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| US President Barack Obama smiles as Burma's President Thein Sein waves during their meeting in Rangoon (Reuters) |
Burmese exports in the garments, wood and farming industries are likely to flourish, as the US government prepares to lift import taxes on goods from the former pariah state, according to an economic expert.
Dr Maung Aung, an advisor to the Minister of Trade and Commerce, said he sees a bright future ahead for Burma’s export industry after years of being crippled by economic sanctions imposed by western governments.
It follows news that the US government — which voted to extend targeted sanctions against Burma last week – is planning to deepen its trade ties with the former military dictatorship by waiving import duties on thousands of goods from Burma.
The move forms part of a US government programme, known as the Generalised System of Preferences (GSP), which is designed to promote economic development in poor countries by boosting their access to the US market.
“There is a good probability these export items could bring more foreign investment in the country and boost job creation. We also expect the expanding export sector to contribute to the alleviation of poverty and boost the country’s economy,” said Maung Aung.
A public hearing to discuss whether Burma should be given “beneficiary” status under the GSP programme, which is also expected to boost American job creation, is planned for 4 June. “It’s a great opportunity for both sides,” US Trade Representative Demetrios Marantis told reporters last month.
Western countries have continued to step up their diplomatic and economic engagement with Burma over the past year in recognition of the country’s democratic reform programme. Last month, the EU voted to permanently lift all remaining economic sanctions against the former pariah state, in a move that includes similar tariff reductions for Burmese exports.
But Dr Maung Aung said it will take time for the US and EU markets to reach the same level of trade flows that Burma has with Thailand and China – two of its main trading partners. According to government statistics, the value of trade between China and Burma reached US$5bn for the 2011-12 financial year, while Thai-Burma trade hit US$4.5bn.
“It is not likely the [US and EU] trade flow will sky-rocket straight away following the GSP restoration but it will increase gradually. Also, we have to work to meet their standardisations. In the past, the US and UK markets were crucial for our export sector – we will get back to that stage again.”
Both Washington and the EU suspended their GSP schemes to Burma in 1989 and 1997 respectively over concerns about labour rights abuses under the military junta. But the International Labour Organization (ILO) lifted its restrictions on Burma in June last year, citing the government’s efforts to eliminate forced labour.
The US government has moved more cautiously than other western countries in removing sanctions against the former military dictatorship, which continues to be plagued by ethnic conflicts and attacks on religious minorities. But the US decision to further boost trade with Burma, which was formally blocked until November last year, is the latest sign that Washington is keen to secure an economic foothold in the resource-rich Southeast Asian country.
President Thein Sein is also due to make a make a landmark visit to the US capital later this month, despite allegations of “ethnic cleansing” taking place against Rohingya Muslims in western Burma.
Burma is the poorest country in Southeast Asia with an estimated $1,400 GDP per capita. But the Asian Development Bank has predicted that its economy could grow by 6.5% in the year 2013 as long as the government retains momentum on its democratic reform programme.
Credit & Copy From; http://www.dvb.no/news/economics-news/burmese-trade-to-flourish-under-new-us-regulations-expert/27929
