Myanmar: Experience with aid and management development during transition

PUBLIC ADMINISTRATION AND DEVELOPMENT, VOL. 13,423-434 (1993)

Myanmar: experience with aid and management development during transition

PAUL COOK Manchester University

SUMMARY This article examines the role of the UNDP’s management development programme in Myan- mar between 1988 and 1992. It describes the economic and political background against which technical assistance was provided to assist the transition from a centrally planned to a market-oriented economy. It is argued that present reforms can be interpreted as part of a survival strategy. The article analyses the principal findings of the various components of assistance between these years, and reports on implementation. In particular, attention is given to problems that occur in reforming both central bureaucratic institutions and patterns of decision-making, and to changes in these key areas. The concluding part summarizes the lessons that arise from implementation and indicates that forms of state-led planning are likely to continue alongside attempts to embody market principles.

INTRODUCTION

In 1988 the government of Myanmar, formerly Burma, signalled its intention to implement economic reforms and move towards a more open economy. In the following year, a number of UNDP projects were begun to support the transition from a centrally planned to a market-oriented economy. In comparison with similar projects and programmes in other countries, assistance provided to Myanmar was highly controversial. The series of activities to aid transition was initiated when most bilateral donors had withdrawn support on the basis that it would not be resumed until the interim government introduced political changes and ceased alleged human rights abuses. During this period, there was no new lending from the IMF or the World Bank. The IMF provided technical assistance support to the trade and banking sectors under the auspices of the UNDP. In 1992, under mounting international pressure, the UNDP’s Governing Council put a halt on funds for new activities in Myanmar. This effectively quelled the catalytic role it had attempted to fulfil over the previous 4 years.

This article analyses the reasons for initiating a range of UNDP-sponsored activities intended to support changes at the policy level, in particular in the way in which policy is formulated at high levels in Myanmar, and also those activities aimed at strengthening implementation. The principal objective in this respect was to raise the competence of the administrative machinery as well as steer it into new directions. This paper provides a brief chronological record of the involvement of the UNDP

Paul Cook is senior lecturer in Economics at Manchester University, Manchester, M13 9PL, UK.

0271-2075/93/040423-12$11 .OO 0 1993 by John Wiley & Sons, Ltd.

424 Paul Cook

Management Development Programme (MDP) that stems from the initial assessment missions in 1989, which were designed to probe and assess the parameters on which assistance would be provided, through to the design and formulation of a strategic framework for tackling problem areas identified by the government and the UNDP. It also discusses issues that have arisen from the implementation and management of the programme and reports on the findings of various project review missions.

The article consists of five short sections. The first provides a brief review of the economic and political conditions that prevailed prior to and following the economic reforms which commenced in 1987, and assesses the reasons for the change in economic policy. The second describes the MDP in the context of the overall political and economic changes taking place, and describes the broad strategy adopted by the UNDP. The third examines in greater detail the economic policy environment and discusses attempts to strengthen the capacity to formulate and coordinate economic policy in the public sector. The fourth section examines the implications of the changes introduced by government for the development of management and human resources. The final section assesses the lessons from 4 years of management development assistance.

THE MOVE TOWARDS ECONOMIC REFORMS

During the period under consideration the government has emphasized a range of economic reforms that provide an impetus to private sector growth and to a more open economy, in terms of both trade and capital. The relative emphasis between the two has even changed over time, and appears at times to be paradoxical, with a formal disclaimer of the open-door policy while continuing to place a strong signifi- cance on the role of foreign investment.

The first major step towards economic reform in Myanmar in the 1980s came in September 1987 when the government removed restrictions on trade in major crops. These changes signalled the end of 30 years of central planning in which almost all activities, including large-scale manufacturing, mining, communications, services and banking, were in the state sector. In the same year, Myanmar was also classified as a least developed country (LDC) by the United Nations in a move to alleviate the debt situation. More substantial reforms were announced when the military State Law and Order Restoration Council (SLORC) took over in September 1988 as a self-declared caretaker government following substantial civil unrest.

