Editorial Board

Myanmar’s Mandela Moment

Activists complain that U.S. President Barack Obama, who welcomes Myanmar’s President Thein Sein to the White House this week, is embracing the former general too soon, before he’s proved his reformist bona fides. In fact, Obama is late to the party.

Nowadays international businessmen, academics and aid workers throng Yangon’s dilapidated airport. In parts of the former capital, rents rival Singapore’s. “If you don’t have a Myanmar visa in your passport, you’re a nobody,” one giddy investor told U.S. researchers last year.

For a once-shunned nation, such enthusiasm is heady and welcome. It’s also becoming one of Myanmar’s biggest challenges.

Businessmen swarm ministries in the new capital Naypyidaw, clamoring to sign deals and revise investment rules. Donor countries and organizations compete to promote development projects. Delegations of experts and big thinkers shower Burmese officials with planning papers and studies. Ministers find themselves hosting hundreds if not thousands of well-meaning visitors each month -- with little time left to read all those papers, let alone to formulate policy.

Such an onslaught would burden even a well-functioning bureaucracy. Myanmar’s is no such thing. Decades of military rule devastated the country’s education system and bred a pervasive paranoia among the civil service. Although Thein Sein has put in place several very smart, energetic ministers, they have almost no bureaucratic support. Ministry buildings appear to be half atrium, with a few dozen sleepy officials scattered through the remaining offices.

The promise of riding the next Asian tiger won’t keep investors interested forever. Myanmar remains one of the world’s least developed nations. It lacks road or rail connections to any of its neighbors. Its citizens average only four years of education -- and possess few of the English skills that exist in other former British colonies. The country is expected to grow 5 percent to 6 percent over the next several years, but its entire gross domestic product ranks only slightly above that of Baton Rouge, Louisiana: At best the economy might eventually account for about 0.5 percent of Asia’s total GDP. Faced with some of the world’s most expensive start-up costs, many companies will decide Myanmar isn’t worth the trouble.

Others will stick it out. But without efficient government oversight, Burmese might not reap the full benefit. A sovereign wealth fund like Norway’s, for instance, is needed to husband the billions in hard currency generated by oil and gas concessions. Brookings Institution scholar Lex Rieffel has suggested Myanmar could become the organic breadbasket of Asia, given that its farmland is relatively unpolluted by agricultural chemicals. As he writes, though, this will require “exceptionally disciplined policies by the government,” in the face of intense outside commercial pressures.

What Myanmar needs as much as investment and aid money is government expertise -- officials who know how to manage the currency, oversee massive infrastructure projects, build a banking system and revise land tenure laws.

Donor organizations can help by resisting the urge to push quick, high-profile projects. Instead of besieging the few enterprising ministers, they should work with and help to build up lower-level officials. Training sessions abroad can be immensely effective: They should precede work on projects wherever possible.

As the U.S. discovered painfully in Afghanistan and Iraq, the best way to develop bureaucratic capacity is often to embed long-term mentors within ministries, where they can be force multipliers and ease the pressure of dealing with foreign embassies and executives. That means sending fewer well-meaning, star-studded delegations to Naypyidaw and more procurement specialists, agronomists and tax lawyers.

Companies like Cisco and Microsoft are already working with the U.S. and Burmese governments to help train local teachers and computer programmers. Corporations should consider joining forces with the government to develop a dedicated academy for administrators and bureaucrats. A more efficient civil service would do more to ease doing business in Myanmar than any expensive lobbying campaign.

The Burmese diaspora, which numbers more than 100,000 in the U.S. and several million in Thailand and Malaysia, presents another untapped pool of talent. Right now high rents and red tape deter many who want to return and contribute their time and experience. One idea would be for foreign donors to fund a “diaspora campus” -- a subsidized, well-connected oasis like Google’s California headquarters -- where returning Burmese could spend yearlong fellowships with their families, either pursuing start-ups or working with the government.

This is Myanmar’s Mandela moment: Largely because of charismatic opposition leader Aung San Suu Kyi, the world will never be more interested in the country or more eager to invest there, as happened in South Africa in the early 1990s. At the same time, Myanmar’s transition is hardly complete. The jails still hold political prisoners. Violent chauvinism against the country’s Muslim minority is spreading. The government has yet to peacefully resolve differences with various hill tribes and integrate them into the national polity with an acceptable degree of autonomy.

The fragile Burmese administration can hardly focus on any of these issues, let alone all of them. Next year, when Myanmar is set to head the Association of Southeast Asian Nations, will be worse. Obama is right to embrace Thein Sein in recognition of the progress Myanmar has made thus far. If those gains are to be preserved, though, the Burmese leader urgently needs more help to professionalize his government.

    To contact the senior editor responsible for Bloomberg View’s editorials: David Shipley at davidshipley@bloomberg.net .

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