Governments and agencies must be wary of flooding Myanmar with well-intentioned but ill-targeted aid, experts warned Thursday, admonishing the global community to "first do no harm."
With the once pariah country approaching the second anniversary of the government of President Thein Sein, foreign aid is pouring into the country as it embarks on a series of surprising political and democratic reforms.
But there is "ample evidence that the flow of foreign aid... is likely to be greater than Myanmar's capacity to absorb it," said a new report commissioned by US economic consultants Nathan Associates.
Co-author Lex Rieffel, a Brookings Institution senior fellow, said Myanmar "is undertaking a remarkable transition, it's not an easy transition. And the outcome, I think, is highly uncertain."
"Don't think that everything's going to go well, it could go in many different directions," he said.
The country needs help but there should also be "sensitivity in recognizing that not everything we might want to do is actually helpful," Rieffel added.
Myanmar officials have been swamped by requests for meetings from governments, NGOs and even movie stars as it emerges from six decades of isolation.
But such requests divert time and energy from the many challenges facing the government as it grapples to shore up long neglected institutions and enact reforms.
"We think one of the biggest problems is the incentives donors have," said the second co-author, James Fox, a former senior economist for the US Agency for International Development.
"Every donor wants to make a difference," he said, referring to it as the "MAD disease" in which each donor pushes its own programs.
That can lead to chaotic aid distribution in which none of the agencies work together, but jealously fight their own corner, as well as programs unsuited to the realities of life in Myanmar.
New Zealand, for instance, decided that 85 percent of its aid over the next five years would go toward dairy farming, even though that was a low priority for the government, the report said.
Donors have also been loathe to fund such activities as education abroad, or facilitating the return of the Myanmar diaspora, which could help boost skill levels.
Acting Assistant Secretary for East Asian and Pacific Affairs Joseph Yun disagreed, however, that there was too much aid flowing into the country, saying "the burden now is on everyone to keep the momentum."
"I cannot think of any engagement that the Americans could provide that would not be useful. I think in every sense of the word more would do better," he argued.
"This country which has suffered so much over the past 60 years deserves a better chance and it could be a huge success story."