Development aid and domestic regional inequality: the case of Myanmar

Abstract

There is a cyclical nature to the dilemmas confronting international donors willing to operate in Myanmar. Brief periods of relative openness led to rapid surges in development assistance, regularly interrupted by long phases of military rule and disengagement by donors. Amidst all this, many predicaments remain. This article engages with one of them: the inequality between regions. How have international donors reacted to the issue of domestic regional inequality? Recent studies suggest that official development assistance (ODA) does not target poor regions very well, but it is not always clear why this is the case. Myanmar’s sudden, yet uneven and unequal liberalization from 2011 to 2021 catalyzed huge inflows of ODA, while it also confronted donors with new policy dilemmas. The article shows that aid providers struggle with the problem of rising regional inequality, especially for political reasons. Donor and recipi- ent interests often do not align well on this issue. In the case of Myanmar, donors who press for regional inequality to sit prominently on the agenda might fare less successfully than those who address the issue indirectly. The article concludes that regional inequality and the politics of targeting deserve a more central role in the political economy of ODA.