health and on the point of retiring, a move that some believe could precipitate an open power struggle.

The government has more The cabinet forms the second tier of the military government; key decisions are limited influence taken by the SPDC and its committees. The cabinet too was reshuffled in late 1997. Two new ministries were added (electricity and military affairs) and 22 new ministers were appointed. General Than Shwe (the only person with a post in both the cabinet and the SPDC) remained as prime minister. The large majority of the 40 cabinet members are high-ranking military figures.

A controlled judiciary and Although civilian courts were fully reinstated in 1992, many judges still have many political prisoners military backgrounds. Pro-democracy campaigners are regularly denied proper legal representation, and cases are often heard in secret. Jail terms for pro- democracy activists are severe; even peaceful anti-junta activities by Myanmar citizens regularly attract jail terms of seven to 20 years. Conditions in the jails are very harsh; torture is often used against the junta’s opponents. There are estimated to be at least 1,000 political prisonersalthough the junta denies this.

International relations and defence

Relations with ASEAN The Association of South-East Asian Nations (ASEAN) has followed a policy of remain tricky “constructive engagement” with the junta, and in July 1997 Myanmar was admitted as a full member of ASEAN. Yet since then some ASEAN members have begun to question the constructive engagement approach. ASEAN investors have become increasingly exasperated with the junta, while a series of EU-ASEAN meetings have been cancelled over EU objections to the junta’s inclusion.

The junta’s relations with neighbouring Thailand are perhaps the most difficult. Since the Democrat Party-led coalition came to power in Thailand in late 1997, Thai officials have been more outspoken in voicing their concerns about the flow of drugs and illegal migrants from Myanmar. The presence of around 120,000 refugees from Myanmar in camps in Thailand has further strained relations. The junta blamed the Thai government for freeing armed activists who took hostages at the Myanmar embassy in Bangkok in October 1999. Thailand in turn was angered when early in 2000 a group of insurgents from Myanmar laid siege to a Thai hospital, demanding greater assistance. Yet despite the concerns from Thailand and elsewhere, ASEAN has stuck to its policy of “constructive engagement” with the junta. Plans to send three ASEAN representatives to the junta to push for change were vetoed in September 2000 by ASEAN members such as Vietnam.

The junta remains an The junta has been shunned by many countries and international bodies for international pariah— failing to recognise the 1990 election, as well as for its poor human rights record and complicity in the narcotics trade. Myanmar’s main donors—

including Japan and the US—all suspended aid after the September 1988 coup. Japan recognised the new government in February 1989, but the US has continued to enforce a strict aid embargo, and in April 1997 banned new investment in Myanmar by US companies. The EU and other industrialised countries (such as Canada) have also removed trade and aid benefits.

In 1998-99 signs emerged that some members of the international community were looking for new ways to break the stalemate. The UN was reported to have considered renewing technical assistance to the junta in exchange for political reforms, while the EU sent a delegation to talk to the junta, and Canada proposed the formation of a human rights commission in Myanmar, backed by foreign assistance. However, these limited attempts to engage the junta are not expected to result in a marked thaw—not least since the junta has little interest in softening its stance in order to appease outside concerns. International criticism of the junta intensified with the renewed crackdown on the NLD in the second half of 2000, but to little effect.

—but has close ties In 2000 the junta tried to reduce its international isolation, engaging in a with China number of diplomatic visits to countries including India. Part of the motivation was to reduce reliance on China, by far the junta’s most important ally. China has provided aid and military hardware, while economic ties have flourished, resulting in a wave of Chinese investment. Fears have grown among Myanmar’s neighbours that the ties go even deeper; India has accused the junta of allowing China to set up military installations on Myanmar’s Coco Islands, close to India’s Andaman Islands. Some within the junta are also believed to be concerned about the level of dependence on China.

Resources and infrastructure

Population

Population, 1999/2000 (mid-fiscal year) Total (m) 49.1 Male n/a Female n/a % change 2.0 Source: Internal report.

Population statistics The government estimated the total population at 49.1m in the middle of are dubious fiscal year 1999/2000 (according to an official unpublished report—the junta has delayed publication of its annual statistical review for the last two years). The new data show erratic growth patterns, with the population jumping by 3.8% in 1998/99, then by 2% in 1999/2000. Although these figures seem high, rapid population growth would not be surprising, as Myanmar’s population is relatively young (with 33.2% of the population in the 0-14 age group in

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1997/98). (See Reference table 1 for data on population growth and age structure.)

However, Myanmar’s population statistics must be treated with some caution; according to a UNICEF report, an internal evaluation of population data in 1994 found 40% under-reporting for births and 60% for deaths. Another complicating factor is the flow of refugees and migrant workers (see box). It is possible that the recent jump in population figures reflects efforts to correct some of these data problems.

Myanmar’s mobile population: refugees, migrant workers and internally displaced people

A repressive regime and a stagnant economy have resulted in a large flow of workers and refugees from Myanmar to neighbouring countries. Thailand alone has an estimated 1m illegal migrant workers—the majority from Myanmar—as well as around 120,000 refugees from Myanmar housed in border camps. In addition, around 21,000 Muslim refugees from Myanmar’s Arakan province are located in camps in Bangladesh.

Inside Myanmar, continued fighting in some border regions, and the junta’s harsh policies against ethnic minority members, including forced relocation, have resulted in many people being displaced from their homes. The UN High Commissioner for Refugees has been unable to estimate the numbers of such internally displaced people; exile groups estimate it could be hundreds of thousands.

The labour force Myanmar’s labour force numbered 18.8m in 1995/96 (the latest available data), of which 64% were employed in the agricultural sector. The lack of investment in education and the prolonged closure of the universities in recent years have had a detrimental impact on the quality of the labour force. Unskilled labour is widely available; there is no minimum wage, but holiday and other entitlements are set out under the 1954 Social Security Act. (See Reference tables 2 and 3 for data on employment and the labour force.)

Data on ethnic minorities Data on the size of Myanmar’s numerous ethnic groups are contentious: no are sparse and out of date detailed census of ethnic minorities has been attempted since 1931. The 1931 census classified 65% of the population as belonging to the majority Burman group, followed by the Karen (9%), the Shan (7%), the Chin (2%), the Mon (2%), the Kachin (1%) and the Wa (1%). The majority of ethnic minorities live in the border states—although there are sizeable minority populations in the Burman-majority divisions.

Religion and language About 89% of the population are Buddhist. An estimated 4% of the population are Christian (including large numbers of Karen and Kachin) and another 4% are Muslim, most heavily concentrated in Arakan state. A variety of local languages is spoken among minority groups, but Burmese is the official language of the state and is widely spoken and understood.

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Population by state/division: census results, Apr 1983

Annual Population growtha Area Density State/division ‘000 % (%) (sq km) (per sq km) Kachin 904 2.56 2.05 89,042 10 Kayah 168 0.48 2.89 11,730 14 Karen 1,058 3.00 2.11 30,381 35 Chin 369 1.05 1.33 36,017 10 Sagaing 3,856 10.92 2.14 94,623 41 Tenasserim 918 2.60 2.46 43,344 21 Pegu 3,800 10.76 1.80 39,404 96 Magwe 3,241 9.18 2.09 44,820 72 Mandalay 4,581 12.98 2.25 37,021 124 Mon 1,682 4.76 2.50 12,295 137 Arakan 2,046 5.80 1.70 36,778 56 Yangon 3,974 11.26 2.20 10,171 391 Shan 3,719 10.53 1.58 155,801 24 Irrawaddy 4,991 14.14 1.85 35,136 142 Total 35,307 100.00 2.02 676,563 52

a Average for 1973-83.

Source: 1983 census returns.

Health

Health indicators give a A UNICEF report has described a “dramatic decline” in spending on healthcare gloomy picture since the late 1980s. Spending on health was equivalent to just 0.3% of GDP in 1997/98. Private clinics have sprung up, but they are relatively expensive and located mainly in urban areas. As a result, much of the population has access to little or no basic healthcare. The results can be seen in poor health and nutrition standards; according to World Bank estimates, in 1997, 39% of children under the age of five in Myanmar were moderately malnourished. Border areas suffer the worst healthcare provision, with a higher incidence of diseases such as HIV/AIDS and malaria. According to World Bank estimates, life expectancy in Myanmar averaged 60 years in 1997, compared with an East Asian average of 69 years.

HIV/AIDS is a According to a 1995 survey, 56.5% of Myanmar’s injecting drug users were growing problem infected with HIV. Two years later, around half a million people in the country were estimated to be HIV-positive. Rates of infection are high and increasing among intravenous drug users and sex workers (amid high levels of poverty, there is a flourishing trade in women and children sold into prostitution in Myanmar, China and Thailand). Migrant workers are also a factor in spreading the disease to other groups. For several years the junta was reluctant to recognise the problem, and remains unwilling to permit outside assistance.

Education

Political turmoil has For more than ten years the higher educational system has been severely disrupted higher disrupted by regular closures aimed at curbing student dissent. The majority of education— universities were reopened in 2000, but courses are being significantly shortened in order to push the huge backlog of studentsmany of whom have been waiting years to start collegethrough the system.

—and overall standards The junta’s disdain for education is reflected in low spending—equivalent to have been severely affected 1% of GDP in 1997/98. Official figures still put the adult literacy rate at just under 83% in 1997, comparable with rates in Malaysia and Indonesia. However, this may well be a considerable overestimate. According to the Ministry of Education’s own surveys, only around 30% of children now complete primary school education. Many children are taken out of school either because their parents cannot afford ever-increasing unofficial fees (charged to offset weak state spending), or because falling family incomes mean that children start work early. Teachers in state-funded schools are very poorly paid, and the quality of teaching is low. There is a growing informal school system—including private classes on such subjects as English language and computing—but these are mainly in urban areas, and are only accessible to the relatively well-off. Traditional monastic schools, which have historically played an important role in education, can only go so far in making up the deficit. As a result of these problems, the overall standard of education in Myanmar, particularly in rural areas, is believed to have declined sharply in recent years.

Natural resources and the environment

Potentially rich Myanmar has considerable agricultural potential. The predominantly tropical agricultural resources climate allows a wide variety of crops to be grown; among the most economically important are rice, maize, wheat, pulses, oilseeds, timber, rubber, jute, cotton, and many fruits and spices. (Myanmar is, in addition, the world’s second largest producer of opium.)

Much of the country is mountainous and forested, and the area of land under cultivation remains unusually low. In 1997/98 less than 13% of the total land area was cultivated. A further 12% was classified as “wasteland suitable for cultivation”. Since 1999 the junta has offered incentives to bring more land into production (see The economy: Economic policy).

Forest resources According to official data, 48% of total land area was forested in 1997/98. The most economically important forest resources are teak and hardwoods, as well as oil-bearing trees and bamboo. Myanmar accounts for around 75% of the world’s remaining teak. In some areas, particularly along the Myanmar-Thai border, these resources are endangered by severe overlogging.

Water-based resources Myanmar’s rivers and 2,832-km coastline provide rich waters for fishing. According to official estimates, the maximum sustainable yield for marine

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fishing is 1.1m tonnes/year (t/y), of which only 600,000 tonnes is being exploited. Since October 1999, the junta has banned Thai trawlers from Myanmar waters. The hope is that Myanmar’s own fishing fleet will benefit, although the fleet is poorly equipped. In addition to fishing, Myanmar’s waters have massive hydroelectricity potential, of which only around 1% is currently estimated to be exploited. However, several Chinese firms plan investments in this area, while surveying has already begun for a controversial dam project on the environmentally sensitive Salween river.

Minerals and metals Myanmar’s mountains contain reserves of a wide variety of minerals, ores and gemstones, including: copper, gold, nickel, coal, lead, zinc, silver, gemstones, tungsten and tin. A full assessment of these resources has not been undertaken, but some mining specialists believe that Myanmar could be a major producer of several minerals, including tin and copper. All minerals and metals belong to the state (in some cases this right has been ceded to regional military commanders). Investors must negotiate a profit- or production-sharing agree- ment with the state (or one of six state-owned mining companies), or in some cases with the regional military command. In addition, Myanmar has major offshore oil and gas reserves, some of which are already being exploited in co- operation with foreign firms.

Transport and communications

Road, rail and waterways Transport in Myanmar is slow and unreliable. According to press reports, at the end of 1998/99 there were 29,370 km of roads. However, all but the major roads are unpaved, and during the rainy season some of the network becomes impassable. Efforts are being made to repair and extend the road system; for example, the road between Lashio and Muse (close to the border with Yunnan province in China) is being upgraded. A bridge-building programme is also helping to reduce journey times between some cities (a new bridge will eliminate the hour-long ferry crossing that extends the journey between Yangon and Bassein, the major town in the southern delta). A number of efficient private coach companies service the main road routes. The railway network is underutilised; the network is in very poor repair and trains are slow and unreliable. The country’s extensive inland waterways (covering around 12,800 km compared with around 6,099 km of railway track) remain the principal means of long-distance transport in many areas, and may carry more freight than the railway (the freight statistics included in Reference table 4 cover operations of state-owned companies only).

Air and sea services The main airports are at Yangon, Mandalay and Pagan. In September 2000 a major new international airport was opened at Mandalay, although falling tourist arrivals mean there is little traffic. Myanmar has three airlines, Myanma Airways and Myanma Airways International, Air Mandalay, and Yangon Airways. A number of crashes of Myanma Airways airplanes in recent years raised concerns over the safety record of domestic flights.

Yangon seaport is the largest in the country, handling 90% of seaborne trade, but it cannot accommodate vessels of more than 10,000 tonnes. New seaports

are being developed at Thilawa, on the outskirts of Yangon, and Kyaukpyu in Rakhine (Arakan) state.

