In this webinar, experts with deep knowledge and understanding of the inter-related nature of the political, economic, and social issues in Myanmar’s democratic transition discussed the state of play on the eve of general elections taking place on November 8, 2020.
MYANMAR STUDIES PROGRAMME WEBINAR SERIES
Thursday, November 5, 2020. – On November 8, citizens of Myanmar would go to the polls in nation-wide elections amidst Covid-19 concerns across the country. Myanmar citizens overseas had cast their votes earlier, on 1-15 October, and the National League for Democracy (NLD) government had introduced advance voting for senior citizens from 29 October to 7 November.
The conversation opened with a forward-looking overview of priority topics and concerns to consider for the 2021-2025 term. Key points highlighted by the panellists include:
- There had been little discussion on economics during the 2020 election campaign. Not clear whether this was because the NLD government chose not to discuss the economy as an election topic, or because the economy was perceived to have performed well in the 2016-2020 term, averaging a 6% annual growth rate. However, some serious economic challenges remain across the country, and appointment of a credible and skilled economic team is necessary.
- Both the Union Solidarity and Development Party (USDP) and NLD governments had prioritised attracting foreign direct investment (FDI). The NLD government had prioritised the realisation of FDI targets over the past two years; however, ambitious FDI targets did not reflect on-the-ground realities as Covid-19 had a far-reaching impact on the economy, particularly affecting jobs in the garment, agriculture and tourism sectors. Still, FDI continued to be important for developing the economy. Priority concerns to consider include: 1) political consequences of the elections and the ongoing conflict, particularly in Rakhine State. The consequences of the Arakan Army insurgency are being felt even in Kyaukphyu – one offshore gas exploration project had relocated shore backup to Thandwe; 2) how to maintain declining revenue from offshore gas and develop an energy policy that is responsive to local concerns and global oil price fluctuations; 3) less haste and more deliberation in planning and executing energy projects (e.g. the recent solar energy tender which only took price as the sole tender criterion and not quality, technology or environment/social performance, leading to Chinese companies sweep the board). The next NLD government should consider how to incorporate environmental and social performance into investment plans, such as benefits to local communities.
- Ethnic political parties have developed long-term and short-term goals, based on past election experience. They have developed detailed/focused plans and programmes in preparation for the 2020 elections, which could be compared with the NLD’s manifesto with regard to ethnic areas and development. Looking ahead to the situation and sentiments in the ethnic areas beyond November 8, ethnic political parties were starting to change their political narrative, recognising the value of participating in the political process to push for policies redressing the effects of armed conflict and marginalisation.
- The electoral landscape in 2020 had been affected by the Covid-19 surge as well as by the UEC or Union Election Commission’s management of election preparation and logistics. Several questions had been raised about the legitimacy of the elections in this context. The cancellation of polling in several areas due to security reasons had led to about one million people being been disenfranchised (in addition to the Rohingya community). The people in these areas where polling was cancelled were part of Myanmar’s 37.4 million eligible voters. The electorate of Myanmar’s 2020 elections also had to follow most party campaigns online due to Covid-19 movement and travel restrictions. These restrictions posed difficulties for local and international observers and media to observe elections and report on them.
- The projected return of the NLD into office has raised expectations among the business community for a continued momentum of business and economic initiatives. The business community is keen to see capable ministers who know the economy well, and will improve the planning and transparency of important projects, such as in energy.
Further elaborating these key points, the panellists shared the following perspectives.
The Economy
Rather than dwell on “should-haves” or “could-haves” regarding economic performance, it was noteworthy that Myanmar’s economy in 2020 differed from 2015 in four aspects: a higher average annual growth rate; diversification in agriculture development; expanding the garment industry; and growth in FDI inflows which had created 750,000 jobs and helped to reduce poverty incidence. Thus, most people in Myanmar seem to be economically and socially better off that in the past. Closer coordination between public and private sectors would also contribute to the government’s goal of ensuring continued socio-economic improvement in people’s lives.
Appropriate fiscal and monetary policies would further improve economic performance. Future economic policy formulation would need to consider two types of broad challenges:
- lack of support for SMEs, low productivity in the agriculture sector, and limited government capacity to manage/coordinate economic programmes.
- rapidly growing cities with attendant needs for services and infrastructure; climate change; increasing energy insecurity; and social protection needs of a growing industrial workforce.
