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41. Myanmar: The Politics of Economic Reform

Publication Date:
07-2012
Content Type:
Working Paper
Institution:
International Crisis Group
Abstract:
Myanmar has embarked on an ambitious program of sweeping reforms to end its isolation and integrate its economy with the global system. Closely entwined with its dramatic political transition, the end of longstanding Western sanctions is supporting this reconfiguration. If the reforms are done well, many across the country stand to benefit, but those who profited most from the old regime's restrictions and privileges will lose access to windfall profits and guaranteed monopolies. The crony businessmen, military and party elite will still do well but will need to play by new rules, meet domestic and foreign competition and even pay taxes. Perhaps recognising the opportunities a more vibrant economy in a fast-growing region will bring for all, there is no major pushback to these changes, rather attempts to adapt to the new economy. The challenges and risks are numerous for a government with little experience juggling the many changes required, but it cannot resist the pent-up political pressure for change it has already unleashed.
Topic:
Democratization, Economics, Globalization, Government, International Trade and Finance, and Politics
Political Geography:
Southeast Asia and Myanmar

42. "Small Is Beautiful": Lessons from Laos for the Study of Chinese Overseas

Author:
Danielle Tan
Publication Date:
09-2012
Content Type:
Journal Article
Institution:
German Institute of Global and Area Studies
Abstract:
During the colonial period, Laos welcomed the smallest overseas Chinese communities in Southeast Asia, communities that almost disappeared after the communist forces seized power in Laos in 1975. Yet, this landlocked country shares a long history with China and even experienced a Golden Age thanks to the thriving caravan trade between Yunnan and mainland Southeast Asia. The Greater Mekong Subregion initiative, a development programme launched by the Asian Development Bank, has revitalized these historical trade routes, causing thousands of Chinese migrants to pour onto the new roads of Laos, channelled through the North–South Economic Corridor linking Kunming to Bangkok. Depicted as “an army of ants” that plunders the natural resources of this poor country, these Chinese migrants are also the main drivers of development. The paper seeks to examine the specificity of China's engagement in Laos. I suggest that this small and forgotten country can provide insightful lessons to better understand the current changes taking place in Chinese migration worldwide.
Topic:
Development and Economics
Political Geography:
Southeast Asia and Laos

43. Thailand's Development Strategy and Growth Performance

Author:
Peter Warr
Publication Date:
01-2011
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
Thailand's development strategy has been strongly market-oriented and open to trade and investment flows with the rest of the world. Since the late 1950s, its growth performance has been outstanding. Poverty incidence has declined dramatically, but economic inequality has increased. Economic progress has been reflected in very significant improvement in non-economic indicators of well-being such as life expectancy, infant and maternal morality, and literacy. Nevertheless, the performance of the education system is chronically poor. Environmental problems and institutional failures in resource management are ongoing. Reform is needed in several areas, including political and corporate governance, regulation of industry, and in the education and health systems.
Topic:
Development, Economics, Education, Emerging Markets, Poverty, and Foreign Direct Investment
Political Geography:
Asia and Southeast Asia

44. Making Growth Inclusive - Some lessons from countries and the literature

Author:
Elizabeth Stuart
Publication Date:
04-2011
Content Type:
Working Paper
Institution:
Oxfam Publishing
Abstract:
Economic growth in developing countries is desirable and necessary, but it is the distribution of that growth that matters for poverty reduction, rather than the pursuit of growth for its own sake.
Topic:
Development, Economics, and Poverty
Political Geography:
Latin America and Southeast Asia

45. It's Not Only Rents: Explaining the Persistence and Change of Neopatrimonialism in Indonesia

Author:
Nina Korte
Publication Date:
05-2011
Content Type:
Working Paper
Institution:
German Institute of Global and Area Studies
Abstract:
Indonesia has long been associated with neopatrimonialism, corruption, collusion, and nepotism as the main modi operandi of politics, economics and public administration. Despite various measures and initiatives to fight these practises, little evidence for a significant decline can be found over the years. Rather, longitudinal analysis points to changes in the character of neopatrimonialism. Based on more than 60 in-depth interviews, focus-group discussions, and the analysis of both primary and secondary data, the aim of this article is, first, to describe the changes that have taken place, and, second, to investigate what accounts for these changes. Political economy concepts posit the amount and development of economic rents as the explanatory factor for the persistence and change of neopatrimonialism. This study's findings, however, indicate that rents alone cannot explain what has taken place in Indonesia. Democratisation and decentralisation exert a stronger impact.
Topic:
Corruption, Democratization, Economics, and Authoritarianism
Political Geography:
Indonesia, Asia, and Southeast Asia

