In the 1940-1950s, Myanmar was the wealthiest nation in Southeast Asia, a country who was on its way to become the second developed nation in Asia after Japan. By 1950, Myanmar was the first Asian economic tiger, whose economy was on fast-track development. At the end of 1960 Myanmar had built up the largest pool of qualified, educated workforce in Southeast Asia.
The country is extremely rich in natural resources, it has oil, gas, teak & timber, tin, antimony, zinc, copper, tungsten, lead, coal, marble & limestone, gems, plus huge hydro-power and agricultural capacities. It was once the world’s largest exporter of rice, with Myanmar helping to alleviate severe famines in India last time, but today it is the one plagued by starvation. The country supplied 75% of the world’s teak, and is also well-known for its precious stones like sapphires, pearls and jade. 90% of the world’s rubies come from Myanmar, whose red stones are prized for their purity and hue.
But a military coup d’etat in 1962 destroyed Myanmar and plunged it into one of the world’s most impoverished country today. With the fall of Myanmar, the Southeast Asia richest title shifted to Brunei, the oil-rich sultanate however, is incapable of progressive industrialization, and was later overrun by Singapore.
Today, the formerly richest Southeast Asian nation is seeking help from the currently richest Southeast Asian nation in economic development.
Singapore is now the wealthiest and most successful nation in Southeast Asia, but it wasn’t like that 50 years ago. The island merged into the federation of Malaysia in 1963 in hope to resolve its high unemployment, stagnating economy and the security threats posed by revolutionary elements at that time. Malaysia however, failed to bring prosperity to Singapore. Kuala Lumpur enacted prohibitive measures against Singaporean trade, while Indonesia, as part of its Konfrontasi with Malaysia, bombed Singapore’s Orchard Road. The island also saw itself rocked by racial riots and economy weakened.
Racial and economic disagreements became so intense between both that Singapore was expelled from Malaysia in 1965. The new country immediately faced unemployment and housing crisis. Coupled with low level of education and lack of natural resources, much of the international media was skeptical of Singapore’s survival at that time. Most portrayed two future scenarios for the island; either be attacked by the Indonesian military or forcibly re-integrated into the Malaysia Federation on unfavorable terms.
But the island who once had little money and little hope, not only survived but thrived. Singapore becomes one of the world’s most prosperous nation, with a highly developed free market economy, strong international trading links, and one of the highest per capita GDP in Asia. It now has the most advanced military and technological capabilities in Southeast Asia, and topped almost all economic rankings in the region. This impressed Myanmar, who has been silently admiring it till now.
Myanmar president Thein Sein came to Singapore this week with a big delegation, for the signing of and agreement on economic co-operation in areas ranging of everything from tourism to law to education to technology to finance to economic advising to investment, and to thanking Singapore for its loyal support over the years. When Myanmar was shunned and sanctioned by the West, it was Singapore, as an international trading hub, who helped it to continue trading with the rest of the world. Now that Myanmar has opened up its economy, naturally it is coming down to reward Singapore for everything it did in the past.
Myanmar intends to learn from Singapore’s expertise in finance, law, public services and education to help kick-start economic development, and Singapore has agreed to send advisers to Myanmar to train their Burmese counterparts across a range of areas, including economic planning, central banking, trade facilitation and legal reforms, according to a statement issued yesterday by Singapores Ministry of Foreign Affairs. Myanmar has also expressed vast interest in area of technology and in engineering, it has likewise signed agreement for Singapore to provide vocational training to its schools. It would basically mean Myanmar sought to practice the Singaporean system in its country.
Singapore will also help Myanmar, which has a population of roughly 55 million people, build a base of skilled workers, according to the statement. Its young people lack the skills as workers in other Asian countries, partly because of past isolation and also because of underinvestment in education.
Under a pact between the two nations signed Monday, Singapore will engage in and help Myanmar modernize its economy and open itself further to foreign investment. Analysts have said that working with Singapore, one of Asia’s main financial centers, could help accelerate economic reforms if Myanmar’s leaders decide to emulate some of the wealthy city-state’s financial institutions. It is also possible some Myanmar companies might seek to list on Singapore’s stock exchange to raise capital.
Myanmar to Singapore: We have long admired you
“We have turned a new page in our country in order to create better conditions in Myanmar. We want to give a brighter future for our people.” Thein Sein said in a lavish dinner hosted in Singapore. The pact also calls on Singapore to share its best practices in trade, tourism and urban planning with Myanmar, in return, resource-rich but largely untapped Myanmar will offer attractive opportunities for Singapore businesses tapping its resorces. This is especially ideal for Singapore, who lacks natural resources.