A comprehensive, credible and coherent economic policy for the future would thus comprise three main components: 1) efficient use of aid, 2) leveraging regional economic integration to meet national needs, and 3) human resource development (HRD). These were important considerations as:
- Myanmar’s status as a recipient of international aid had changed drastically after about 25 years of not receiving aid. Public officials therefore had no experience in managing the increasing volume of aid. They also lacked the requisite project management skills for coordinating economic development projects and programmes.
- Myanmar occupied a strategic location in regional integration projects, and thus should leverage this to benefit local communities affected by economic corridors and connectivity projects, such as the Kaladan multimodal transit transport project. It was important to negotiating with external partners on Myanmar’s national interest in such projects
- The need to invest in human capital had become more urgent than ever. Myanmar’s democratic dividends should be efficiently utilised by more investments in developing a competent and skilled workforce. Increases in labour supply and the impact of internal and international migration (including labour rights and remittances) required more consideration for healthcare and skills/education needs of workers. The most critical need, however, was to train more people to teach in higher education.
Overall, the NLD government had a reasonably good performance record for the economy in its 2016-2020 term. This probably had pre-emptive effect on efforts by opposition parties such as the USDP to challenge the NLD’s economic policies, but had also limited more discussion about the economy during the election campaign.
The current report card thus highlighted the importance of developing and clearly articulating a comprehensive and technically credible economic vision which has been thoroughly discussed with the people.
Responsible investment
That vision was starting to be shaped in the form of the draft Myanmar Economic Recovery and Reform Plan (MERRP), a successor plan to April’s Covid-19 Economic Relief Plan (CERP), on which comments had been sought in October. However the draft lacked a focus being seen elsewhere on “building back better” to build a ’green economy’, particularly as regards climate change mitigation and adaptation, despite the vulnerability of the Myanmar economy to climate change.
A key feature of Myanmar’s post-Covid economy should be more locally beneficial investment projects, which incorporated international good practice such as community development agreements that were negotiated with local communities. Prime candidates for this – all of which involved foreign investors seeking to invest responsibly – were the revival of Bawdwin mine in Northern Shan State; development of offshore gas off Ayeyarwady and Rakhine; and the Shweli-3 hydropower project.
To date, the stumbling peace process had yet to engage with the economic reform process in the so-called triple transition, and was being pursued in silos. To the extent the economy was even mentioned in the context of peace, it tended to be a d simplistic narrative that ’economic development will bring peace’ which ignored the reality of many misconceived investments which actually drove conflict such as certain mines and proposed dams. However well-conceived investment projects which incorporated effectively public participation and a community development approach in response to demands for benefit sharing (including local job creation and building local supply chains) could, if successful, contribute learning for the peace process and give it more meaningful content. Currently the simplistic approach of pushing companies to contribute funds to a government-run off-budget account (often identified as 2% of variously profit, revenue or investment), would not achieve this, and would likely fuel corruption.
Reducing corruption continued to be important for improving attractiveness to investment. The NLD government had stepped up the fight against corruption, and appointed an active Chair to the Anti-Corruption Commission (ACC). But there were still many challenges to address, in particular the potential for conflict of interest by government decision-makers, and the need for disclosure of commercial interests and assets, requirements under the AntiCorruption and the Civil Service Laws which weren’t yet fully implemented and where the government and ACC only appeared to take action in response to media coverage, such as by Myanmar Now. A 2021-2025 NLD government should get Myanmar’s house in order on these reforms, and political party finance, not least to establish a framework for future, more hotly contested, elections in which money might play a bigger role than in 2020.
Ethnic aspirations and planning for post-2020
The 2015 election experience had been instructive for ethnic political parties as it highlighted two important lessons: 1) merging parties for a larger, consolidated representation; and 2) preparing focused policies and programmes well in advance.
Additional lessons learnt were with regard to discussing, demanding or accepting offers executive positions with the NLD, as the experience in 2015 had damaged relations among the ethnic political parties. There was a now an understanding among the ethnic political parties about agreeing on principles before negotiating political positions or appointments with the government.
Starting in 2018, ethnic political parties in Kachin, Kayah, Kayin, Chin and Mon States had successfully merged and registered to compete in 2020. In 2020, detailed policies and plans had also been presented to voters by several ethnic political parties. These policies pertain to principles for federal state formation; more local economic development and investment projects; and access to social welfare, education, health, and electricity.
