The Irrawaddy News Magazine [Covering Burma and Southeast Asia]
The Control of Political Economy

Burma’s economic development reflects the history of failed dictatorships


State Dominance in Myanmar,
by Tin Maung Maung Than. Institute
of Southeast Asian Studies,
Singapore, P472

The Political Economy of Industrialization,’ the subtitle of Dr Tin Maung Maung Than’s recently released State Dominance in Myanmar, may be perplexing to those who perceive industrialization as modernization, impersonal bureaucratization and the welfare state formation of the West over the past two centuries. 

Is there such a thing as industrialization in Burma? Tin Maung Maung Than’s answer is an unequivocal “Yes.” He defines industry, following the late American economist Simon Kuznets, as “encompassing manufacturing and processing of agricultural, forest, marine and mineral products as well as electricity production.”

The first few chapters will convince the reader that the tradition of planned economy in Burma is deeply rooted in “the negative experience of laissez-faire economy” for the locals under colonial rule. It had also emerged from the leftist ideas and “lingering notions” of the nationalist leaders, led by Gen Aung San.

During the constitutional period (1948-62), ideological conflicts, ethnic resistances and infightings in the government put the state in turmoil. The Burmese scholar asserts that then Premier U Nu’s vision to establish Burma as a socialist welfare state had been founded o­n the three objectives of “Burmanization, nationalization and industrialization.” More than half a century after his cataclysmic Pyidawtha (welfare state) Plan, with hindsight and with the assistance of Tin Maung Maung Than’s book, the reader will not fail to note that o­nly the first two objectives of the plan have ever materialized. 

State planning in Burma was carried o­n by the military regime that seized power from U Nu in 1962. The Revolutionary Council moved fast to take complete control of the economic, political and social affairs of the country. Tin Maung Maung Than warns that state control can never be complete or absolute. Under the rule of the Revolutionary Council, a thriving black market economy emerged in Burma. 

The author says that “despite the rhetoric of self-reliance, the 1962 junta continued to solicit technical and financial assistance from the International Monetary Fund, specialized agencies of the UN, sympathetic countries and country groupings such as the Colombo Plan.” Japan had been the single largest country donor to the junta. As early as 1963, Japanese aid came in the form of US $140 million in grants for war reparations, which had been negotiated under the previous government. Other major countries that lent a financial lifeline to a regime that would reduce potentially prosperous Burma to “Least Developed Country” status in less than three decades included China, the Federal Republic of Germany and the US.

The etiology, or cause, of the economic crisis that led to the demise of the Burma Socialist Program Party, which comprises the bulk of the book, is examined in scrupulous detail with analyses of trade figures and charts from government sources. The author writes: “Lacking indigenous technological capability, Myanmar’s [Burma’s] industrial development was based o­n an investment-driven approach that was undermined by the state’s self-imposed straitjacket of relying o­nly o­n government revenues and the ODA [Official Development Assistance].” Thus, the BSPP collapsed and the state was “enervated.” The military remained, restored the state and made it more unitary and stronger.

The book’s last chapter is intriguingly titled “Dual Transition under Military Rule, the State Prevails.” Despite opposition, political transitions in Burma are designed to ensure the state prevails. Under the State Peace and Development Council, the state “still follows the same methods used during the Socialist era.” The economic transition, the SPDC’s acceptance of market economy notwithstanding, is merely an extension of the socialist era’s “penchant for self-reliance and planning.” Nonetheless, he does not see a “scenario in which the state will not play a major role in Myanmar’s development for the next decade or so.”

This book is an updated version of Tin Maung Maung Than’s PhD dissertation, for which American academic Robert Taylor served as mentor. The book’s critique of the Burmese state for its “visible hand” in the country’s economy is a welcome departure from pro-state polemics usually championed by Taylor. Scant attention is paid to the political economy of sanctions imposed o­n Burma by the West since the 1990s. This will be a disappointment to those readers who naturally expect to find a discourse o­n sanctions from such a voluminous study o­n Burma’s political economy.   

Ko Ko Thett, a Burmese researcher, studies world politics at the University of Helsinki

Copyright © 2008 Irrawaddy Publishing Group |