Telecoms and electronic According to the latest available statistics, at the end of 1997/98 there were communications are poor only 222,082 telephones in the whole of Myanmar, the equivalent of about 0.5 phones per 100 people, few even for a low-income country (although the number of phones had increased by 16.6% compared with 1996/97). Almost half of all telephones are in Yangon. Despite the installation of new cellphone equipment and digital phone systems in some towns, the service remains unreliable, and international calls are extremely expensive. In August 1999 international direct calls were permitted from all telephones, but the cost was raised sharply (and payment was required in US dollars or dollar-equivalent foreign- exchange certificates). The use of telecoms equipment is strictly monitored.

E-mail is available only in companies and some large organisations, and is monitored. Internet access is not available (although the Ministry of Communications is planning to establish itself as Myanmar’s Internet service provider).

Censorship of telecommunications and the media

The 1996 Computer Science Development Law regulates the use of modems and computers with networking capabilities. These regulations are backed by harsh penalties. The junta’s surveillance capabilities have been enhanced by new technology that enables the monitoring of cellphones and e-mail. Most newspapers and magazines are run by the state or its agencies, and all are heavily censored. The purchase of most foreign media, including regional newspapers, is prohibited. There are harsh penalties for unauthorised private video transmission. Foreigners travelling to Myanmar are required to obtain permission from three different ministries if they wish to take mobile phones or computers into the country.

Energy provision

Electricity capacity In 1997/98 total installed electricity capacity was 1,572 mw, up from 1,394 mw and distribution is in 1996/97. Of total installed capacity, the state-owned Myanma Electric Power very limited— Enterprise (MEPE) managed 77%, the remainder being run by individual ministries. Power supply is inadequatein 1998/99 around 35% of generated electricity was lost during generation, transmission and distributionand many private companies buy their own generators. Many towns and villages are not connected to the national grid. According to a 1997 survey by the Central Statistical Organisation, only 37% of all households have access to electricity for lighting (71.6% in urban areas and 17.7% in rural areas). In fact, Myanmar’s largest source of energy, according to Energy Data Associates, remains items such as fuel wood and sugarcane by-products. (Reference table 5 provides national energy data.)

—and power cuts Through much of 1998-99 Yangon and other cities suffered repeated, very are frequent severe power cuts and brown-outs, because of the impact of droughts on

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hydroelectricity, shortages of imported fuel, and the failure of old plants. Heavy monsoon rains in 1999 and 2000 brought some improvements, but power cuts are still common even in the larger cities.

Imports of crude oil and petroleum products are not covered fully in official statistics. Estimates have put total oil and petroleum imports at between 300,000 tonnes/year (t/y) and 600,000 t/y (6,000-12,000 barrels/day) and the annual oil import bill is reported to be around US$100m. However, imports of oil seemed to increase sharply in 1998-99, according to figures from Energy Data Associates, reaching 1.3m tonnes in 1999. Gas may eventually increase in importance as an energy source with the coming on stream of the massive Yadana and Yetagun gasfields—although most gas is scheduled for export (see Economic sectors: Mining and semi-processing).

Energy balance, 1999 (m tonnes oil equivalent) Elec- Oil Gas Coal tricity Othera Total Production 0.50 1.52 0.02 0.16b 10.60 12.80 Imports 1.30 0.00 0.00 0.00 0.00 1.30 Exports 0.02 0.00 0.00 0.00 0.00 0.02 Primary supply 1.78 1.52 0.02 0.16b 10.60 14.08 Losses & transfers –0.28 –1.10 0.00 –0.28 –1.45 –3.11 Transformation output – – – 0.36c – 0.36 Final consumption 1.50 0.42 0.02 0.24c 9.15 11.33

a Mainly fuelwood. b Primary electricity production, imports and exports are expressed as input equivalents on an assumed generating efficiency of 33%. c Output basis.

Source: Energy Data Associates.

The economy

Economic structure

Main economic indicators, 1999

Real GDP growtha (output basis; %) 5.7b Consumer price inflation (av; %) 18.4 Current-account balance (US$ bn) –0.2 Foreign debtc (US$ bn) 5.7 Official exchange ratea (Kt:US$) 6.34 Free-market exchange ratea (Kt:US$) 341 Populationd (m) 49.13

a Fiscal year beginning April 1st. b IMF figure. The 10.8% growth figure produced by the junta is widely believed to be an overestimate. c End-1998. d Mid-fiscal year, 1999/2000.

Source: EIU.

Myanmar is a low- Data problems make an accurate assessment of the size and structure of the income country economy extremely difficult. However, by any measure, Myanmar counts among the world’s lowest-income countries. According to UNICEF, in 1994 GDP per head in Myanmar, based on a purchasing power parity basis, was the lowest in South-east Asia. A survey undertaken in 1997 indicated that 23% of Myanmar’s population lived below the poverty line. According to official, probably inflated, estimates of GDP growth for fiscal year 1999/2000, GDP per head reached Kt44,579—over US$7,000 at the official exchange rate, but a mere US$130 if exchanged at the more realistic free-market exchange rate. The real level could be even lower (see Reference table 8 for a comparison of GDP figures per head).

Data problems The use of the massively overvalued official exchange rate to measure some statistics severely distorts Myanmar’s economic data. In addition, a very large informal sector and extra-legal economy are not captured in the figures. The extra-legal economy includes illegal logging, widespread smuggling and opium exports. This introduces further distortions in trade and other data. The timeliness and quality of official statistics are also inadequate. For example, the junta ceased publication of its full annual statistical review in 1998. Published data are patchy with frequent, unexplained revisions. Unpublished data for 1999/2000 obtained by the EIU show a surge in GDP growth that contradicts earlier published data. As a result of these many problems, some of Myanmar’s official statistics can, at best, give only a broad indication of prevailing trends.

The considerable problems can be seen in a comparison of one key number, the GDP growth rates, as presented in various official sources.

Gross domestic product growth (% change, year on year) 1997/98 1998/99 1999/2000 Official internal report, 2000 version one 5.7 5.8 10.5 version two 5.7 5.8 10.9 IMF, International Financial Statistics 5.7 5.8 5.7 IMF, Myanmar: Recent Economic Developments 5.7 5.0 n/a Sources: Internal report, 2000; IMF, International Financial Statistics; IMF, Myanmar: Recent Economic Developments, November 1999.

As can be seen from this table, it is not clear whether GDP growth slowed, or rose strongly, in 1999/2000although anecdotal evidence supports a slowdown.

National savings are low, at 13% of GDP in 1999/2000 according to the junta’s estimates, reflecting the undeveloped banking sector and low income levels. The collapse in foreign investment (see The external sector) has further reduced the resources available for investment.

An economy dominated by Myanmar remains a predominantly agricultural economy. Agriculture agriculture accounted for 53% of current-price GDP and employed 66% of the workforce in 1998/99. By contrast, the industrial sector remains very undeveloped (industry, including manufacturing, energy, mining and construction, accounted for only 9% of current-price GDP in 1998/99). Industrial output is hampered by

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inadequate power and infrastructure, and limited investment. The small manufacturing sector is dominated by food-processing. The energy and mining sector is growing in importance with the start of gas exports from the massive Yadana and Yetagun fields, and as investments in Myanmar’s considerable mineral resources yield results.

Comparative economic indicators, 1999

Myanmara Thailand Malaysia Indonesia Vietnam Japan GDP (US$ bn) 6.4b 125.8 78.9 155.0 27.8 4,351.0 GDP per head (US$) 130b 2,045 3,608 747 350 34,341 Consumer price inflation (av; %) 18.4c 0.3 2.8 20.4 –1.5 –0.3 Current-account balance (US$ bn) –0.2c 11.2 12.5 5.2 -0.5 107.0 Exports of goods (US$ bn) 1.1c 56.6 83.1 49.4 14.2 404.0 Imports of goods (US$ bn) 2.1c 43.2 61.1 29.4 14.7 311.0 Foreign traded (% of GDP) 50.0e 79.3 182.7 50.8 104.0 16.4 a Fiscal year beginning April 1st. b Converted at the free-market exchange rate; data are for fiscal year 1999/2000, based on inflated official growth figure. c Calendar year. d Merchandise exports plus imports. e Foreign trade accounts for only 0.9% of GDP when the latter is converted at the official exchange rate.

Sources: National sources; EIU.

The state plays a The state sector’s share of GDP has remained steady at around 22-23% of central role constant price GDP in recent years. However, the state dominates some sectors including mining and power, and has an important role in transport, domestic trade and manufacturing. The state also controls exports of many key commodities, and as a result accounted for 28% of exports (in kyat terms) in 1999/2000. However, in 1999 private investors in land reclamation projects were granted permission to export up to half of their crops (see Economic policy). The military and the Union Solidarity Development Association (USDA) are also involved in businesses including gems and logging.

Economic policy

The junta has not tackled In the early 1990s real GDP growth was boosted by the junta’s limited efforts at economic reform economic reform, including agricultural price liberalisation, and efforts to attract foreign direct investment (FDI). However, an acute lack of technical capability has continued to hamper policymaking. The following policy problems remain unresolved:

• The junta has failed to improve its budgetary management, resulting in wide budget deficits and continued strong money supply growth.

• Health and education spending remains very low.

• Although the private sector now accounts for around two-thirds of GDP, government interference in many sectors continues.

• Poor data hamper decision-making; data availability deteriorated during 1999-2000.

• There has been growth in the private banking sector, and some effort to improve regulation, according to the IMF, but this has not extended to the state banks.

• Privatisation efforts have stalled, and the state-owned enterprise (SOE) sector continues to accumulate heavy losses.

• In 2000 the junta at various times commented on the need to scrap the overvalued official exchange rate. However, it has made clear that it will not adjust the exchange rate without international assistance (most aid has been cut off since 1988).

• The junta has been unable to stem sharp falls in FDI approvals and tourist arrivalswhich have brought pressure on the free-market kyat, and eroded foreign-exchange reserves.

A renewed focus on As efforts to attract more foreign investment stalled in the late 1990s, the junta agriculture refocused its attention on boosting agricultural output.

Since late 1998 the junta has offered incentives to investors in a bid to bring more unused land into production. The incentives comprise:

• a 30-year land lease for farms of more than 2,000 ha; • the waiver of land revenue and income taxes for a fixed period; and • the right to export up to half of the rice and some other commodities produced (the state controls export of most commodities).

The economic policies of the NLD

The junta’s lack of economic reform contrasts with the stated policies of the National League for Democracy (NLD). In a September 1997 policy document the NLD set out the policies it would implement if it were in power. These included:

• the official exchange rate to be devalued and brought into line with the market rate;

• a devaluation following studies carried out in consultation with the IMF, and a stabilisation fund to be set up with assistance from the IMF and other international agencies;

• all state-owned enterprises (SOEs) to be sold, except in cases where this would seriously increase unemployment;

• the removal of SOEs from the government’s budget and strict control over budget expenditure;

• the Central Bank of Myanmar to be given responsibility for implementing monetary policy and producing reliable forecasts; and

• foreign direct investment to be encouraged.

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The SOE sector: stalled privatisation? According to the IMF report, Myanmar: Recent Economic Developments, in 1999 there were 54 non-financial SOEs. These enterprises manage around 1,600 factories. The SOE sector accounts for around one-fifth of GDP and around 2% of total employment. Since 1989 SOE accounts have been merged with those of the central government, making the imposition of hard budget constraints very difficult. SOEs enjoy privileges such as easier access to foreign exchange for imports. Yet the IMF estimates that SOE losses are increasing.

A privatisation programme began in 1995, and in December 1997 the junta called for 42 of the remaining SOEs to be privatised. However, progress has been sluggish, constrained by lack of investor capital.

These policies helped to boost output of some key crops in 1998/99 and 1999/2000. But the success of the policy is hampered by a severe shortage of key inputs, the lack of modern farming techniques and continued price distortions caused by the state procurement policy (see Economic sectors: Agriculture, forestry and fishing).

Another policy focus has been substantial public expenditure on infrastructure, although the quality of some of the projects has been questioned.

Myanmar’s history of piecemeal reforms

Agriculture: Since 1987 farmers have been allowed to sell most of their output, except rice, at market prices. In 1997-98 the junta tried to lift state rice procurement quotas and raise the price paid by the state for rice, but fear of shortages caused a retreat. Since 1998, private investors have been offered incentives to bring more land into production.

Trade: In 1988 border trade was legalised and the role of the private sector recognised. In 1988-90 exporters were permitted to retain an increasing share of their export earnings. However, private traders remain (mostly) barred from exporting rice, teak and minerals. In 1998 the junta extended the state monopoly on exports to include key commodities such as sugar and pulses. Tough restrictions were imposed on imports in 1998, and extended in 2000.

Foreign exchange: In 1995 private money-changers were licensed to deal in foreign exchange. But in 1998 the junta imposed a new limit of US$50,000 per month on access to foreign exchange for repatriation, subsequently reduced to US$30,000 per month. Foreign-exchange licences were removed from private banks. Foreign-exchange markets are often closed at times of severe pressure on the currency. The junta has spoken of the need to realign the grossly overvalued official exchange rate, but has indicated that this remains unfeasible without external support.

Taxation: In mid-1996 the official rate used for valuing imports for customs duties was raised from Kt6:US$1 to Kt100:US$1, and the top tariff rate on imports was cut from 500% to 40%. Revenue from customs duties soared as a result. But tax evasion remains rife.

Erratic trade policy Myanmar was admitted as a full member of the Association of South-East Asian Nations (ASEAN) in July 1997. Under the common effective preferential tariff (CEPT) scheme of the ASEAN Free-Trade Area (AFTA), Myanmar was required to begin cutting tariffs from January 1st 1998, with tariffs falling to 0-5% by 2008. However, as reserves dwindled, a series of import restrictions were imposed in 1998-2000. In March 1998 the junta banned imports of non-essential goods not on two priority lists. Imports did fall in 1999, but reserves continued to slide. In September 2000 the junta introduced new import restrictions, limiting traders to a maximum of Kt1m in imports per month (US$154,000 per month at the official exchange rate, or around US$3,000 per month measured using the more widely used free-market rate). Imports above that value are now subject to fines or confiscation.

