2) Context

Burma has suffered 48 years of military rule and more than 60 years of internal conflict. In a region containing some of the fastest growing economies in the world, Burma has become one of the poorest countries in Asia. Data about poverty in Burma is difficult to obtain and some of it is unreliable, but there is evidence of widespread poverty. A third of the population (16.5 million people) do not have enough money to meet their basic food and living needs. Where reliable data exists, it shows the country is not on track to meet many of the Millennium Development Goals. It has some of the worst health indicators in Asia, and suffers amongst the highest rates of malaria, malnutrition (especially amongst children) and tuberculosis in the world.

Burma is ethnically diverse. It has struggled since independence in 1948 to find peaceful way to manage this diversity. Ethnic tensions continue to be a source of conflict, particularly along the eastern border with Thailand. The impact of conflict includes human rights abuses, severe poverty and displacement. An estimated half a million people are Internally Displaced in eastern Burma alone, and 140,000 live in refugee camps in Thailand.

Elections in November 2010, the country’s first since Aung San Suu Kyi’s National League for Democracy won at the polls 20 years ago, were not judged to be free and fair by most of the international community. The new constitution, now in force, makes provisions for the first time for a degree of devolution and space for local decision-making. However, there is no guarantee that this will happen in practice.

Economic and social policies have so far failed to release the country’s huge economic potential. Liberalisation of the economy since the end of the socialist period in the 1980s has progressed slowly, despite the country being well-placed to take advantage of markets in India, China and countries of the Association of Southeast Asian Nations (ASEAN). Economic growth has accelerated in recent years, largely as a result of the discovery and exploitation of natural gas, but remains modest, and it has not brought significant benefits for the large number of poor people. The benefits from oil, gas, mining, timber and other natural resources are controlled by a small elite. The banking sector is weak, over regulated and has virtually no reach outside major urban areas. As a result, the country’s majority rural population cannot access the credit they need. The agricultural sector, once the rice basket of the region, and still the main source of income for 70% of the population, is now unproductive, uncompetitive and low-value. There is a growing number of landless people (15 million) dependent on seasonal, non-farm work which is inadequate across the year.

Government budgets have not been published for many years, but estimates from international organisations show extremely low levels of investment in basic services for the people. Over 40% of public expenditure is allocated to the military, while government spending on basic health care and education combined is less than US $1 per person each year. Skills at all levels have been in decline for 20-30 years. The state machinery can still deliver its leaders’ priorities, but these are focused on narrow national security goals, personal enrichment and political control. A growing voluntary sector provides some of the services which an effective government would normally provide. This was particularly evident following Cyclone Nargis in 2008.

Burma’s people also receive very little aid from the international community. Since 2004, the UK has led the way in demonstrating how higher levels of aid can make a real difference to poor people in Burma without supporting the regime. As one of the few donors with a permanent presence in Burma, our expert staff play a critical role in ensuring what aid is given is used effectively.