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Myanmar shuffles energy, finance officials amid slowing growth

Published 08/02/2017, 07:07 AM
Updated 08/02/2017, 07:10 AM
© Reuters. Myanmar's Foreign Minister Aung San Suu Kyi smiles after a meeting with Norway's Foreign Minister Borge Brende at Myanmar's Foreign Ministry in Naypyitaw

YANGON (Reuters) - Myanmar has replaced its minister for energy, state media reported on Wednesday, as Aung San Suu Kyi's administration looks to address concerns that the enactment of vital reforms has been slow since she took power last year.

The government also appointed a new deputy finance minister and confirmed three new central bank deputy governors this week.

New foreign investment approvals have slowed since Suu Kyi's National League for Democracy won a landslide election victory in late 2015, and gross domestic product growth - while still among the fastest in Asia - fell last year.

Analysts say the changes this week signal that Suu Kyi, who had prioritized sealing a peace deal with the country's myriad armed groups ahead of economic reforms, is aware of growing frustration with her government's management of the economy.

Outgoing Minister of Electricity and Energy Pe Zin Tun will be replaced by Win Khaing, who takes the role in addition to heading the Ministry of Construction, according to an official announcement carried by state media on Wednesday.

The government inherited a power crisis, with major cities experiencing regular blackouts and only a third of the country's 53 million or so people connected to the grid. Pe Zin Tun was a civil servant who had been retained from the previous quasi-civilian government.

"There has been a lack of overall direction and movement in Myanmar's energy and power sectors over the last year," said Jeremy Mullins, research director at Yangon-based consulting firm Myanmar Energy Monitor.

Decisions were needed on a number of large-scale energy projects - including the sensitive Chinese-backed Myitsone dam - while hefty electricity subsidies need to be culled, he said.

"Investors have been frustrated by slow processes and conflicting signals, and in the meantime the country's poor electricity situation has not improved much," he added.

The new role for Win Khaing reflected Suu Kyi's "focus on electricity and roads as drivers of growth and jobs", said Yangon-based analyst Richard Horsey.

"ECONOMY STABILIZED"

On Tuesday, state media also announced the appointment of new Deputy Minister of Planning and Finance Set Aung, a foreign-trained economist and central banker who held the same role in 2012-13.

Investors and diplomats have told Reuters they privately urged Suu Kyi to make more sweeping changes to her economic team.

The personnel changes this week, however, "suggest a continuation of the government's current approach", said Horsey.

Planning and Finance Minister Kyaw Win - who has not won the confidence of investors - remains in place, as does the central bank governor, another holdover from the previous military-backed government.

Suu Kyi's office issued a statement on Friday to mark a year since her administration announced its economic plan - a three-page document widely criticized as lacking specifics.

The statement said the new government had "stabilized" the economy and that GDP growth was "around 7 percent annually", but did not give specific growth forecast for the current fiscal year.

The World Bank estimates growth slowed from 7.3 percent in 2015-16 to 6.5 percent in the fiscal year that ended in March.

© Reuters. Myanmar's Foreign Minister Aung San Suu Kyi smiles after a meeting with Norway's Foreign Minister Borge Brende at Myanmar's Foreign Ministry in Naypyitaw

"The government's long-term economic plan will take time," Kyaw Win said in the statement, "but will bring prosperity in which all can share."

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