SPECIAL REPORT MYA N M A R May 25th 2013 A Burmese spring Myanmar6.indd 1 07/05/2013 14:39 SPECIAL REPORT MYANMAR A Burmese spring After 50 years of brutal military rule, Myanmar’s democratic opening has been swift and startling, says Richard Cockett. Now the country needs to move fast to heal its ethnic divisions A WALK AROUND battered, ramshackle Yangon, Myanmar’s biggest city and former capital, quickly makes it clear how far the country has fallen behind the rest of Asia over the past half•century. In large part the place is but a ghostly reminder of former glories. Under British colonial rule, be• fore independence in 1948, Rangoon (as it was then) was a thriving, cos• mopolitan entrepot, the capital of Burma, one of the region’s wealthiest countries. All that came to an abrupt end in 1962 after a junta of army o• cers, led by the brutal General Ne Win, seized power and launched the country on the quasi•Marxist Burmese Way to Socialism. Private for• eign•owned businesses were nationalised, prompting the exodus of hundreds of thousands of people, many of Indian origin. The country’s tenuous attachment to democra• cy was broken. Myanmar, as Bur• ma was later renamed by its rul• ing generals, retreated into itself. Comprehensive Western sanc• tions hit home from the mid•1990s onwards, only slightly CONTENTS alleviated by an injection of Asian money. 3 The story so far Yangon, with its old cars Democracy on prescription and bookshops selling textbooks 4 Politics from the 1950s, attests to this se• Suu Kyi for president? clusion. The colonial•era banks, law courts and department 6 Geopolitical consequences stores, once as imposing as any in Rite of passage Kolkata or Shanghai, have all but 8 Business crumbled away. Except for the The promiseand the magnicent Shwedagon Pagoda, pitfalls lovingly regilded to welcome the crowds of pilgrims and tourists, 9 Ethnic strife most of the city seems to have re• The F•word mained untouched for decades. Even youthful rebellion is stuck in a time•warp. Boys are still gamely attempting to out authority by dressing up as punk•rockers. But now the country has seen another about•turn, almost as abrupt as that in 1962. Over the past two years dramatic reforms introduced by a new president, Thein Sein, prompted by the country’s increasingly des• perate economic straits, have started a rapid transition from secretive iso• lation to an open democracy of sorts. The mere fact of such a change tak• ing place has surprised the world; its speed and breadth have caused A CKNOWLEDGMENTS widespread bewilderment. As well as those quoted in the text, Even in careworn Yangon the signs are everywhere. The pavements the author would like to thank the following for their views, time and are cluttered with traders selling an array of newspapers, newly licensed advice in the preparation of this and privately owned, carrying pictures of Aung San Suu Kyi, the leader report: Thet Kay Byin, Iftekhar of the National League for Democracy (NLD). Less than two years ago the Ahmed Chowdhury, Adam Cooper, image of the deant Nobel peace•prize laureate was banned; under a Sreeradha Datta, Tom Kramer, Joseph Fisher, Steve Marshall, strict censorship system her name could not even be mentioned in the Binoda Kumar Mishra, Robert Pé, press. Now all censorship before publication has been lifted; any paper, A list of sources is at Ben Rogers, Phyu Phyu Sann, Hla NLD such as the ’s own newspaper D Wave, can apply to publish daily; Economist.com/specialreports Maung Shwe, Tina Singhsacha, and Miss Suu Kyi’s photo festoons T•shirts, mugs and biros for sale on al• Hkalam Samson, Ashley South, An audio interview with Masaki Takahara, Soe Thein, Win Tin, most every street corner. People are still excited about being able to speak the author is at Thant Myint U, Ross Wilson, Hla Hla freely, even about politics, without constantly having to look over their Economist.com/audiovideo/ Win, Wong Yit Fan, Aung Kyaw Zan. shoulders. Some of those interviewed for this special report had never 1 specialreports The Economist May 25th 2013 1 SPECIAL REPORT MYANMAR 2 before talked to a foreigner, let alone a foreign journalist. 