Last updated: October 2014
Myanmar first became a member of the International Bank for Development and Reconstruction (IBRD) in 1952, the International Financial Corporation (IFC) in 1956, and the International Development Association (IDA) in 1962. In December 2013, Myanmar became a full member of the World Bank Group’s Multilateral Investment Guarantee Agency (MIGA). These four institutions, along with the International Centre for Settlement of Investment Disputes, make up the World Bank Group (WBG).
The WBG financed a total of 35 projects in Myanmar until 1987. In 1998, the government went into arrears but remained a WBG member and continued attending its Annual Meetings.
After a nearly 25-year absence, the re-engagement groundwork in Myanmar was set when the WBG’s Board of Executive Directors endorsed an Interim Strategy for the country in November 2012. This strategy, which guided the WBG’s work in the country through March 2014, focused on accelerating poverty reduction by helping reform institutions deliver better services to people during the critical transition period.
Under the Interim Strategy, the WBG focused on supporting the government's efforts to transform institutions to enable them to deliver to citizens. Analytical work, including an investment climate assessment, is underway to underpin these efforts. Technical assistance and policy advice on health, education, social protection and telecommunications is being provided. The WBG is also financing investments to help put in place the institutions, tools, and information needed to implement sustainable integrated river basin management in the Ayeyarwady River.
The WBG is completing a Systematic Country Diagnostic that will identify development priorities to reduce poverty and boost shared prosperity in Myanmar and lay the basis for the planned Country Partnership Framework (CPF) that will follow the Interim Strategy. Working closely with Myanmar country counterparts and development partners toward the CPF, the World Bank Group is preparing a scaled-up partnership program with Myanmar that is expected to include support for energy, health, agriculture, water resources management, and other key development priorities. The partnership in energy focuses on support for National Electrification Plan development, regulatory reforms, private sector investments in power generation and distribution, and renewable energy for rural and off-grid electrification. Financing and delivering global knowledge for Myanmar’s health sector will support the country’s efforts to achieve universal health coverage by 2030, with the initial focus on expanding access to essential services, particularly those that improve maternal, newborn, and child health.
The WBG is contributing to informed debate and decision-making on development policy within a rapidly changing Myanmar by periodically bringing most recent economic data and analysis on development issues to government policy makers, think tanks, civil society and citizens. In 2013, the WBG released its first Myanmar Economic Monitor. The report looks at recent macroeconomic developments, as well as recently implemented and planned policy reforms. In the public sector, diagnostic work like the Public Expenditure and Financial Accountability Assessment provide a snapshot of the condition of Myanmar's public expenditure, procurement and financial accountability systems.
Since re-engaging with Myanmar, in addition to the $80 million pre-arrears clearance IDA grant, the WBG has provided financial assistance to the country in the form of:
- A $440 million interest-free IDA credit – the Myanmar Reengagement and Reform Support credit—was approved in January 2013 and facilitated the clearance of arrears to the World Bank, paving the way for the resumption of a full partnership to pursue Myanmar’s development priorities. The final amount disbursed was $419.6 million. In addition to helping Myanmar clear its debts to creditors, this credit is supporting critical reforms.
- A $140 million interest-free IDA credit for the Myanmar Electric Power Project (MEPP) was approved in September 2013 to support the installation of a modern, high-efficiency 106 MW electricity power plant in Mon State. With this new technology, this plant will be able to produce 250% more electricity with the same amount of gas and reduced emissions.
- A $31.5 million interest-free IDA credit for the Telecommunications Sector Reform Project which is helping to improve the enabling environment for the telecommunications sector. It is also extending coverage in selected remote pilot locations and is beginning to put in place the foundation for ‘e-government’ by developing the Myanmar National Portal. This platform will provide citizens, businesses and visitors (including foreign workers, investors and tourists) with a single on-line window for government information and services
- A $30 million interest-free IDA credit for the Modernization of Public Finance Management Project was approved by the Board in April 2014. Multi-Donor Trust Fund grants from the Australian government ($8.5 million) and the UK Department for International Development ($16.5 million) are co-financing the PFM project, bringing the total financing to $55 million.
- The $80 million interest-free IDA credit for the Decentralizing Funding to Schools Project was approved by the Board in May 2014 to provide 8.2 million students with better schools. More than 100,000 poor students will receive financial support to attend classes through this project. Australia is providing $20 million through the Myanmar Partnership Multi-Donor Trust Fund to improve and expand the Myanmar Government’s School Grants Program and Students Stipends Program.
IFC, the WBG’s member exclusively focused on private sector development, provided a $5 million loan to Yoma Bank to increase lending to small and medium enterprises (SMEs). IFC’s investment and advisory support package is expected to help Yoma Bank provide an additional 1,000 loans (worth $370 million) to Myanmar SMEs by 2019.
IFC is supporting reforms and investments in to help revive the private sector and to create jobs. IFC is working with the government and the private sector in developing a new investment law and other regulations that will create a level playing field for both local and foreign investors. It is establishing the Myanmar Business Forum - a public-private dialogue platform that will help facilitate the reform process. IFC is also providing financing and capacity building to local banks and financial institutions so that they can meet SME needs, such as trade finance, loans, and microfinance. In addition, IFC is also helping the Central Bank of Myanmar improve its financial infrastructure. This will help banks serve their clients better, with diversified products and services. IFC is covering Myanmar’s infrastructure needs, with an initial focus on the power and telecommunications sectors.