Thailand has much to gain if Burmese reform process proves successful

From the economic perspective, the reform process as it is currently taking shape, would create

 

a good atmosphere for economic development, trade and investment. If successful, it would enable the Burmese authorities to manage the economy rationally with effective economic instruments, rather than using only raw military power to run the economy as before.

 

The government of President Thein Sein, who took the helm last year, has done much to restructure the economy. Moreover, the authorities are now working to unify the multi-rate kyat, and the Burmese central bank could begin to float the currency by the end of this month. This move, under which a single-rate kyat is planned in two years, would benefit not only Burmese citizens but also foreign traders and investors, who have been suffering for a long time from the unrealistic exchange-rate regime.

 

Adjustment and amendment of trade and investment regulations to ease restrictions would definitely also benefit foreign traders and investors, especially Thais who are heavily engaged with many economic activities in Burma at present.

 

Many Thai traders and investors have complained about Burma’s balancing act, which allows them to import capital goods only when they can find items of the same value to export. If this regulation were to be eliminated, it would create a freer flow of trade and investment in the country, and thus directly benefit Thailand.

 

Burma’s reforms, if they were to continue in this direction, would pave the way for western countries and international organisations to lift sanctions against the country.

 

The sanctions that have been in place against the military regime for decades are really

 

counterproductive to Burma’s development. They aim to hurt the junta and its key members, but consequently obstruct the country’s economic development as a whole.

 

The United States’ decision to lift one of the many sanctions against Burma early last month was a small but important step for the country, as it opened up a channel for international financiers to help Burmese economic development.

 

If all kinds of sanctions by western countries were to be lifted, trade and investment would flow freely to Burma, and hence countries that have already booked their concessions in the country would definitely benefit. Thailand’s Dawei project by Italian-Thai Development would have more funding sources for investment, as investors from Japan and other states would have financial liberty to participate in the project.

 

Of course, some development projects such as Thailand’s coal-fired power plant in Dawei and the Chinese-run Myitsone dam on the Irrawaddy River could be affected by reform, as the Burmese government would need to heed social and environment concerns in regard to major projects. However, such practice would be good for the economy in the long run, as it should ensure that all development projects were conducted in a transparent manner for the public interest.

 

Thailand would also benefit from the ongoing reform in Burma when it comes to political and security concerns. The Kingdom has long had a burden of proximity to shelter more than 100,000 refugees who fled from the conflict at home, but Thai governments have never hidden their intention to eventually repatriate them.

 

If the reform trickled down into permanent peace and reconciliation, with freedom and basic rights being guaranteed, the Thai authorities would have an excuse to repatriate all refugees to their place of origin.

 

Peace along the border, if it really could be achieved, would enable Thailand and Burma to regulate and maintain order in border areas that are home to many transnational crimes, including drug- and human-trafficking.

However, if the reform process were to go into reverse, everything would go back to the previous status quo and no one would benefit.