Executive Summary
The past four years have brought unprecedented challenges to Myanmar, creating a profound "polycrisis." Political instability, compounded by the far-reaching impacts of the COVID-19 pandemic, entrenched conflict, economic disruptions, severe human rights violations and worsening environmental degradation, have reshaped every aspect of life. Public health systems have become severely strained, while educational opportunities have diminished, leaving human capital in decline. A youth and skills exodus, driven by forced conscription, limited job opportunities, and deteriorating socio-economic conditions, have markedly depleted the nation's workforce.
This polycrisis has pushed millions into poverty, with half of the population living below the poverty line and a further one third just barely above it. Rural-to-urban migration and displacement caused by conflict have further strained urban systems, while negative coping strategies — such as, in severe cases, selling vital assets (e.g., houses, land) — perpetuate long-term socio-economic vulnerabilities. Access to electricity has plummeted to less than half of the population. Agricultural productivity, driven by access to land and affordability of inputs, is sharply declining, intensifying food insecurity, particularly in states like Rakhine and Chin. Environmental challenges, including deforestation and mangrove loss, have exacerbated climate impact risks, further threatening community livelihoods.
The coming year will test Myanmar’s resilience to its limits as it navigates the numerous challenges of this prolonged polycrisis. The international community must adapt its support strategies, accordingly, prioritizing limited resources to mitigate the most severe regressions while building community resilience to ongoing and inevitable future shocks.
Active positive international engagement and negotiation with all parties involved is necessary to help the people of Myanmar navigate through their current challenges and set the stage for a better future. A more stable and peaceful Myanmar, that thrives on a legal economy, protects it human and natural resource assets and invests in the safety and prosperity of all its people is also in the self-interest of its neighbors and the international community writ large.
1. An Economy in Disarray
Inefficient Policies and Trade
Myanmar's economic policies under the SAC have been ineffective and lacking in coherence to address the macroeconomic reset needed, resulting in further economic decline and heightened uncertainty. Deficiencies in countering money laundering and terrorist financing led to the country's placement on the Financial Action Task Force (FATF) blacklist. Coupled with widespread insecurity, this further exacerbated Myanmar’s economic isolation, curtailing trade and financial inflows. Significant currency depreciation and the consequent high cost of imports have caused high inflation and intensified economic hardships across the population. (2)(3) The average inflation rate reached 25.4% in 2024. (4) There has been a GDP contraction of 9% from 2020 to 2024, following GDP growth of 27% in the preceding four years (2015 to 2019). GDP is estimated to increase by 2% between 2024 and 2025 but remains far below pre-pandemic levels. (5)
Trade disruptions remain pervasive, especially in cross-border commerce with a large number of border crossings with neighboring countries either closed or under opposition group control. Consequently, overall trade volumes have dramatically contracted. A sharp decline in imports is expected to narrow the trade deficit, with projections indicating a reduction to 2.2% of GDP in 2024. (6) The decline in imports will be even more pronounced when considering the disruptions in trade with Bangladesh and India. (7)
While data on the illicit economy and trade in Myanmar is not readily available, it is evident that the country’s illicit activities have far-reaching impacts on its stability. Today, Myanmar is the world’s leading source of opium and heroin and is also one of the largest global producers of methamphetamines, fueling a thriving regional drug trade. (8) The jade industry, which generates billions of dollars annually, often operates outside formal regulatory frameworks, raising significant concerns about labor practices and environmental degradation. Moreover, porous borders facilitate illegal logging and wildlife trafficking (9), further depleting natural resources. Additionally, it is reported that human trafficking, illegal gambling, money laundering, illegal and scam operations have expanded, exploiting weak oversight to establish safe havens for illicit activities along some of the borders. (10)
Night-Time Light as a Proxy for Economic Activity and Electricity