In 1988 the government declared that it would depart from central planning and move towards a more open-door policy. In November of that year the government enacted the Foreign Investment Law and made border trade with its neighbouring countries official, although some exports were excluded from border trade arrangements. The Foreign Investment Law permitted foreign investors to form wholly owned enterprises or joint ventures, especially those engaged in exporting activities. Foreign investment was also to be induced by a number of incentives, including tax holidays and tax exemptions, particularly for businesses that reinvest their profits. In March 1989 the SLORC introduced the State-Owned Economic Enterprise Law, which essentially opened the door for the private sector to compete in activities previously the exclusive domain of the public sector. The Private Investment Law was passed a year later which, while recognizing the part the private sector might

Experience with aid 425

play in the economy, nevertheless continued to establish an operating framework of strict regulation and licensing. Further measures that might eventually increase the competitiveness among financial institutions and strengthen their capacity to facilitate investment finance were enacted in 1990 through the Central Bank of Myan- mar Law, the Finance Institutions of Myanmar Law and the Myanmar Agricultural and Rural Development Bank Law. These, at least, provided the framework for a more conventional role for the central bank in the use of monetary instruments and opened further channels for investment finance for the private sector.

The pursuit of these reforms can be interpreted as a survival strategy by the government in response to deteriorating economic conditions (Cook and Minogue, 1992a), in part attributable to unfavourable movements in the terms of trade, particularly in the 1980s for major exports of teak and rice (Catling and Dunning 1989), and in part due to mismanagement under the centrally planned system. This was not the first time the government had acted in this way. In the mid-1970s new policy measures had also been introduced in response to the deteriorating conditions and through pressure from international lending agencies (Fenichel and Khan, 198 1; Hill, 1984).

The survival strategy in the case of Myanmar is based on the notion that benefits can be achieved in the relatively short term. These benefits will largely accrue to a middle-income urban business class that is emerging on the basis of trade and business activities stimulated by some economic reforms. A key element in this approach is the emphasis attached to joint venture arrangements with foreign investors (P. Cook, forthcoming). In the longer term, substantial investment in oil and gas exploration might form key elements which the present government hopes will assist economic transformation as well as minimizing external dependency (Cook and Minogue, 1992b). However, measures to reallocate resources and substantially widen the export base have been side-stepped. Adjustment of a highly misaligned exchange rate has persistently been rejected.

On the political front, elements of a survival strategy can be seen by the behaviour of the government following the elections held after the initial bout of reforms in May 1990. These did not see the majority party, the National League for Democracy (NLD) forming a government. Instead, the SLORC continued to dominate the economy and made it clear that there would be no movement towards transition to a new constitutional order until certain preliminary steps had been carried out. First, the Election Commission has to finalize the results of the 1990 election, including the accounts and appeals of all candidates. This process has already taken 2 years and leads some to believe that SLORC has little intention of transferring power to an elected government. Second, the SLORC has indicated that a consultative assembly representing all the political parties which had candidates in the election, together with representatives from ethnic minority groups, ought to meet to construct guidelines for the drafting of a constitution (Taylor, 1991). The time frame for this is unclear.

The evolution of the present political situation has to be placed in the context of a long-standing authoritarian regime and therefore can be represented as a process that is adapting to a long tradition in politics. War, violence and crises have been endemic in Burmese political history, and the stability of the ‘nation’ of Myanmar has been under constant threat in the post-independence period from both external sources (China) and internal sources (i.e. communists, ethnic insurgents). These fea-

426 PaulCook

tures attract little understanding or sympathy, particularly from bilateral agencies demanding complete democratization. Other donors, such as Japan, would probably resume aid and investment with a lesser degree of political change, or even on the basis of a stability founded on military power.

The argument about democratization is, however, relevant to the economic reform process in the sense that a reforming government which lacks legitimacy and authority will find it difficult to secure the cooperation and energies required to ensure the success of innovative policies. Clearly though, economic reforms are proceeding slowly, with the use of the government’s ‘stick and carrot’ strategy, although at the present time the strategy is somewhat one-sided, with more stick than carrot. Since the elections, the opposition has been substantially weakened, partly through legal and political attacks upon opposition representatives and partly through increased military pressure on ethnic rebels in the regions. Recent examples have included the signing of loyalty oaths to the state, and against participation in party politics, for personnel in the public service.

It would be premature to say that the economic reforms have failed and economic performance has worsened since the events of 1988. Clearly, official statistics on economic performance must be treated with caution. This warning equally applies to attempting to associate changes in performance over the last 4 years with changes in policy. The data are too weak to show causal relationships. More importantly, in the case of Myanmar, there is not much evidence to show that the reforms are well understood or have been implemented beyond the point of passing them into law. There are examples of the government simultaneously lifting controls on private- sector activities, while replacing them with others (P. Cook, forthcoming). The net outcome is understandably unclear. Again, there are instances of laws being enacted but their implementation having to await further interpretation.

