Future Prospect for the Inclusive Federal Economic Policy in a Post-Conflict Myanmar

Author: Khanu Pang Tain

Advisor: Pobsook Chamchong

 

Problem statement

For decades, Myanmar’s economic landscape has been characterized by inequality and mismanagement. Even before the military coup in 2021, many citizens struggled under oppressive governance that failed to provide equitable access to resources and opportunities. The economic policies of previous governments largely ignored the rights and well-being of vulnerable groups, including women, youth, people with disabilities, ethnic and religious minorities, LGBTQ+ individuals, and the rural and urban poor. As a result, many poor people became poorer, trapped in cycles of poverty with little hope for improvement. The political crisis has further compounded these economic challenges. Since the Military coup in 2021, the coup led to widespread unrest, resulting in job losses, business closures, and a dramatic decline in economic activity. Many individuals have lost their livelihoods, homes, and loved ones, while those who were previously marginalized now face even greater hardships. The urgent economic needs of these populations must be addressed through a comprehensive and inclusive policy framework. As Myanmar seeks to reverse the effects of the recent coup, there is an urgent need for holistic political and economic reform. This moment presents a critical opportunity to develop economic policies that include the voices of those who have been marginalized, ensuring their needs and rights are prioritized in the path toward recovery and inclusivity.

This paper aims to explore the key factors hindering the development of an Inclusive Federal Economic Policy (IFEP) in Myanmar and to provide actionable recommendations for addressing these challenges and additonal recommendation is to advocate for to recoganize the initial group of IFEP project. The collection of data through a review of existing literature and analysis of policy documents related to the federal economoci policy. And analysis through stakeholder interviews and discussions. In addition, I obtained the data from the IFEP workshop by ALTSEAN-Burma (initial group of IFEP project). The collection of data is analysised using the Casual Layered Analysis framework. Causal Layered Analysis (CLA) is a futures studies methodology used in the public policy field to explore complex social issues by examining them across multiple layers particularlly for this policy issue. Using CLA, It allows for a comprehensive exploration of the multifaceted challenges by the military coup and historical governance failures. By unpacking the layers of economic inequality and marginalization, CLA helps to identify not only immediate economic challenges but also the systemic issues that require attention. This holistic approach facilitates the development of inclusive economic policies that genuinely reflect the needs of marginalized groups, ensuring their voices are integral to the policy-making process.

Background information

Myanmar is currently going through a transitional phase that requires changes throughout the nation. Political leaders are trying to establish a federalist democrative system. However, the military coup has created many challenges for everyday life. At the same time, the National Unity Government (NUG) is implementing major government reforms. These reforms mainly focus on political and structural changes, especially federalism and institutional restructuring.

Since gaining independence, Myanmar has been looking for a political system that can support its diverse cultures, languages, ethnic groups, and religions. Ethnic minorities have been advocating for federalism to guarantee equality and rights for all groups. However, the military’s centralized system, which has been in place during various periods of military rule since 1962. the military dictatorships with the long period of military rule from 1962 -1989, 1990 – 2010 and 2021 – present. This has led to political instability. Moreover, the 2008 Constitution[1] created a centralized form of federalism. From 2015 to 2021 in the National League for Democracy (NLD) government that time the 2008 Constitution was widely discussed to shape the democratic system and federal structure as part of the peace process. and efforts were made to shape the democratic system and federal structure in the peace process. However, even during the time of the National League for Democracy (NLD) government, the government’s work and vision remained centralized. In fact, It is important to make sure that the Constitution does not create a centralized system. For instance, it is crucial to divide power between the federal and state governments in their constitutions.

As Myanmar emerges from a period of significant instability, the need for an Inclusive Federal Economic Policy has become increasingly urgent. The historical context of economic challenges, exacerbated by the recent military coup and ongoing conflicts, underscores the importance of developing policies that prioritize inclusivity and address the needs of marginalized populations.