Myanmar recently had taken up some positive steps, including the release of political prisoners, easing of social restrictions, economic reforms, and shown willingness to implement changes based on international advices. Confidence is growing in Myanmar and businesses from many countries have been eager to explore investments in Myanmar - a large and untapped market in Asia, where many sectors of the economy have been underdeveloped.
The U.S. has restored full diplomatic relations and the European Union has reversed visa bans against some senior Myanmar officials. Both the U.S. and EU have signaled they could ease sanctions if Myanmar continues to improve. Singapore has been working with Myanmar to urge the U.S. in lifting the sanctions. Singapore President Tony Tan said the wealthy city-state would strengthen economic cooperation and business links with Myanmar, and guide the country as it emerges from decades of political and economic isolation.
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Under military rule, Myanmar had long been a thorn in the side of ASEAN, hobbling the bloc’s relations with Western powers because of the jailing of opposition leader Aung San Suu Kyi and allegations of widespread rights abuses. Suu Kyi now has been released from detention as part of the reforms and is now campaigning for a parliamentary seat in elections scheduled in April.
Thein Sein becomes the new president of Burma (Myanmar) since March 2011. He is widely regarded to be a moderate and reformist who seeks economic prosperity and development for Myanmar. Under his governance, investments have been flocking in and Myanmar now record a faster economic growth than neighboring Thailand and Malaysia.
With the West looking at easing sanctions and businesses closely watching the reforms, Myanmar needs to prepare for an anticipated increase in investments and tourism, analysts said.
Myanmar has rich natural resources, including gold, gas, teak, oil, jade and gems and a large pool of low-cost labour. The country also boasts an array of tourism attractions with its appealing colonial architecture, picturesque temples and golden beaches.
“If all goes well, Burma certainly looks forward to being welcomed from the political wilderness,” said Song Seng Wun, a regional economist with Malaysian bank CIMB. “It looks like the new Burmese leadership are in a hurry to catch up in the shortest possible time,” he told AFP.
“After so many years of isolation, their capacity to handle the expected inflow of investments and set up the much-needed regulatory frameworks have to be brought up to scratch as quickly as possible. Done correctly, Myanmar may even experience an economic boom akin to that of the four Asian economic tigers (Singapore, Hong Kong, Taiwan and South Korea).”
Singapore: a major player in Southeast Asia trade and investment
Singapore’s economic clout is widely felt throughout Southeast Asia, its investments is so prevalent in Bangkok that the Thais have a saying the city is owned by Singaporeans. The sale of Shin Corporation, one of Thailand largest conglomerates, to Singapore in 2006 caused great controversy and highlighted the stranglehold Singapore has over Thai businesses. Singapore acts as technological consultant to most major Bruneian IT firms, and a huge chunk of Bruneian imports are traded over Singaporean port. Unlike most Southeast Asian countries, multinationals in Brunei are operated from Singaporean offices.
Singapore invested so massively in Indonesia that its investments made up nearly one-third of Indonesian foreign investment. The island is expected to increase its investments in Indonesia this year by 50%, a move that delighted Indonesia. Indonesia has stated that Singapore is now its most important economic partner in the region. After the departure of Malaysia’s Mahathir, Singaporean investments in Malaysia surged rapidly that there is fear among Malaysian leadership its Southern state, Johor, may be ‘swallowed up’ by Singaporeans.
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Following Vietnam’s industrial boom, Singapore is investing in over 973 projects there, putting the city-state the second biggest investor in Vietnam after Taiwan. Vietnam has reaffirmed Singapore as its most important economic partner in Southeast Asia. Singapore has investments, though not very significant, in Philippines real estate, retail, hospitality, energy and information and communication industries. The city-state has been reluctant to invest more as the Filipino economy is slow to take off all these years. The Philippines however, acknowledged Singaporean economic achievements and constantly use it as benchmark for economic development. Philippines Central Bank, for instance, estimated that it would take the Philippines 45 years to develop to the current economic status of Singapore.
Singaporean firms have been rubbing their hands in anticipation at the opportunities arising from Myanmar’s moves to liberalize its economy. Industries ranging from education to manufacturing see plenty of potential in what is fast shaping up to be a rich new frontier for business. Those riches could be unlocked by Singapore’s close ties with the country, which were manifested on Monday when the memorandum of understanding was inked.