250 km With greater political freedom has come economic change. Population, 2012, m Almost all Western sanctions against the country have been lift• INDIA ed, and the country is swifty reconnecting with the international BHUTAN CHINA nancial system. Visitors no longer have to wander around with so many wads of dirty old kyat, the local currency, in their pock• 1,223.2 KACHIN ets: the rst international ATM in Yangon has recently started dis• gorging fresh banknotes. Some outlets are now accepting credit 1,353.8 cards. Real Western brands, rather than pirated versions, are BANGLADESH about to appear in a few shops. An inux of relatively wealthy foreigners and returned natives will need new oces and apart• 150.0 SAGAING ments. Prime parts of Yangon are rapidly being attened to cater for the expected demand. MYANMAR Myanmar’s transformation is the most signicant event to have taken place in South•East Asia in the past decade, and this S H A N CHIN 63.7 special report will argue that it will have important conse• LAOS quences for the rest of Asia as well. In the space of just a few MANDALAY 6.4 R years almost every aspect of life has been touched by the reform A MAGWE Naypyidaw K I Sittwe r programme. Not only was Miss Suu Kyi released from house ar• H r a I w N rest in November 2010, but the vast majority of the country’s a KAYAH E d NLD d thousands of political prisoners have been freed. The , ha• Bay of y rassed for decades and then declared illegal for refusing to parti• Bengal BAGO cipate in rigged elections in 2010, is legitimate once more. In April 2012 it won 43 out of 44 seats it contested in by•elections, the THAILAND country’s rst free and fair polls since the 1950s: its MPs, led by YANGON KAREN Miss Suu Kyi, now sit in parliament. special report IRRAWADDY Yangon The blacklists barring former political opponents of the re• will weigh the 64.5 gime and hostile journalists have been put away. A new labour pros and cons of law covering private industry has encouraged the formation of rushing into what MON new trade unions. Once a byword for bleak authoritarianism, investors are calling Andaman S e a Myanmar is now doing better than some of its Asian peers on the nal frontier. T A civil and political rights. N I Don’t cheer too soon N International nancial institutions such as the World Bank T H have returned, often after writing o the country’s old debts. The new sense of optimism A R Thein Sein now tours the world’s capitals much like any other and condence among Myanmar’s Y leader, even if he does not get the rapturous welcome given to own people is still tinged with cau• I Miss Suu Kyi wherever she goes. And this December Myanmar tion. Hopes in the past have been Gulf of celebrates its return to regional respectability by hosting the raised by modesAndamant doses of liberalisa• Thailand South•East Asian Games for the rst time since the 1960s. tion, only to beIslands das (tohed India) again. It is also Foreign governments and multinationals have converged clear that in easing military control, on a country that occupies a unique geostrategic position be• Myanmar’s reformers have provided an tween the new Asian superpowers of India to the west and Chi• opening for dark forces that authoritarian na to the east. Private companies are jostling to capture a share of rule had kept in check. Since June 2012, starting an almost virginal consumer market of some 60m people. This in the city of Sittwe in western Rakhine state, Buddhist mobs have killed hundreds of Muslims and razed their mosques and homes to the ground. It was not what the reformers had intend• ed, but the e ects of relaxing restrictions can be unpredictable. Regional laggard 1 The rst two months of 2013 also saw the heaviest ghting Selected Asian high GDP-growth periods yet between the Myanmar army and the Kachin Independence Average annual rates, % Army (KIA), an armed militia of the Kachin people. Like many of 0 2 4 6 8 10 12 the other ethnic minorities that make up about 40% of Myan• China (1991-2010) mar’s population, the Kachin, in the far north of the country, have been battling for decades for autonomy and against major• Thailand (1976-90) ity Burman rule. For all the past two years’ economic and politi• Cambodia (1994-2010) cal progress in the Burman heartlands in the centre of the coun• Vietnam (1994-2010) try, much of the periphery remains largely cut o and in a state of, at best, suspended hostilities. Malaysia (1976-90) Thein Sein’s government has signed ceasere agreements Laos (1994-2010) with most of the armed groups, but a lasting political solution Indonesia (1976-90) still seems a long way o . It will require proper citizens’ rights to be granted to the country’s entire population, including margin• Myanmar* (2000-10) alised people like the Rohingya Muslims, which all of Myan• Myanmar † (2000-08) RANGE mar’s rulers since independence have neglected to do. This spe• Sources: Asian Development Bank; cial report will argue that the current period of upheaval is the Harvard (Dapice, Vallely & Wilkinson) *IMF estimate †Harvard estimate, 2-4% best possible opportunity to resolve these ethnic disputes.