Government Sets Spending Priorities for Foreign Aid Money

By Kyaw Hsu Mon 14 December 2016

RANGOON — The National League for Democracy (NLD) government has identified a shortlist of the most urgent development projects across Burma that could be financed with international aid money, State Counselor Daw Aung San Suu Kyi said in Naypyidaw on Monday.

Her announcement came after she chaired the first meetings of the government’s new Development Assistance Coordination Unit (DACU) and Cooperation Partners Group (CPG) on Monday.

Many countries have offered assistance to Burma since the NLD government took charge in April, the State Counselor said. The DACU and CPG groups are tasked with managing where and how to apply that international aid, in accordance with the country’s new economic policy that was released in October.

At the first meeting, Daw Aung San Suu Kyi told the groups to seek out projects that would boost job creation, agriculture, and rural development in Burma.

“Infrastructure development projects are the major issue that the country needs right now,” said Dr. Maung Maung Lay, vice chairman of the Union of Myanmar Federation of Chambers of Commerce and Industry. “These projects impact all sectors of the economy. If we can just cut transaction costs here, then everything will happen more smoothly, and our commodity prices will decrease.”

He argued that the aid money should be prioritized for power, energy, and transportation projects.

“Also, these government projects must be more transparent to the public,” said Dr. Maung Maung Lay.

The newly formed DACU’s primary responsibilities are to identify priority sectors and projects for future development assistance, based on consultations across government. The board will also draw up a national policy for development assistance.

However, one item the State Counselor did not mention was which areas will be targeted first for development projects.

U Khine Maung Yi, a former Upper House lawmaker from the National Democratic Force party, thinks the government must be more transparent about how much international assistance is coming in and where those areas are that require the most urgent aid.

“Government ministries should be able to perform their functions with only the money allocated in their regular state budgets,” he said. “The international aid money is different.  That should be spent in the least developed areas, especially in border areas where the people are suffering from internal conflicts.”

DACU members will play a critical role by prioritizing the country’s infrastructure requirements, and it will coordinate with government agencies, the private sector, and aid donors, the state-run newspaper Global New Light of Myanmar reported.

Since the NLD government came to power, Daw Aung San Suu Kyi has visited four major economic powers: the US, Japan, China, and India. During those visits, the State Counselor received pledges of aid and official assistance loans.

Following her visit, the US said it would end economic sanctions against Burma. Japan pledged to provide US$7.73 billion in aid. In China, Daw Aung San Suu Kyi received loan pledges from the president of the Asia Infrastructure Investment Bank (AIIB), which she plans to spend constructing a gas power plant. During her visit to India, she signed a memorandum of understanding to enable closer cooperation in the banking, power, and insurance sectors.