WORLD BANK VIEW OF MYAN­MAR In­ter­view with Ab­doulaye Seck

In­ter­view with Ab­doulaye Seck

Mizzima Business Weekly - - CONTENTS - Aung Thura

Ab­doulaye Seck is the Coun­try Man­ager for the World Bank Group in Myan­mar. Mr Seck has been in his po­si­tion for about three years and is about to trans­fer to Afghanistan.

In a wide-rang­ing in­ter­view, the World Bank Coun­try Man­ager talked to Mizzima’s Aung Thura about the bank’s in­volve­ment and pri­or­i­ties in Myan­mar.

What have been the main fo­cuses of the World Bank for Myan­mar dur­ing your ten­ure as coun­try man­ager?

The World Bank has a broad man­date which is ap­plies to all coun­tries in elim­i­nat­ing ex­treme poverty and in mak­ing sure the pros­per­ity is shared by do­ing it in a sus­tain­able way; en­vi­ron­men­tal sus­tain­abil­ity, fis­cal sus­tain­abil­ity and so­cial sus­tain­abil­ity. Of course, all coun­tries are dif­fer­ent, so when we come to a coun­try, we would like to lis­ten to the coun­ter­parts of the com­mu­nity, from the gov­ern­ment and see how the goal is and we shall be man­dated to the World Bank Group to trans­late in Myan­mar.

We have a num­ber of sys­tem­atic coun­try di­ag­nos­tics. As the di­ag­nos­tic tools, we lis­ten to all com­mu­ni­ties and stake­hold­ers and the me­dia. The World Bank Group would be sup­port­ing Myan­mar in three fo­cused things. One thing is about re­duc­ing ru­ral poverty be­cause it is ex­tremely high in the coun­try. The sec­ond thing is about the in­vest­ing in the peo­ple, in the ef­fec­tive in­sti­tu­tions for peo­ple, and the third that we have been sup­port­ing in Myan­mar is about help­ing the dy­nam­ics of the pri­vate sec­tor for jobs. Th­ese three fo­cus ar­eas are what we have un­der the coun­try part­ner­ship frame­work be­tween the World Bank Group and Myan­mar, which ba­si­cally started with my ten­ure. It was the three-year agenda ended in June this year. We have been as­cend­ing this en­gage­ment along the same lines for an­other two years to give time and space for the new ad­min­is­tra­tion and the new World Bank Group man­age­ment struc­ture to cre­ate a longer term strat­egy. So we have two more years to pre­pare the longer term strat­egy.

The World Bank reen­gaged with Myan­mar in 2012 af­ter more than two decades. Can you tell us about the coun­try di­ag­nos­tic and other an­a­lyt­i­cal work that the World Bank has car­ried out for Myan­mar?

First of all, I should say that the coun­try part­ner­ship frame­work is re­ally about Myan­mar. Myan­mar should be ex­tremely proud with the achieve­ments over the past few years, when it comes to the first fo­cus area of re­duc­ing ru­ral poverty that Myan­mar has pre­sented to the World Bank Group for sup­port­ing as a Na­tional Com­mu­nity Driven Project. This is the very first one and it is also re­ally a good pro­gramme to sup­port. We started with an ini­tial grant of over US$80 mil­lion in 2012 and we added an­other US$400 mil­lion to sup­port this pro­gramme.

What did it do? It started by lis­ten­ing, lis­ten­ing to com­mu­ni­ties. What do you want to build ba­sic in­fra­struc­ture. As of to­day, over 5 mil­lion peo­ple from the ru­ral ar­eas of Myan­mar got bet­ter school­ing, they got bet­ter birth meth­ods, san­i­ta­tion, and they got bet­ter ac­cess to clean wa­ter and so on. They de­sign the sys­tem them­selves and they brought women who have been rep­re­sent­ing at least 50 per­cent of the vil­lage com­mu­nity to de­cide what in­fra­struc­ture to do. When I vis­ited some vil­lages, women told me, “The men wanted to do this, I said no and I wanted to do some­thing else”. It has re­ally given peo­ple power and a voice and it is re­ally a tool so that what we talk about when it comes to sup­port em­pow­ers peo­ple for in­clu­sive growth. So that is one ex­pec­ta­tion.

Bet­ter elec­tric­ity in the ru­ral ar­eas is im­por­tant for house­hold growth and de­vel­op­ment. How has the World Bank been in­volved in this?

