October 23, 2016

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Myanmar’s Potential for BIMSTEC

Professor Chaw Chaw Sein

State Counsellor Daw Aung San Suu Kyi poses for group photo with other leaders of BIMSTEC countries in Goa, India.
State Counsellor Daw Aung San Suu Kyi poses for group photo with other leaders of BIMSTEC countries in Goa, India.

Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation (BIMSTEC) was established on 6 June 1997 in Thailand with the main objective of fostering socio-economic progress in the member countries by promoting the cooperation in various sectors. The original name of the BIMSTEC was BIST-EC (Bangladesh-India-Sri Lanka-Thailand Economic Cooperation). Myanmar joined the organization as a full member at a Special Ministerial Meeting held in Bangkok on 22 December 1997. Since then the name of the grouping was changed to BIMST-EC (Bangladesh, India, Myanmar, Sri Lanka, and Thailand Economic Cooperation). Subsequently, full membership has been granted to Nepal and Bhutan in 2004.
We can see the potential of Myanmar from three perspectives: political, strategic and economy. From political point of view, Myanmar under previous government from 1988 to 2010 had to face many difficulties in her international relations due to external pressures. However, since opening up in 2011, Myanmar has been reintegrating into international community by undertaking a series of reforms. Moreover, the current changes and political developments in Myanmar have paved way to take a leading role in regional organizations.
From the strategic point of view, Myanmar is situated between South and Southeast Asia. Myanmar is surrounded in the West by the Bay of Bengal and the Gulf of Mataban and the Andaman Sea in the South. She is located on routes that go from the India Ocean to the Southwest sea of China. Moreover, she has significant influence upon the sea approaches of Bangladesh in the West and the Southwest of Thailand. For India, it is a land bridge between India’s North East Region and ASEAN countries. Myanmar has remained a crucial factor for the national interest of India and Southeast Asian nations. This strategic position, as a gateway for the BIMSTEC or South Asian Association for Regional Cooperation (SAARC) could improve its basic economic fundamentals and infrastructure and learns from its neighbours and other economic clubs from transport network through Myanmar. As Myanmar is in the centre of BIMSTEC region transport network, this Sub Regional Organization can gain strategic benefits.
For Bangladesh, Myanmar is the gate way to ASEAN. In this context, bilateral relations are boosted by Bangladesh’s desire to strengthen ties with ASEAN members under a “Look East” policy adopted by Bangladesh. Bangladesh participates along with Myanmar, Thailand, and other South Asian countries in the BIMSTEC regional economic grouping. Bangladesh adopted “Look East” policy and emphasized on finding ways and means to promote its market access with ASEAN member countries. Among them, Myanmar is Bangladesh’s closes neighbor as well as entry point to ASEAN. Trade routes through Myanmar are essential for trade promotion among BIMSTEC region. Myanmar and Bangladesh agreed to implement direct highway between two countries in March 2003, which was commonly called BIMSTEC Highways. The project route is 1370 kilometers and can be regarded as a part of Asian Highway. This road also helps boost regional cooperation by strengthening economic and trade relations in the South and Southeast Asia.
Myanmar also plays a central role in another major transport project, India-Myanmar –Thailand Tripartite Highways. The Project linking Thailand to Dawei deep sea port of Myanmar is a part of India-Myanmar Thailand Tripartite highway. Moreover Dawei Deep Sea Port is a beneficial project for all BIMSTEC countries. Thailand proposed for using shorter trading sea route by upgrading modern ports along Bay of Bengal. These geopolitical significances make Myanmar’s potential for BIMSTEC member countries.
From economic point of view, there are also many opportunities for BIMSTEC member countries. The west including EU and US has also lifted sanctions based on the political development of Myanmar. Prospect for inflows of resources from abroad into Myanmar in the form of Foreign Direct Investment (FDI) and bilateral and multilateral assistance have considerably brightened with removal of sanctions and improved relations with the major players in the world stage. In the wake of this good outlook for foreign resource flows, Myanmar has also passed FDI Law at the Parliament session and approved by the President. So, in line with new FDI law it is easier for foreign investors to invest. In this regard, Myanmar’s potential for BIMSTEC is trade and investment. Investments and trade relations between Myanmar and BIMSTEC countries can be seen especially with Thailand, India, Sri Lanka and Bangladesh.
Besides these potentials, Myanmar can contribute to BIMSTEC energy security since it is endowed with large reserves of oil and gas. Myanmar has many oil and gas field along the coast. Myanmar’s export of gas from both Yadana and Yetagun (which is located in southern Myanmar) to Thailand is an example of success in energy cooperation in this region for mutual benefit. In addition, Bangladesh, India and Myanmar have agreed to an understanding for a tri-nation gas pipeline project, reflecting the necessity for enhancing regional cooperation in the energy and infrastructure development sector for the common benefit among BIMSTEC nations. Myanmar’s cooperation in energy sector can bring fruitful benefits for member countries.