The fiscal deficit A range of factors including poor tax compliance and a large informal remains high economy mean that tax revenue is very low, at around 3% of GDP. The IMF estimated total government revenue, including transfers made by SOEs, at 8.3% of GDP in 1998/99. (Reference table 6 provides data on government finances.) Unable to significantly boost revenue, the junta has sought to control the deficit in the last few years by compressing capital spending, for example by slashing spending on investment projects. As a result of these cutsas well as inflated estimates of GDP growth in recent yearsthe central government deficit appears to have declined as a percentage of GDP. However, the official budget and GDP data are contradictory and also exclude high levels of off-budget defence spending. Defence spending remains a high priority for the junta, while spending on education and health has dwindled. The IMF estimates that spending on education fell to 0.4% of GDP in 1998/99, down from 0.7% in 1995/96; spending on health was even lower, at 0.1% of GDP.

Recent fiscal According to the IMF, the junta’s budget projections are regularly wide of the performance— mark. This again proved to be the case in 1999/2000. The junta set a target of cutting the budget deficit to Kt53.4bn, but the junta’s estimates show the deficit rising to Kt109.7bn (US$17bn at the official exchange rate, around US$322m at the free-market rate). Based on the junta’s inflated GDP growth figure, the budget deficit dwindled to 5% of GDP in 1999/2000. That is still alarmingly high, and the real figure may be much higher if, as seems likely, GDP growth was lower than the junta indicated.

Fiscal trends, consolidated budget (Kt bn unless otherwise indicated) 1995/96 1996/97 1997/98 1998/99 1999/2000 Total revenue 40.2 53.8 88.3 113.9a n/a Total expenditure –77.7 –105.6 –145.3 –184.0a n/a Total balance –37.5 –51.8 –57.0 –70.1a n/a % of GDPb –6.2 –6.6 –5.1 –4.5a n/a Memorandum item Total balance: alternative measurec –38.8 –51.7 –58.8 –91.9 –109.7 % of GDPc –6.4 –6.5 –5.1 –5.7 –5.0 a IMF estimate. b As estimated by the IMF, based on GDP data available in late 1999. c Official data obtained by the EIU. Data show a much larger budget deficit for 1998/99.

Sources: Internal report, 2000; IMF, Myanmar: Recent Economic Developments, November 1999.

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—financed by bank In the absence of significant foreign lending (see The external sector: Capital borrowing flows and foreign debt), the junta has financed the budget deficit through bank borrowing, the issuance of Treasury bills and bonds, and the accrual of arrears on external debt. The government’s need to finance large fiscal deficits has been the main cause of monetary expansion. (See Reference table 7 for data on money supply, domestic credit and interest rates.) In 1995-99 (calendar years) M2 expanded by an annual average of 33.6%.

Monetary policy The monetary policy tools available to the government remain very blunt, and instruments are very blunt interest rates are controlled. Interest rates have been lowered steadily through 1999 and 2000, partly in a bid to boost growth. Yet as inflation has come down, interest rates have turned positive in real terms. However, credit growth remains quite strong. The private sector’s share of credit rose from around 23% in 1995 to just over 32% in 1999. Nevertheless, the state sector continues to take the lion’s share of credit; the central government absorbed 58.7% of all credit in 1999, down from 72.2% in 1995but the share going to public enterprises jumped to 9.2%, from 4.2% in 1995.

Economic performance

Gross domestic product (% real change) Annual average, 1998/99 1994/95-1998/99 Agriculture 4.5 4.8 Industry 6.1 9.7 Services 7.0 7.2 Investment 16.3 19.6 Consumption n/a n/a GDP 5.8 6.5 Sources: Internal report, 2000; Ministry of Planning and Economic Development, Review of Financial, Economic and Social Conditions for 1997/98.

Doubts over new data There is considerable confusion over Myanmar’s recent economic performance. In mid-2000 the junta declared real GDP growth had reached 10.9% in 1999/2000 (April/March). However, anecdotal evidence suggests that such a surge in growth was unlikely. The junta appears to have ceased publishing its annual statistical review. An internal report obtained by the EIU confirmed the 10.9% figure (the report also gave a figure of 10.5%, on an output rather than expenditure basis). Yet other official data published in the IMF’s International Financial Statistics indicate that real GDP growth slowed to 5.7% in 1999/2000, down from 5.8% in 1998/99. Meanwhile, earlier IMF estimates suggested that growth in 1998/99 slowed to only 5%. (See Reference tables 8-10 for constant- price GDP data.)

The economy may It is possible that efforts to improve data collection have brought more have stagnated economic activity into the official statistics, giving an apparent boost to growth. However, there are still reasons to question the junta’s 1999/2000 growth figures. Agriculture is by far the largest economic sector, and new

incentives for private investors did boost output of some key crops in 1999/2000. However, the 10.9% agricultural growth figure (including forestry and fishing) given by the junta seems improbable, as certain growing regions faced adverse weather conditions and the sector suffers from shortages of key inputs. Agriculture rose by a modest 4.8% in 1994/95-1998/99 (see Economic sectors: Agriculture, forestry and fishing).

The 13.1% growth claimed by the junta for the industrial sector in 1999/2000 also appears suspect (industrial growth averaged 9.7% in the previous five years). Myanmar’s small manufacturing sector, which is largely based around agro-processing, benefited from rising output of key crops and firmer international commodity prices in 1999/2000. According to the junta, manufacturing output rose by 15.6% in 1999/2000, up from growth of around 4-6% in the previous three years. Again, however, problems such as power cuts, shortages of investment and lack of imported inputs suggest double-digit growth was very unlikely. The other components of industrial production—construction, mining, and power—account for only a small proportion of GDP. The energy and mining sector showed very strong growth in 1999/2000the energy sector rose by 69.2% in real terms according to the juntaas recent investments in oil, gas and mining projects came on stream. However, the construction sector remains in the doldrumsthe junta showed a slowdown from 6.3% in 1998/99 to 4.4% in 1999/2000, but even weaker growth is likely. The property boom of the early 1990s has turned to bust, while the junta has cut capital spending on infrastructure projects (see Economic sectors for a fuller discussion).

The junta estimates that services expanded steadily over the last few years, rising by 7% in 1998/99 and by 9.1% in 1999/2000. There has been recent public and private investment in transport and communications, and the financial sector has expanded following the lifting of controls on private-sector activity during the early 1990s. However, the surge shown by the junta in retail and wholesale trade—by far the largest services sector—seems unlikely. Earlier data had shown a slowdown in retail trade since 1994/95, hit by falling real incomes. Hence a marked turnaround in 1998/99 and 1999/2000when high inflation continued to erode real incomesseems unlikely. (See Reference table 10 for historical data on GDP growth rates by sector.)

Consumption and No official data are produced on private consumption (the junta publishes investment trends total consumption data, which groups public and private consumption). are confused However, real incomes have been eroded in recent years (see below) and consumer confidence remains poor. As a result, private consumption is likely to have stagnated; total consumption growth slowed to only 1.9% in 1997/98 (the latest published data). (See Reference table 9 for data on expenditure-based real GDP.) The junta has claimed that fixed investment rose by 16.3% in 1998/99, slowing to 9.2% in 1999/2000. Such a strong rise seems unlikely given the collapse in foreign investment, and efforts to reign in public investment spending.

Official data According to the Yangon consumer price index (CPI, the main measure of understate inflation inflation used by the government), inflation slowed to an average of 18.4% in

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calendar 1999, down from 51.5% in 1998. (See Reference table 11 for data on consumer price inflation.) The slowdown was the result of the high base period and lower food prices. However, the inflation rate may in fact be higher than official data suggest. The Yangon CPI is based on an unrepresentative lower- income basket of goods chosen in 1985/86, which contains no imported goods and gives a very low weighting to the key staple, rice.

Consumer price inflation (%) Annual average, 1999 1995-99 Yangon indexa 18.4 27.6

a 1995=100.

Source: IMF, International Financial Statistics.

Despite a public-sector According to the 1999 IMF report, Myanmar: Recent Economic Developments, the wage hike— junta’s wage bill remained static at around Kt8bn-9bn in 1995/96 to 1998/99, despite the price level almost tripling during this period. As a result, although public-sector wages are supplemented by a range of subsidies, incomes have been eroded in real terms. To try to redress the balance, the junta boosted civil servants’ pay fivefold starting from April 1st 2000. The increase brought the minimum monthly wage for civil servants (which includes teachers and medical staff) to Kt3,000 (around US$476/month at the inflated official exchange rate, or US$9/month at the more realistic free-market exchange rate). The maximum wage was raised to Kt15,000/month. The increase was the first since April 1993. Both the World Bank and IMF estimate that wages in the private sector are generally higher than those in the public sector (although data are sparse). However, perhaps the majority of the population relies on seasonal agricultural labour, where wages remain very low indeed. (See Reference table 8 for data on GDP per head.)

—overall living standards In the 1990s there was an increase in ownership of basic consumer goods, such are deteriorating as radios and bicycles. However, some studies suggest that farmers’ margins have been squeezed, resulting in a steady fall in real disposable rural incomes in recent years. City dwellers have also been hit by rising food prices and higher unemployment. As prices rise, an increasing share of income is spent on basic food items; the Central Statistical Organisation estimated that rice alone accounted for 20% of average monthly expenditure in 1994, and the situation has deteriorated since then. At the same time, the collapse in public spending has left many reliant on expensive private health and educational services. As a result of these trends, for many people real incomes and living standards declined in recent years.

Regional trends

Growth is unevenly Growth and incomes are very uneven. Over the years the main divisions have distributed— benefited from consistently higher levels of investment than the mountainous border states (which are home to many of Myanmar’s ethnic minorities). The

fertile lowland regions of the Irrawaddy river valley and the southern delta are the key rice-growing regions. Industrial output (apart from energy and mining) is concentrated in urban areas, mainly around the cities of Yangon and Mandalay. Mandalay in particular has benefited from growing economic contact with China. Incomes tend to be higher in urban areas, and in the lowland and central regions around Yangon and Mandalay.

—with the border states The junta’s grip on the border regions remains tenuous, as ethnic tensions and lagging behind strife continue (see Political background: Political forces). In the border areas, agricultural land tends to be less productive, investment has been very low, infrastructure is extremely poor and the tourism sector remains undeveloped. The opening of several trading posts along the borders with China, Thailand and India has allowed pockets of prosperous activity to spring up. However, security problems have resulted in the frequent closure of these border crossings. Some border regions do, however, have quite large informal and also illegal economies (the latter based around the smuggling of timber, gems and opium).

As ceasefires have been signed with some ethnic groups, the junta has sought to invest more in some border areas. For example, there has been greater investment in infrastructurealthough many projects are of dubious quality. The junta also plans to focus its incentives to bring more agricultural land into production on the remote Kachin state, from 2001 onwards. Such efforts may be behind the surge in growth shown in some border states in 1999/2000; GDP in Kachin state for example jumped by 23.9% in real terms (although growth data are suspect). However, it will be years before the border states catch up.

Economic sectors

Agriculture, forestry and fishing

Agriculture and forestry production, 1998/99 (‘000 tonnes unless otherwise indicated) Rice 17,848 Sugarcane 5,927 Pulses 1,678 Teak & hardwood logs (‘000 cu tonnes) 1,583a Groundnuts 502 Sesame 186 Cotton 189 Rubber 26

a 1997/98 data.

Sources: Ministry of National Planning and Economic Development, Salient Economic and Social Indicators, March 1998; IMF, Myanmar: Recent Economic Indicators, November 1999.

The junta wants to boost The junta’s “four pillars” policy seeks to boost production of four key crops— production of key crops— rice, pulses, cotton and sugarcane. The junta is also striving to encourage

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production of edible oilseeds, in a bid to reduce reliance on imports. Farmers are encouragedand in some cases pressuredto grow these crops. In addition, starting from late 1998, the junta has offered incentives to private investors to bring unused land into production (see The economy: Economic policy). Limited returns have constrained private-sector interest in the scheme, but there has been an increase in output of some key crops in recent years. For example, by 1998/99 output of pulses was 51% higher than in 1994/95. Output of cotton and sugarcane has also risen in the last few years. (See Reference table 12 for historical data on key crops.)

—but traditional crops However, not all crops have performed well. Rice remains Myanmar’s main are stagnating— cropin 1997/98 (latest available data) around 66% of the total sown area was planted with rice. Yet adverse weather conditions and lack of inputs such as fertiliser resulted in steady falls in rice output in 1994/95 to 1997/98, before output picked up in 1998/99. In the early 20th century Myanmar was one of Asia’s main rice exporters; the junta’s main priority now is to ensure domestic supply. In recent years rice exports have collapsed; they totalled 59.7m tonnes in 1999/2000, down from a recent peak of 1bn tonnes in 1994/95. Output of rubber, traditionally another important source of export revenue, has remained static at an average of around 27m tonnes per year from 1994/95 to 1999/2000. Rubber output has been hit by lack of investment, particularly in the ageing rubber stock.

—hit by shortages of key In addition to erratic weather conditions, there are several reasons for the inputs and other recent mixed agriculture performance. constraints— • Lack of irrigated land. In 1997/98 only 18.5% of the sown area was irrigated. Moreover, irrigation has been hampered by rising fuel prices and power cuts (in 1997/98 irrigation pumps—run by diesel or electricity— accounted for 41% of the irrigated area). Although the junta has built many new dams and reservoirs since 1988, much of the work has been of poor quality, leaving land classed as “irrigated” vulnerable to droughts and floods.

• Limited scope for further gains from multicropping, given farmers’ inability to buy the fuel and fertiliser vital for dry-season crops.

• Drying equipment, pesticides, storage facilities and high-quality seeds are all in short supply.