46. Capital Controls: Myth and Reality-A Portfolio Balance Approach

Author:
Carmen M. Reinhart, Nicolas E. Magud, and Kenneth S. Rogoff
Publication Date:
03-2011
Content Type:
Working Paper
Institution:
Peterson Institute for International Economics
Abstract:
The literature on capital controls has (at least) four very serious apples-to-oranges problems: (i) There is no unified theoretical framework to analyze the macroeconomic consequences of controls; (ii) there is significant heterogeneity across countries and time in the control measures implemented; (iii) there are multiple definitions of what constitutes a "success" and (iv) the empirical studies lack a common methodology-furthermore these are significantly "overweighted" by a couple of country cases (Chile and Malaysia). In this paper, we attempt to address some of these shortcomings by: being very explicit about what measures are construed as capital controls. Also, given that success is measured so differently across studies, we sought to "standardize" the results of over 30 empirical studies we summarize in this paper. The standardization was done by constructing two indices of capital controls: Capital Controls Effectiveness Index (CCE Index), and Weighted Capital Control Effectiveness Index (WCCE Index). The difference between them lies in that the WCCE controls for the differentiated degree of methodological rigor applied to draw conclusions in each of the considered papers. Inasmuch as possible, we bring to bear the experiences of less well known episodes than those of Chile and Malaysia. Then, using a portfolio balance approach we model the effects of imposing capital controls on short-term flows. We find that there should exist country-specific characteristics for capital controls to be effective. From this simple perspective, this rationalizes why some capital controls were effective and some were not. We also show that the equivalence in effects of price- vs. quantity-capital control are conditional on the level of short-term capital flows.
Topic:
Development, Economics, International Trade and Finance, and Markets
Political Geography:
Latin America and Southeast Asia

47. Inward FDI in Malaysia and its policy context

Author:
Rajah Rasiah and Chandran Govindaraju
Publication Date:
04-2011
Content Type:
Working Paper
Institution:
Columbia Center on Sustainable Investment
Abstract:
Malaysia is still perceived as an important destination for foreign direct investment (FDI). Deregulation by the Malaysian government in 1986 with a new round of Pioneer status tax holidays, tax allowances for expansion projects, liberal rules for firms operating in free trade zones (FTZs), and tax exemptions are encouraging stronger FDI inflows (IFDI). IFDI flows reached a peak in 1988-1993 as export-oriented foreign multinational enterprises (MNEs) relocated manufacturing production operations to Malaysia to benefit from cheap labor, government incentives and liberal conditions for manufacturing FDI. After 1996, due to the Asian financial crisis in 1997-1998, IFDI flows into Malaysia decreased and subsequently recorded the lowest level in 2001 as a result of the world trade recession. Following steady growth in 2002-2007, IFDI in Malaysia fell dramatically in 2008 and 2009 due to the global economic crisis. However, a strong resumption in the first quarter of 2010 and government efforts, including continued liberalization of manufacturing and services, the Government Transformation Programme, promoting new key economic areas, and the active role of the Ministry of International Trade and Industry (MITI), contributed to an increase in inward FDI flows in the second quarter of 2010.
Topic:
Economics, Industrial Policy, International Trade and Finance, Foreign Direct Investment, and Financial Crisis
Political Geography:
Malaysia and Southeast Asia

