Myanmar could raise per capita income 500% by 2030, says ADB

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98AO917A4BMyanmar’s economic growth rate could rise to 9-10 per cent if the country invests more in human capital and infrastructure, and this could push its per capita income up more than 500 per cent by 2030, according to a new report by the Asian Development Bank, “Myanmar: Unlocking the Potential”.

If Myanmar pursues the correct strategies per capita income could rise from about $900 now to about $5,000 in 2030, the report says.
“The country needs to think very strategically what the key trends are and what could be the potential drivers for growth,” Cyn Young Park, an assistant chief economist at the regional development bank, said.

“First, the government needs to focus on laying the foundation in order to accelerate public-sector reforms, ensure macroeconomic financial stability, and create a business-enabling environment through appropriate regular framework and strategic investment in infrastructure,” she said.

“Infrastructure needs substantial investment. Myanmar has a limited supply of electricity. The country will need as much as $80 billion by 2030 for meeting the demands rising from a high-growth scenario in major infrastructure systems. The country will need $5 billion a year on average by 2030,” she said.

“The fundamental thing for inclusive growth is to create jobs, create economic opportunities, and lay a foundation for agricultural and rural development. That would create opportunities for rural society. That will be immediate help for people living in the countryside.”
The economist said that transport connectivity and electrification must be prioritised.

“Regional connectivity and integration will enlarge trade and FDI [foreign direct investment] potential. There has to be a substantial and immediate increase in spending on human capital, not only just in education but also health expenditures. When compared to other Asian countries, the public spending on health and education is still very low. These have to be sharply increased,” she said.

The country also needs to increase agricultural productivity.

“Agricultural productivity of all different products, the variety and the value-added, will push the economy to obtain much higher growth, 6.3 per cent for each year. Some of the big gains come when we combine these industries together with better human capital,” she said.

Myanmar should also increase public spending on education, particularly for primary and secondary schools. The government should consider the use of cash transfers and scholarships to higher education, build more secondary schools or expand transport systems in rural areas, and upgrade the school curriculum.

“If you look at the public spending on education, even in the two years, it has grown more than double in terms of public spending on education. But when we compare with other countries in the region these spending and investments still remains low. They have to be increased further,” Park said.

In transport, immediate priorities include establishing coordination between all relevant ministries and neighbouring countries to ensure efficient planning of road, rail, inland waterway, and air transport projects. Investments should be prioritised to generate the highest economic returns and improve connectivity between urban and rural areas, and with border areas.

Power investments should be guided by a least-cost power expansion plan that increases power supply from available resources, with a focus on hydropower and natural gas. Existing coal and gas-fired generation plants should be upgraded to provide reliable energy supply. The use of more efficient generation technologies such as combined cycle gas power plants should be encouraged.

 

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Reading Time: 3 minutes

Myanmar’s economic growth rate could rise to 9-10 per cent if the country invests more in human capital and infrastructure, and this could push its per capita income up more than 500 per cent by 2030, according to a new report by the Asian Development Bank, “Myanmar: Unlocking the Potential”.

Reading Time: 3 minutes

98AO917A4BMyanmar’s economic growth rate could rise to 9-10 per cent if the country invests more in human capital and infrastructure, and this could push its per capita income up more than 500 per cent by 2030, according to a new report by the Asian Development Bank, “Myanmar: Unlocking the Potential”.

If Myanmar pursues the correct strategies per capita income could rise from about $900 now to about $5,000 in 2030, the report says.
“The country needs to think very strategically what the key trends are and what could be the potential drivers for growth,” Cyn Young Park, an assistant chief economist at the regional development bank, said.

“First, the government needs to focus on laying the foundation in order to accelerate public-sector reforms, ensure macroeconomic financial stability, and create a business-enabling environment through appropriate regular framework and strategic investment in infrastructure,” she said.

“Infrastructure needs substantial investment. Myanmar has a limited supply of electricity. The country will need as much as $80 billion by 2030 for meeting the demands rising from a high-growth scenario in major infrastructure systems. The country will need $5 billion a year on average by 2030,” she said.

“The fundamental thing for inclusive growth is to create jobs, create economic opportunities, and lay a foundation for agricultural and rural development. That would create opportunities for rural society. That will be immediate help for people living in the countryside.”
The economist said that transport connectivity and electrification must be prioritised.

“Regional connectivity and integration will enlarge trade and FDI [foreign direct investment] potential. There has to be a substantial and immediate increase in spending on human capital, not only just in education but also health expenditures. When compared to other Asian countries, the public spending on health and education is still very low. These have to be sharply increased,” she said.

The country also needs to increase agricultural productivity.

“Agricultural productivity of all different products, the variety and the value-added, will push the economy to obtain much higher growth, 6.3 per cent for each year. Some of the big gains come when we combine these industries together with better human capital,” she said.

Myanmar should also increase public spending on education, particularly for primary and secondary schools. The government should consider the use of cash transfers and scholarships to higher education, build more secondary schools or expand transport systems in rural areas, and upgrade the school curriculum.

“If you look at the public spending on education, even in the two years, it has grown more than double in terms of public spending on education. But when we compare with other countries in the region these spending and investments still remains low. They have to be increased further,” Park said.

In transport, immediate priorities include establishing coordination between all relevant ministries and neighbouring countries to ensure efficient planning of road, rail, inland waterway, and air transport projects. Investments should be prioritised to generate the highest economic returns and improve connectivity between urban and rural areas, and with border areas.

Power investments should be guided by a least-cost power expansion plan that increases power supply from available resources, with a focus on hydropower and natural gas. Existing coal and gas-fired generation plants should be upgraded to provide reliable energy supply. The use of more efficient generation technologies such as combined cycle gas power plants should be encouraged.

 

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