• Limited use of technology. The junta has confiscated land for use in large, mechanised “model farms”. However, most farms are small family holdings that rely on traditional techniques.

—and onerous Rice output in particular is also constrained by the junta’s burdensome government policies procurement policy. Under this scheme, farmers are required to sell 12 46-lb baskets of paddy per acre (620 kg/ha) to Myanmar Agricultural Products Trading (MAPT), a Ministry of Commerce agency, at a procurement price of around half the free-market price or less. In late 1997, in an effort to lift rice output, the junta announced that the price paid by the state was to be raised and quotas would be abolished. However, a poor monsoon harvest raised

concern over food supplies and the new policy was largely abandoned in 1998. The state also controls the export of many agricultural commodities.

Livestock and fishing The livestock and fishing sectors remain relatively small, together accounting for 5.7% of current-price GDP in 1998/99. The domestic market is quite small, as many people cannot afford to buy much meat or fish. However, thanks to greater investment in freezing and processing facilities, the fishing industry has recently been able to benefit from demand for processed fish exports (there is heavy demand for prawns and other fish in Thailand, for example). The junta estimates that livestock and fishing surged by 16.5% in 1999/2000 (real national accounts terms). The value of timber and hardwood exports did surge, but fish exports fell, suggesting such a strong rise in output is unlikely. (See Reference table 13 for livestock and fisheries data.)

Forestry In 1999/2000 there was a strong increase in exports of hardwoods. It is not clear whether this was linked to a rise in output. (See Reference table 14 for data on timber production, and Reference table 20 for data on timber exports.) Timber output stagnated through much of the 1990s, because many of the most accessible logging areas had already been exploited, and because of the introduction of protection measures. Teak output fell from 332,000 cu tonnes in 1993/94 to 200,000 cu tonnes in 1997/98 (latest available data). However, production of other hardwoods rose over the same periodand the real increase may be higher, because of widespread illegal logging.

Mining and semi-processing

Gas has potential Myanmar has considerable offshore reserves of natural gas. Two large offshore gasfields, Yadana and Yetagun, are now on stream. Both were due to export the bulk of their gas to the Petroleum Authority of Thailand (PTT). However, Thailand’s economic crisis has reduced demand for gas, and the PTT is trying to renegotiate its contracts, which may hit earnings from both projects. (See Reference table 15 for data on output of gas and minerals.)

The Yadana natural Yadana is estimated to have 1.2trn cu ft of recoverable gas reserves. Under the gas project original 30-year contract Thailand was scheduled to purchase 325m cu ft/day of gas, rising to 525m cu ft/day 15 months after the start of production. The remaining 20% of output was to be used domestically.

Ownership of Yadana (% share) Total (France) 31.24 Unocal (US) 28.26 PTT Exploration & Production (Thailand) 25.50 Myanmar Oil & Gas Enterprise (Myanmar) 15.00 Source: Press reports.

Gas exports started in 1998, but remained well below target in 1998-99, because of failure to complete a power plant on the Thai side. Some aspects of the contract may now be renegotiated. The junta will not receive earnings

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from the project until its share of the start-up costs has been paid (originally scheduled for 2000/01), but this too will now be delayed.

Proven and recoverable oil reserves are all located onshore and are estimated at 100m barrels. The available data show a slowdown in oil production to 3.4m barrels in 1999/2000 (although the data are for the state sector only, and may understate output). Myanmar’s three refineries (with a total capacity of 51,800 barrels/day, b/d) typically run below capacity because of supply shortages and poor maintenance.

Foreign investors are Foreign firms have been key investors in energy in Myanmar. However, interest pulling out is waning, and following the imposition of sanctions, several US companies have pulled out. Texaco of the US, the main investor in Yetagun, sold its 43% stake to Premier Oil of the UK in 1997, while in 1998 Atlantic Richfield Corporation (ARCO) of the US allowed leases on two exploration blocks in the Gulf of Martaban to lapse.

The mining sector may Myanmar has large deposits of minerals and gems, including copper, tin, be recovering sapphires, diamonds, rubies and jade. A new 1994 mining law allowed foreign investors to take concessions. For years mining output has been constrained by declining deposit grades and lack of investmentsome foreign companies have pulled out or suspended their rights over various exploration blocks. The available output datafor the state-owned sector onlyshow a fall in output of many key minerals including zinc, lead, tin and silver in the five years to 1999/2000. However, some large projectsfor example, the massive Monywa copper mine, a joint venture between the state’s Number 1 Mining Enterprise and a Canadian company, Ivanhoehave now come on stream, while international commodity prices have firmed. According to the junta, mining output rose by 14.1% in 1999/2000 (in real terms). One area that has definitely performed well is gem mining; the export of gems such as rubies remains an important source of foreign exchange. (See Reference table 15 for historical data on minerals production.)

Principal mineral products, 1999/2000a

Crude oil (m barrels) 3.4 Natural gas (bn cu ft) 57.9 Refined lead (‘000 tonnes) 1.7 Zinc concentrates (tonnes) 507 Jade (‘000 kg) 5,243 Rubies (carats) 3,163

a Output by state-owned enterprises only.

Sources: Central Statistical Organisation, Selected Monthly Economic Indicators; IMF, Myanmar: Recent Economic Developments, November 1999.

Manufacturing

Manufacturing sector (1985/86 constant prices; % change, year on year, most recent data) Annual average, 1997/98 1995/96-1997/98 Manufacturing & processing 5.2 7.2 Food & beverages 2.9 n/a Clothing 3.4 n/a Industrial raw materials 6.3 n/a Mineral & petroleum products 55.7 n/a Source: Ministry of National Planning and Economic Development, Review of the Financial, Economic and Social Conditions for 1997/98.

There has been some Manufacturing is largely agro-based, and the food and beverage industries diversification— account for around 82% of total manufactured output. The junta’s policy of diversifying agribusiness has yielded some successes. Fish products have become an important source of export revenue, boosted by investment in refrigeration equipment. Investment in refining mills boosted refined sugar production steadily in the second half of the 1990s. Myanmar has also developed a growing forest-product manufacturing sector, producing plywood, veneer, furniture and other wood-based products, including for export. However, much of the manufacturing sector remains small in scale. Many basic products—such as foodstuffs and clothing—are produced in small-scale family- based cottage industries, almost entirely outside the formal economy. These industries suffer from lack of access to capital (often available only from expensive local money-lenders) as well as the rising cost of inputs.

One relatively new manufacturing industry is garment manufacturing. By 1996 about 30 plants were reported to be producing garments for the export market; at least 16 of the plants were wholly or partly foreign-owned, mostly by Hong Kong or South Korean firms. Ready-made garment production rose from 29.8m items in 1992/93 to 57.2m items in 1997/98 (latest available data), much of which was exported to the US. However, the successful consumer boycott movement in the US and elsewhere persuaded many garment manufacturers and retailers, including Levi Strauss, Reebok and British Home Stores, to cease sourcing in Myanmar. Garment exports fell in 1997/98; recent data on garment exports are not available, although US data show that garment and knitwear exports to the US rose in 1998. (Discrepancies in the US and Myanmar data suggest under-reporting by Myanmar.)

—but the sector faces Revised data contained in an internal report produced by the junta show many problems manufacturing growth in 1999/2000 of 15.6%, on a national accounts basis. Previously published data had shown manufacturing growth slowing successively in each year between 1993/94 and 1997/98. (See Reference table 16 for historical data on manufacturing output in current prices and volumes.) It is possible that higher output of key crops in 1999/2000 boosted the agribusiness sectors. However, such a strong rise seems surprising, as the manufacturing sector continued to face the following problems:

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• Market access. Both domestically, as a result of poor infrastructure, and internationally (many countries including the US have withheld from Myanmar the trade privileges normally accorded to low-income countries because of concerns over labour rights and other human rights abuses).

• Shortages of key inputs. Import restrictions were imposed in early 1998 and tightened in 2000. Imports of intermediate goods fell sharply in 1999/2000 (see Reference table 21 for import data). • Power shortages. In 1998-99 the manufacturing sector was hit by prolonged and widespread power cuts; the problems continued into 2000. • Growing competition. The opening of border trade with China, Thailand and India has resulted in a flood of low-cost consumer goods, from household items to packaged foods and electronics. Despite restrictions, imports of consumer goods rose by 22.4% year on year in 1999/2000. Local manufacturers have little capacity to produce many of these items. • Inadequate access to finance. Particularly for small-scale manufacturers (although the expansion of the private banking sector may be reducing the lending bias towards state-owned industries—see Financial services). • Falling foreign investment. Foreign direct investment (FDI) approvals in the manufacturing sector peaked at US$924m in 1996/97, but have subsequently collapsed, totalling US$13m in 1999/2000. A number of high- profile manufacturing companies, including Pepsi, have pulled out of Myanmar, partly in response to international pressure (although in some cases their products continue to be sold under franchise).

Construction

A boom in construction— In the early 1990s the construction sector showed consistent, rapid growth. The construction boom was broad-based, ranging across residential housing, industrial zones, infrastructure, dams, hotels and office space. Much construction work was not captured in the official statistics because of the use of forced labour (see box). (See Reference table 17 for data on construction, and Reference table 10 for growth in the construction sector.)

The state and forced labour

In 1997/98, according to the latest available data, the state accounted for 65% of the value of construction work undertaken, having fallen from around 80% in 1993/94. The state’s role may be higher than these figures suggest, as the extent of government involvement is obscured by the use of uncompensated (for example, forced) labour. The US embassy estimated in its Foreign Economic Trends Report: Burma, published in July 1996, that the market value of forced labour employed by the government on public- works projects was Kt17.5bn (US$2.8bn/US$588m) in 1994/95, equivalent to 3.7% of GDP. Since then, the junta has increasingly used the armed forces to build infrastructure projects, although forced labour remains common practice in some parts of the country. The International Labour Organisation has sharply criticised Myanmar for the use of forced labour.

—has turned to bust However, the construction boom rapidly turned to bust, and Yangon is now ringed by unfinished and empty property investments. Building in the hotel and tourism sector stalled as tourist arrivals slowed (see Other services). Sluggish FDI inflows dampened demand for new office space (although Myanmar’s main cities have very limited international-standard office space). In addition, in 1999-2000 cuts in public spending on infrastructure further hit the construction sector. Cement imports fell in 1999/2000, although it is not clear whether this was the result of slack demand or of import restrictions. The junta’s own internal figures show a slowdown in the construction sector in 1999/2000, with growth of 4.4% in national accounts terms, down from 6.3% in 1998/99.

Financial services

The private banking sector The most notable trend in Myanmar’s financial services in recent years has has expanded rapidly— been the rapid expansion of private-sector banking. Private commercial banks were permitted starting in 1992, and the number of private banks reached 20 in March 1999. According to the IMF, private banks have been able to attract a growing share of deposits and to make around 20% of all loans, thanks to their more efficient services and wider range of products compared with the state- owned banks. By 1998/99 (the latest available data), private banks accounted for 49% of all savings, up from 10.4% in 1994/95. (See Reference table 18 for banking statistics.)

Myanmar’s banking sector is still dominated by five state-owned commercial banks: the Myanma Economic Bank (MEB), the Myanma Investment and Commercial Bank (MICB), the Myanma Foreign Trade Bank (MFTB), the Myanma Agricultural Development Bank (MADB) and the Myanma Industrial Development Bank. The MEB in particular has suffered from competition from the private sector. According to the IMF, the MEB’s share of deposits dropped from 86% in March 1994 to 40% in March 1999. However, the Central Bank of Myanmar still provides some 60% of all credit.

Foreign banks are permitted to enter into joint ventures with local private banks, and a number of memorandums of understanding have been signed. However, so far no joint ventures have started operation, and foreign interest remains muted. The number of foreign banks’ representative offices fell to 21 by late 1999, down from 49 at the end of 1997.

—but the banks are Both private and state-owned banks face a number of obstacles. Despite the little trusted— rapid growth in savings held at private banks, overall bank savings remain very low. For private individuals, the banking system is cumbersome and little used even in urban areas. Particularly outside urban centres, the main source of capital is private money-lenders, who typically charge interest rates of 12-20% a month (depending on location and availability of collateral), many times the official interest rate.

—and are hampered by The junta’s policies also hinder bank operations. Interest rates have remained government policy steeply negative for several yearsalthough rates turned positive once again in

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2000 in real terms (based on official inflation data), which should help to stimulate savings. The performance of the state-run banks is further undermined by the demands of the junta. For example, the MEB has had to carry the large burden of non-interest-paying government equities into which the debts of state enterprises were converted in 1989. The MEB has also been required to purchase Treasury bills with low rates of return.

Private banks also face problems. For example, in March 1998, as foreign- exchange reserves dwindled, the junta revoked nine banks’ licences to conduct foreign-exchange trade, leaving only two state-owned banks—MFTB and MICB—with licences to conduct foreign-exchange transactions. Other problems noted by the IMF include shortages of qualified staff and poor communications and clearance systems, while non-performing loans may be rising. However, the IMF notes that the private banking sector is profitable, and since the Asian economic crisis there have been efforts to improve bank regulation (see box).

Myanmar’s banking regulations

According to the IMF report, Myanmar: Recent Economic Developments, published in late 1999, non-performing loans rose to a range of 1-18% of total loans (varying by bank) as of end-1998, compared with a maximum of 12% in early 1998. However, there have been efforts to improve regulation of the banking sector. Banks must meet reserve requirements of 5-10%; a liquidity ratio of 20%; and a lending limit to one client of 20% of capital and reserves. Banks undergo annual inspection by the Central Bank of Myanmar, with more regular reporting on key requirements. The IMF notes that private banks are believed to be in full compliance with these regulations, although capital adequacy and reserve requirements “do not appear to be enforced…to the same degree” for the state-owned banks.

