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The Burmese military's role in the economy

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Title: The Rise of Private Indirect Government in Burma
Date of publication: November 2010
Description/subject: "...due to budgetary and ideological reasons, the regime requires all of its field battalions to be as economically self-sufficient as possible. This policy, introduced in the early 1990s, has encouraged the battalions to engage in a diverse array of activities to fund their operating expenses, which minimally include food, ammunition, and pay packets for Ken MacLean | 44 | the soldiers under their command. Of these activities, joint ventures are among the most lucrative since they allow the battalions to collect various rents (such as extra-legal taxes and protection fees) in addition to a percentage of the commodities extracted. Second, decades of counterinsurgency operations have resulted in the extensive militarization of Burma’s border regions. There are, for example, more than 200 infantry battalions presently deployed on or near the country’s eastern border.11 Due the density of these deployments, battalions frequently find themselves seeking to exploit the same limited number of economic opportunities in order to finance themselves. Third, most of the extractive enclaves in the ceasefire areas contain several different kinds of resources, so concessions devoted to one commodity often overlap spatially with others, which results in shifting forms of competition and collusion between the ad hoc joint ventures. Over time, these practices have produced a curious paradox that complicates conventional understandings of sovereignty, which still privilege a state’s monopoly over the legitimate use of force within a territory. On the one hand, the resource concessions have helped the regime to expand its military, administrative, and economic reach into areas of the country where it previously had little or none. On the other hand, the resource concessions have simultaneously undermined the regime’s ability to exercise centralized control over these same areas since the joint ventures are able to divert a considerable portion of the resources they extract (rents as well as primary commodities) to members of their respective patron-client networks, group, or locality. Both processes have not only intensified efforts by the joint ventures to claim what remains of Burma’s natural “capital” before someone else does, but accelerated the devolution of sovereignty into competing networks of authority and accumulation, which cross-cut the regime’s civil and military bureaucracy at some moments and bypass them entirely at others..."
Author/creator: Ken MacLean
Language: English
Source/publisher: Woodrow Wilson International Center for Scholars, Washington, D.C.
Format/size: pdf (156K)
Date of entry/update: 20 November 2010

Title: Burma/Myanmar: The Role of The Military in the Economy
Date of publication: September 2005
Description/subject: "...It seems evident that the military will attempt to keep its autonomy under any future ‘civilianized’ or civilian government. It is likely to do so through constitutional means, such as ensuring a percentage of active-duty officers in a parliament (there in any case will be many retired military in politics–the National League for Democracy’s top leadership around Aung San Suu Kyi are also former military), or creating a national security council it could control. It will also attempt to ensure its own budgets, but in any case will supplement those budgets through economic activities that are outside of the ken of a new administration. These include the continuation of a military procurement system that is far wider in scope than the needs for defense, but include lucrative industries, the profits from which feed into military coffers. It will also retain its Myanmar Economic Holdings Corporation (MEHC– see Appendix II), incorporated under the companies act and thus outside of the public sector (the State Economic Enterprises). It also controls the Myanmar Economic Corporation (MEC–see Appendix III). All these enterprises enable the military to supplement its budgets, provide employment for military and their families, and provide additional retirement funds for institutional and individual members. The scope of these activities is so great, employing some hundreds of thousands of workers in fields such as mining, that they could have a profound affect on the market in certain areas in which they predominate or have monopolies. Thus, military ventures into the economy in the future should not be considered as isolated lucrative efforts, but rather that they have the potential, through both institutional and personal means, of broadly influencing the markets and sectors of the economy.
Author/creator: David I. Steinberg
Language: English
Source/publisher: Burma Economic Watch
Format/size: pdf (113K)
Date of entry/update: 20 November 2010