The RSIS Centre for Non-Traditional Security (NTS) Studies' Blog


Reviewing and Evaluating Industrial Policies: Small-Medium enterprise (SMEs) development in CLMV Countries

Posted in ASEAN-Canada Partnership by NTSblog on April 25, 2013
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Recently, the Republic of the Union of Myanmar had successfully changed its political system to become a democratic presidential system. In addition, Myanmar has been transforming its economic system into a market-oriented economic system. Prompt and active political and economic reforms have particularly been made since the formation of the new democratic government in March 2011.

These political and economic reforms are vital for Myanmar, which despite being an agricultural country with vast amounts of natural resources, has been regarded as a least developing country by international organizations. Myanmar cannot and should not rely solely on agriculture if it wishes to raise its level of development. It is therefore necessary for countries like Vietnam, the Philippines, and Myanmar to focus on industrial development while scaling up agricultural development efforts. As such, Myanmar’s new government has proposed five-year national development plan and it also prepared industrial development plan which is the main engine of growth to industrialization.

As part of my research, I conducted a survey (from January to February 2013) to evaluate industrial policies of small and medium enterprises development in CLMV countries on the extent to which they take into account policy changes. The survey revealed that investment capital is an essential need for the development of SME’s in Myanmar. Other important factors are technology and upgraded industries.

On 9th January, the Central Committee and Work Committee for Development of Small and Medium Enterprises was formed at the state level. It comprises of 27 members, out of which 20 are ministers. The Committee is geared to enhance SME development as a central part of national economic development and the advancement of socio-economic well-being of Myanmar citizens. The committee represents about 99.4% of SMEs in Myanmar, which equates to 126,237 registered SMEs nation-wide. Committee members have agreed to the following duties and responsibilities: –

  • Draft laws, regulations and procedures for SMEs development and submit them to the central committee for their enactment;
  • Collect, analyze and report data and information for encouraging small and medium enterprises:
  • Remove obstacles in works for small and medium enterprises development;
  • Place emphasis on market development to ensure wide market chain;
  • Nurture sufficient number of skilled workers and create job opportunities;
  • Make contact and coordinate with local and foreign organizations to be able to receive financial and technical assistance;
  • Ensure development of micro credit business through Small and Medium Enterprises Bank;
  • Set up subcommittees and groups for respective sectors of small and medium enterprises as necessary.

By fulfilling these new responsibilities, it is hoped that Myanmar will be able to industrialize based on the growth of its SMEs. During the month of February 2013, there have been several meetings and discussions amongst government officials and the private sector, as part of a public-private consultation process concerned with development policies and laws pertaining to SMEs. These policies and laws emphasize the importance of result-oriented activities, which would thus facilitate means for upgrading industrial policies to incorporate and mainstream the role of SMEs in Myanmar.

This blog post has been written by Nang Saw Nandar Hlaing. Nandar is a researcher with the Union of Myanmar Federation of Chambers of Commerce & Industry (UMFCCI), and a Junior Fellow for 2012 under the ASEAN-Canada Research Partnership. For more information on the ASEAN-Canada Research Partnership, please click here.

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