No stockmarket As of mid-1999, Myanmar was without a stockmarket or over-the-counter market. In June 1996 Daiwa Securities (of Japan) and the MEB set up a joint- venture securities company, the Myanma Securities Exchange Centre, intended to conduct securities business and eventually to enable Myanmar to create its own over-the-counter market.

Insurance investments The Insurance Business Law, passed in 1996, opened the insurance industry (which had been a government monopoly since the early 1960s) to private (including foreign) participation. Several Japanese firms have entered the market.

Other services

The tourism sector has The junta had hoped to develop the tourism sector as a major foreign- proved disappointing— exchange earner. The first half of the 1990s saw a flood of foreign and other investment into the sector. Several international-class hotels were upgraded, and a rash of new hotels was built, particularly in Yangon.

Arrivals for 1997/98 rose by a muted 5.4% to 265,122, picking up by 10.2% in 1998/99 to 292,282. However, arrivals then fell by 14.4% in 1999/2000, to 246,007 (see Reference table 19 for tourist arrivals). Key problems faced by the tourism sector include:

• concern over political unrest; • a well-organised worldwide boycott campaign organised by supporters of the pro-democracy movement, and targeting foreign tour operators; worldwide awareness of human rights and other abuses in Myanmar;

• relatively expensive accommodation compared with some other South-east Asian countries;

• poor infrastructure, making travel time-consuming and unreliable; and • government policy; visitors are prevented from visiting many areas of the country, and the cash-strapped junta requires all independent (non-tour) travellers to exchange US$200 into non-refundable local-currency units (foreign-exchange certificates, FECs), regardless of length of stay. (The sum was reduced from US$300 in 2000.)

—and investment Sluggish tourist arrivals have spelled disaster for the sector. Occupancy rates at has slumped most large hotels are very low, and some have temporarily suspended trading. (See Reference table 19 for statistics on tourism.) Unsurprisingly, foreign investment in hotel and tourism projects has collapsed. No new foreign projects were approved in the sector in the whole of 1998/99, with only two projects totalling US$15.5m approved in 1999/2000although it is possible that some small projects have not been captured in the data. The junta hopes that the new international airport opened at Mandalay in September 2000 will boost arrivals, but interest is likely to remain muted.

The external sector

Trade in goods

Foreign trade, 1999/2000a (Kt m; cif-cif) Exports 7,064 of which: pulses 1,179 teak & other hardwoods 1,309 prawns 530 fish & fish products 233 base metals & ores 129 continued

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Imports –15,853 of which: machinery & transport equipment 3,153 base metals & metal goods 1,718 electrical machinery 1,359 edible vegetable oil & other hydrogenated oils 479 fertiliser 329 Memorandum items Capital goods 6,492 Intermediate goods 2,738 Consumer goods 6,623 Trade balance –8,789

a Official trade data exclude some key items. For example, exports of garments are not measured, nor are imports of oil. The data above therefore provide only a partial picture of trade patterns.

Source: Central Statistical Organisation, Selected Monthly Economic Indicators.

Trade data are unreliable Myanmar’s trade statistics are particularly problematic. Although data are produced on a regular basis, they are subject to large revisions, and different official sources often show a contradictory picture. For example, two official sourcesthe Central Statistical Organisation (CSO) and an official internal report obtained by the EIUshow a marked difference in trade figures for 1999/2000. According to the CSO data, both exports and imports fell, bringing a reduction in the merchandise trade deficit to Kt8.8bn (US$1.4bn at the official exchange rate or around US$230m at the free-market rate). However, according to the internal report, exports rose strongly in 1999/2000, bringing the merchandise trade deficit down to Kt5.9bna difference of almost Kt3bn.

Merchandise trade balance, differing data sources (Kt m) 1997/98 1998/99 1999/2000 Exports CSO 6,290.0 7,672.5 7,033.0 Internal report 6,290.0 7,700.3 9,393.5 Imports CSO 14,257.4 16,941.1 15,852.8 Internal report 14,257.4 16,941.1 15,247.6 Balance CSO –7,967.4 –9,268.6 –8,819.8 Internal report –7,967.4 –9,240.8 –5,854.1 Sources: Central Statistical Organisation, Selected Monthly Economic Indicators; Official internal report.

The trade data are distorted by:

• widespread smuggling; • over-reporting of exports for money-laundering reasons, and extensive illegal drug exports;

• under-reporting of imports to avoid customs duties; • the use of an unrealistic official exchange rate in measuring data; and • the exclusion of many military imports.

Illegal drug exports are a particular problem. Myanmar is the world’s second largest producer of opiates, much of which are exported. The US embassy’s Foreign Economic Trends Report: Burma (1996) estimates that the value of opiate exports may be equal to that of legal exports. Legal export invoices may be exaggerated as a result of money-laundering related to the drug trade.

The merchandise trade Bearing these data problems in mind, it does seem that Myanmar’s deficit has narrowed merchandise trade deficit narrowed in 1999/2000. (See Reference tables 20, 21 and 22 for export and import data.) It is not clear whether exports rose (internal report) or fell (CSO data). Myanmar remains reliant on exports of commodities such as pulses, fish and timber, which have replaced traditional export staples such as rice and rubber in recent years. Many commodities have suffered from sluggish output and weak international prices in recent years. Hence the main reason for the reduction in the merchandise trade deficit in 1999/2000 would have been import compression.

Both the junta’s internal report and CSO data show a fall in imports in 1999/2000. Imports of capital goods fell by 11.8% year on year while imports of intermediate goods fell by 34.4%. Imports of machinery, transport equipment, electrical machinery and edible vegetable oils all fell. It is possible that growth in the manufacturing sector has allowed some import substitution. More likely, the weakness of the kyat and shortages of foreign exchange combined with restrictions imposed on imports (see The economy: Economic policy) curbed imports. Further, slowing foreign and other investment may have reduced demand for capital goods.

Key trade regulations

There are 14 tariff bands ranging from 0-40%. In theory the junta is committed to a schedule of tariff cuts under the ASEAN Free Trade Area (AFTA). However, a number of ad hoc non-tariff trade restrictions remain:

• restrictions were imposed on imports in March 1998, when non-priority imports were banned; further restrictions were imposed in September 2000, with traders limited to importing Kt1m/month (see The economy: Economic policy);

• licences are required to import goods; proof of foreign-exchange earnings is required;

• the government has a monopoly or near-monopoly on exports of key items, including rice and teak, which was extended in March 1998 to include other commodities such as rubber and sugar (this monopoly was relaxed in 1999 for investors in the junta’s land reclamation scheme, who may export around half of certain crops);

• some exports are subject to a 5% export tax; and

• border trade must be conducted in US dollars.

However, import restrictions have not proved wholly effective. Consumer goods have risen strongly in recent years, rising by 22.4% in 1999/2000. The

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opening up of more border checkpoints along the Thai and Chinese borders has resulted in a flood of previously unavailable consumer imports, including electrical items such as computers and many basic household goods.

In addition, investment levels in recent years rising have boosted demand for imports, while exports remained weak.

Limited success in import As a result, by early 1998 Myanmar was facing a balance-of-payments crisis. substitution Unable to tap multilateral institutions for financial support, the junta reacted by imposing tight controls on imports in March 1998, banning all imports of items not on two priority lists (see box). Despite these efforts, reserves weakened in 1999-2000.

Hence the junta has placed increased emphasis on import substitution. For example, the junta hopes to boost production of edible oils (which are widely used in traditional cooking, and which accounted for 3% of imports in 1999/2000). However, import substitution efforts for items such as machinery are hampered by the extremely low level of industrialisation and the recent collapse in foreign direct investment (FDI; see Capital flows and foreign debt).

Exports are hampered Myanmar’s exports do not enjoy many of the benefits usually accorded by industrialised nations to low-income countries. In addition, the decision of many Western manufacturers not to source in Myanmar has hampered development of the export-oriented manufacturing sector. Finally, the junta had hoped for a significant boost to export earnings once the huge Yadana and Yetagun gasfields came on stream in 1998-2000. However, weak demand in Thailand is likely to keep gas export earnings below initially projected targets.

Obstacles to trade and investment

• US sanctions: In April 1997 the US banned all new investment in Myanmar by US companies.

• US selective purchasing laws: One US state (Massachusetts) and a number of US cities have passed selective purchasing laws that penalise firms exporting to Myanmar in bids for government contracts. However, a US federal judge ruled the Massachusetts law to be unconstitutional in November 1998 following a challenge from the National Foreign Trade Council, and subsequent appeals have been overturned.

• EU restrictions: In March 1997 the EU withdrew generalised system of preferences (GSP) benefits on agricultural goods. Myanmar had already lost GSP on industrial goods.

• Canadian restrictions: In August 1997 Canada removed Myanmar’s GSP benefits.

• Consumer boycotts: Active and well-organised consumer boycott campaigns have contributed to the decision by a number of companies to pull out of, or to cease sourcing goods from, Myanmar.

Main trading partners, 1999/2000

Exports to: % of total Imports from: % of total India 12.5 Singapore 28.3 Singapore 11.4 Thailand 12.5 China 10.8 China 10.3 Thailand 5.8 Japan 9.9 Hong Kong 5.4 South Korea 9.4 Source: Central Statistical Organisation, Selected Monthly Economic Indicators.

Intra-Asian trade Myanmar conducts the bulk of its trade with its Asian neighbours. (See dominates Reference table 23 for data on Myanmar’s main trading partners.) Trade with Thailand, India and particularly China has expanded strongly as border trade posts have been opened. Increased trade with India and China helped Myanmar survive the Asian economic crisis. However, frequent closures of trading posts have disrupted trading, particularly with Thailand. Discrepancies in data from Myanmar and the US also suggest that exports to the US may be being under-reported in Myanmar’s official figures.

Invisibles and the current account

Current account (IMF accounts), 1999 (US$ m) Merchandise exports fob 1,125.2 Merchandise imports fob –2,115.9 Trade balance –990.7 Services balance 241.3 Income balance –3.4 Current transfers balance 530.7 Current-account balance –222.1 Source: IMF, International Financial Statistics.

The current-account deficit According to the IMF’s International Financial Statistics (IFS), the current-account has narrowed deficit more than halved in 1999, to US$222.1m, after surging in 1997-98, pushed up by the rising merchandise trade deficit. (See Reference table 25 for balance-of-payments data in US dollars, and Reference table 26 for national estimates in kyat.)

Services have remained According to the IMF, services inflows have been boosted in recent years by in surplus— receipts of royalties from companies involved in oil and gas exploration, “signature bonuses” paid when contracts are signed, land-lease payments by foreign hotels, and rising tourism receipts. From 1995, services payments also started to rise rapidly (perhaps relating to stronger demand for trade-related services and rising foreign investment). Both services debits and credits fell in 1999, allowing the services account to remain in surplus.

—but current transfers are Perhaps the most notable trend of the last five years is the sharp rise in current playing an increasingly transfers. In 1999 Myanmar received current transfer inflows of US$530.7m, important role down from a peak of US$655.4m in 1997, but still sharply higher compared

with inflows of less than US$100m in the early 1990s. Current transfer inflows are much higher than FDI inflows and are now one of Myanmar’s largest sources of foreign exchange.

The IFS data do not give a breakdown of current transfers. However, IMF studies have indicated that official (public) transfers remain relatively small, boosted mainly by inflows of Japanese debt-relief grants (see Capital flows and foreign debt). There may have been a slight increase in other official aid in the last few years, as some of the unilateral organisations and major international non-governmental organisations have established modest development projects. However, IMF studies suggest that private transfers are much more important in value terms than such public transfers. Hence the jump in transfers in the last few years cane be assumed to reflect private transfers, probably the result of the growing number of Myanmar citizens working abroad. Political repression and a stagnant economy have driven a huge number of Myanmar citizens overseas in search of work; there may be up to 1m illegal migrant workers from Myanmar based in Thailand, with other large populations elsewhere in South-east Asia and the Middle East (see Resources and infrastructure: Population). In addition, more remittances may now end up in the formal banking system, following the liberalisation of rules on retention of foreign exchange. The dip in current transfers in 1999 may reflect a tighter work situation in Thailand, as the Thai authorities began to expel thousands of illegal workers from Myanmar starting in late 1999.

Capital flows and foreign debt

FDI inflows have stalled FDI inflows remain an important source of foreign exchange. However, after several years of rapid growth, FDI inflows have stalled. In 1999 actual FDI inflows totalled US$216.3m, the lowest level for five years (see Reference table 24 for actual foreign investment inflows). The outlook for a recovery in FDI inflows is not good, as FDI approvalsa guide to future inflowshave collapsed. FDI approvals for the whole of 1999/2000 (financial year beginning April 1st) totalled US$55.6m—a sharp drop compared with a peak of US$2.8bn in 1996/97. It is likely that many small FDI projects, particularly from China and elsewhere in Asia, are not being captured in the official data. However, even given this probable under-reporting, the dramatic collapse in FDI approvals since 1997/98 is likely to be reflected in smaller actual inflows in the next few years—even allowing for stronger investment from regional neighbours where an economic recovery is now under way.

Key trends in FDI FDI approvals have fallen sharply in recent years. Approvals have been hit by the following factors:

• the regional economic crisis, which slowed FDI inflows from key investors such as Thailand;

• consumer boycotts and the sanctions on new US investment imposed by the US in April 1997; and

• investor concern over political risk and the erratic policy environment.

There has also been a shift away from investment in oil and gas, first to manufacturing, property and tourism, and more recently to mining.

Foreign direct investment approvals (US$ m) 1995/96 1996/97 1997/98 1998/99 1999/2000 Mining 155.8 178.3 2.7 4.9 18.5 Hotels & tourism 79.2 114.9 40.0 0.0 15.5 Manufacturing & processing 21.3 923.6 319.2 19.6 13.1 Oil & gas 14.8 695.6 172.1 0.0 5.3 Fisheries 13.1 17.5 5.8 5.0 3.3 Transport 118.9 47.9 106.6 0.0 0.0 Real estate 251.5 623.5 122.2 0.0 0.0 Total incl others 668.2 2,814.2 777.4 29.5 55.6 Source: Central Statistical Organisation, Selected Monthly Economic Indicators.

