"...Economic growth inMyanmar has been strong over the past few years, with the International Monetary Fund predicting a 7.5% growth rate for 2014. Creating a conducive business environment for increased foreign direct investment as well as a vibrant domestic private sector is a key element in generating strong and sustainable economic growth. At the local level, the important role of small- and medium-sized businesses, which constitute the vast majority of businesses in the country, to provide employment and services to communities, to generate much needed revenues for local governments to finance social services and development initiatives, and to participate effectively in the emerging production chains as part of Myanmar?s regional and global integration must be highlighted. Encouraging these local agents of growth is dependent on both furthering national reforms but also on strengthening the support of local governments at the state and region levels and below. The research presented in this discussion paper by Jared Bissinger and Linn Maung Maung analyzes the role that local government institutions play in economic governance and how this affects small- and medium-sized businesses. Intended to reach a general readership, the paper provides the relevant history, policy structures and overarching reform context. Moreover, using data collected through field work carried out in Mon State and Sagaing Region, the authors illustrate and analyze local economic governance trends and the subsequent business environment for small- and medium-sized businesses. The paper concludes with key policy considerations by the authors..."