COUNTRY PROFILE 2000 Myanmar (Burma)

COUNTRY PROFILE 2000 Myanmar (Burma) This Country Profile is a reference tool, which provides analysis of historical political, infrastructural and economic trends. It is revised and updated annually. The EIU s Country Reports analyse current trends and provide a two-year forecast The full publishing schedule for Country Profiles is now available on our website at http://www.eiu.com/schedule The Economist Intelligence Unit 15 Regent St, London SW1Y 4LR United Kingdom

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Comparative economic indicators, 1999 EIU Country Profile 2000 The Economist Intelligence Unit Limited 2000

1 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 EIU Country Profile 2000 The Economist Intelligence Unit Limited 2000

2 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 EIU Country Profile 2000 The Economist Intelligence Unit Limited 2000

Myanmar (Burma) 3 Myanmar (Burma) Basic data Land area Population Main towns 676,577 sq km 45.1m (mid-1999/2000 estimate) 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 Weather in Yangon (altitude 5 metres) Languages Measures Currency Time Fiscal year Public holidays, 2001 Subtropical Hottest month, April, 24-36 C; coldest month, January, 18-23 C; driest month, January, 3 mm average rainfall; wettest month, July, 582 mm average rainfall Burmese; numerous other minority languages are also in use, such as Karen and Shan 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 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 (freemarket 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 6.5 hours ahead of GMT April 1st-March 30th 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 The Economist Intelligence Unit Limited 2000 EIU Country Profile 2000

4 Myanmar (Burma) 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 independent country A long history of military rule On January 1st 1886 Burma (as Myanmar was known until the current junta 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. The AFPFL won two further elections, and apart from a two-year period under a 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 movement was crushed in 1988 In October 1987, as the economy deteriorated further, student demonstrations were held in the capital, Yangon. Widespread protests began in March 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. EIU Country Profile 2000 The Economist Intelligence Unit Limited 2000

Myanmar (Burma) 5 and a new military council formed The junta has clung to power despite losing the 1990 election Despite this crackdown, demonstrations continued, forcing General Sein Lwin 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. More than 200 parties registered for the 1990 election. The main contenders were the National Unity Party (NUP, a renamed BSPP), the NLD (of which 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 to entrench itself still further In 2000 the NLD continued to push for the result of the 1990 election to be recognised. The NLD refused to disband the ten-member Committee 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 The Economist Intelligence Unit Limited 2000 EIU Country Profile 2000

6 Myanmar (Burma) 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 dismantle the NLD Angered by the NLD s bid to develop a constitution of its own, and by renewed 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 widespread The junta continues to be widely feared and disliked. In addition to the NLD, 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. EIU Country Profile 2000 The Economist Intelligence Unit Limited 2000

Myanmar (Burma) 7 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 military The junta s ruling council, made up of senior military figures, is the dominant 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 The NLD 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 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 Economist Intelligence Unit Limited 2000 EIU Country Profile 2000

8 Myanmar (Burma) 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-inchief 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 fighting for autonomy The question of the degree of autonomy to be given to Myanmar s many ethnic groups has never been adequately settled, and at times more than EIU Country Profile 2000 The Economist Intelligence Unit Limited 2000

Myanmar (Burma) 9 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 Economist Intelligence Unit Limited 2000 EIU Country Profile 2000

10 Myanmar (Burma) 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 been reorganised but still controls the country In November 1997 the ruling military council was renamed the SPDC. 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. The SPDC, rather than the cabinet, takes all key policy decisions. In 1998-99 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 EIU Country Profile 2000 The Economist Intelligence Unit Limited 2000

Myanmar (Burma) 11 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 limited influence A controlled judiciary and many political prisoners The cabinet forms the second tier of the military government; key decisions are 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. Although civilian courts were fully reinstated in 1992, many judges still have military backgrounds. Pro-democracy campaigners are regularly denied proper legal representation, and cases are often heard in secret. Jail terms for prodemocracy 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 remain tricky The Association of South-East Asian Nations (ASEAN) has followed a policy of 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 international pariah The junta has been shunned by many countries and international bodies for 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 The Economist Intelligence Unit Limited 2000 EIU Country Profile 2000