There are limited signs that economic performance has improved since 1988, reversing the declining trend experienced during much of the 1980s. Prior to 1988, real GDP declined throughout the 1980s to reach negative rates after 1986. Both exports and imports fell up to 1988. Myanmar’s major exports of teak and rice had experienced drops in volume as well as value. Prices for these commodities had dropped by 30 per cent between 1981 and 1987. Valuable foreign exchange earnings had been soaked up by obligations to service debt from previous borrowings, and, although debt levels were not high in comparison with those in neighbouring countries, the poor export performance had revealed a dramatic situation as far as the debt-service ratio was concerned. The deteriorating economic conditions in the 1980s had had a major impact on the government’s financial position, with declining revenue from state-owned enterprises and from foreign trade. Financing the budget deficit, which was kept to around 8 per cent of GDP in the 1980s, was a main cause of monetary growth and inflation. These would have been greater had the government not also cut capital expenditure of state enterprises during this period.

Foreign investment has increased from virtually zero before 1988 to a cumulative total of around $655 million by 1991. The range of countries involved in foreign investment has also widened considerably during these years. Exports, which fell continuously between 1985 and 1988, are reviving, with some evidence of diversifi- cation. The value of exports grew by 51 per cent between 1989 and 1990, and by 29 per cent between 1990 and 1991 (UNCTAD, 1992). Lending by the state-owned banks to the private sector increased between 1989 and 1991. Data provided by


the Ministry of Planning and Finance to the World Bank show a modest revival in the indices for output and capacity utilization for the public enterprises after 1989, reversing a continued decline over the period 1985-89. The international debt burden has been alleviated to some extent by the debt ‘forgiveness’ approaches of Japan and France.

Despite improvements in these indicators, the government maintains firm control over economic agents in the economy. With the passing of new economic laws, the government continues to control the prices charged for goods produced by the state-owned enterprises. Instead of devolving financial responsibility to these enterprises, all financial matters have been placed in the hands of central government (P. Cook, manuscript in preparation). The private sector continues to operate under a system of strict registration and licensing and suffers from restricted access to credit from the state-owned banking system. The Foreign Investment Law provided an array of incentives to foreign investors, although most have benefited from joint ventures with domestic partners. Foreign companies have established themselves where natural resource rents can be exploited, such as fishing, timber, mining, and oil and gas, or where they can benefit from the underutilized export quotas, particularly for textiles and footwear.

ROLE OF THE UNDP

The UNDP maintained a liaison with the government of Myanmar even during the difficult year of 1988. The hope was to strengthen the move to reform signalled a year earlier. A major step in this direction were the negotiations for technical assistance support through a management development programme. This programme’s aim was fourfold: to improve the quality of national economic decision- making and strengthen the policy-formulating process through better coordination and research; to provide policy-makers and managers of parastatals with studies that outline options for improving the performance of public sector organizations; to develop an in-country capacity for training in management development; and to improve organization and management in the public sector (UNDP, 1991).

The initial terms of reference for the project were to help the national authorities assess the management needs implied by the new economic reforms and to define a programme to strengthen institutional management capability. There was little doubt that the administration in Myanmar reflected organizational weaknesses found in many developing countries. In part an explanation for this related to the lack of incentives provided to those in the public service, but it also related more generally to a problem about the structure of government involving too many agencies with ill-defined responsibilities. These limitations could be overcome through a process of structural rationalization which ties in organizational and management reforms, including the public agencies and enterprises, to more widespread changes in government as a whole. But implementation would challenge the sources of both bureaucratic and political power.

This had profound implications for reform since it was the defective bureaucracy which was the principal instrument for implementing reform policies. It is, therefore, likely in these circumstances, as in Korea for example, that the bureaucratic machinery would only deliver reforms effectively when driven hard by a political leadership

428 Paul Cook

that was strongly committed to specific reforms. This presents a difficult situation for those who advocate the introduction of reforms with a ‘big bang’. Indeed, it has been shown that military governments similar to Myanmar’s are no great sup- porters of the free market (Shackleton, 1987). They tend to use orders and regulations in their own field and too often view similar controls over economic activity as appropriate. In this respect they are themselves major beneficiaries of statism. In Myanmar there were convincing reasons to believe that similar styles of political leadership existed and that, as a consequence, the gradualist survival strategy was being pursued. It was also evident that features of a state-led planning system would continue alongside a limited reorientation to a market economy (Cook and Minogue, 1992a).