In terms of ac­cess to bet­ter elec­tric­ity, I think that is the larger pro­gramme. We shared the Na­tional Plan from now to 2030 to achieve uni­ver­sal ac­cess to elec­tric­ity. As of the time when we (World Bank) ar­rived in Myan­mar, less than 16 per­cent of peo­ple in ru­ral area had ac­cess to elec­tric­ity. So in this pro­gramme, now you do have a num­ber of so­lar-sys­tems be­ing pro­vided to com­mu­ni­ties across the coun­try. Sud­denly a lot of more can be done there in terms of bring­ing elec­tric­ity to the com­mu­nity.

I be­lieve the World Bank has is pro­vid­ing more than US$400 mil­lion from 2016 to 2021 for bet­ter elec­tric­ity in ru­ral area. So where has that in­vest­ment been used?

This US$400 mil­lion has been sup­port­ing in grid ex­pan­sion and off-grid ex­pan­sion. So there has been a split be­tween grid ex­pan­sion and off-grid ex­pan­sion.

Ba­si­cally, we es­ti­mated US$310 mil­lion for the grid to build and US$90 mil­lion is about off-grid that is mostly for ru­ral ar­eas. That is the World Bank Group’s con­crete and spe­cific sup­port. The Na­tional Elec­tri­fi­ca­tion Plan is ac­tu­ally more im­por­tant for Myan­mar and it de­scribed very clearly the list of costs for the uni­ver­sal ac­cess to elec­tric­ity.

Myan­mar should un­der­take of­f­grid and on-grid so that ev­ery­body will have elec­tric­ity at the least cost. It was a very nice well-de­signed plan, and it will be done in a very ef­fec­tive way in­volv­ing the pri­vate sec­tor. The plan is also a plat­form for ev­ery­body to come in the pri­vate sec­tor, for ex­am­ple, IFC of that World Bank Group that also sup­ports the large pro­gramme for ac­cess to elec­tri­fi­ca­tion in ru­ral ar­eas us­ing that plat­form.

Is there other ad­di­tional loan plus 400 Mil­lion USD?

Un­der the Na­tional Elec­tri­fi­ca­tion Plan, the es­ti­mated cost of bring­ing elec­tric­ity to ev­ery­body by 2030 is US$6.5 bil­lion, so the World Bank’s con­tri­bu­tion is US$400 mil­lion, but then IFC from our group is bring­ing more of a con­tri­bu­tion as a pri­vate sec­tor player.

What does US$6.5 bil­lion cover?

That is the to­tal cost of in­vest­ment that Myan­mar needs to in­vest in terms of dis­tri­bu­tion, not in gen­er­a­tion. This is also the cost of the Na­tional Elec­tri­fi­ca­tion Plan. The World Bank has helped Myan­mar de­sign this plan and we es­ti­mated the cost, and then the World Bank will pro­vide US$400 mil­lion of this US$6.5 bil­lion. Of course, it means there is still US$6.1 bil­lion that needs to be mo­bi­lized. That is where good re­forms are most im­por­tant and Myan­mar also should im­ple­ment re­form, pol­icy and should look at the tar­iff is­sue. There are other needs and our donors’ re­view and anal­y­sis have shown that Myan­mar will need in ad­di­tion to dis­tri­bu­tion, trans­mit­ting, so you need about US$2 bil­lion a year and will also need US$30 bil­lion for 15 years to pro­vide ac­cess for ev­ery­body. Myan­mar gov­ern­ment will have re­quire­ments for the pri­vate sec­tor to come in.

What do you think are the chal­lenges for the pri­vate sec­tor to come in?

lems is tar­iffs. If tar­iffs are be­low cost, the pri­vate in­vestors will not be able to col­lect a re­turn on their in­vest­ments. So they will not come in. So tar­iffs in Myan­mar right now is be­low cost. The Myan­mar gov­ern­ment is also sub­si­diz­ing the con­sumer. All peo­ple in Myan­mar are get­ting elec­tric­ity be­low cost, it is hap­pen­ing in Myan­mar to pro­duce the elec­tric­ity. I es­ti­mate the sub­sidy is about US$420 mil­lion and the gov­ern­ment losses a lit­tle bit less than US$500 mil­lion ev­ery year. The Min­istry of Plan­ning and Fi­nance will sub­si­dize the elec­tric­ity.

