Burma: fuel prices and turmoil

September 27, 2007

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Burma protesters defy crackdown

BBC
Up to 10,000 Burmese Buddhist monks and civilians have defied police tear gas and live bullets on the ninth day of protests against the military rulers.

At least one monk was killed, hospital sources in the main city of Rangoon said. The government has confirmed one death, without giving details.

Witnesses described monks with blood on their shaved heads as police charged at the Shwedagon pagoda in Rangoon.

Meanwhile, the UN said it was sending a special adviser on Burma to the region.

…The confrontation in Burma has become a battle of wills between the country’s two most powerful institutions, the military and the monkhood, and the outcome is still unclear, the BBC’s South East Asia correspondent, Jonathan Head, says.

Analysts fear a repeat of the violence in 1988, when troops opened fire on unarmed protesters, killing thousands.

…The protests were triggered by the government’s decision to double the price of fuel last month, hitting people hard in the impoverished nation.
(26 September 2007)


The Economic Factors Behind the Myanmar Protests

Power and Interest News Report (PINR)
he first sign of the current protests currently underway in Myanmar occurred in a rare display of public outrage over the economic conditions within the country in February 2007. A small group calling themselves the Myanmar Development Committee called on the military rulers to address consumer prices, lack of health care, education and the poor electricity infrastructure. Normally unseen in Myanmar, the protest was quickly broken up after only 30 minutes of activity. Likely in response to the protests, the ruling military junta appointed Brigadier-General Than Han of the Myanmar police to the responsibility of handling civil unrest in Rangoon.

On August 15, 2007, the government made significant cuts to national fuel subsidies, which had an immediate effect of increasing the price of diesel fuel by a reported 100 percent, causing a five-fold increase in the price of compressed natural gas, and placing additional inflationary pressure on an economy already facing estimated inflation levels of 17.7 percent in 2005 and 21.4 percent in 2006.

…The end of fuel subsidies were likely part of a larger package of reforms that the junta has been planning in order to, among other things, reduce the pressure of global fuel prices in a country that is dependent on diesel imports for its entire economy. Myanmar has an insignificant domestic refinery capacity and a chronic need for foreign currency. The latest Indian proposal intended to regain access to the Shwe gas fields has reportedly included diesel fuel exports, while a deal with Petronas of Malaysia is seeking similar arrangements. [See: “Pipeline Politics: India and Myanmar”]

The International Monetary Fund (I.M.F.) and World Bank made recommendations along the lines of the subsidy cut as part of a larger package of reforms as recently as last year; critically citing the trend toward extraordinarily high deficit budget deficits carried by the junta.
(27 September 2007)


Myanmar’s painful oil and gas price rise?

Reuters
Public anger at sudden, steep fuel price rises in Myanmar in August triggered protests which have swelled into the largest demonstrations against the military junta in 20 years. Here are some facts on the country’s energy policy and reserves.

— Myanmar has some of Asia’s biggest reserves of natural gas. It has been an oil producer since the 19th century, but gas has bypassed oil in importance.

… Myanmar has to import nearly all of its diesel because its domestic refining sector has been crippled by 50 years of non-investment, analysts say. In 2004 it imported an estimated 19,180 barrels of oil per day.

…The shock doubling of diesel prices and a five-fold rise in the cost of compressed natural gas on Aug. 15 most likely resulted from the government’s struggle to fund domestic diesel subsidies, analysts say.
(25 September 2007)


Q&A: Life in Burma

Ian MacKinnon, Guardian
Burma has long been one of south-east Asia’s poorest countries, but recent price rises and the security crackdown spawned by the protests have tightened the screw

How hard is daily life?

The average Burmese worker once spent half their meagre daily wages just getting to and from work. The other half went on food. But fuel price rises that doubled petrol and diesel prices led to dramatic bus fare increases. Now commuting swallows 70% of the daily income, leaving little for sustenance. School fees or a medical bill can tip many over the edge. Those working in Rangoon’s industrial zone can be seen trudging for an hour back and forth to work because they can no longer afford the fares. That explains why so many have taken to the streets in a country where inflation had already hit 40% this year before the latest price hikes. Electricity in Rangoon regularly goes off without warning for five or six hours, compounding the sense of misery.

So the shops and markets are empty?

Not exactly. The markets are well stocked with food. But more and more people find it a struggle to pay for basic supplies. Beyond food the shops are drab and stocked with little anyone might want, had they money to pay for it. It is especially true outside the former capital, Rangoon.
(27 September 2007)


Tags: Fossil Fuels, Oil, Politics, Transportation