The debt profile is shifting After falling steadily for the last few years, Myanmar’s external debt stock rose towards commercial debt to US$5.7bn at the end of 1998, according to the World Bank’s Global Development Finance, up from US$5.1bn at the end of 1997. The rise in the debt stock in 1998 is the result of an increase in short-term debt, and a small increase in long-term disbursements by bilateral creditors, as well as a reduction in debt service paid.

The debt profile is shifting away from long-term concessional debt, towards shorter-term commercial debt such as exporters’ credits. Concessional lending to Myanmar has fallen off since 1990, when the country’s traditional donors cut off aid after the junta’s refusal to recognise the results of the election held that year. Myanmar’s poverty makes it eligible for generous debt relief from the Paris Club of bilateral donors, but such relief has been blocked by the US. (However, since 1991 Japan has provided debt-relief grants equal to the small amounts of debt service paid by Myanmar to Tokyo.) Myanmar still receives some UN assistance. But the junta has increasingly relied on commercial credits, much of it short term, and mostly obtained from neighbouring countries. According to the IMF, the junta has obtained short-term commercial funding for a variety of infrastructure projects from Japanese, Chinese, Thai and other companies. The junta may also have mortgaged part of its earnings from gas exports in order to raise loans.

It should be noted that debt statistics may exclude or under-report borrowings from some sources, particularly related to financing for infrastructure projects and for military imports. (See Reference table 27 for debt statistics and Reference table 28 for data on official development assistance.)

Lack of financing points Limited access to external lending, combined with a slide in FDI inflows, to a continued build-up suggests that Myanmar may continue to face balance-of-payments problems in in arrears the next few years, despite the recent reduction in the merchandise trade deficit (see Trade in goods). Given this weak payments situation, the junta has continued to part-finance its overall balance-of-payments deficit through the accumulation of arrears on its external debt. By the end of 1998 interest arrears

reached US$471m, accounting for 77% of the short-term debt stock. Principal arrears rose to US$1.6bn, up from US$1.3bn at end-1997.

The junta has changed its policy on debt repayment. As no new lending has been forthcoming from the major multilateral institutions, the junta now concentrates on repaying commercial and then bilateral creditors. For example, in 1998 the junta ceased servicing its debt to the International Development Association (IDA), the concessional lending arm of the World Bank.

Foreign reserves and the exchange rate

Reserves have A widening current-account deficit and falling FDI inflows have put pressure weakened further— on Myanmar’s foreign-exchange reserves in recent years. After a modest recovery in 1998, reserves weakened again in 1999 to US$276.6m, and totalled US$273m at end-June 2000. In response, the junta has introduced draconian restrictions on imports. The junta also tightened access to foreign exchange. (See Reference table 29 for data on foreign-exchange reserves.)

—and the kyat has Since 1977 the official exchange rate has been fixed against the SDR at continued to fall Kt8.51:SDR, and has therefore remained stable at around Kt6.2-6.4:US$1. How- ever, following liberalisation measures taken since 1988, the majority of transactions take place at the free-market rate. Citizens are permitted to buy and sell kyat at a limited number of legal foreign-exchange trade centres; more widespread trading takes place on the black market, where rates are slightly higher.

The junta does not publish data on the free-market rate; the EIU relies on private estimates, which can be taken only as a broad indication of exchange- rate movements. In mid-1997, in a bid to stop the fall in the kyat, the authorities imposed a limit of US$50,000 per month on the exchange of foreign-exchange certificates (FECs) for foreign currency for imports or transfers abroad, subsequently reduced to US$30,000 per month. Despite these and other measures, the free-market rate remained under pressure through much of 1999-2000. In times of pressure on the kyat there is often a flight to gold and to FECs. FECs were introduced in 1993, initially for tourists but subsequently for use in a range of transactions. They are converted to kyat at a rate close to the US dollar rate, and can be used by Myanmar citizens to open FEC accounts. (See Reference table 30 for data on official and free-market exchange rates.)

Foreign-exchange reserves, end-1999

Total (US$ m) Per head (US$) Thailand 34,063 544.1 Malaysia 30,588 1,324.2 Indonesia 26,445 125.3 Philippines 13,230 168.8 Singapore 76,843 19,703.3 Myanmar 276.6 5.6a

a Based on the official population estimate for 1999/2000, and actual reserves data for end-1999.

Source: IMF, International Financial Statistics.

Appendices

Regional and other organisations

Myanmar was accepted as a full member of the Association of South-East Asian Nations (ASEAN) in 1997. The countries of the EU continue to boycott Myanmar’s participation in joint ASEAN-EU meetings.

Myanmar was suspended as a full member of the International Labour Organisation (ILO) in mid-1999, because of concern over the continued use of forced labour by the junta.

Sources of information

National statistical sources Central Statistical Organisation, Selected Monthly Economic Indicators (bi- monthly), Yangon

Central Statistical Organisation, Statistical Yearbook (various years), Yangon

Ministry of National Planning and Economic Development, Review of the Financial, Economic and Social Conditions (annual), Yangon

Ministry of National Planning and Economic Development, Salient Economic and Social Indicators (March 1998), Yangon

International statistical Asian Development Bank, Key Indicators of Developing Asian and Pacific Countries sources (annual), Manila

Energy Data Associates, Bishops Walk House, 19-23 High Street, Pinner, Middlesex HA5 5PJ

International Institute for Strategic Studies, The Military Balance (annual), London

IMF, International Financial Statistics (monthly), Washington, DC

IMF, Myanmar: Recent Economic Developments, April 1997, Washington, DC

US embassy, Country Commercial Guide, Yangon, 1998

US embassy, Foreign Economic Trends Report: Burma, Yangon, 1996

World Bank, Global Development Finance (annual), Washington, DC

World Bank, Myanmar: Policies for Sustaining Economic Reform, Washington, DC, 1995

World Bank, World Development Report (annual), Washington, DC

Select bibliography and Aung San Suu Kyi, Freedom From Fear, London, 1995 websites Aung San Suu Kyi, Letters From Burma, London, 1997

The Burma Action Group, Burma: The Alternative Guide, London, 1996

Human Rights Watch, World Report, Washington, DC, 1996

Bertil Lintner, Burma in Revolt: Opium and Insurgency since 1948, Boulder, Colorado, 1994

Rory Maclean, Under the Dragon: Travels in a Betrayed Land, London, 1998

Mya Maung, The Burma Road to Poverty, New York, 1991

Martin Smith, Burma: Insurgency and the Politics of Ethnicity, London, 1991

Internet resources are plentiful, with a well-linked network of sites run by a variety of pro-democracy campaign groups providing information on all aspects of Myanmar, including human rights, recent political developments and some aspects of the economy. Two good websites to visit are:

• http://www.soros.org/burma/index.html • http://www.freeburma.org/ For the junta’s view, see:

• http://www.Myanmar.com

Reference tables

These reference tables provide the most up-to-date statistics available at the date of publication. Data are for fiscal years unless otherwise indicated.

Reference table 1 Population estimates (m unless otherwise indicated; mid-fiscal years) 1993/94 1994/95 1995/96 1996/97 1997/98 Male 21.4 21.8 22.2 22.6 23.0 Female 21.7 22.1 22.5 22.9 23.4 Total 43.12 43.92 44.74 45.57 46.40 % change 1.87 1.86 1.87 1.86 1.82 Sex ratio (male:female; %) 98.8 98.8 98.8 98.8 98.6 Age structure: 0-14 14.7 14.9 15.0 15.3 15.4 15-59 25.3 25.8 26.3 26.9 27.4 60+ 3.2 3.3 3.4 3.5 3.6 Sources: Ministry of National Planning and Economic Development, Review of the Financial, Economic and Social Conditions for 1997/98; Salient Economic and Social Indicators, March 1998.

Reference table 2 Employment by sector 1995/96 1996/97 1997/98 ‘000 % of total ‘000 % of total ‘000 % of total Agriculture 11,272 64.1 11,381 63.4 11,507 62.6 Livestock & fisheries 388 2.2 391 2.2 397 2.2 Forestry 188 1.1 188 1.1 189 1.0 Mining & energy 116 0.7 132 0.7 147 0.8 Processing & manufacturing 1,481 8.4 1,573 8.8 1,666 9.1 Power 19 0.1 21 0.1 22 0.1 Construction 354 2.0 378 2.1 400 2.2 Transport & communications 441 2.5 470 2.6 495 2.7 Social services 563 3.2 577 3.2 597 3.3 Administration & other services 776 4.4 835 4.7 888 4.8 Trade 1,715 9.8 1,746 9.7 1,791 9.8 Others 274 1.6 272 1.5 270 1.5 Total 17,587 100.0 17,964 100.0 18,369 100.0 Source: Ministry of National Planning and Economic Development, Review of the Financial, Economic and Social Conditions for 1997/98.

Reference table 3 Labour force 1991/92 1992/93 1993/94 1994/95 1995/96a Labour force (‘000) 16,955 17,391 17,838 18,296 18,766 Urban 3,795 3,892 3,992 4,094 4,199 Rural 13,160 13,499 13,846 14,202 14,567 Unemployment rate (%) 5.6 5.3 5.7 5.8 6.3b

a Estimates. b EIU estimate derived from official employment data. Source: IMF, Myanmar: Recent Economic Developments, April 1997.

Reference table 4 Transport statistics (‘000) 1993/94 1994/95 1995/96 1996/97 1997/98a Railways Passengers 56,260 53,362 53,928 55,283 55,400 Freight carried (imperial tonnes) 3,269 3,297 3,112 3,165 3,200 Airways Domesticb Passengers 537 626 726 776 909 Freight carried (short tonnes)33232 Internationalc Passengers 78 121 181 216 248 Freight carried (short tonnes)22576 Inland waterways Passengers 36,003 26,582 24,979 23,404 21,524 Freight carried (metric tonnes) 3,172 3,194 3,227 3,565 3,319 continued

1993/94 1994/95 1995/96 1996/97 1997/98a Road Passengersd 139,312 130,276 136,972 128,867 127,668 Freight carried (imperial tonnes) 1,115 1,169 1,340 1,302 1,216

Note. 1 imperial tonne=2,240 lb; 1 short tonne=2,000 lb; 1 tonne=1,000 kg. a Provisional. b From 1994/95 includes activities of Air Mandalay. c Includes statistics of Myanma Airways International from August 1993 and Air Mandalay from 1994/95. d Buses, taxis and state haulage.

Source: Ministry of National Planning and Economic Development, Review of the Financial, Economic and Social Conditions for 1997/98.

Reference table 5 National energy statistics

1993/94 1994/95 1995/96 1996/97 1997/98a Electricity generationb (m kwh) 3,386 3,632 3,762 3,945 4,205 Gas 1,594 1,852 2,061 2,183 2,310 Hydroelectric 1,705 1,659 1,595 1,651 1,655 Thermal 34 79 63 65 198 Diesel 53 42 43 46 42 Total installed capacity (state and other; mw) 1,115 1,151 1,317 1,394 1,572 of which: Myanma Electric Power Enterprise 810 837 982 1,031 1,207 a Provisional. b By the state-owned Myanma Electric Power Enterprise.

Source: Ministry of National Planning and Economic Development, Review of the Financial, Economic and Social Conditions for 1997/98.

Reference table 6 Government finances (Kt m) 1993/94 1994/95 1995/96 1996/97 1997/98a Central government Receipts 27,212 31,907 39,298 54,580 71,502 Taxes 17,036 20,101 22,644 31,357 38,845 State-owned enterprises 6,636 8,195 10,509 16,642 25,451 Others 3,540 3,611 6,146 6,580 7,206 Current expenditure –23,281 –27,732 –32,888 –37,010 –47,972 Foreign loans & aid 620 579 777 422 766 Financial account (net) 10 –335 –522 –258 –366 Amount available for investment 4,560 4,419 6,664 17,734 23,930 Investment –12,304 –20,145 –31,821 –42,920 –44,756 Balance –7,744 –15,727 –25,157 –25,185 –20,826 State-owned enterprises Receipts 52,358 72,515 87,221 108,608 213,192 Current 52,310 72,400 87,185 108,555 213,099 Capital 48 115 36 53 94 Current expenditure –56,843 –80,978 –91,625 –119,937 –237,435 Current balance (current receipts less current expenditure) –4,533 –8,578 –4,440 –11,382 –24,336 Foreign loans & aid 529 649 643 351 1,314 Financial account –449 –479 –700 –1,227 –1,091 Capital expenditure –3,374 –5,636 –9,210 –14,351 –20,451 Balanceb –7,779 –13,929 –13,671 –26,555 –44,471 continued

1993/94 1994/95 1995/96 1996/97 1997/98a Local government Current receipts 15 19 23 18 22 Current expenditure –9 –9 –11 –12 –18 Current balance 6 10 12 6 4 Foreign loans & aid 00000 Financial account 00000 Capital expenditure –1 –1 –4 –4 –15 Balanceb 5982–11 Memorandum item Summary of published balances –15,517 –29,647 –38,820 –51,738 –65,308 a Provisional. b Official figures do not add.

Source: Ministry of National Planning and Economic Development, Review of the Financial, Economic and Social Conditions for 1997/98.