12 Myanmar (Burma) 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 with China In 2000 the junta tried to reduce its international isolation, engaging in a 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 are dubious The government estimated the total population at 49.1m in the middle of 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 EIU Country Profile 2000 The Economist Intelligence Unit Limited 2000

Myanmar (Burma) 13 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 Data on ethnic minorities are sparse and out of date 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 the size of Myanmar s numerous ethnic groups are contentious: no 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. The Economist Intelligence Unit Limited 2000 EIU Country Profile 2000

14 Myanmar (Burma) 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. EIU Country Profile 2000 The Economist Intelligence Unit Limited 2000

Myanmar (Burma) 15 Population by state/division: census results, Apr 1983 Annual Population growth a 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 gloomy picture HIV/AIDS is a growing problem A UNICEF report has described a dramatic decline in spending on healthcare 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. According to a 1995 survey, 56.5% of Myanmar s injecting drug users were 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. The Economist Intelligence Unit Limited 2000 EIU Country Profile 2000

16 Myanmar (Burma) Education Political turmoil has disrupted higher education and overall standards have been severely affected For more than ten years the higher educational system has been severely disrupted by regular closures aimed at curbing student dissent. The majority of 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. The junta s disdain for education is reflected in low spending equivalent to 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 agricultural resources Myanmar has considerable agricultural potential. The predominantly tropical 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 Water-based 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. Myanmar s rivers and 2,832-km coastline provide rich waters for fishing. According to official estimates, the maximum sustainable yield for marine EIU Country Profile 2000 The Economist Intelligence Unit Limited 2000

Myanmar (Burma) 17 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 agreement 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 cooperation with foreign firms. Transport and communications Road, rail and waterways Air and sea services 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). 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 The Economist Intelligence Unit Limited 2000 EIU Country Profile 2000

18 Myanmar (Burma) are being developed at Thilawa, on the outskirts of Yangon, and Kyaukpyu in Rakhine (Arakan) state. Telecoms and electronic communications are poor According to the latest available statistics, at the end of 1997/98 there were 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 foreignexchange 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 and distribution is very limited and power cuts are frequent In 1997/98 total installed electricity capacity was 1,572 mw, up from 1,394 mw in 1996/97. Of total installed capacity, the state-owned Myanma Electric Power 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.) Through much of 1998-99 Yangon and other cities suffered repeated, very severe power cuts and brown-outs, because of the impact of droughts on EIU Country Profile 2000 The Economist Intelligence Unit Limited 2000

Myanmar (Burma) 19 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$100m. However, imports of oil seemed to increase sharply in 1998-99, according to figures from Energy Data Associates, reaching 1.3m tonnes in 1999. Gas may eventually increase in importance as an energy source with the coming on stream of the massive Yadana and Yetagun gasfields although most gas is scheduled for export (see Economic sectors: Mining and semi-processing). Energy balance, 1999 (m tonnes oil equivalent) Elec- Oil Gas Coal tricity Other a Total Production 0.50 1.52 0.02 0.16 b 10.60 12.80 Imports 1.30 0.00 0.00 0.00 0.00 1.30 Exports 0.02 0.00 0.00 0.00 0.00 0.02 Primary supply 1.78 1.52 0.02 0.16 b 10.60 14.08 Losses & transfers 0.28 1.10 0.00 0.28 1.45 3.11 Transformation output 0.36 c 0.36 Final consumption 1.50 0.42 0.02 0.24 c 9.15 11.33 a Mainly fuelwood. b Primary electricity production, imports and exports are expressed as input equivalents on an assumed generating efficiency of 33%. c Output basis. Source: Energy Data Associates. The economy Economic structure Main economic indicators, 1999 Real GDP growth a (output basis; %) 5.7 b Consumer price inflation (av; %) 18.4 Current-account balance (US$ bn) 0.2 Foreign debt c (US$ bn) 5.7 Official exchange rate a (Kt:US$) 6.34 Free-market exchange rate a (Kt:US$) 341 Population d (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. The Economist Intelligence Unit Limited 2000 EIU Country Profile 2000

20 Myanmar (Burma) Myanmar is a lowincome country Data problems Data problems make an accurate assessment of the size and structure of the 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). 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 agriculture Myanmar remains a predominantly agricultural economy. 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 EIU Country Profile 2000 The Economist Intelligence Unit Limited 2000