Portal:Business and economics/Selected economy/March 2008
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The Economy of Burma has suffered from decades of stagnation, mismanagement, and isolation. Burma’s GDP grows only 2.9% annually — the lowest rate of economic growth in the Greater Mekong Subregion. Under British administration, Burma was one of the wealthiest countries in Southeast Asia. It was once the world's largest exporter of rice. During British administration, Burma supplied oil through the Burmah Oil Company. Burma also had a wealth of natural and labor resources. It produced 75% of the world's teak, and had a highly literate population. The country was believed to be on the fast track to development. After a parliamentary government was formed in 1948, Prime Minister U Nu attempted to make Burma a welfare state. His administration adopted the Two-Year Economic Development Plan, which was a failure. When Burma gained independence in 1948, it was believed to be on its way to become the first Asian Tiger in the region. However, after the military dictatorship seized power in 1962, Burma became an isolated and impoverished nation.
After the 1962 military coup d'état, the military government introduced an economic plan called the Burmese Way to Socialism, under which the military regime nationalized all industries with the exception of agriculture. In 1989, the Burmese government began decentralizing economic control. It has since liberalized certain sectors of the economy. The government heavily regulates lucrative industries, such as gems, oil, and forestry. These sectors have recently been exploited by foreign corporations, which have partnered with the government to gain access to Burmese natural resources. The economy of Burma is currently mixed. The private sector dominates in agriculture, light industry, and transport activities, while the military government controls mainly energy, heavy industry, and rice trade.
Burma was designated a least developed country in 1987. Private enterprises are often co-owned or indirectly owned by the Tatmadaw. In recent years, both China and India have attempted to strengthen ties with the government for economic benefit. Many nations, including the United States, Canada, and the European Union, have imposed investment and trade sanctions on Burma. Foreign investment comes primarily from China, Singapore, South Korea, India, and Thailand. In the eleven years from 1989 to 1999, the military government tried to revitalize the economy after three decades of tight central planning. However the regime has recently canceled its reforms. Despite this, the private sector continues to grow albeit slowly.
