The recent political developments are not expected to have any immediate impact on the economy. Western governments are unlikely to ease trade sanctions or loosen restrictions on investment, and Myanmar's political situation has not had a negative impact on trade and investment links with the rest of Asia. Large projects funded by investors from China, South Korea and Thailand have been approved in a number of sectors (mainly power, petroleum and infrastructure), and these will support accelerating economic growth in the next two years. Excluding these sectors, the domestic economy will remain sluggish. Agriculture will continue to struggle to grow rapidly because of a lack of investment and poor access to important inputs and equipment. The manufacturing sector will remain troubled, reflecting the difficulties that it faces in obtaining essential inputs and investment capital. Gas production has plateaued and will not resume strong growth until new fields come on stream-something that will not happen until 2013 at the earliest. Gem mining will continue to be hampered by lacklustre global demand and the impact of sanctions on Myanmar's international trade, but there are signs that production is picking up.

The outlook for growth in private consumption and investment by local enterprises is also fairly bleak. Consumer spending is constrained by low average incomes, and also by a lack of confidence owing to price instability and the weak free-market exchange rate. In 2009 consumption was depressed by a drop in farm incomes amid falling international commodity prices, and by a decline in official and unofficial remittances from workers overseas as a result of job losses suffered by Burmese nationals employed abroad. Despite an improvement in these areas in 2010, a rapid rise in consumer spending is not expected to occur as long as average household incomes remain low. Domestic investment will be constrained by a lack of confidence and limited access to capital.