The US this month waived objections to limited World Bank assistance for Myanmar. The UN has agreed to work jointly with Naypyidaw to hold an international aid conference. The European Union says it will provide €150m over the next two years, nearly as much as its contribution in the past 15. My-anmar is coming in from the cold.
It is welcome that the international community is responding to political reform. It will bolster the position of pro-reformers – reducing the possibility of a backlash by hardliners – and sends a message to pariah states, including North Korea, that change can bring tangible benefits. Still, both the pace of re-engagement and the amount of aid flowing into the country need to be carefully monitored. The risk is that, with the dam wall of international opprobrium bursting, aid will pour into Myanmar faster than it can handle it.
The dangers are threefold. First, after decades of isolation there is a desperate lack of capacity. More than money, at this stage the government requires technical expertise of the sort the International Monetary Fund is now providing. The government has shown an encouraging desire to grasp these thorns. Without such technical groundwork, the system could be swamped.