Reference table 7 Money supply, credit and interest rates (Kt m unless otherwise indicated; calendar years) 1994 1995 1996 1997 1998 Money supply Money (M1) 98,288 125,957 167,971 220,006 282,177 % change, year on year 33.8 28.2 33.4 31.0 28.3 Quasi-money 33,942 54,572 82,786 102,944 151,363 Money (M2) 132,230 180,529 250,757 322,950 433,540 % change, year on year 35.6 36.5 38.9 28.8 34.2 Domestic credit 155,719 196,720 267,068 344,122 454,108 of which: claims on government 115,603 142,103 180,906 217,137 251,598 claims on non-financial public enterprises 11,343 8,351 10,631 11,419 46,688 claims on private sector 28,262 45,956 75,346 115,505 155,761 Interest rates Deposit rate (six months; %) 9.0 9.8 12.5 12.5 12.5 Lending rate (working capital loans; one-year; %) 16.5 16.5 16.5 16.5 16.5 Source: IMF, International Financial Statistics.

Reference table 8 Gross domestic producta (at market prices) 1995/96 1996/97 1997/98 1998/99 1999/2000 Total (Kt bn)a At current prices 604.7 792.0 1,119.5 1,609.8 2,190.3 At constant (1985/86) prices 66.7 71.0 75.1 79.5 88.1 % change, year on year 6.9 6.4 5.8 5.9 10.9 Per head (Kt) At current prices 13,515 17,381 24,127 33,426 44,579 At constant (1985/86) prices 1,492 1,559 1,619 1,650 1,794 % change, year on year 4.5 4.5 3.9 2.0 8.6 continued

1995/96 1996/97 1997/98 1998/99 1999/2000 Memorandum item Alternative measure of GDPb (Kt bn) At current prices 604.7 792.0 1,119.5 1,609.8 n/a At constant (1985/86) prices 66.7 71.0 75.1 79.5 84.0 % change, year on year 6.9 6.4 5.7 5.8 5.7 Per head (Kt) At current prices 13,515 17,381 24,127 33,426 n/a At constant (1985/86) prices 1,492 1,559 1,619 1,650 1,710 % change, year on year 4.5 4.5 3.9 2.0 3.6 a GDP data are on an expenditure basis, and growth rates differ slightly from output basis data. There are serious question marks over the surge in growth shown for 1999/2000. b Alternative GDP data from the IMF.

Sources: Ministry of National Planning and Economic Development, Review of Financial, Economic and Social Conditions for 1997/98; Internal report, 2000; IMF, International Financial Statistics.

Reference table 9 Gross domestic product by expenditure (Kt m; constant 1985/86 prices; % change year on year in brackets) 1993/94 1994/95 1995/96 1996/97 1997/98a Total consumption 46,795 47,955 51,027 52,184 53,177 (7.5) (2.5) (6.4) (2.3) (1.9) Fixed investment 10,234 12,640 16,201 19,887 21,196 (10.6) (23.5) (28.2) (22.8) (6.6) Change in stocks 236 389 541 –975 –538 Exports of goods & servicesb 6,229 6,528 5,089 5,608 6,340 (15.8) (4.8) (–22.0) (10.2) (13.1) Imports of goods & servicesb –5,431 –5,106 –6,117 –5,663 –5,846 (41.8) (–6.0) (19.8) (–7.4) (3.2) GDPc 58,064 62,406 66,741 71,041 74,329 (6.0) (7.5) (6.9) (6.4) (4.6)d a Provisional. b Non-factor services. c EIU estimates; diverge slightly from official output-basis GDP totals for some years. d In mid-1999 a revised GDP growth figure of 5.7% for 1997/98 was released. However, the junta has failed to publish its usual detailed statistical review, and in the absence of a new breakdown, the last full published series has been retained.

Source: Ministry of National Planning and Economic Development, Review of the Financial, Economic and Social Conditions for 1997/98.

Reference table 10 Gross domestic product by sector (% change, year on year) 1995/96 1996/97 1997/98 1998/99 1999/2000a Agriculture 5.5 3.8 3.0 3.5 9.9 Livestock & fisheries 3.0 11.9 7.1 9.3 16.5 Forestry –4.5 2.1 2.8 3.2 2.3 Energy 9.2 –2.1 2.3 53.6 69.2 Mining 18.5 12.4 29.7 7.0 14.1 Manufacturing 7.6 4.6 5.0 6.2 15.6 Power 6.5 12.8 17.8 –5.4 13.5 Construction 27.2 24.6 9.8 6.3 4.4 Services 7.3 6.5 6.7 7.0 9.1 GDP at factor cost 6.9 6.4 5.7 5.8 10.5 a Provisional growth figures produced by the junta. A full, revised breakdown for GDP on an output basis, in price terms, has not been published. The high growth rates for 1999/2000 have been widely questioned.

Source: Internal report, 2000.

Reference table 11 Consumer price index (calendar years) 1995 1996 1997 1998 1999 Yangon indexa 100.0 116.3 150.8 228.5 270.5 % change, year on year 25.2 16.3 29.7 51.5 18.4

a 1995=100. Sources: IMF, International Financial Statistics.

Reference table 12 Output and yields of key crops

1994/95 1995/96 1996/97 1997/98a 1998/99b Net area sown (‘000 ha) 8,721 8,912 9,006 9,035 9,131 Irrigated 1,556 1,758 1,558 1,634 1,743 % of total area sownc 17.4 19.2 16.8 17.5 18.5 Paddy (‘000 ha) 5,930 6,142 5,880 5,939 6,075 Output (‘000 tonnes) 18,195 17,953 17,676 17,308 18,571 Yield (tonnes/ha) 0.519 0.488 0.502 0.508 0.501 Pedesein (green gram, ‘000 ha) 384 460 450 550 537 Output (‘000 tonnes) 272 337 333 415 386 Yield (tonnes/ha) 0.118 0.121 0.123 0.126 0.118 Sesame (‘000 ha) 1,332 1,277 1,146 1,069 1,215 Output (‘000 tonnes) 304 304 344 307 367 Yield (tonnes/ha) 0.044 0.055 0.056 0.059 0.050 Cotton (‘000 ha) 205 379 334 266 324 Output (‘000 tonnes) 86 165 168 169 221 Yield (tonnes/ha) 0.078 0.082 0.090 0.106 0.110 Rubber (‘000 ha) 89 104 119 134 158 Output (‘000 tonnes) 27 26 26 27 29 Yield (tonnes/ha) 0.086 0.087 0.093 0.093 0.093 continued

1994/95 1995/96 1996/97 1997/98a 1998/99b Sugarcane (‘000 ha) 53 67 83 108 109 Output (‘000 tonnes) 2,254 3,251 4,043 5,137 5,597 Yield (tonnes/ha) 7.419 0.172 0.166 0.167 0.172 Memorandum items Opium poppy (‘000 ha) n/a n/a n/a n/a 163 Output (‘000 tonnes) n/a n/a n/a n/a 2.5 a Provisional. b Plan. c Official data.

Sources: Ministry of National Planning and Economic Development, Salient Economic and Social Indicators, March 1998; US embassy, Country Commercial Guide, 1998.

Reference table 13 Production of livestock and fish (‘000 tonnes unless otherwise indicated) 1993/94 1994/95 1995/96 1996/97 1997/98a Livestock Draught cattle (‘000 head) 6,496 6,627 6,808 6,922 7,088 Poultry 30.4 38.3 45.8 52.3 56.2 Beef 18.6 18.6 19.1 19.6 20.0 Pork 18.2 22.2 25.5 27.8 29.3 Fish Freshwater 81.9 84.2 83.4 88.7 93.6 Marine 230.1 230.8 174.3 241.6 257.6

a Provisional.

Sources: Ministry of National Planning and Economic Development, Review of the Financial, Economic and Social Conditions for 1996/97; Salient Economic and Social Indicators, March 1998.

Reference table 14 Timber production (‘000 cu tonnes) 1993/94 1994/95 1995/96 1996/97 1997/98a Teak 332 272 230 203 200 Other hardwoods 1,580 1,217 1,250 1,358 1,383

a Provisional.

Source: Ministry of National Planning and Economic Development, Review of the Financial, Economic and Social Conditions for 1997/98.

Reference table 15 Minerals production (tonnes unless otherwise indicated) 1993/94 1994/95 1995/96 1996/97 1997/98a Crude oil (‘000 US barrels) 5,200 4,207 4,278 3,788 6,057 Natural gas (m cu ft) 36,042 45,599 54,025 58,579 68,540 Zinc concentrates 1,939 3,475 1,539 1,507 1,500 Refined lead 1,547 2,068 1,862 1,986 2,000 Tin concentrates (65%) 544 648 575 327 401 Tungsten concentrates (65%) n/a 152 148 37 57 Jade (‘000 kg) 584 794 1,791 4,464 2,785 Refined silver (‘000 oz) 120 160 140 120 130 Gold (troy oz) 14,030 19,560 12,702 13,903 20,280 Pig iron 1,000 1,188 1,368 1,506 1,500 Copper concentrate (‘000 tonnes) 25 27 28 26 9 Copper ore (‘000 tonnes) 970 1,201 1,101 1,024 495 a Provisional.

Sources: Ministry of National Planning and Economic Development, Review of the Financial, Economic and Social Conditions for 1996/97; Salient Economic and Social Indicators, March 1998.

Reference table 16 Manufacturing production (Kt m current prices; quantum index 1985/86=100 in brackets) 1993/94 1994/95 1995/96 1996/97a 1997/98a Food & beverages 131,458 153,743 217,590 305,335 405,542 (n/a) (n/a) (119.1) (123.4) (127.0) Clothing 3,765 5,063 6,855 7,729 8,500 (n/a) (n/a) (132.6) (138.0) (142.7) Construction materials 3,946 4,141 4,877 5,562 6,553 (n/a) (n/a) (124.7) (134.5) (143.5) Personal goods 1,313 2,181 2,930 3,158 4,800 (n/a) (n/a) (114.7) (110.5) (126.0) Household goods 470 578 689 845 995 (n/a) (n/a) (171.5) (203.2) (204.5) Printing & publishing 616 598 1,064 1,962 871 (n/a) (n/a) (105.2) (200.1) (85.5) Industrial raw materials 4,485 8,075 14,335 14,879 24,737 (n/a) (n/a) (154.0) (150.3) (159.8) Mineral & petroleum products 3,210 4,904 4,805 5,332 32,797 (n/a) (n/a) (91.1) (102.7) (159.9) Agricultural equipment 603 730 962 1,540 2,362 (n/a) (n/a) (167.3) (265.9) (263.5) Machinery & equipment 76 103 171 155 209 (n/a) (n/a) (161.3) (232.2) (240.5) Transport vehicles 424 1,084 1,558 1,571 2,869 (n/a) (n/a) (76.9) (57.9) (79.9) Electrical goods 125 253 419 441 590 (n/a) (n/a) (38.8) (44.1) (68.6) Others 1,375 1,830 1,775 2,242 3,050 (n/a) (n/a) (62.4) (72.9) (96.1) Total 151,866 182,283 258,030 350,751 493,875 (n/a) (n/a) (118.4) (123.7) (130.1) a Provisional.

Source: Ministry of National Planning and Economic Development, Review of the Financial, Economic and Social Conditions for 1997/98.

Reference table 17 Construction and renovation work (Kt m at current prices) 1993/94 1994/95 1995/96 1996/97 1997/98a State sector 13,972 23,470 36,459 44,386 53,120 of which: irrigation & embankments 899 1,074 5,800 4,196 4,069 railways, airstrips & jetties 735 2,163 3,885 8,523 9,427 roads & bridgesb 3,034 5,228 6,284 7,990 11,327 buildingsb 8,331 13,072 17,762 18,785 18,667 Private sector 3,253 4,080 7,841 18,753c 28,080c Total incl othersb 17,433 27,797 44,489 63,254 81,363 a Provisional. b Includes renovation and upgrading. c Increases steeply because from 1996/97 two large build-operate transfer (BOT) road- and bridge-building projects were begun with private-sector involvement.

Sources: Ministry of National Planning and Economic Development, Review of the Financial, Economic and Social Conditions for 1997/98; Statistical Yearbook, 1997.

Reference table 18 Banking statistics (Kt m) 1993/94 1994/95 1995/96 1996/97 1997/98 Total savings 25,566 37,016 58,935 88,099 108,815 State banks 24,495 33,158 44,313 55,020 63,875 Private banks 1,071 3,858 14,622 33,079 44,940 Loans n/a 28,461 42,977 62,487 n/a of which: extended by private banks n/a 4,262 11,519 20,461 n/a Sources: Ministry of National Planning and Economic Development, Review of the Financial, Economic and Social Conditions for 1997/98; Central Statistical Organisation, Selected Monthly Economic Indicators.

Reference table 19 Tourist arrivals and receipts

1994/95 1995/96 1996/97 1997/98 1998/99a Arrivals 95,616 120,205 251,501 265,122 292,282 Receipts (Kt m) 206.1 181.6 190.5 180.2 n/a

a Provisional.

Sources: Ministry of National Planning and Economic Development, Review of the Financial, Economic and Social Conditions for 1997/98; Central Statistical Organisation, Selected Monthly Economic Indicators.

Reference table 20 Exports (Kt m; cif) 1994/95 1995/96 1996/97 1997/98 1998/99a Rice & rice products 1,165.8 439.8 125.8 37.7 246.6 Pulsesb 799.4 1,357.9 1,272.1 1,403.3 1,134.1 Raw rubber 122.4 180.0 170.6 133.6 100.4 Prawns 352.0 408.7 564.2 565.4 575.7 Fish & fish products 209.8 159.4 226.6 301.7 302.1 Teakc 953.1 903.0 854.6 697.6 848.3 Other hardwoodsc 107.8 145.5 130.5 155.3 209.9 Plywood, veneer & other forest products 129.7 207.9 300.5 n/a n/a of which: plywood & veneer 31.0 23.5 34.5 34.4 120.4 Readymade garments 342.5 300.1 402.4 345.5 n/a Gems 97.5 126.4 151.9 135.9 n/a Sesame seeds 223.4 186.1 191.0 175.6 163.8 Unspecified itemsc 1,318.3 1,099.3 1,771.3 2,707.9 3,206.3 Total incl others 5,405.2 5,032.7 5,487.7 6,290.0 7,082.0 Government 2,950.3 2,353.0 1,910.4 1,655.3 2,174.7 Private 2,454.9 2,679.7 3,577.3 4,634.7 4,907.3 a Preliminary. b Includes matpe, pedesein and other pulses. c Includes border trade.