In this context the reforms were more likely to proceed if political leaders had sufficient technical and organizational capacity to formulate, and successfully implement, innovations and if they have sufficient political authority to sustain the political costs. To counter administrative inefficiency and the lack of management skills the UNDP, through the management development programme, then initiated a 2-year technical assistance programme to strengthen policy formulation and management development. This programme, in view of the constraints outlined above, rejected the complete reform of the administrative structure and opted instead for a series of measures that included studies, consultancy support and institutional development, which would have small, dispersed impacts throughout the large bureaucracy (Cook, et al. 1989). It was envisaged that this more politically acceptable approach would have a multiplier effect on management and organizational change over time.

The principal elements of the technical assistance support consisted of reforms to the Central Institute for Public Services (CIPS), which is the civil service training school, and which has a substantial military emphasis for new entrants; the establishment of a general management services unit, which would review systems and procedures in various ministries and assist with implementing changes; the establishment of a policy advisory unit in the Ministry of Planning and Finance, which would provide a wider range of policy alternatives to cabinet; and a number of efficiency reviews of key ministries, which would spearhead future changes in administrative practices and procedures and support for financial administration through a series of training programmes.

POLICY FORMULATION

It was apparent from the initial investigating mission that weaknesses in policy implementation could not be considered in isolation from policy formulation. In comparison with neighbouring economies, the policy environment is underdeveloped. In particular, the information base for policy analysis is weak. Although a substantial amount of data are collected, many data cannot be applied to policy issues, and there is little capacity to select from and analyse basic data. There is an absence of qualitative analysis, particularly in the form of appropriate specialist advice; for example, the Ministry of Transportation and Communications has no transport econ- omist, and similar skill gaps exist in other government agencies. There is generally an incomplete awareness and understanding of comparable external experiences,


despite attempts that have been made to examine other political and economic systems.

It is also evident that there is little systematic coordination of policy analysis and implementation. A picture emerges of ad hoc arrangements, which below the cabinet level do not appear to be widely perceived and understood. The Prime Minis- ter’s office, which in other economies often has this role, is restricted in scope with an emphasis on the servicing of weekly cabinet meetings, and has few resources for the effective coordination of policies, or of their implementation. Although under the former planned economy there was an Economic Coordination Committee, this has now disappeared with a reversion to an annual budgeting process and, more recently, to a 3-year planning process. There are several interministerial committees, some of which correspond to cabinet subcommittees, for example the recently created National Health Committee; others appear to be more temporary, forming around specific issues.

The initial investigation revealed that a small number of ministers were responsible for around 20 ministries, and it would be difficult for them to ensure effective coordination by these means, even when they are supplemented by other interdepartmental committees. Since 1992 the number of ministers has been increased, but overall, in the absence of a systematic set of coordinating mechanisms, and given the burdens that continue to exist on ministers, it is unlikely that there can be effective consideration of the full range of intersectoral implications of specific policy options. Although these arrangements are comprehensible in relation to the short-term demands placed on government since the inception of the market-oriented development strategy, it would appear appropriate to develop a more systematic approach. The MDP, therefore, recommended the establishment of a central policy advisory unit (Cook and Minogue, 1990).

The policy response to the initial idea of setting up a policy advisory unit by the individual ministries in government showed considerable variation. Some ministries adopted a static, ‘minimum reaction’ position, seeing their role primarily in terms of administering particular rules and laws; other ministries adopted a more innovative ‘directive approach’, in which they used the scope provided by the new laws for interpretation, and also acted to identify problems which require further action and possibly legislation. The adoption of these stances seems to depend partly on the personalities of specific officials and ministers and partly on the character of their policy responsibilities.

These characteristics conditioned perceptions and attitudes towards the idea of a centralized policy advisory unit. The ‘directive’ ministries accept the case for such a unit and believe it would fill a gap in the existing system, provide a systematic appraisal of the intersectoral or strategic implications of individual policies, and be a vehicle to identify weaknesses in the mechanisms for coordinating across government, whether at the policy, planning or management levels. The ‘minimum reaction’ ministries had difficulty in comprehending the distinction between substantive policy and procedural planning. They took a narrow view of their policy function and were not always able to identify all the intersectoral implications of their own policy fields. In particular, there was uncertainty and some confusion on their part about the policy changes implicit in the so-called new development strategy.

