The Burmese junta to accelerate the privatization of state enterprises

Credited, but unofficial sources say the plan would also include the sale of fuel distribution to private companies. A possibility that worries analysts about the impact on social stability.

In order to make its industries more efficient in view of a market economy, the former Burma had already introduced a privatization program in 1995 that in part has been realised through the sales or joint ventures with local or foreign investors. Businesses for sale are located mostly in the divisions of Yangon, Mandalay, Ayeyawaddy, Bago and in Rakhine State. The final date for the auction is scheduled for February 26.

But what the analysts are looking at with greater concern is the intention to privatize all distribution stations and gas stations by 31 March. For now, the only certainty is the constitution of the association of importers and distributors of fuel that will handle the trade of fuel for nearly 50 years as the exclusive preserve of the regime. The head of the newly formed association is Tay Za, one of the oligarchs with close ties to the Burmese junta and blacklisted by UN sanctions.

Chinese media - who are closely following the events given their country’s thirst for energy - they talk about "an important step paving the way for free trade in petrol and diesel, putting an end to a system of citizen sales based on rations and fixed rates”. According to the Ministry of Energy, are there are over 250 service stations around the country.  

Privatization, however, could lead to a drastic increase in fuel prices in the sale to the public. In August 2007, the regime's decision to double the cost of gasoline, diesel and LPG was the fuse that sparked peaceful protests led by monks, that finished in a bloodbath.