Why Inclusive Federal Economic Policy is important? Especially considering that implementing an Economic Policy for Transitional Justice is a top priority in post-coup Myanmar. In the aftermath of the military coup in Myanmar, the nation is grappling with profound economic, social, and political challenges. The urgent need for an Inclusive Federal Economic Policy has never been clearer. Such a policy is not only critical for addressing the immediate economic needs of the population but also essential for fostering transitional justice. Inclusive economic policies are important in this transitional period, emphasizing the needs of those most affected by the crisis, including victims of war, political persecution, and those who have suffered disabilities or trauma.

For this policy issue, I am going to use Causal Layered Analysis (CLA) to explore into the existing challenges and gain a deeper understanding of the factors hindering the transformation towards a more inclusive federal economic policy for a brighter future.

Causal Layered Analysis
Litany	Rising poverty, job losses, and exclusion of vulnerable groups.
Systemic Causes	Historical neglect, lack of inclusive policies, and insufficient representation.
Worldview/ Discourse	Top-down governance prioritizing stability over inclusivity.
Metaphor / Myth	Federalism viewed as a threat to national unity, complicating inclusive policy discussions.

Analysis

Litany: Myanmar faces significant economic challenges characterized by deep-rooted inequalities (Many poor people become poorer). The military coup has exacerbated conditions for many citizens, leading to rising poverty rates, job losses, and widespread unrest. Vulnerable groups, including women, youth, persons with disabilities (PWD), LGBTIQ+ individuals, and ethnic minorities, continue to experience exclusion from economic opportunities.

The immediate aftermath of the coup, there we can see mass lay-offs across various sectors, particularly in industries reliant on foreign investment, such as textiles and tourism. Many of these sectors were crucial for job creation and economic growth. Those working in informal employment often comprising marginalized groups have faced even greater challenges, as they lack access to social safety nets or unemployment benefits. The loss of income has left countless families in dire situations, struggling to survive without the means to secure basic necessities. The impact of the coup has been disproportionately felt by marginalized communities. Women, youth, persons with disabilities, LGBTIQ+ individuals, and ethnic minorities face systemic barriers that limit their access to economic opportunities. Young people, particularly those from marginalized backgrounds, find themselves at a disadvantage due to limited access to quality education and vocational training programs. The disruption of educational institutions during the coup has severely hindered access to quality education, especially for youth. With schools closed or operating under restricted conditions, many students have fallen behind in their studies. This lack of education translates into limited employment opportunities, perpetuating cycles of poverty. The ongoing political instability and economic hardship have led to increased levels of anxiety, depression, and trauma among the population. Many individuals and families are grappling with the psychological effects of losing their homes, livelihoods, and loved ones. Unfortunately, mental health services are scarce, complicating recovery efforts. Addressing mental health is crucial for enabling individuals to regain agency and actively participate in rebuilding their lives. The economic policy framework must consider the profound impact of these losses, recognizing that rebuilding livelihoods is not merely about financial recovery, it is about restoring dignity, community ties, and social cohesion.

 

“I always think that to establish an inclusive federal economic policy,

it is right time to start taking action initially from all sides.

For example, whether it’s from the NUG government

or

relevant CSOs, it is crucial to initiate and implement policies

and ideas at this important time.”[2]

 

An inclusive federal economic policy can facilitate community-based recovery initiatives that empower individuals to work together in rebuilding their neighborhoods. This might include supporting local cooperatives, community projects, and social enterprises that foster collaboration and mutual aid. By focusing on community-led recovery, policymakers can help restore a sense of belonging and collective identity.

Systemic Causes: Myanmar has been in place during various periods of military rule since 1962. the military dictatorships with the long period of military rule from 1962 -1989, 1990 – 2010 and 2021 – present. This has led to political instability and historical neglect of marginalized groups has led to entrenched inequalities that are difficult to dismantle. The governments have often overlooked the needs of vulnerable populations, resulting in economic policies that fail to promote inclusive growth. Lack of representation and participation of marginalized groups in decision-making processes perpetuates their exclusion from economic benefits. Policies often lack a focus on social equity, resulting in initiatives that do not reach those most in need. For example, many infrastructure projects in Myanmar, mostly concentrated in urban centers, leaving rural areas underserved and further exacerbating regional disparities. The history of Myanmar is marked by a significant lack of attention to the needs of marginalized communities, including ethnic minorities, women, and the urban poor. This neglect has led to deep-rooted inequalities that continue to affect economic opportunities today.