Local concerns in ethnic areas are thus focused on the economy and livelihoods. The interest to have greater say in policies and programmes in their own areas motivated many ethnic political candidates to focus on gaining seats in the state (sub-national legislatures), and to negotiate for Chief Minister positions. Such negotiations should be based on federal principles and political values
Mon, Chin and Kachin parties were especially interested in having active representation in the state legislatures. This did not mean that there was no interest in having more representation at Union level. Ethnic political parties hoped to win 150-180 seats in the union legislature; however, the Covid-19 restrictions, voter registration issues, and the cancellation of polling in several constituencies in ethnic areas had damped these aspirations. Ethnic politicians shared the concern that disenfranchised voters in the cancelled areas might turn to armed struggle as an alternative to the electoral process. Looking ahead beyond 2020, ethnic political parties were also discussing informally on a consensus-based approach to presenting ethnic views and positions in a more united and coordinated manner. Some projections of a possible “national unity” government comprising the NLD ethnic political party representatives were too early to discuss definitively before the polls.
The election landscape, Covid-19, and Myanmar’s political economy
Despite all the shortcomings or flaws being reported and discussed on Myanmar’s upcoming polls, the November 8 elections in Myanmar constitute a positive development and step forward in the country’s democratisation. As the 2020 elections were the first time that the NLD competed as incumbent, there was naturally more scrutiny and discussion of the NLD’s policies and performance.
A topical performance discussion in Myanmar related to the UEC’s management of election preparations. Both political parties and civil society have spoken out on the lack of preparation and little progress on electoral reform since 2015, as the present UEC had five years in which to learn from and improve upon its predecessor’s performance. Additional points of concern were the UEC’s recent flip-flops over cancellation of polls in several parts of the country, and the earlier censoring of political parties’ televised political speeches.
The 2020 election experience was also affected by the surge in Covid-19 cases and casualties, adding to the uncertainties. Nevertheless, it was clear that the election date would not be rescheduled, and both the UEC and the President’s Office had provided detailed clarifications on this point. While the UEC’s decisions on voting cancellations and election date were not unexpected, they added to the tensions between political parties and the UEC. Additionally, media had not been able to reach the UEC for comment. The UEC had admitted however, the inability to guarantee secrecy of ballots for the advance voting arrangements for senior citizens.
As the Covid-19 surge in Myanmar had caused political parties to move their campaigns online, this also affected the share of online or public media space for election campaigns. The incumbent could use public media to communicate campaign messages, while the UEC restricted some opposition parties’ televised political speeches. Due to movement and travel restrictions, local and international observers and media were not able to get a sense of the situation on the ground. The shift online for campaigning, coverage and rallies added to the challenges of verifying fake news and/or disinformation related to the elections and political parties.
As had been observed earlier, the election campaigns had little discussion or focus on the economy. The unfolding impact of Covid-19 on the economy might have added to the disinclination to discuss the economy. There were some exceptions, however. The People’s Pioneer Party (PPP) head, Dr Thet Thet Khine – a businesswoman – had discussed NLD’s economic performance, and the leader of the People’s Party, U Ko Ko Gyi of the ’88 generation’ had also highlighted the importance of the economy in his statements. Overall, however, campaign speeches and debates have barely discussed the economy, including from the largest parties such as the incumbent NLD and the opposition USDP. The USDP criticism of the NLD’s performance did not offer alternative plans or policies. In such a scenario, it was important for the NLD to discuss its economic plans and policies more openly, as many among the business community want the NLD to maintain momentum in the transition to a second administration. Some further information on the MERRP – though mentioned as being drafted – would have been useful to address some of these concerns over continuity but details had not yet been shared to date.
