• Myanmar’s tycoons are strong in many sectors of the economy such as banking, construction and property, trading, mining, hotels, logging, marine products, transportation, building materials, energy services, agribusiness, food and beverage manufacturing, and miscellaneous consumer products.
• Western donors regard them as “cronies” who benefited from favourable treatment under military rule and being resistant to reform, and try to marginalize them through advocacy of good governance, economic liberalization and creation of a “level playing field” for competition.
• But the Washington Consensus liberalization approach, with the burgeoning trade imbalance it engenders, could trigger a payments crisis that leaves tycoons fire-fighting in operations and western donors with more influence.
• The ancien regime used the tycoons to get things done but wholesale abandonment of the old system before the new – the donors’ “good governance” agenda – is firmly rooted risks the country becoming caught between two systems, with stunted results and unexpected consequences.
• A more nuanced and pragmatic approach to state business relations from donors and power-holders would reduce the risk of a failed transition. With the prospect of a change in president coinciding with the Asian Infrastructure Investment Bank commencing operations next year, there are grounds for optimism.