Country Report Myanmar January 2011

Outlook for 2011-12: Fiscal policy

The post-election administration is likely to continue to run a substantial fiscal deficit in 2011-12. Central government tax revenue has grown rapidly in recent months, but it will not be sufficient to reduce the deficit, given the small revenue base. The authorities do not provide timely data on fiscal expenditure, but there is anecdotal evidence to suggest that the government has been spending heavily on large projects (such as the development of the new capital city at Naypyidaw) that provide benefits to the military and its leaders, borrowing funds from the Central Bank of Myanmar and other sources to support such schemes. There are also indications that the SPDC went on a populist spending spree in the run-up to the election, investing in various small infrastructure projects throughout the country to much fanfare.

© 2011 The Economist lntelligence Unit Ltd. All rights reserved
Whilst every effort has been taken to verify the accuracy of this information, The Economist lntelligence Unit Ltd. cannot accept any responsibility or liability for reliance by any person on this information
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