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In Broken Economy, Burmese Improvise or Flee

People file in and out of the downtown passport office in Rangoon. Stalls outside offer passport candidates some of the more than 15 forms required for their applications.
People file in and out of the downtown passport office in Rangoon. Stalls outside offer passport candidates some of the more than 15 forms required for their applications. (The Washington Post)
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At tea shops or grocery stalls, people pull out bricks of local bills to pay for basics in an economy that the International Monetary Fund estimates suffered inflation of 40 percent in 2007.

Fuel rationing and price controls have insulated the country from much of the recent shocks to the world economy. Nonetheless, black market prices for gasoline and diesel fuel have continued to spiral upward in recent months, residents say. A cyclone three months ago that wrought havoc on the country's rice production areas has pushed the economy further toward desperation.

So far, the generals have been able to largely shrug off Western sanctions, by dealing instead with India, China and Thailand, to which they funnel vast stores of natural gas.

Revenue from energy sales is set to increase significantly once production begins at the offshore Shwe and Shwe Phyu fields, which are estimated to hold up to 10 trillion cubic feet of natural gas. South Korea's Daewoo International Corp. is partnering with Burma to develop the fields, and Chinese firms, including Sinopec and China National Petroleum Corp., have exploration projects underway in the country.

Even without the new fields, sales of oil and gas topped $3.3 billion last year, with $2 billion in sales of gas to Thailand alone, according to Sean Turnell, a professor at Macquarie University in Sydney.

Those funds largely disappeared into the military's parallel universe of separate schools and hospitals, subsidized housing and the multimillion-dollar construction of a remote new capital, Naypyitaw, whose name roughly translates as "abode of the kings." It reportedly includes an artificial beach resort, golf courses and an air-conditioned zoo.

But 250 miles south of the junta's fantasyland, in the former capital, Rangoon, electricity functions erratically and abandoned government offices and colonial-era edifices molder and blacken in a peculiar form of urban leprosy. Decades-old cars sputter along with wires poking out and monsoon waters sloshing around below the passenger seats.

The junta sharply restricts car imports, which means that a 1988 Toyota Camry can sell for upwards of $20,000, according to local residents. A memory card needed to make a cellphone function costs anywhere from $2,000 to $3,000.

Official statistics on employment, and most other economic indicators, are notoriously unreliable, but analysts and Burmese residents say unemployment -- and underemployment -- is on the rise. Salaries that were already inadequate have failed to keep pace with inflation.

To make up the shortfall, professionals such as government geologists double as taxi drivers, professors sell exam scores, civil servants demand bribes to process paperwork and prison guards run elaborate operations allowing the smuggling of money to inmates, in return for a 20 percent cut, local residents and former detainees said.

Teachers sometimes sell lunch to their students. "Can you imagine asking your students for money? I couldn't do it," said a 26-year-old former elementary school teacher who switched to being a tour guide.

So many people engage in corruption that the Berlin-based watchdog group Transparency International rated Burma in 2007 as tied with Somalia as the most corrupt country in the world.


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