In general, there was a common concern that existing policy planning units, bodies developed over the last 30 years of central planning within specific ministries, were

430 Paul Cook

not functioning as intended. This was partly attributable to the inadequacies of staffing but also to the problems connected with data collection and analysis. All ministries wanted to upgrade, and improve the competence of these units. Indeed, there was an acceptance that if a centralized policy advisory unit was to be established then it should draw on, and interact with, improved planning units in ministries, even if in the more immediate future there was uncertainty over how these ministry- specific planning units would continue to function in a market-oriented economy.

The MDP provided support to establish a policy advisory unit which would advise cabinet and individual ministers on a range of policy issues, through long term studies, short reviews, policy commentaries and numerous progress reports and ad hoc briefings. Undoubtedly, the establishment of a policy advisory unit would be politically sensitive and therefore, from the MDP point of view, it was seen as essential that the director of the unit could combine administrative authority and experience with technical competence.

This element in the project has proved the most difficult to implement. Although the cabinet has approved the unit, there have been delays in appointing a director and staff. It is difficult to know precisely why the unit has not been established. At one level there have been bureaucratic uncertainties about its location, reporting relationships and headship. On another level, it has been difficult to judge how readily it has been accepted by SLORC, given the lack of knowledge over the working relationships between SLORC and the cabinet a t large. The proposal has not officially been rejected, but its implementation has continually been postponed. This could indicate that there are real fears that implementation might imply that decision- making will be decentralized into the hands of the bureaucracy and away from SLORC control. It may, however, indicate that this component of the project cannot be eliminated but only delayed because it forms some kind of conditionality for other parts of the overall programme, which are less politically sensitive but much needed. Clearly, aspects of the programme not associated into policy formulation fall into this category. Undoubtedly weaknesses in project management and the initial failure to appoint a chief technical adviser for the overall project also contri- buted to delay, if not directly, by giving the government the opportunity to use these as stalling devices.

MANAGEMENT DEVELOPMENT AND ECONOMIC REFORMS

Implementation of the economic reform policy has radical implications for the development of management and human resources, of which there is as yet little awareness inside Myanmar. There is some perception of the shortage of skills relevant to economic liberalization, both in management and in vocational fields. But the nature of the required cultural and behavioural transformation in the public service and in public enterprises is not generally perceived. Nor is the scale of the necessary systems development in basic organization, personnel administration and human resource development (HRD) appreciated. This situation is not unique to Myanmar. Other economies in transition, particularly those in East and South-East Asia, have identified weak administrative institutions and low levels of managerial capacity as significant constraints on implementing economic reforms.

The public service in Myanmar remains highly centralized and regulated. There


are no systematic job descriptions, responsibilities are not always clear and there is little delegation to lower levels. The low salaries and absence of career paths and development opportunities have led to low morale, and there is little scope for the exercise of individual initiative. Even relatively superficial discussions in some ministries suggest overemployment and duplication.

During its long isolation, Myanmar has been insulated from modern developments in public administration, management and HRD. Concepts of objective setting, accountability and efficiency are lacking and there are no systems in place for motivat- ing or developing staff, or for assessing and rewarding successful performance.

Training is uncoordinated and fragmented. There is no policy on training, no needs assessment is conducted and there are no training standards. There are very few professional trainers, most ministries relying on informal on-the-job training provided by senior staff. There is little management training of any type, emphasis having been placed on professional, technical and vocational training. A 2-year Dip- loma in Management and Administration is offered by the Institute of Economics of the University of Yangon, and the CIPS provides a 4-month induction course for public servants covering basic administration and ideological topics. CIPS is developing a senior course for in-service civil servants.

The management culture in Myanmar, as in other countries in transition, represents a constraint to reform. Management culture refers to the beliefs, values and attitudes which govern behaviour in the performance of management duties. Beliefs and values are more difficult to change than organizations and systems, tending to endure over a longer period and imposing limits on the rate of change of organizations.

The current system of management in Myanmar is not conducive to the development of a more open, market-oriented system. It remains centralized and authoritarian, formal and governed by procedure, with little delegation of authority, cross- sectoral consideration or willingness to experiment with new forms of organization, remuneration or employment contracts.