That needs to be ad­dressed be­cause that is not still ad­dressed and the pri­vate in­vestors will not be will­ing to in­vest. They ex­pect a re­turn. So the tar­iff is one as­pect that Myan­mar should be work­ing on. But hap­pen­ing right now we are sup­port­ing the coun­try pre­pare and re­view the fi­nan­cial vi­a­bil­ity of the power sec­tor in the coun­try. The peo­ple who can af­ford will pay the full cost but the poor house­holds should be pro­tected. Ac­cess is very im­por­tant, and we are look­ing at uni­ver­sal ac­cess. In­stead of the cur­rent sit­u­a­tion, only 30 per­cent of the pop­u­la­tion is get­ting ac­cess to elec­tric­ity but at a sub­si­dized cost. And the rest of the per­cent­age of fam­i­lies as well as poor house­holds do not have ac­cess, so they use can­dles and they use a very ex­pen­sive source of en­ergy. We need to bring them to the grid to have ac­cess.

Do you be­lieve the Na­tional Elec­tri­fi­ca­tion Plan for 2030 will be suc­cess­ful?

Ab­so­lutely. When you look at the coun­tries like Laos PDR, Cam­bo­dia and Viet­nam, they have achieved that. Why not Myan­mar. Ab­so­lutely. We should make it hap­pen. When the Min­istry of Elec­tric­ity and En­ergy makes sure of the right de­ci­sion, they should be some in­ter­nal min­is­te­rial co­or­di­na­tion struc­ture, but some are miss­ing. En­ergy is a cross­cut­ting is­sue, it does not di­rectly be­long to the Min­istry of Elec­tric­ity and En­ergy, it be­longs to the Min­istry of Trans­port to de­liver, it also be­longs to the other min­istries and it be­longs to the Min­istry of Plan­ning and Fi­nance. They should be some high level of co­or­di­na­tion struc­ture for which they can think of the plans con­sid­er­ing the role of the pri­vate sec­tor, and the role of the pub­lic sec­tor. De­ci­sions should be made quickly, there should be trans­parency and there should be com­pet­i­tive ten­der for the pri­vate pro­ducer. IFC, the mem­ber of World Bank Group, has sup­ported and in­vested in My­ingyan. More­over, Myan­mar should ap­ply the IPP (In­de­pen­dent Power Pro­ducer) frame­work in a very com­pet­i­tive way. It will save the coun­try bil­lions of US dol­lars.

What are the most suc­cess­ful pro­grammes dur­ing your as­sign­ment in Myan­mar?

When we came back to 2012, we sup­ported the Min­istry of Fi­nance at that time to do pub­lic ex­pen­di­ture and fi­nan­cial ac­count­abil­ity, rat­ing how the Myan­mar gov­ern­ment de­signs the bud­get and im­ple­ments the bud­get, make ac­count­ing re­ports on bud­get. As a re­sult of this as­sess­ment sup­ported by the World Bank, the World Bank can mo­bi­lize other part­ners UK, Aus­tralia, and Den­mark to come and sup­port the pub­lic man­age­ment project on how to mod­ern­ize pub­lic fi­nan­cial man­age­ment. I think it is very im­por­tant. In my view, it is re­ally by far, I mean this is the most im­por­tant pro­gramme. Myan­mar re­ceives the fi­nan­cial re­sources from the World Bank and the oth­ers as well. Here, the most im­por­tant re­sources are gov­ern­ment’s rev­enue through tax. Tax pay­ing in Myan­mar pro­vided to the gov­ern­ment to de­liver the ser­vices is the most im­por­tant part of the en­gine. We work through the gov­ern­ment sys­tem through the bud­get, which lever­ages our sup­port to have a big­ger im­pact be­cause it is about a largest prof­itable re­source in the coun­try. So we have this pro­gramme that looks at more trans­parency that gives you a bet­ter un­der­stand­ing of how the gov­ern­ment is us­ing your tax pay to give you bet­ter schools, to give you bet­ter health care.

Could you ex­plain the sus­tain­abil­ity that the World Bank is try­ing to achieve?

We are re­ally look­ing at what we do in a sus­tain­able way. We also look at the three di­men­sions of sus­tain­abil­ity. One is the en­vi­ron­men­tal sus­tain­abil­ity which ba­si­cally we can trans­late as how we ask, we can use re­sources that we have with­out geo-pol­lut­ing, af­fect­ing the abil­ity of fu­ture gen­er­a­tions to use the same re­sources, that is very im­por­tant.

Then we have so­cial sus­tain­abil­ity, de­vel­op­mentof the com­mu­nity, talk­ing to the com­mu­nity’s men to en­sure they sup­port the pro­gramme.

