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Economic reforms and peace in Burma

Aug 20, 2010

United States Institute of Peace report Can Economic Reform Open a Peaceful Path to Ending Burma’s Isolation? points out how Burma’s economy could provide a viable entry point for effective international assistance to promote peace. The study finds engagement of the international community significant for national reconciliation.

Can Economic Reform Open a Peaceful Path to Ending Burma’s Isolation?

Authors: L. Rieffel; R. Gilpin

Publisher: United States Institute of Peace , 2010

After decades of domestic conflict, military rule and authoritarian governance, Burma’s economy could provide a viable entry point for effective international assistance to promote peace. Doing so would require a detailed understanding of the country’s complex and evolving political economy.

The study finds:

•    The lingering income and distributional effects of the 2008 Cyclone Nargis, anticipated changes associated with the new constitution, and the 2010 elections and the Obama administration’s decision to devote more attention to Burma suggest that the time is ripe for the creative application of economic mechanisms to promote and sustain peace.

•    Looming challenges could derail Burma’s prospects for economic and political stability. These challenges include irrational macroeconomic policies, failing to ensure all citizens enjoy benefits accrued from natural resources, endemic corruption, a flourishing illicit economy, a dysfunctional financial system and critical infrastructure bottlenecks. Failure to address these problems would frustrate peacebuilding efforts.

•    During Cyclone Nargis, an estimated 85,000 lives were lost and over 50,000 are deemed missing. By destroying a significant proportion of the country’s livestock and half the fishing fleet, and flooding a million acres of rice paddies, the cyclone created a humanitarian disaster in rural Burma, which was already suffering from the junta’s misguided policies.

However, engagement by the international community with the new Burmese government could contribute to national reconciliation and economic progress by taking into account the following recommendations:

•    A conflict-sensitive economic strategy for Burma would focus on effective capacity-building, sustained policy reform, progressive steps to reduce corruption, fiscal empowerment of sub national authorities and prudent natural resource management. Success in these areas requires unwavering political will for sensibly sequenced policy improvements by domestic actors and finely targeted support from Burma’s international partners.

•    Avoid overwhelming the new government in its first weeks and months with visitors seeking special deals and offering conflicting advice.

•    Post-conflict reconstruction has floundered in other parts of the world because aid agencies and other external players seeking to help have ignored or discounted the power of individuals and groups with a vested interest in the status quo. It may be possible, however, to work with these individuals and groups to advance broad social objectives and enlarge the space for new high-value entrepreneurial activity.

Source : Eldis
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