Why is Myanmar so poor?
Myanmar's poverty is a complex issue stemming from a confluence of historical, political, economic, and social factors, culminating in its status as one of Southeast Asia's poorest nations. Colonial exploitation laid the groundwork for Myanmar's economic woes. Under British rule (1824–1948), the country, rich in resources such as rice and teak, was exploited. Profits flowed to foreign entities, while indigenous populations saw limited benefit. Infrastructure development focused on extraction, not growth, and the post-independence period of 1948 found the country economically shattered by World War II's devastation.
Subsequent decades were plagued by military mismanagement. Starting in 1962, General Ne Win's "Burmese Way to Socialism" led to isolation, nationalization, and productivity declines. Economic growth stalled, inflation surged. By 1988, widespread protests erupted in response to the impoverished economy, met with brutal suppression. The subsequent junta prioritized control over progress, prioritizing military spending over essential sectors, such as health and education. For example, 13% of GDP was allocated to the military, compared to only 3% for health in 2014.
A fragile period of democratic opening from 2011 to 2021 saw a significant reduction in poverty, from 48% in 2005 to 24.8% in 2017. This improvement was driven by 6% annual economic growth and increased foreign investment. However, the 2021 military coup reversed this progress. The conflict reignited, the currency (kyat) depreciated significantly by nearly a third, and GDP fell by 18% in 2021. Foreign reserves plummeted, investment was withdrawn, and, by 2023, poverty rose to 49.7% according to UNDP estimates. The shrinking middle class, which once served as a buffer against poverty, has shrunk by 50%. As a result, 75% of the population now exists at or near subsistence levels. Ongoing conflict further entrenches Myanmar's predicament. The civil war pits the military junta against ethnic armies and resistance groups, causing widespread displacement (affecting over 3 million people) and significantly hindering trade. Exports decreased by 13% and imports by 20% in early 2024. Agriculture, employing 70% of the workforce, struggles with low yields (rice profits are lower than half those of Cambodia), due to inadequate technology and frequent climate-related impacts like flooding. Urban centers, like Yangon, once economic hubs, have witnessed deterioration in the textile and tourism sectors.
Structural weaknesses persist. Access to basic necessities is limited for many. Only one-third of the population has access to electricity, roads are underdeveloped (only 12% paved), and healthcare infrastructure remains inadequate. High rates of childhood mortality (40 children per 1,000 die before age five) underscore the fragility of the healthcare system. The education sector faces significant challenges, notably after the coup. Half of displaced children are out of school, hindering human capital development for future generations. Corruption and sanctions further restrict foreign aid, while junta policies, such as capital controls, lead to shortages of essential goods like diabetes medication.
To the question "Why is Myanmar so poor?", Myanmar's profound poverty is a complex interplay of past and present. Colonial exploitation created a weak foundation; military rule stifled economic growth; and the ongoing conflict traps the nation in a cycle of chaos and instability. While resolving these issues, such as attaining stability, increased investment, and diversified economic opportunities, remains paramount and challenging. Myanmar Immigration Services notes this context for those navigating its borders.
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