It is very im­por­tant. We shall be look­ing at ev­ery time we sup­port a pro­gramme, we in­form the pub­lic that we, the World Bank, would like to sup­port this pro­gramme and we think that from our pre­lim­i­nary anal­y­sis, th­ese are the safe­guard is­sues. This is what we plan to do to make sure. It will be done in a very healthy and sound way. We re­quest feed­back and we ask peo­ple about the projects whether they agree.

The last one is about fis­cal sus­tain­abil­ity be­cause we are the lend­ing in­sti­tute and we pro­vide grants to the coun­tries that are re­ally heavy in debt. But for other coun­tries that have the ca­pac­ity to bor­row so we pro­vide loans.

For Myan­mar, we pro­vide highly con­ces­sional loans with zero in­ter­est rate over 38 years of ma­tu­rity and rise pe­riod of 6 years. We grant el­e­ments of over 60 per­cent but we ad­vise also the gov­ern­ment in terms of the debt strat­egy. We work with the Min­istry of Fi­nance to en­sure that each cen­tral­ized pub­lic debt man­age­ment, you know the new pub­lic debt man­age­ment law that we sup­ported.

What has been the fo­cus ar­eas of the World Bank for ru­ral growth in Myan­mar?

We sup­ported a lot com­mu­nity ac­cess to ba­sic in­fra­struc­ture that is the na­tional com­mu­nity driven project about agri­cul­ture. Agri­cul­ture is very im­por­tant for the com­mu­nity in Myan­mar. So we are sup­port­ing bet­ter ir­ri­ga­tion in the dry zone and we com­mit­ted ac­tu­ally to do more in terms of agri­cul­ture. We have an ex­ten­sion of coun­try part­ner­ship frame­work and we will be help­ing a sec­ond agri­cul­ture project go­ing for­ward. And we are sup­port­ing ru­ral elec­tri­fi­ca­tion.

We have a com­mit­ment to sup­port agri­cul­ture. We are work­ing the project through the gov­ern­ment sys­tem. We are not driv­ing the de­vel­op­ment agenda in Myan­mar, it is re­ally true. We have got re­quests from the Min­istry of Plan­ning and Fi­nance and Min­istry of Agri­cul­ture, Live­stock and Ir­ri­ga­tion to sup­port agri­cul­ture.

We have plenty of ideas and we want to im­port the ideas to Myan­mar. So we are ready to sup­port and our team comes and talks with all peo­ple, talks with gov­ern­ment, talks with the com­mu­nity. The World Bank would like to sup­port your agenda and your pro­grammes (as a guide to) what we should be do­ing.

Do you think that the de­vel­op­ment agenda of gov­ern­ment and your ideas are syn­chro­nized?

Ab­so­lutely. We are dif­fer­ent or­ga­ni­za­tions. We are work­ing with most of the tra­di­tional donors or im­ple­ment­ing agen­cies out­side of the gov­ern­ment. We are an or­ga­ni­za­tion and Myan­mar is a share­holder. Plan­ning and Fi­nance Min­is­ter U Kyaw Win is a gover­nor and he will be sit­ting in a room with all the other re­gional min­is­ters of fi­nance and they de­cide what the World Bank should be do­ing. I am not the alien to the coun­try. I am here to serve the peo­ple of Myan­mar.

Of course, we lis­ten to what the peo­ple of Myan­mar who are ar­tic­u­late in terms of vi­sion, in terms of pro­grammes and we would like to sup­port that. We are in many coun­tries, so there are many ex­pe­ri­ences that we can be col­lect­ing. We brought ex­pe­ri­ences from Myan­mar to other coun­tries and we can also bring other ex­pe­ri­ences to Myan­mar. Viet­nam is ex­tremely suc­cess­ful in agri­cul­ture. This is what we have done. So we can grow to­gether.

What has the World Bank ac­com­plished in terms of pro­vid­ing sup­port in ed­u­ca­tion, par­tic­u­larly try­ing to keep chil­dren in school?

I will give some ex­am­ples. Ten kids en­ter­ing school in Myan­mar are kinder­garten and less than 3 kids will get to ma­tric­u­la­tion. It is a huge loss for Myan­mar be­cause seven kids could not go to ma­tric­u­la­tion. For those who study in school, in terms of what they learn and how then can read, let me tell you one ex­am­ple, this is very im­por­tant. When we ask the kids how they read a word, 77 per­cent of the kids in Grade 1 can­not read even a sin­gle word.