Worldview/ Discourse: Myanmar has historically have been emphasized a top-down approach to governance. This perspective prioritizes stability and control over inclusivity and equity, often sidelining the voices of marginalized communities. The reliance on authority and hierarchical structures tends to reinforce existing power imbalances, limiting opportunities for grassroots participation. One of the most significant consequences of this governance model is the marginalization of diverse voices within society. Communities that experience the greatest socio-economic challenges often lack representation in the political discourse. Their needs and perspectives are frequently overlooked, leading to policies that do not address the root causes of inequality or provide adequate support for vulnerable populations. The top-down approach not only sidelines marginalized voices but also limits opportunities for grassroots participation. Effective governance requires the engagement of local communities, yet the hierarchical nature of decision-making in Myanmar creates barriers to this engagement. Grassroots organizations and movements that seek to advocate for change often face significant challenges in accessing platforms for dialogue and influence.

Metaphor / Myth: The concept of federalism still faces challenges, when the military sees it as a threat to national unity, viewing it as an unsuitable concept that undermines stability, including the idea of an inclusive federal economic policy. This perspective poses significant risks during the country’s transition to democracy, potentially leading to an authoritarian style of governance. The myths surrounding federalism in Myanmar, particularly the military’s perception of it as a threat to national unity, present significant challenges to the country’s democratic transition. This perspective undermines the development of inclusive federal economic policies and poses risks of reverting to authoritarian governance.

To effectively implement the Inclusive Federal Economic Policy (IFEP) in Myanmar, the following actions are recommended:

• Immediate Economic Support and Job Creation: Policymakers must prioritize the establishment of programs that create job opportunities and offer vocational training to the needs of marginalized groups, including women, youth, and ethnic minorities. This approach will empower communities to regain agency and rebuild their economic foundations. Additionally, facilitating access to resources and financial support for local cooperatives and social enterprises can foster collaboration and mutual aid, enabling individuals to work together in rebuilding their neighborhoods. Moreover, An effective economic policy must consider the holistic needs of affected individuals, addressing not only financial recovery but also the psychological impacts of the conflict. Many individuals suffer from trauma due to experiences of violence and persecution, necessitating the inclusion of mental health services and rehabilitation programs within the IFEP. By recognizing and addressing these interconnected needs, the policy can promote both economic stability and psychological well-being.
• Promote the existing initial group of IFEP project: ALTSEAN-Burma was initially organized the Inclusive Federal Economic Policy (IFEP) project, since 2023. Now, they have 437 policy recommendations across 8 sectors (Agriculture, Natural resources, Industry & Services, Health & Education, Financial development, International trade, Infrastructure and Federal economic systems) focusing on inclusive federal economic policy themes. These 436 policies drafted by the 18 partners organizations primarily involve participants such as ethnic minorities, LGBTIQ+, people with disabilities (PWDs) and Rohingya women from Myanmar. And another recommendation is the policies review and update the existing draft policies from the Ethnic Nationalities Affairs Center (ENAC) to ensure they align with current needs and conditions. ENAC has organized a series of workshops aimed at facilitating discussions among various stakeholders, including ethnic armed organizations (EAOs), ethnic political parties (EPPs), community-based organizations (CBOs), and civil society organizations (CSOs). These stakeholders have been actively engaged in the peace process and have contributed valuable insights toward building a federal democratic union. Over the past two years, these workshops have enabled stakeholders to develop a common understanding of the policies needed for effective governance. The discussions culminated in 11 sectoral policy recommendations that address critical areas necessary for fostering a federal democratic union. These sectors include: Agriculture, Education, Internally Displaced Persons (IDPs) and Refugees, Health, Humanitarian Aid, Land Rights, Natural Resources Management, Taxation, Trade and Investment, Forest and Environment and Energy. While these sectors form a robust foundation for policy development, there remains a significant need for the creation of additional policies in other areas. Continuous evaluation and adaptation will ensure that the policies remain relevant and effective in addressing emerging challenges. Therefore, the current government NUG and other influential administrative bodies need to promote the existing initial group or project. It is effective way to enhance visibility and engagement through targeted outreach efforts that foster community involvement and support. Establish partnerships with local organizations and marginalized communities to raise awareness about the IFEP’s objectives and benefits.

