The formation of a public accounts committee in Burma appears to have given the National Democratic Force (NDF) a glimmer of hope that they can prize open one of the junta’s most valued assets.
Analysts have long claimed that the lucrative gas revenues the country ‘enjoys’ from its most valuable legal export were siphoned off by way of discrepancies in the dollar exchange rate. This has meant that the vast profits from sale went towards lining the junta’s pockets, and not feeding the nation.
The market rate for the Burmese currency hovers around 1,000 kyat to the US dollar, whilst the official exchange rate is closer to six kyat to the dollar. The accusation is that the junta accounts at the official rate. when in reality it is sold using the market rate.
The NDF has Tin Nwe Oo on the parliamentary committee, a trained accountant and former Dean of the Rangoon Institute of Economics. She told DVB: “We are to guarantee and take responsibility regarding public accounts as a standing committee in the parliament.”
The leader of the opposition party, Khin Maung Swe, said that he hoped the committee would “scrutinise all the ministries…starting in May”.
The NDF leader was upbeat about its formation, despite facing several challenges. Amongst them is the fact that, as the Myanmar Times reported, the committee will be staffed mostly with pro-military Union Solidarity and Development Party (USDP) members. Indeed the chairman of the committee will be the former deputy minister of planning and economic development, Thurein Zaw.
Another potential hindrance will be the structure of the process by which the committee goes about its work. Economic analyst Aung Thu Nyein suspects it will have limited or no oversight as regards to the commercial income of ministries. The person who does have this privilege is Tin Aung Myint Oo, the new Burmese vice president whose position allows him to be in charge of the budget for central government.
Aung Thu Nyein believes that gas revenues will be ploughed by Tin Aung Myint Oo to a so-called Fund to Protect State Sovereignty, a shadowy body overseen by the newly-appointed commander-in-chief, Min Aung Hlaing.
It is inevitable then that the relatively junior Min Aung Hlaing will not have the power to resist the business-as-usual destination for the funds, which analysts suspect have been used for the acquisition of military hardware or special projects like the alleged nuclear program.
The NDF’s Tin Nwe Oo told DVB however that “the budget for 2011/12 fiscal year, which was set last year, will be used starting from 1 April and the accounts are supposed to be sent to us but have not yet arrived. We need to first look at amounts of income and spending under different categories.”
Worryingly, Tin Nwe Oo also confessed: “I am usually asked in the first place to give my opinion in discussions. I even ask them to show me the minutes of the discussions afterwards because people who do the minutes cannot understand things at the level that I speak.
“I pointed that we need the computers and software we have to use – only three out of the 13 [committee members, excluding chairman and vice chairman] know how to use a computer, specifically only Microsoft Word. So I was able to request what we need.”
Gas revenues were said to be worth in the region of $US2.5 billion in 2008 alone, but this will inevitably rise when the Shwe gas pipeline comes online in 2013.
These revenues are noted by the International Monetary Fund (IMF) to have a “small fiscal impact”, as the earnings accounted for around one percent of budget revenues in 2007/08, but if accounted for at market rates, would have amounted to as much as 57 percent.
As these figures indicate, the ability of the public accounts committee should be judged on its success in wresting control of this chunk of revenue, which in any other circumstance would be hugely significant to the country’s prospects.
“Up to now we don’t know exactly in which way the gas revenues go through the budget system,” says Khin Maung Swe. “We don’t know as yet because the budget system is not very much open to the public.”
The NDF has previously spoken of the importance of the extractive sectors and the urgent need for a more people friendly, and indeed sustainable, policy towards them.
Analysts have estimated that should gas revenues be accounted for properly, Burma would not have a fiscal deficit, or indeed a public sector deficit, as it currently does. At the moment it runs with an approximate 3.5 percent deficit when in fact it is estimated that it should be running with a surplus of some 15 percent of GDP.