It grows to 27 per­cent in Grade 2 and 10 per­cent in Grade 3. You can imag­ine some of the stu­dents in Grade 3 can­not read a sin­gle word. So the qual­ity is very low and what we have done? I would like to thank Aus­tralia here be­cause they have been help­ing us from the very be­gin­ning in the ed­u­ca­tion sec­tor by work­ing to sup­port the Min­istry of Ed­u­ca­tion. First of all, we said let’s keep kids in school. Let’s make sure that we have ten all the way to ma­tric­u­la­tion.

The rea­son why they do not go to school is that they can­not af­ford to pay for the cost. All par­ents can­not af­ford for the ex­pen­di­ture for school be­cause they worry about the loss of in­come if he or she went to school as he or she will not be able to sell jas­mine flow­ers or some­thing else.

So we give stipend pro­grammes, and now this pro­gramme has 115,000 young kids who can study in school. And it pro­vides the pro­grammes to school so they can im­prove the qual­ity of ed­u­ca­tion. Now the other part­ners be­cause of that plat­form are join­ing, Den­mark, Fin­land bring­ing more re­sources to sup­port the ed­u­ca­tion pro­gramme for teach­ing men­tor­ing. Many teach­ers have been higher, but they do not have enough train­ing. So we need to help them to make sure to give qual­ity ed­u­ca­tion.

Can you tell us about the World Bank’s sup­port for health in Myan­mar?

In Myan­mar, out of 100,000 live births by women, 200 of them die dur­ing de­liv­ery. That is re­ally sad. Out of 1,000 kids who are born in Myan­mar, about 51 will not have the chance to blow the can­dles and to cut the cake on their fifth birth­day. Even worse, out of 51, half of them die in the first six months. It is also sad and it is pre­ventable. The rea­son why is that one needs to en­sure that pack­age of ser­vices. You make sure the de­liv­ery as­sisted by the peo­ple who have the skill, not just in the re­mote vil­lages.

You make sure of the ser­vices be­fore de­liv­ery, dur­ing de­liv­ery, af­ter de­liv­ery. So that is ex­actly what we have done for the health project, ac­cess to the ba­sic health ser­vices to sup­port ma­ter­nal health care, new­born health care.

Ad­di­tion­ally, we are sup­port­ing the re­forms around bet­ter health fi­nanc­ing for uni­ver­sal health cov­er­age. That is a very im­por­tant agenda. The State Coun­cilor and Min­istry of Health and Sports pre­sented the Na­tional Health Plan in March. It is very good plan to work uni­ver­sal health cov­er­age and we would like to sup­port it. And we have sec­ond ad­di­tional fi­nanc­ing hope­fully by Septem­ber and Oc­to­ber and we are able to go to the board of direc­tors to re­quest their sup­port to bring more fi­nanc­ing to this agenda of ba­sic health care but also to im­prove health fi­nanc­ing.

For about 16 per­cent of house­holds in Myan­mar, they spend 10 per­cent of their ex­pen­di­ture for health. In terms of gov­ern­ment bud­get, the gov­ern­ment has done ex­tremely well over the past five years. Myan­mar in­creased pub­lic health spend­ing by nine fold. It is unique. And the gov­ern­ment in­creases the pub­lic ed­u­ca­tion spend­ing by four fold.

Even af­ter hav­ing an in­crease in pub­lic health spend­ing and ed­u­ca­tion, Myan­mar has one of the low­est pub­lic spend­ing in ed­u­ca­tion and health be­cause it was ex­tremely low for many years. So there a lot more needs to be done. Myan­mar would like to bring good ed­u­ca­tion and health to the peo­ple so that peo­ple can see op­por­tu­nity in the job mar­ket. You have to bring more re­sources in the sec­tor, but you need to do it more ef­fi­ciently be­cause it is not just about in­creas­ing the vol­ume, you need to in­crease the ef­fi­ciency.

What is your mes­sage for Myan­mar as you are leav­ing?

Firstly, I would like to thank Myan­mar and its peo­ple who have been ex­tremely kind to me. I think this is my best pro­fes­sional and per­sonal years by far. I feel very much that it has been a priv­i­lege be­ing in Myan­mar at the time of tran­si­tion be­cause that there are won­der­ful move­ments that Myan­mar has done in the peace process, NCA (Na­tional Cease­fire Agree­ment) sign­ing, and the elec­tion in Novem­ber 2015.

There are many mea­sured de­vel­op­ments in Myan­mar. I think Myan­mar will do ex­tremely well and there are some steps that the coun­try can un­der­take. The fu­ture is bright, but of course, some of the re­forms are im­por­tant to keep do­ing.

Ab­doulaye Seck, Coun­try Man­ager for the World Bank. Photo: Mizzima

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