Wednesday, January 21, 2015

Day Three: US Embassy in Rangoon and Myanmar Centre for Responsible Business (MCRB)

Day Three

US Embassy in Rangoon

Our Wednesday morning started with a visit to the beautiful U.S. Embassy located by Inya Lake in Yangon. After going through the security checks, we walked through the manicured courtyard into a large conference room. Our meeting was with James Shea (Political/Economic Officer), Christopher Mohrman (Second Secretary - Political/Economic Section), and Jeffrey Warner (Political Officer). We were pleasantly surprised to learn that they were SAIS alums, or as they said: some of the “SAIS mafia” in Myanmar.

After introductions, Jeffrey Warner started to talk about the political situation in Myanmar. With a specific focus on the upcoming elections in October/November 2015, Jeffrey talked us through the political timeline in Myanmar. The Myanmar Parliament was in session since Monday, and their main discussion topics included amendments to the Constitution. With respect to the upcoming elections, it was expected that by June/July, the voter’s list would be disclosed, and in August the official dates of election would be announced. The months of September and October would serve as the 60 days campaigning period. Based on the discussion, we sensed that while there are a few international organizations monitoring the process and results of the elections, it is yet to be seen whether the elections will be inclusive, particularly in regions with ethnic conflicts.

James Shea then gave us a summary of the economic scenario in Myanmar. Since 2011/12 the country had opened up, and the government had made reforms in trade, foreign investment, and addressed issues in areas including banking, finance, corruption, and money laundering. However, the government still needs to consolidate its Foreign Direct Investment (FDI) and domestic investment laws, implement and institutionalize existing rules and regulations, and introduce new laws to address areas like intellectual property, alien workers, arbitration, labor rights, etc. The discussion also highlighted the main hurdle in Myanmar was capacity and lack of qualified human capital. While both the government and foreign investors were optimistic of economic opportunities, the country presently lacks the capacity to manage the sudden growth. This reiterated the sentiment of DICA (see entry for DICA meeting), and it seems that both the US government and the government of Myanmar see a need to strengthen human capital in Myanmar's public sector.

Christopher Mohrman then spoke to us about Myanmar’s external ties. We learnt that China has had a prominent presence in Myanmar for decades. However, since 2000, the country decided to redirect its dependency from China and strenghten its ties with other nations. There were many indicators that highlighted the change in policy, including the suspension of the Myitsone dam, renegotiation of the copper mine agreement, and the commander-in-chief’s first visit to Vietnam. While Myanmar was reducing its dependency on China it was not minimizing its external relations relations overall. We also learnt that historically, corporate social responsibility measures of Chinese companies would often come in the form of donations to charities. However, more recently, Chinese companies were making an effort to invest in the communities of their projects. For Myanmar, the U.S. brand was considered “the standard,” and the country favors American brands over other nations. Furthermore, American investors are considered to be responsible investors. With respect to foreign investors, we also got a sense that the people of Myanmar expect foreign companies to be involved with the communities, and engage extensively through corporate social responsibility.

After hearing about Myanmar’s political, economic, and external relations, numerous questions followed, which added more insight to our knowledge and understanding of the country. The meeting at the U.S. Embassy was very interesting and we were very happy to hear a summary of the political and economic situation in Myanmar. As it was day three of our meetings, the discussion at the U.S. Embassy served as a validation of what we had heard before. After the meeting, we had a sense of what the American Embassy was doing in Myanmar, and an insight about the U.S. strategy and leverage in the country.

~ Neeli Shah

Myanmar Centre for Responsible Business (MCRB)

After paying the visit to US Embassy in the morning, our next meeting brought us to the Myanmar Centre for Responsible Business (MCRB) in downtown Yangon. MCRB is a non-governmental initiative created to encourage responsible business activities in Myanmar, and as MCRB's mission notes, the Centre "aims to provide a trusted, impartial forum for dialogue, seminars, and briefings to relevant parties as well as access to international expertise and tools."

We met the founder of MCRB, a very elegant but decisive British lady, Vicky Bowman, who was once the British Ambassador to Myanmar. Ms. Bowman, has lived in Myanmar for several years,  is fluent in the local language, and worked in the arena of responsible business within the private sector and government for many years.

Prior to the visit, we have seen Korean and India investors in Myanmar, India diplomats, Myanmar government officials, the US embassy staff. Everyone agreed the reform in Myanmar was true and genuine. But they also raised a lot of questions regarding the challenges of the reform, especially the challenges that foreign investors are facing in Myanmar. As graduate students in a policy-oriented school, we are concerned about more than just the problems, but solutions. Vicky Bowman is the one who give us a clue about how to solve the current in Myanmar.

“Myanmar is not an easy place to do business,” Vicky Bowman said so. First, because of the lack of transparency for Myanmar companies, foreign investors find it difficult to find capable and responsible local partners. Second, Myanmar government doesn’t have much experience in dealing with foreign investors, so there is disconnection between the government plan and the investor’s expectation. Third, the civil society in Myanmar hasn’t used to business, their understanding about business is not comprehensive, and so they are, in most cases, suspicious about foreign investors and investment projects. Last, due to the lack of rule of law, even though the new Foreign Investment Law has been passed, there are enforcement problems, especially coming to arbitration, labor protection and taxation issues.

MCRB is working against such backgrounds, as Vicky tells us, “Myanmar Centre for Responsible Business is established for building the bridges between the private sector and the government, between the investors and civil society.” The Centre is working on monitoring the transparency of Myanmar companies, sharing updated information with public and government and providing advises for decision makers. They started from extractive industry, and is planning to move towards other sectors. Vicky and her colleagues also frequently hold and attend events, joint by government, private sectors and civil society, encouraging cooperation among three sides.

Vicky stresses the importance of doing responsible business. She gives an example of a Chinese company, which has invested a lot in Corporate Social Responsibility (CSR), but the outcomes are not in their favor. Companies like it, who has the wish to improve their company image and their relationship with local community, have little knowledge of how to run with NGOs. Therefore, “we (MCRB) are here to help them understanding what the local community need,” Vicky says. The Centre provides a stage for the investors to engage with the civil society. In terms of the civil society, the Centre provides them with exposures to business through workshops and seminars. Vicky hopes this would help young professionals in NGOs to better know how to effectively represent their community.

During the Q&A part of the talk, Vicky answers several questions about looking forward to the Myanmar reform in 2015. She is very confident that the reform will continue despite of challenges brought by the coming election and constitutional amendment. She believes that Myanmar is a country with huge development potential, but the Myanmar government should quickly build up their capacity. When giving her comments on the requirement of CSR in new Foreign Investment Law, Vicky shows some worries, “it is not correct to let the investors to fill the gap [of providing general social welfare],” and she adds, ”sometimes, the companies should not take the responsibility of government.”

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