'A rich country with poor people' Myanmar can build a developmental welfare state

18 January 2012

After decades in which the West isolated Myanmar, recent visits from officials from the US, UK and other European powers represent a warming of relations. Myanmar's government has introduced democratic reforms, allowed the formation of trade unions, released political prisoners and eased restrictions on access to information.

A woman makes a new Burmese flag in a workshop in Yangon. The Burmese government introduced the new flag in the lead up to the elections in 2010.

The World Bank is being urged to resume work in the country. We can hope the sudden enthusiasm of Western powers stems from genuine support for peace and the rights of Myanmar’s population.  But in reality, the change in stance probably has at least as much to do with these powers’ pursuit of their own national interest: for several decades, US and European sanctions kept their businesses out of Myanmar, while enterprises in Thailand, Singapore, India and especially China eagerly exploited Myanmar’s natural gas, hydropower potential, gemstones, and capitalised on its strategic location.

The current moment is crucial for Myanmar. History has shown time and again that popular movements to ensure civil liberties, democracy and human rights are often highjacked by a simultaneous drive to introduce neoliberal capitalism or prise open a country to foreign investors.

Myanmar, as a country endowed with valuable resources, is in a position to avoid this trap. As the head of the country's new economic advisory board, Dr. U Myint, put it, Myanmar is a rich country, albeit with poor people. The country can use its resources to build an innovative and democratic welfare state in pursuit of equity and social inclusion.

A combination of policies promoting decent work and social protection and an industrial strategy could allow Myanmar to reduce poverty, income inequality and disparities between rural and urban areas.

Read more in the author's recent commentary in the Guardian Poverty Matters blog and in Policy Innovations.

Gabriele Köhler is visiting fellow at IDS in the Vulnerability and Poverty Reduction Team.

Photo credit: Adam Dean/Panos