48. Timor-Leste's Veterans: An Unfinished Struggle?

Publication Date:
11-2011
Content Type:
Policy Brief
Institution:
International Crisis Group
Abstract:
More than ten years after the formation of Timor-Leste's army and the demobilisation of the guerrilla force that fought for independence, the struggle continues about how to pay tribute to the veterans. The increasingly wealthy state has bought off the threat once posed by most dissidents with an expensive cash benefits scheme and succeeded in engaging most veterans' voices in mainstream politics. This approach has created a heavy financial burden and a complicated process of determining who is eligible that will create new tensions even as it resolves others. A greater challenge lies in containing pressures to give them disproportionate political influence and a formal security role. A careful balance will need to be struck between paying homage to heroes while allowing a younger generation of leaders to grow up to replace them. Failure could block the generational transfer of power necessary for the state's long-term stability.
Topic:
Conflict Resolution, Security, Democratization, Economics, and Insurgency
Political Geography:
Southeast Asia

49. From REDD to Green: A Global Incentive System to Stop Tropical Forest Clearing

Author:
David Wheeler, Robin Kraft, and Dan Hammer
Publication Date:
12-2011
Content Type:
Working Paper
Institution:
Center for Global Development
Abstract:
In this paper, we develop and illustrate a prototype incentive system for promoting rapid reduction of forest clearing in tropical countries. Our proposed Tropical Forest Protection Fund (TFPF) is a cash-on-delivery system that rewards independently monitored performance without formal contracts. The system responds to forest tenure problems in many countries by dividing incentive payments between national governments, which command the greatest number of instruments that affect forest clearing, and indigenous communities, which often have tenure rights in forested lands. The TFPF incorporates both monetary and reputational incentives, which are calculated quarterly. The monetary incentives are unconditional cash transfers based on measured performance, while the reputational incentives are publicly disclosed, color-coded performance ratings for each country. The incentives include rewards for: (1) exceeding long-run expectations, given a country's forest clearing history and development status; (2) meeting or exceeding global REDD+ goals; and (3) achieving an immediate reduction in forest clearing. Drawing on monthly forest clearing indicators from the new FORMA (Forest Monitoring for Action) database, we illustrate a prototype TFPF for eight East Asian countries: Cambodia, China, Indonesia, Lao PDR, Malaysia, Myanmar, Thailand, and Vietnam. A system with identical design principles could be implemented by single or multiple donors for individual or multiple forest proprietors within one or more countries, as well as national or local governments in individual countries, tropical regions, or the global pan-tropics. Our results demonstrate the importance of financial flexibility in the design of the proposed TFPF. Its incentives are calculated to induce a massive, rapid reduction of tropical forest clearing. If that occurs, a TFPF for East Asia will need standby authority for disbursements that may total $10–14 billion annually for the next two decades. This financial burden will not persist, however, because the TFPF is designed to self-liquidate once all recipient countries have achieved clearly specified benchmarks. We estimate that the TFPF can be closed by 2070, with its major financial responsibility discharged by 2040.
Topic:
Agriculture, Economics, Globalization, and Markets
Political Geography:
China, Indonesia, Malaysia, East Asia, Vietnam, Cambodia, Thailand, Southeast Asia, and Myanmar

50. Myanmar's Fifty-Year Authoritarian Trap

Author:
Sean Turnell
Publication Date:
09-2011
Content Type:
Journal Article
Journal:
Journal of International Affairs
Institution:
School of International and Public Affairs, Columbia University
Abstract:
Myanmar has been under military rule in various guises for nearly fifty years. The most durable and unyielding of the authoritarian regimes in Southeast Asia, Myanmar's military rulers have expertly exploited circumstances and methods that prolong their rule, even as they have failed to deliver genuine economic growth and development. Their methods include ruthlessly suppressing dissent, inciting ethnic divisions and fears of external threats and making implicit bargains with neighboring states and domestic elites over the spoils available to a rentier state. Myanmar's emergence in recent years as a significant regional supplier of natural gas has dramatically increased the country's distributable economic rents, thus exacerbating the country's political stasis. This article examines the ways in which Myanmar's military regime has maintained its rule through the exploitation of these methods, but with a particular focus on the impacts of the country's exploitable energy and resource wealth and its implications for Myanmar's economic development and political transition.
Topic:
Development and Economics
Political Geography:
Southeast Asia and Myanmar