Sources: Central Statistical Organisation, Selected Monthly Economic Indicators; Ministry of National Planning and Economic Development, Salient Economic and Social Indicators, March 1998; Review of the Financial, Economic and Social Conditions for 1997/98.

Reference table 21 Imports (Kt m; cif) 1994/95 1995/96 1996/97 1997/98 1998/99a Capital goods 2,913.9 3,644.5 4,714.2 6,172.1 8,678.7 Intermediate goods 1,854.3 2,376.8 3,046.0 3,350.1 1,979.4 Consumer goods 3,564.1 4,280.3 4,018.6 4,735.2 6,234.2 Total 8,332.3 10,301.6 11,778.8 14,257.4 16,892.3 Government 2,949.3 3,352.0 2,563.4 4,126.9 5,489.6 Private 5,383.0 6,949.6 9,215.4 10,130.5 11,402.7 Major items Machinery & transport equipment 2,092.1 2,402.0 3,032.1 3,597.4 4,649.3 Base metals & manufactures 713.6 971.3 1,535.0 1,498.6 1,951.5 Electrical machinery 561.2 598.2 830.1 1,202.8 1,676.8 Edible vegetable oils 806.5 1,183.6 398.2 805.5 669.6 Cement 107.1 135.1 299.5 502.6 393.3 Unspecified itemsb 3,114.8 3,848.1 4,652.7 4,875.5 6,018.6 a Preliminary. b Mostly border trade.

Source: Central Statistical Organisation, Selected Monthly Economic Indicators.

Reference table 22 Key exports and imports (volume) (‘000 metric tonnes unless otherwise indicated) 1994/95 1995/96 1996/97 1997/98 1998/99a Exports Rice & rice products 1,041.0 354.0 93.1 28.3 123.0 Pulses 424.9 609.6 594.8 768.9 621.6 Raw rubber 24.3 24.8 25.8 22.0 29.7 Teak logsb (cu tonnes) 150.0 117.3 138.7 138.0 165.1 Hardwood logsb (cu tonnes) 83.4 83.3 130.8 153.9 235.3 Prawns 10.1 9.0 12.8 13.5 13.2 Fish & fish products 71.8 34.5 32.8 41.2 45.7 Imports Wheat flour 58 54 26 n/a n/a Milk, condensed & evaporated 6,932 14,843 2,432 n/a n/a Edible vegetable oils & other hydrogenated oils 205 218 72 n/a n/a Paper, paperboard & manufactures 31 43 38 n/a n/a Refined mineral oil (‘000 gallons) 5,120 912 13,075 n/a n/a Artificial & synthetic fibres 962 602 262 n/a n/a Tobacco products 54 1,769 963 n/a n/a a Provisional. b Includes border trade.

Sources: Central Statistical Organisation, Selected Monthly Indicators; Statistical Yearbook; Ministry of National Planning and Economic Development, Statistical Yearbook, 1997.

Reference table 23 Main trading partners (Kt m) 1994/95 1995/96 1996/97 1997/98 1998/99a Exports to: China 277.5 195.1 336.1 667.7 790.2 India 695.4 1,036.8 929.0 1,421.5 692.8 Singapore 883.5 986.8 1,007.3 828.8 665.2 Thailand 542.8 535.0 544.2 748.8 456.8 Malaysia 102.0 147.5 305.3 165.2 343.2 Total incl others 5,405.2 5,032.7 5,487.7 6,290.0 7,082.0 Imports from: Singapore 1,215.7 1,819.7 2,791.5 4,440.4 5,170.6 Thailand 830.2 1,318.8 1,191.7 1,397.9 2,153.3 Japan 1,962.7 2,505.8 2,465.0 2,181.4 2,143.4 China 1,019.4 1,433.8 1,116.3 1,338.8 1,725.2 Indonesia 320.0 350.3 319.8 677.8 1,263.7 Total incl others 8,332.3 10,301.6 11,778.8 14,257.4 16,892.3

a Provisional.

Source: Central Statistical Organisation, Selected Monthly Economic Indicators.

Reference table 24 Direction and composition of tradea (US$ ’000) US India Singapore Thailand China Derived exports 1998 1998 1998 1997 1998 Food 4,857 87,381 62,636 13,606 5,263 of which: fish 1,985 230 39,112 12,129 245 fruit, vegetables & products 328 85,503 18,622 21 3,072 Oilseeds 4,242 62 12,329 129 1,562 Rubber & manufactures 0 1,237 7,574 2 430 Wood & manufactures 7,453 83,501 16,921 58,511 23,720 Ores, slag & ash 0 0 454 51 4,918 Pearls, precious stones, metals & jewellery 10,600 7 1,717 41,456 8,172 Total incl others 174,805 173,918 120,433 82,303 62,050

China Singapore Thailand Malaysia Japan Derived imports 1998 1998 1997 1998 1998 Food 9,277 27,471 39,961 2,742 161 of which: dairy products 4,242 9,013 13,418 324 0 Beverages & tobacco 36,995 17,464 39,523 489 20 Mineral fuels 16,120 55,913 29,926 82,423 36 Animal & vegetable oils & fats 24 4,600 5,983 135,186 0 Chemicalsb 34,467 46,610 63,921 6,977 4,994 Textile fibres, yarn, cloth & manufactures 68,534 21,357 32,921 1,822 2,974 Iron & steel & manufacturesc 68,938 30,029 19,396 47,248 16,535 Tools etc & miscellaneous metal manufactures 2,889 6,873 2,104 396 1,267 Machinery incl electric 156,758 166,462 37,205 7,146 110,282 Road vehicles & tractors 17,849 12,226 12,305 196 40,447 Other transport equipment 59,897 4,396 439 77 325 Clothing 1,366 6,065 7,091 8 6 Scientific instruments etc 6,757 12,902 696 120 2,094 Total incl others 514,335 455,914 403,602 292,915 184,422 a Figures from partners’ trade accounts. b Including crude fertilisers and manufactures of plastics. c Including scrap.

Sources: UN, External Trade Statistics, Series D.

Reference table 25 Balance of payments, IMF series (US$ m; calendar years) 1994 1995 1996 1997 1998 Current-account balancea –129.9 –258.5 –279.8 –412.0 –453.7 Exports, fob 897.4 933.2 937.9 974.5 1,171.4 Imports, fob –1,466.7 –1,756.3 –1,869.1 –2,106.6 –2,455.0 Trade balance –609.4 –823.0 –931.2 –1,132.1 –1,283.6 Services: credit 270.7 360.9 427.7 521.7 543.4 Services: debit –128.9 –243.8 –302.0 –443.4 –444.5 Services balance 141.8 117.1 125.7 78.3 98.9 Income: credit 7.1 15.4 9.1 6.5 10.9 Income: debit –74.1 –124.2 –53.1 –20.3 –39.7 Income balance –67.0 –108.8 –44.0 –13.8 –28.8 continued

1994 1995 1996 1997 1998 Current transfers: credit 405.2 564.2 598.4 685.1 789.7 Current transfers: debit –0.6 –8.0 –28.8 –29.7 –29.8 Current transfers balance 404.6 556.2 569.6 655.4 759.9 Capital account n/a n/a n/a n/a n/a Financial account 185.2 242.8 266.8 469.1 535.8 Outwards direct investment 0.0 0.0 0.0 0.0 0.0 Inwards direct investment 126.1 277.2 310.4 387.2 315.1 Other investment liabilities 59.1 –34.4 –43.6 81.9 220.7 of which: general government 56.5 –36.7 –40.6 87.5 224.2 Errors & omissions (net) –10.3 –16.2 –11.7 –26.0 –22.3 Overall balance 45.0 –31.8 –24.7 31.0 59.7 Change in reserves –45.0 31.8 24.7 –31.0 –59.7

a Components do not add in source due to rounding.

Source: IMF, International Financial Statistics.

Reference table 26 Balance of payments, national series (Kt m) 1993/94 1994/95 1995/96 1996/97 1997/98a Exports fob 4,249 5,405 5,255 5,496 6,022 Imports cif –7,952 –8,766 –10,295 –11,501 –13,451 Merchandise trade balance –3,703 –3,361 –5,040 –6,005 –7,429 Services credit 3,150 3,585 4,803 5,737 6,177 Government 11111 Private services & transfers 1,671 1,897 2,644 2,908 2,894 Travel 720 847 1,062 1,236 1,145 Transport & insurance 30 20 32 44 41 Embassies & international organisations 94 81 68 63 80 Other 634 739 996 1,485 2,016 Services debit –764 –771 –1,584 –2,063 –2,138 Government 11111 Private 1 2 56 206 124 Travel 62 81 109 188 210 Transport & insurance 125 124 198 192 202 Embassies & international organisations 101 69 82 63 70 Other 474 494 1,138 1,413 1,531 Services balance 2,386 2,814 3,219 3,674 4,039 Interest credit 28 49 101 38 35 Interest debit –457 –445 –790 –154 –174 Interest balance –429 –396 –689 –116 –139 Current-account balance (excl grants) –1,746 –943 –2,510 –2,447 –3,529 Memorandum items Net grants 601 632 745 643 762 Net loans 344 347 –229 –668 56 Net foreign investment 581 814 1,824 1,865 2,685 Net short-term loans –7 –7 –5 0 –27 Total balance incl others –140 374 –240 –445 –67 a Provisional.

Source: Ministry of National Planning and Economic Development, Review of the Financial, Economic and Social Conditions for 1997/98.

Reference table 27 External debt (US$ m unless otherwise indicated; debt stocks as at year-end; calendar years) 1993 1994 1995 1996 1997 Total external debt 5,757 6,555 5,771 5,184 5,074 Long-term debt 5,394 6,154 5,378 4,804 4,640 Short-term debt 362 401 393 381 434 of which: interest arrears on long-term debt 354 380 352 366 390 Use of IMF credit 0 0 0 0 0 Public & publicly guaranteed long-term debt 5,394 6,154 5,378 4,804 4,640 Official creditors 5,105 5,820 5,011 4,438 4,188 Multilateral 1,348 1,458 1,311 1,223 1,171 Bilateral 3,758 4,362 3,680 3,215 3,017 Private creditors 289 334 367 366 452 Total debt service, paid 111 162 248 157 114 Principal 22 42 180 140 101 Interest 89 120 68 18 13 of which: short-term debt 1 1 2 1 2 Ratios (%) Debt-service ratioa 11.8 13.4 19.3 12.1 8.0 Short-term debt/total external debt 6.3 6.1 6.8 7.3 8.6 Concessional long-term loans/ total external debt 86.6 86.6 84.7 83.5 80.6 Memorandum items Disbursements 72 59 86 144 190 Multilateral creditors 14 12 0 –1 0 Bilateral creditors 23 19 16 97 47 Private creditors 35 28 69 47 143

Note. Long-term debt is defined as having original maturity of more than one year. Figures do not add due to rounding. a Debt service as a percentage of earnings from exports of goods and services. Source: World Bank, Global Development Finance, 1999.

Reference table 28 Net official development assistancea (US$ m; calendar years) 1993 1994 1995 1996 1997 Bilateral 77.3 142.8 126.2 45.3 23.6 of which: Japan 68.6 133.8 114.2 35.2 14.8 France 3.4 2.0 4.3 2.1 1.9 Australia 0.2 0.4 1.9 1.5 1.7 Norway 0.4 0.7 0.8 1.2 1.6 Germany 1.6 1.4 1.3 1.5 1.4 continued

1993 1994 1995 1996 1997 Multilateral 24.1 18.8 25.6 10.9 21.7 of which: IDA 0.3 –1.7 –9.5 –10.8 –7.0 UNDP 8.6 10.9 14.3 5.8 14.0 Asian Development Bank –3.4 –10.1 –10.3 –10.3 –11.7 UNICEF 7.5 6.5 6.9 8.0 8.4 UNHCR 0.2 8.2 11.5 9.6 7.9 Total 101.5 161.6 151.8 56.2 45.2

a Disbursements by OECD and OPEC members and multilateral agencies. Official development assistance is defined as grants and loans, with at least a 25% grant element, administered with the aim of promoting economic or social development. Source: OECD, Geographical Distribution of Financial Flows to Aid Recipients, 1993-97.

Reference table 29 Foreign reserves (US$ m unless otherwise indicated; end-period; calendar years) 1994 1995 1996 1997 1998 Foreign exchange 422.0 561.1 229.1 249.8 314.9 SDRs 0.1 0.1 0.1 0.1 0.3 Golda 12.8 12.0 11.6 10.9 11.4 Total reserves incl gold 434.9 573.2 240.8 260.8 326.6 Memorandum item Gold (m fine troy oz) 0.251 0.231 0.231 0.231 0.231

a National valuation.

Source: IMF, International Financial Statistics.

Reference table 30 Exchange rates (Kt:US$; annual averages; calendar years unless otherwise indicated) 1994 1995 1996 1997 1998 Official rate 5.98 5.67 5.92 6.24 6.30 Official rate (financial year beginning Apr 1st) 5.87 5.69 5.99 6.30 6.34 Free-market rate 115 117a 138a 260a 330a Free-market rate (financial year beginning Apr 1st) 113 120a 155a 237a 340a

a EIU estimate.

Sources: IMF, International Financial Statistics; US embassy (Yangon), Foreign Economic Trends Report: Burma; private reports.

Editors: Georgia Bush (editor); Graham Richardson (consulting editor) Editorial closing date: November 1st 2000 All queries: Tel: (44.20) 7830 1007 E-mail: [email protected]