 

“I used to think that only the government could make policies

and there is no place for people. But now I feel so great

about myself because I am now contributing for

the future economic policy of my conutry.

This is not just hope, this is making a real impact”[3]

 

• Adopt the “No One Left Behind” Principle: Prioritize the rights of persons with disabilities (PWDs), LGBTIQ+ individuals, ethnic and religious minorities, and conflict-affected communities. Implement targeted programs to address their specific needs and ensure their full participation in society.
• Engage Diverse Representatives: To implement the IFEP is very important to designed for participatory decision-making mechanisms process. Communities should have real opportunities to provide input on policies that affect their lives. By actively involving marginalized voices in the policy formulation process, the IFEP can ensure its initiatives are both inclusive and responsive to those most affected by conflict. The economic policies of previous governments in Myanmar have often overlooked the rights and well-being of vulnerable groups. Women, youth, people with disabilities, ethnic and religious minorities, LGBTQ+ individuals, and both rural and urban poor communities have been marginalized in the policy-making process. Consequently, many individuals from these groups have found themselves trapped in cycles of poverty, facing limited opportunities for improvement. In the IFEP should involve representatives from marginalized communities that include women, youth, ethnic minorities, LGBTQ+ individuals, and people with disabilities will ensure that their voices are heard in the policy development process. To address these systemic inequalities, it is essential to adopt inclusive economic policies that prioritize the needs and rights of all citizens.
• Commit to Power Sharing: Establish equitable power distribution among federal units to ensure diverse voices are represented in decision-making processes. it is crucial to commit to a power-sharing framework within a federal system. This approach should prioritize equitable distribution of power among federal units, ensuring that diverse voices particularly those of marginalized communities are represented in decision-making processes. Policymakers must establish mechanisms that facilitate local participation and accountability, fostering transparency in governance. Additionally, empowering regional governments to develop context-specific policies will enhance the effectiveness of solutions to local challenges. By embracing this inclusive framework, Myanmar can build trust among its citizens, promote social cohesion, and pave the way for a more democratic and equitable future.

References:

1. Sohail Inayatullah, 1998, Causal Layered Analysis: Poststructuralism as method.
2. Ethnic Nationalities Affairs Center (ENAC), 2022, Sectoral PolicyRecommendations for building a future federal democratic union. (https://www.burmaenac.org/?p=2565)
3. Asia Foundation Myanmar, the effects of global inflation on conflict-affected border areas -fall 2022. (https://asiafoundation.org/peripheral-vision-the-effects-of-global-inflation-on-conflict-affected-border-areas-fall-2022/?highlight=inflation)
4. UNDP, Middle class disappearing and poverty deepening in Myanmar, April 11, 2024. (https://www.undp.org/press-releases/middle-class-disappearing-and-poverty-deepening-myanmar)
5. Kyu Khin Gar, Poverty Reduction in Myanmar, November 2019. (https://archives.kdischool.ac.kr/bitstream/11125/38157/1/Essays%20on%20poverty%20reduction%20in%20Myanmar.pdf)
6. Khanu, (July 2024), Local government’s role in bottom-up federalism for Myanmar democratic future, School of Public Policy. (https://spp.cmu.ac.th/local-governments-role-in-bottom-up-federalism-for-myanmar-democratic-future/)

 

Note:

[1] Constitution of the Republic of the Union of Myanmar (2008)

[2] One interviewee from Youth activists (member), May 2025.

[3] One participant from the IFEP project workshop, May 2025.