Presidential economic adviser's open letter to U Nay Htun Naing

Dear U Nay Tun Naing,
Subject: Open Letter on your article titled “Would Myanmar plunge deeper into recession?”
published in Eleven Newsmedia Myanmar, dated 1 April 2015.

Please refer to the above article written by you. I believe that an investigative media to review, monitor, assess, and to point out shortcomings and deficiencies in the formulation and implementation of government’s policies and plans are crucial to achieve the declared intent for Myanmar to become a modern industrialized democratic nation.

A responsible and an investigative media has played an important role in many countries, both developed and developing, in exposing misconduct as well as in serving as a watchman to ensure the government is doing its work and fulfilling commitments and promises made to its people. The media has not always acted in a responsible manner, and like everything else in this world, it is not perfect. Nevertheless, its power to limit misconduct and improper behaviour on the part of public and private officials should not be underestimated.

I have reviewed your article in this spirit. I find that you must have devoted a lot of time and effort in its preparation. I have no doubt that you have written the article with good intentions and that you sincerely want to protect the people of Myanmar from the serious consequences of the country plunging into a “deeper recession” as expressed in the English text, and “collapse of the economy” as it appears in the Burmese text.

I also note with considerable interest that you have declared jihad on President U Thein Sein, his government, his advisers, the Hluttaw and the opposition. Among these, U Thein Sein’s government and his advisers received special mention. For instance, you have pointed out that:
“If the Myanmar economy collapses in 2015, President Thein Sein and his government are the first to blame. The second most responsible people are the presidential advisors.”

In going through your article I get a feeling that you think the country will be better off if the U Thein Sein’s government and its advisers are removed from office. Speaking for myself and on behalf of my four fellow economic advisers, if you think we are ineffective and should be removed, especially in thinking about make-up of the next administration, I would be interested if you could give me five names that meet your expectation of who you consider will be good economic advisers.

Finally, I notice that your article has two parts. The first part is devoted to reproducing data and observations from recent press releases and reports from international organizations and government ministries to indicate that the country’s economy is near collapse and will soon go down the drain if the President and his advisers continue to sit idly by and do not take remedial action.

In the second part you have made observations and presented a set of remedial measures to save the country’s economy from going under. I have taken careful note of both parts of your article. I think you have raised important issues and have made good points. Unfortunately, the good points you have made are not likely to have the desired impact they deserve because the quality of your article in terms of journalistic merit, command of the English language and knowledge of the subject matter of economics are far below local standards.

Hence, I have reviewed both parts of your article and have made specific suggestions on how you may wish to improve your presentation and quality of economic analysis to benefit the members of the next administration and its five economic advisers that you may suggest to bring on-board to replace us.

My comments on your measures relating to remedial action are given below. There are 18 comments. They are labeled [u1] to [u18]. The exact words, phrases and sentences you have used are in italics and are underlined. My comments follow these underlined texts.

My comments on the first part of your article dealing with facts, figures ideas and reports concerning the present state of the Myanmar economy and which – according to you – is on the brink of collapse, will be sent to you in due course in the form of an open letter.

Comments on U Nay Tun Naing’s observations and recommended remedial action

1. Comment [u1]. The opposition has the duty to alarm the government: I believe the main aim of an opposition is to defeat the regime in power through free and fair elections. I have difficulty in understanding what is meant by an opposition’s “duty to alarm” the government. Please explain. I hope it does not mean that an opposition has duty to overthrow the government by inciting violence, civil disobedience and social unrest. These will have tragic consequences on the people of Myanmar.

2. Comment [u2]. Sitting back and watching the government's mistakes is not enough to solve the country's problems: As we all know, it is obvious sitting back and watching mistakes do not solve anything. So saying something obvious in different words to create an impression of being provocative, wise and smart does not add anything to an argument. It is called a tautology.

3. Comment [u3]. If the National League for Democracy (NLD) ruled the power: The meaning of NLD “ruled the power” is not clear. It will be desirable to redraft this statement. Ask your editors to do it for you.

4. Comment [u4]. It is true that the NLD have only a few seats in the Parliament, but its representatives should not spend all their time in human right affairs: I don’t believe NLD representatives “spend all their time” with human right affairs. I suggest you check the local and international mass media on this.

5. Comment [u5]. The government and the Parliament have raised the salaries, but the lower levels have faced a tighter situation due to the increasing expenditures along with the salary raise: A decision was made to raise salaries of public servants beginning on 1 April. These public servants will get the pay increase at the end of April. Hence, it is too early to rush to judgment on this matter. Why not wait a few weeks to make your case based on more up-to-date and reliable information and data.