In the general discussion that followed, panellists shared their views on the following topics:
Voter turnout
Heightened concerns over Covid-19 could potentially affect voter turnout on November 8, but sentiments differed between central and remote locations, different ethnic and religious communities, and urban and rural households, as well as within households. For example, while there were widespread concerns about voting on November 8 due to the Covid-19 situation, the situation was different in the ethnic areas where there was more excitement about casting votes. As access to polling stations was a challenge for many voters in ethnic areas, there were expectations that turnout would be high for ethnic areas, though not to the fullest extent. There were also expectations of a higher turnout by NLD supporters to vote, but the turnout for other political parties is uncertain (due to logistical challenges posed by Covid-19 restrictions). Additionally, it should be noted that the 2020 elections were the second openly contested elections in Myanmar’s recent contemporary history. Turnout would usually be lower than the first such instance. Still, some three million of eligible voters were age 60 years and above, and they had mostly found the advance voting arrangements helpful amidst the Covid-19 concerns and despite concerns over secrecy of ballots.
External (economic) relations
There did not seem to be a clear Belt and Road Initiative (BRI) policy in Myanmar, but the NLD government said it was negotiating based on Myanmar’s national interest and had re-negotiated several infrastructure projects with China on this principle including those under the BRI/CMEC. The NLD were cautious – they had yet to sign the Kyaukphyu Special Economic Zone (SEZ) project with China. The Project Bank had been introduced to allow for greater scrutiny of cost-benefit and national interest of existing and new public sector investment proposals.
Although China remained a political and economic reality for Myanmar, other Asian countries such as Japan, South Korea, Singapore and Thailand were also important economic partners. External economic relations also had the potential to support the ongoing peace process, which currently lacked an economic perspective.
Investment due diligence and good governance
Myanmar was a complex country for investors, and the due diligence – including on human rights and conflict risk – was essential for investment, particularly in ethnic areas. Some Embassies in their desire to see ‘their’ companies invest in Myanmar downplayed this aspect; indeed some companies – observing the difficulties of their peers – were ahead of their governments in understanding human rights risks. For example, consequences for Kirin of having the military owned Myanma Economic Holdings as a JV partner were not lost on other international companies.
There was increased understanding in Myanmar of what corporate governance and transparency means, but this was still a challenge in investments with government participation, as was evident in several projects involving Yangon Regional Government. Furthermore, cultural attitudes in ethnic areas such as Chin State led to a reluctance to challenge corruption, and better governance and transparency on development projects was especially important in ethnic areas.
Human rights
The 2020 election campaigns of large parties contesting seats country-wide had not focussed on human rights. However, there was considerable discussion of human rights issues at the local level. Ethnic political parties discuss social and cultural rights, but do not use the language of human rights. Discussion of political and civil rights is currently muted, in view of the defamation suits brought against activists and journalists during the NLD’s term in office. Opposition parties – if gaining a stronger representation in the legislature – might be able to raise human rights issues at Union level.
Human capital
Project management skills, especially managing development aid, were sorely lacking in Myanmar across government departments. There was also a lack of competence in government on ‘e-government’ and cybersecurity. There was an urgent need to develop technical skills and capacity to develop and manage cybersecurity regulatory infrastructure. The next cabinet minister with responsibility for Telecommunications and e-government should possess the necessary ICT understanding and drive to pursue the digital transformation, ideally through separation of the Transport and Telecommunications portfolios. Data protection currently constituted a major gap to be filled: it needed a rights-based approach to personal data protection, rather than a top-down control approach, but there needed to be punishment of data protection breaches by government entities, private sector or others – as is the case in Singapore.
In conclusion, the panel agreed that Myanmar’s simultaneous transition on both political and economic fronts required unique solutions and dedicated effort. Panellists noted that the business community would welcome the continuity and stability provided by a continued NLD administration, but would want a clearer national vision for development than was on offer in 2016, based on consultation of stakeholders, and better government communication than in their first term, including with the media. They agreed that economic considerations merited an equal priority with political-security issues in nationwide dialogue on peace and national unity. Harking back to 1947, Burma’s independence architect General Aung San had highlighted the importance of addressing the country’s deep economic challenges in a speech at the Sorrento Villa conference in Rangoon (now Yangon), which laid the foundation for independent Burma’s first economic development plan.
Panellists also acknowledged that in Myanmar’s short contemporary experience with elections as a central institution of democracy, the calls and efforts to ensure that elections are democratic and honest provided some cause for optimism. The ethnic political groups also increasingly view elections as an opportunity to address economic grievances and political inequality. Panellists did not foresee political violence on a nationwide scale in the aftermath of the 2020 elections. Looking ahead to the next term of government over 2021-2025, watchwords would be: communication, capacity, and coherence.
The webinar attracted interest and participation from 129 registered attendees.