Research has indicated that over a wide variety of contexts, motivation of staff by authoritarian means and disciplinary practices is less effective than generating genuine enthusiasm and commitment. Commitment requires a different management attitude, under which targets are set for programmes and individuals, and authority is delegated to empower individuals to achieve their targets. Formal procedures are minimized to allow for initiative and experiment, and promotion and remuneration reflect individual performance and add to a sense of achievement. Performance appraisal in such a culture is open and related to job descriptions, and communication is kept informal to allow for ad-hoc problem solving sessions as well as regular staff meetings.

Moreover, specific problems and programmes may need to be managed by a variety of project teams, special committees and task forces set up as temporary organizations across departments, with team leaders reporting back to line managers on individuals’ performance and progress. The aims of such flexibility and lateral coordination should be founded on the continual improvement in the quality of services provided, and in needs assessment methods which consult community views. The revolution of a management culture of this type will take time, and will apply to organizations throughout Myanmar.

For example, in the case of the health sector, although the general requirements apply elsewhere, state and divisional health directors and township medical officers

432 Paul Cook

have no training in management (the situation is similar in parastatals) and administration (Raitt, 1991). Some have attended short courses in the past but these courses appears to be composed mainly of training in procedures rather than skills. These key administrators have little conception of the skills appropriate to the effective management of people and programmes. These skills have been conceived in two categories. First, communication and human relation skills, including leadership skills, motivation of staff, team building, participative approaches, emphasis on staff development and coordination skills. Second, the analytical skills, including target setting and performance measurement in terms of effectiveness, efficiency, utilization and service quality, financial skills, resource allocation, problem solving and management information systems.

Training, however, is not the only means of developing new management skills and systems. These can be reinforced by other means, for example the formation of management service units to support management analytical functions, systems development in finance and personnel, appropriate leadership and guidance at top level.

In terms of personnel administration there is little awareness of the principles of modern personnel management systems in the public sector. In general these require: programmes of job analysis and job evaluation to clarify duties and job descriptions, and to place salary grades on a systematic basis (these could be under- taken by a management services unit); progressive decentralization of recruitment procedures; open performance appraisal systems for staff, based on the performance of duties specified in job descriptions, and including the agreement of personal development plans; the establishment of career paths as broader ‘schemes of service’ for each of the professionals, offering promotion prospects based on performance and with opportunities to advance to higher levels through additional experience and training; and the gradual introduction of greater flexibility in remuneration, with more allowances for postings in hardship areas and possible other allowances related to workload, which may include incentives for voluntary workers.

In terms of existing institutions and organizations in Myanmar which have potential to act as catalysts for the development of human resources and related systems, there are several possibilities. These may be regarded as primary targets for technical assistance programmes. They include the CIPS, which is already beginning to plan extensions to its range of training provision, and is established as the central source of training for the civil service, and the Organization Analysis Unit within the Depart- ment of Project Appraisal and Progress Reporting, Ministry of Planning and Finance. This unit has responsibilities for organization review, but little technical capacity and limited power to initiate changes in other ministries. With technical assistance, however, it has potential to overcome these limitations by virtue of its location in one of the strongest ministries. There is also a role for the Institute of Economics in the University of Yangon, which is already linked to schemes to develop macro- policy advice, and which could form a basis for the development of a business school, offering a wider range of management training and consultancy services.

Current technical assistance programmes were designed to support the development of management and vocational skills and to help to develop the technical capability and the management systems which facilitate structural changes in the way public services and public enterprises operate. They included a component for the institutional development of the CIPS. This entailed the conduct of a training


needs analysis across the civil service, a review of current training provision including the elimination of military training and the specification of a development plan for the Institute. A further component related to the development of the Organization Analysis Unit in the Ministry of Planning and Finance into an active management services unit with the capacity to undertake organizational reviews and develop personnel administration systems using techniques such as job analysis and O&M. This component also included the conduct of three ministerial efficiency reviews with international consultants acting as project leaders, supervising and training officers from the unit during the course of the reviews.

Implementation of these elements, unlike the policy advisory unit, has generally proceeded according to schedule, although it must be noted that implementation, even of these components, has largely meant receiving and absorbing consultants’ reports, rather than undertaking organizational change or revisions to procedures. Indeed there are grounds for doubting whether some of the recommendations made, which involve setting up new structures and substantially revising existing methods and procedures, will be acted upon. Implementation of even minor changes continue to require high-level approval.