Night-Time Light (NTL) intensity is strongly correlated with access to electricity and economic activity, serving as a reliable proxy indicator, particularly at the sub-national level. Declines in Night-Time Light (NTL) intensity have been observed in 70% of the townships across Myanmar over the past four years, with a staggering 90% of conflict-vulnerable townships experiencing reductions. From 2013 to 2021, Myanmar saw a consistent rise in NTL with an average annual NTL % change of 10.8%, reflecting its economic growth and development. However, the post-2021 decline in NTL intensity, with an average annual NTL % change of minus 8.1%, aligns with the country's severe economic downturn. The decline in reliable electricity access has affected both urban and rural communities, further hindering economic activities. Projections indicate a significant drop post-2021, with an access to electricity rate of just 48% in 2024. Neighboring countries have considerably outpaced Myanmar, with Lao PDR, Bangladesh and Thailand nearing 100%, and Cambodia at 82.5%. This positions Myanmar as the country with the lowest level of access to electricity in Asia. (11)
2. A Society on the Brink
Poverty and Inequality on the Rise
Poverty in Myanmar had escalated dramatically by the end of 2023, with 49.7% of the population living below the national poverty line and an additional 25% barely above it. A further 25% are living barely above the poverty line. In effect, 42 million people are living well below, or barely above subsistence levels. This marks a significant increase in poverty from 24.8% in 2017, highlighting the devastating impact of compounded crises. (12) Particularly alarming is the rise in child poverty: by 2022, an estimated 53% of children in Myanmar were living below the national poverty line, amounting to approximately 8.9 million children. This represents an increase of about 4 million children in this vulnerable group since 2017. (13) Households have adopted negative coping strategies, such as reducing expenditures on health and education, further deepening socio-economic inequalities and threatening long-term human development.
Migration trends
The conflict and economic collapse have led to widespread job losses, forcing many to seek opportunities elsewhere—within Myanmar and abroad. Among internal migrants, displacement, now exceeding 3.5 million people, has deprived individuals of basic rights, assets, livelihoods, and incomes, and is straining local resources within host communities. (14) The far majority, 86% move for employment reasons, while 16% migrate due to conflict. Of those migrating for employment, 4% remain unemployed at their destination. In contrast, 31% of conflict-induced migrants face significantly greater challenges in securing jobs, often due to factors such as discrimination. (15) The influx of rural-to-urban migration has led to a significant rise in urban poverty, particularly in peri-urban areas. The migrant population in these areas is especially vulnerable. (16) Workers in garment and apparel factories residing in peri-urban areas earn just above a daily wage of 1 USD—significantly lower than wages in countries like Thailand, Laos, and Bangladesh. (17)
Thailand remains the most sought-after destination, with about 3.7 million Myanmar migrants moving to Thailand by 2023. Many enter or remain in Thailand irregularly due to restrictive and costly legal migration pathways, making them vulnerable to exploitation, trafficking, and forced labor. Their working conditions are precarious, characterized by low wages, long hours, and inadequate labor protections. Overcrowded living environments, often lacking basic sanitation, further exacerbate their challenges. They face significant barriers accessing social security, healthcare, and legal protections, with irregular migrants, women, and children facing heightened risks due to compounded vulnerabilities. Language barriers, stigma, and fear of detention or deportation further hinder migrants' ability to navigate these systems. Additionally, Myanmar migrants face substantial risks of trafficking for forced labor or criminal activities, exacerbated by legal and procedural gaps that limit effective victim identification and protection. (18)
Education and Health disruptions
School enrollment rates have dropped significantly, particularly in rural and marginalized communities, where access to educational facilities has been disrupted by conflict and economic hardships. In the 2023/2024 academic year, 21% of children were not attending school. (19) Regions such as Chin and Sagaing, which are among the most affected by conflict, show worryingly low enrollment rates of only 62.4% and 44.1%, respectively. (20) Many children have been forced to abandon their education due to displacement, the inability of families to afford school fees, and the overall instability of the country. This decline in education has an immediate impact on national capacities and also jeopardizes the future workforce, further undermining efforts to reduce poverty and inequality and reset the multi-year decline in human development.