There is also an opportunity for BIMSTEC countries in the exploration of commercial scale hydropower for regional energy sector cooperation. Such projects are by nature need huge investments. Under new government, Myanmar is now willing to receive assistance from the west or indeed international organization for materializing these potentials. Then again, technologically more advanced BIMSTEC member countries; such as India, Thailand and Bangladesh on the other hand, have ample opportunity to provide Myanmar with technical assistance. Indeed, promotion of FDI in general will not only enhance the development of BIMSTEC countries but will also make BIMSTEC a more attractive place for greater inflow of FDI. There are still a number of offshore oil and gas blocks left for regional cooperation in energy sector.
Another potential is tourism. Myanmar is a cultural destination known as “the land of Pagodas.” Moreover, Myanmar also offers a variety of tourist attraction such as rich culture nature endowed with beaches, tropical forests, snow capped mountain ranges, world famous gems and handicrafts. Under previous government, tourism industry is not so much flourish due to political reasons. However, because of the changes of new government, it opens way for tourist attraction. Tourists are visiting Myanmar to find out how Myanmar has transformed peacefully in the political process, its culture and history. Myanmar is rich in cultural heritage and has great potential for popular tourist destination. Furthermore, tourism is also a sector that BIMSTEC is promoting for development. In this connection, Myanmar would like to suggest exploring the idea of devising joint tour programmes involving all BIMSTEC countries. These tour programmes will aim not only to promote tourism industry itself but also can promote social and cultural aspects of our respective countries. Myanmar views that BIMSTEC countries can work together to promote BIMSTEC’s cultural, national heritage, eco or nature tours. Myanmar would propose that the Group should look into such possibility for the future undertaking.
It is also necessary to find ways how BIMSTEC can move forward. The level of economic integration includes free trade area, custom union, common market and economic union. Regional organizations like EU and ASEAN is approaching for the success of economic integration and EU has reached these levels. As for BIMSTEC, in spite of diverse dimensions, economic interests remained a priority since BIMSTEC is the home of one fourth of the world poor. With this interest in mind, members agreed to establish the BIMSTEC Free Trade Agreement and to create a free trade area within BIMSTEC region by 2017 as a whole. If this has accomplished, it will benefit for members, which led to non-zero sum game. Before reaching the target, BIMSTEC should also take some experience and lessons from ASEAN.
Another factor to be considered is regional powers like Japan and China’s interest in BIMSTEC. For Japan, promotion of Japanese Direct Investment in BIMSTEC countries, especially in infrastructure (such as power, communication and transportation), is the best way for realizing closer economic relations between Japan and BIMSTEC countries as well as promoting better ties among BIMSTEC countries. Indeed, promotion of FDI in general will not only enhance the development of BIMSTEC countries but will also make BIMSTEC a more attractive place for greater inflow of FDI. Most of the BIMSTEC members have already benefited from the Official Development Assistance and FDI flows from Japan in the past. Political stability and security, besides the liberalization of trade regimes and labor regulations and improvement in infrastructure facilities are quite essential for BIMSTEC members to have increased economic linkages with Japan. The cultural and other economic exchanges between the two will pave the way for sustainable relations. There is a possibility to strengthen the ties among BIMSTEC members to pursue the goal of providing secure, reliable and affordable energy, and in this context, Japan can extend suitable technical know-how to harvest the conventional and non-conventional energies. It is undeniable that Japan’s technological capabilities and its economic strength will bring a significant change in the economies of BIMSTEC. China’s interest in taking part of BIMSTEC can be seen in the some big projects like building deep-sea port in the Bay of Bengal and regional connectivity. The BIMSTEC members should consider how can gain win-win cooperation with these two regional powers.
Peace and security is another factor to be considered. This is also important factor for the promotion of regional economic integration especially among developing countries. There are still some border issues, which are hindrance for economic integration. In order to overcome this issue, there must be an understanding each other and look for a common ground. How can we have understanding among the BIMSTEC members? One of the aims of BIMSTEC which is outlined in the First BIMSTEC Summit held in Thailand in 2004 is to provide assistance to each other in the form of training and research facilities in the educational, professional and technical sphere. But the cooperation in these areas is still limited.
In ASEAN, there is ASEAN University Network, which brings member countries together, understanding and people-to-people contact. It can also have better friendship and closer contacts with BIMSTEC countries by making people-to-people contacts like ASEAN. This will partly contribute for peace and stability in the region. Moreover, in this sub-regional organization, India is the largest economic power among member countries. As a small member country, we would like to see the rising power as a partnership friend, and not as dominant power. BIMSTEC also must be more action-oriented and result-oriented to become a genuinely effective forum to bring progress and prosperity to people of the region. Moreover, as Myanmar is under new elected civilian government with opening up for more investment and cooperation, it is an opportunity for BIMSTEC member countries to expand their trade and investment.
References:
Joint Statement of the 12th BIMSTEC Ministerial Meeting ,2010 , Nay Pyi Taw
Sadiq Ahmed , The Look East policy of Bangladesh, http://www.thedailystar.net

 

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