CONCLUSION

It is evident from the case of Myanmar that reforms are more likely to be continued if political leaders have sufficient technical and organizational capacity to formulate and successfully implement innovations and if they have sufficient political authority to sustain the political costs. This also appears to be the case for other transitional economies, that whatever the particular mix of economic and political strategies there is uniform acceptance of the need for more efficient and more up-to-date administration.

In Myanmar there has been a recognition of the need to improve both the institutional processes through which policy decisions are filtered and the policy skills and analytical capacities of a wider range of personnel. Clearly, Myanmar’s case will be different to other reforming economies and it would be futile to use this case as a model, just as it would be to use other cases as models. There is no one model of state-market interaction. In each, a range of political and administrative factors is likely to inhibit economic reforms. It is, however, highly likely that characteristics of the earlier state-led planning system will continue alongside the slow process to market-orientation.

The MDP’s role in transition in Myanmar was small and the approach adopted was a cautious one. It attempted to implement a large range of relatively small projects that were anticipated to have a multiplier impact. This approach was conditioned by the initial financial constraints imposed on the project, by the relatively optimistic picture for future complementary funding from other aid agencies becom- ing available once the elections had been announced and, foremost, by the uncertainty surrounding the political support for the spate of reforms introduced in the late 1980s.

Uncertainty exists over the extent to which the government will follow up some of the recommendations made in various components of the project. In cases where organizational change is required, implementation is hampered not only by the budget

434 PaulCook

constraint, but also by excessive bureaucracy and the high level of approval required for every minor activity. There often appears to be a reluctance from higher levels of decision-making to implement proposals, even when there is no apparent political risk and support for change from below is widespread. Conversely, in some instances proposals have not reached higher decision-making levels. Even if they did, their implementation often requires legislative changes, a feature which continues to reflect the rigidities implanted from years of central planning.

REFERENCES

Catling, J. and Dunning, A. (1989). Myanmar ITC Sectoral Review Mission, International Trade Centre, UNCTAD/GATT, Geneva.

Cook, P. (forthcoming). ‘Privatisation in Myanmar’, in Cook, P. and Nixson, F. (eds), The Move to the Market, Macmillan, London.

Cook, P., Kennedy, J. and Raitt, R. (1989), Initial Assessment Mission into Rehabilitating and Modernising the Public and Private Sectors in Myanmar, UNDP, New York.

Cook, P. and Minogue, M. (1990). Report on the M D P Mission to the Government of Myanmar Concerning the Strengthening of Policy Formulation, UNDP, New York.

Cook, P. and Minogue, M. (1992a). ‘Economic Reform in Myanmar’, in Adhikari, R., Weiss, J. and Kirkpatrick, C. (eds), Industry and Trade Policy Reform in Developing Countries, Manchester University Press, Manchester.

Cook, P. and Minogue, M. (1992b). ‘Economic Reform and Political Conditionality: the Case of Myanmar’, paper delivered to conference, Burma (Myanmar): Challenges and Opportunities for the 1990s, Asian Studies Centre, St. Anthony’s College, Oxford, December.

Fenichel, A. and Khan, A. (1981). ‘The Burmese Way to Socialism’, World Development, Vol9, No 9, October.

Hill, H. (1984). ‘Industrialisation in Burma in Historical Perspective’, Journal of Southeast Asian Studies, XV, 134-149.

Raitt, R. (1991). Operational Review of the Ministry of Health, Myanmar, UNDP, New York. Shackleton, L. (1987). ‘The Political Economy of Privatisation in Less Developed Countries’,

paper presented to the Development Studies Association Annual Conference, September. Taylor, R. (1991). ‘The Constitutional Future of Myanmar in Comparative Perspective’, paper

delivered to Conference, Burma (Myanmar): Challenges and Opportunities for the 1990s, Asian Studies Centre, St. Anthony’s College, Oxford, December.

UNCTAD (1992). The Least Developed Countries 1991 Report, UN, New York. UNDP (1991). Strengthening Policy Formulation and Public Sector Management in Myanmar,

Project document, UNDP, New York.

Myanmar: Experience with aid and management development during transition

Documents

Transcript of Myanmar: Experience with aid and management development during transition