YANGON — Myanmar’s government has brought a key architect of the previous administration’s economic policy back into the fold, aiming to bolster confidence in the business community.
President Htin Kyaw’s office on Monday announced the appointment of Set Aung, until recently the deputy governor of the central bank, as deputy minister for national planning and finance. Under former President Thein Sein, Set Aung was instrumental in promoting an open-door approach, including the creation of the Thilawa special economic zone on the outskirts of Yangon.
Since de facto leader Aung San Suu Kyi’s National League for Democracy took power, some critics have questioned the economy’s direction without Set Aung’s hand on the tiller.
Set Aung became an economic adviser to Thein Sein in 2011. In 2013, he took the post of deputy minister for national planning and economic development, and also became deputy governor of the Central Bank of Myanmar.
Armed with a master’s degree from the U.K. and vast knowledge of development strategies in other Southeast Asian countries, he set about putting the government’s economic plans into action. His greatest achievement, perhaps, was the establishment of the special economic zone program — a key feature of the country’s economic liberalization.
While foreign companies face various restrictions in Myanmar, such as a ban on sealing long-term land-use contracts, SEZs offer them much freer rein. Set Aung negotiated with the central government authorities in charge of issuing licenses to international companies, in his capacity as chairman of the Thilawa SEZ Management Committee.
The Thilawa SEZ, created with support from Japan, provides a “one-stop window” for processing investment applications, filing taxes, handling labor management and other procedures.
It is considered a model for future zones, and as one official said of Set Aung: “The Thilawa SEZ wouldn’t have been realized without him.”
Short on specifics
But while gradual economic reforms continue, Myanmar has yet to nurture the industries it needs to create jobs.
A 12-point economic policy announced by the NLD government in July 2016 included the development of all sorts of infrastructure — power, roads, ports and so on. It also called for advancing reforms of state-owned enterprises and supporting small and midsize companies. But unlike policies worked out by the Thein Sein government, the plan drew criticism for its lack of detail and numerical targets.
Meanwhile, Myanmar’s growth slowed to 6.3% in 2016, according to the International Monetary Fund — at least partly due to the effects of the change of government. Now, businesses want the Ministry of National Planning and Finance to serve up more specifics.
“The government has only motivation, but some of them are too young and have no experience,” said Than Lwin, a former governor of the central bank and currently a senior consultant at Kanbawza Bank, Myanmar’s largest financial institution.
Set Aung, in his 40s, is young even by the standards of the NLD government. But he does have experience, and now he is being asked to spearhead economic reforms.
Steady hand
The NLD also faces growing popular discontent over price rises, stemming from the depreciation of the nation’s currency, the kyat. In addition, peace talks with ethnic minority rebels — a priority for the NLD — have made little headway of late.
The government is apparently hoping Set Aung can provide a steady hand on the economic front. Though he retained his post at the central bank even after the transfer of power to the NLD, his term expired in July, and the government jumped at the chance to recruit him.
This is likely to go over well with businesses, which will be looking for him to kick economic liberalization into high gear.
But there may be one catch: Suu Kyi has developed a reputation for top-down decision-making, and this might limit Set Aung’s maneuvering room.
Source: Nikkei Asian Review
