ADB drafting new 5-year strategies for Myanmar

The Asian Development Bank is in the process of developing its next five-year strategy for Myanmar, since it re-entered the country in 2012, its new country director for Myanmar, Winfried Wicklein said.

More than US$1 billion has been provided so far for a bundle of projects at interest rates of 1 to 1.5 per cent, over a 30 year period, he said. The lending is part of the interim country partnership strategy, which covers 2012-2014.

“We are in the process of preparing for new medium-term strategies which will be formed in
2017 to 2021,” Wicklein said. “We are looking forward to working with the government, private sector, civil society, and other partners in the preparation for the formulation of these strategies. We will discuss with all the partners this week,” he added.

“So far, more than $ 1 billion will be provided over a period of four years. We are going into the phase of project loans, which are initially in the power sector and in the transport sector as well,” he said, adding that initial loans had been used for policy-based programmes in early 2013 to support the macroeconomic and financial stability of reforms. These also helped to reengage Myanmar with the international community, Wicklein said.

On September 28 and 29, ADB officials held talks with representatives of civil society to help develop its new strategies. On Tuesday, they held talks with the private sector and today and tomorrow they are holding talks with the government.

Energy and transportation have been the key focus of ADB lending so far.

Peter Brimble, ADB’s principal country specialist, said that it is now working on two major transport projects that will link the Delta area with Yangon and possibly the Greater Mekong Region. The $80 million proposed Maubin-Phyapon road rehabilitation project will be approved later this year, he said. Another $100 million proposed East-West economic corridor – the Eindu to Kawkareik road improvement project – is expected to be approved during the Thein Sein administration, he added.

One power transmission project, approved in December last year, aims to upgrade transmission lines in Yangon, Mandalay, Magwe, and other urban areas. Its budget is $60 million. It will be followed by another $80 million loan for a proposed power project.

ADB’s 20-year energy master plan include updating the Myanmar Electricity Law and electricity rules, drafting a new law – the Rural Electrification Law – promoting small scale off-grid renewable energy pilot projects, promoting public-private partnerships in power, and modeling a power-purchase agreement currently being applied to the Myingan project.

Wicklein said technical assistance to strengthen institutional capacity was vital. The ADB has spent more than $12 million a year for this over the past two years. It spent another $20 million on research, but expects research costs to decline to about $10 over the next few years.

Wicklein said ADB is focusing on three main areas: infrastructure, macroeconomic and physical environment, and education and skills.

He also underscored the importance of private-sector development. “We consider the private sector as a very important engine for growth, for the country in terms of driving economic growth, and creating opportunities and jobs. We are working closely with the private sector in various areas,” he said, citing power and roads as examples. “We are also working on legal and policy reforms that are relevant to the private sector,” he added.

Brimble also identified private sector reforms as a key area. “We are doing a lot of work to raise capacity. From ADB’s point of view, most of our activities in Myanmar are going to be concessional loans. We still see capacity building as an important part of the investment projects. Some may not see it as a suitable tool for a loan. They think capacity building should be done for a few months. I think this is the issue that we need to work on,” he said.