Small steps for Myanmar
Top EU official's visit is latest sign of thawing ties, but companies are still wary.
Myanmar’s return from international exile is gathering pace - with a tour by the EU’s foreign policy chief yesterday the latest sign of a “new chapter” in the Asian nation’s relationships with other countries.
Catherine Ashton’s visit followed an easing of sanctions that could prompt a surge of investor interest in the long-isolated state.
Her visit is the most high-profile by the European Union since the military’s brutal five-decade rule of Myanmar came to an end last year, ushering in a quasi-civilian government with a reform agenda that has stunned the world and convinced the bloc to suspend most of its punitive measures.
Ashton met newly elected lawmaker and Nobel laureate Aung San Suu Kyi but made no comment on the tense standoff which has resulted after her National League for Democracy (NLD) party’s much-criticised refusal to take its parliamentary seats, which has left Myanmar in a political quagmire with no clear way out.
The sanctions suspension, which Suu Kyi supports, was intended to allow aid and investment in the resource rich but impoverished country to reward the government for its political and economic concessions, while reserving the right to re-impose them if the reform process stalls.
Ashton acknowledged there was big interest from European investors but said firms were taking a cautious approach.
“We recognise this is a journey that’s not finished. There’s been a lot of interest from the business community, and rightly so,” she told a news conference alongside Suu Kyi at the NLD’s dilapidated headquarters, shouting over malfunctioning microphones during intermittent power outages typical in the underdeveloped country.
“They won’t make their decisions today, they’ll look at the investment potential and opportunities and that needs to be done properly. I hope we’ll see all the elements come into place and make it an irreversible process that can move forward. Much needs to be done.”
The trip comes at a time when the EU is vying with Western powers to capture influence and strengthen commercial ties with Southeast Asia, a region with a combined economy of more than $2 trillion dollars that plans to establish an EU-style economic community by 2015.
European firms now have the green light to compete with Asian companies for a share in Myanmar’s vast untapped natural resources and take advantage of its strategic location, sandwiched between economic heavyweights China and India.
While investment in the former British colony is still seen as risky, it is rich in oil, gas, teak and gemstones, with huge tourism potential and urgent needs for financial services, new roads, hotels and railways and a proper telecoms infrastructure.
But the standoff between Suu Kyi’s party and the country’s current rulers does not bode well for Western countries keen for stability in Myanmar as its inexperienced rulers try to navigate through huge challenges ahead and maintain the pace of essential reforms.