6. Comment [u6]. Weakening kyat makes the import expenses high; the private trading sector is damaged: A weakening kyat makes imports dearer and exports cheaper. More expensive imports reduces a country’s imports while cheaper exports increases a country’s exports. Falling imports and rising exports do not necessarily damage a country’s foreign trade sector.

7. Comment [u7]. The construction sector begins to collapse and the owners are likely to get hurt: Another tautology. If construction sector collapses its owners will definitely get hurt. Not only owners but many others will get hurt. These include poor unskilled labourers who work on construction sites; carpenters and bricklayers; producers of construction materials such as cement, lumber, bricks, etc.; shops that sell construction materials; and transport firms that carry sand, pebbles, cement, bricks, lumber, and other construction materials. I hope you realize that collapse of the construction sector, will not only hurt owners of land and buildings but could prove to be a major disaster for the whole country.

8. Comment [u8]. Meanwhile, the labours have presented a wide set of basic needs: It seems to me that labours do not present a wide set of basic needs, whatever that means. Instead, labourers especially poor labourers require basic needs (food, clothing and shelter) to survive. But for our poor people I think we should provide them not only with basic needs but also with “conventional” needs such as improved health and education, comfortable and affordable dwelling, pleasant and safe neighbourhood, convenient transport, reliable electric power supply, safe and adequate water supply, efficient telecommunications system (especially access to hand phones), and sufficient leisure time to engage in recreational, cultural, religious and civic activities. So please explain what you mean by “labours have presented a wide set of basic needs.”

9. Comment [u9]. Business owners are cutting the workers' salaries to make ends meet and this leads to exploitation: If business owners that cut workers’ wages to make ends meet result in exploitation, then if wages are not cut, businesses can’t make ends meet and will have to close down their firms. As business firms are closed down there is no longer exploitation (implied by your statement), but there are also no jobs and no employment opportunities. This in turn means, workers will have to choose between exploitation and unemployment. Please clarify how you reach this conclusion. Please give evidence. I do not believe such a situation exists in present day Myanmar.

10. Comment [u10]. The basic wage is yet to be termed: The statement “wages to be termed” makes no sense. Please clarify.

11. Comment [u11]. Workers staged protests demanding a new salary rate – Ks 1,000 ($1) a day: It is doubtful workers in Myanmar at present will be protesting for a salary rate of Ks1,000 per day. Last week I met a rice farmer from a village called Paung in Mon state near the border with Thailand. He told me labour cost in Paung was Ks 3,000 per day last year. Now it is Ks 5,000 per day. But even at this wage it is very difficult to get labourers for his farm, as whole families from his and nearby villages have gone across the border. So please tell us where in Myanmar are workers protesting to get a new salary rate of Ks 1,000 per day.

12. Comment [u12]. Imports should be trimmed down in times of kyat depreciation: As shown in comment [u6] above, a kyat depreciation will lead to a fall in imports and there may not be need for trimming as suggested.

13. Comment [u13]. Import of deluxe automobiles should be limited, and raising the tax rates over luxury goods can be another alternative: This proposed measure is internally inconsistent and will be self defeating. It will not be very helpful if imported luxury goods like deluxe cars are restricted and at the same time taxes on luxury items are increased. The increase in tax rate with a decline in the volume of goods to be taxed, is not likely to increase tax revenue.

14. Comment [u14]. The situation will worsen if the running private enterprises fall: “Running private enterprises fall” is poor English and poorly drafted. Suggest redraft.

15. Comment [u15]. Myanmar's poverty rate is not declining yet and the 26 per cent of the population still living in economic deficiency. The country ranks 150 among 187 countries, according to the UN's human development index: The poverty rate of 26% in 2010 for Myanmar is result of the Integrated Household Living Conditions Assessment (IHLCA) nation-wide survey. That poverty rate has nothing much to do with UNDP’s Human Development Index.

16. Comment [u16]. The possibility of economic failure and social gap are making the Myanmar people suffocate: People of Myanmar will suffocate when economic failure and social gap result in depletion of air that we breathe in the country. Not to worry. This is not likely to happen in the foreseeable future.

17. Comment [u17]. The President Thein Sein and his advisors, the government, the Parliament and the opposition cannot sit back and enjoy the situation anymore: As far as I am aware, President U Thein Sein, his advisors, the government, Hluttaw and the opposition are not sitting back and enjoying the situation at present. Please rest assured, trying to recover from fifty years of mismanagement and systematic destruction of the country’s institutions, there is no soft landing and none of us are sitting around and enjoying ourselves.

18. Comment [u18]. The economic depression would lead Myanmar to a crisis in 2015: Recession, depression, economic collapse and economic failure are used interchangeably in the article. It will be helpful if you could tell us how you go about defining, recession, depression, and economic collapse in Myanmar.

1President U Thein Sein’s Chief Economic Adviser.