IMF: Myanmar Economy Needs 'Incremental' Changes

The International Monetary Fund urged Myanmar to implement "incremental" changes to its economy as the Southeast Asian nation opens up under a new government.

In an annual economic assessment, which Myanmar agreed to make public for the first time, the IMF largely praised the previously isolated country and said Myanmar "faces an historic opportunity to jump-start economic development."

The fund projected that Myanmar's economy would grow 6% over the next year, up from an estimated 5.5% growth in the past year, due to stronger commodity exports and higher investment. The country of about 60 million people had annual economic output of about $45 billion through early 2011.

Myanmar officials had sought to move quickly in liberalizing the country's exchange rate to draw foreign investment and trade. The fund warned the country to move cautiously on its economic overhaul to avoid "costly" mistakes.

"Drastic, over-reaching reforms in many policy areas may not be realistic, given the capacity constraints and the need to coordinate across various institutions," said Meral Karasulu, the IMF mission chief for Myanmar, said late Monday.

The U.S. and other nations in recent weeks agreed to start easing some financial sanctions to reward the nation for its democratic changes.