Healthcare access has similarly deteriorated, with significant unmet medical needs across the country. Significant disruptions during the Civil Disobedience Movement, declining government spending on health services, coupled with the destruction of infrastructure in conflict zones, have left many communities without access to basic healthcare facilities and services. In 2023, the overall rate of unmet healthcare needs across the country was 8.1%. As with education, Chin and Sagaing have the highest unmet healthcare needs, with rates of 14.9% and 14.0%, respectively. The lack of access to maternal and child health services has further exacerbated public health challenges, leading to increased mortality rates and a rise in preventable diseases. While there is less access to accurate data for 2024, with the ongoing conflict and lack of corrective policies, skills and investments, it is projected that the situation in these sectors has further deteriorated.
Loss of Human Development
The ongoing crises in Myanmar have also led to a significant loss of human development, closely linked to the decline in human capital. Combining three indices—household GDP, education, and health—the Human Development Index (H-HDI) showed steady growth, averaging 16% annually from 2005 to 2017. However, by 2023, there was a concerning decline of 3%, primarily driven by reductions in the education and household GDP indices, which fell by 6% and 4%, respectively. This decline was more pronounced in urban areas compared to rural ones, with urban household GDP and education indices dropping by 13% and 15%.
The overall loss of human development due to the ongoing crisis is estimated at 19.3% in 2023 compared to what it could have been. The education sector has been hit the hardest, with a significant decline of 29.5%, while the household GDP index has fallen by 19%. This decline underscores the erosion of human capital, jeopardizing the country’s future workforce and exacerbating poverty and inequality. (21) Given the continued economic deterioration in the past year, it is feared that human development will continue to take the battering in 2024.
3. Climate Hazards and Environmental Decline
Climatic Impacts
Myanmar is not a significant contributor to carbon dioxide emissions or other factors driving global climate change. Nevertheless, the country is highly vulnerable to climate-related hazards, especially at certain local levels. The impacts of extreme weather events, such as Cyclone Mocha in 2023 and Typhoon Yagi in 2024, have underscored this vulnerability. Cyclone Mocha resulted in total damages of US$ 2.24 billion, accounting for 3.4% of Myanmar's GDP in 2021. More than 80% of the damage occurred in the Rakhine and Sagaing regions, with Rakhine being the most severely affected. (22) Similarly, Typhoon Yagi led to severe flooding and crop losses, with the combined effects of damage and loss totaling approximately US$ 517.4 million. The recovery needs are estimated at US$ 481.6 million. (23) Heatwaves have also struck Myanmar in the past years, with 2024 being the hottest. Chauk town in Magway was among the hottest places on Earth, reaching a staggering 48.2°C on April 28, 2024. Several other cities in Myanmar ranked among the top 15 hottest locations globally in April 2024, a month during which nearly 1,500 people died from heat-related causes. (24)(25)
Environmental Degradation
Myanmar's political and socio-economic challenges have further exacerbated negative impacts on environmental outcomes. While less immediately visible than human suffering, these impacts are triggering a cycle of degradation that threatens ecological stability and, in turn, community livelihoods and well-being. Myanmar has experienced a rapid decline in forest cover, losing 19.3% of its forests since 2000. Deforestation has accelerated post-2021 due to increased illegal logging and agricultural expansion, driven by economic desperation and weak regulatory oversight. This loss of forest cover exacerbates climate change, threatens biodiversity, and undermines the resilience of local communities to environmental shocks. Mangroves, which are critical for protecting coastal areas from storm surges and supporting local livelihoods, have declined by 37.9% since 2000. This loss is attributed to unsustainable practices such as land conversion and illegal logging, which have intensified in recent years. (26)
4. A Growing Food Crisis
Declining Agricultural Productivity
Closely linked with the macroeconomic disarray, societal challenges and the climate and environment, is Myanmar’s growing food security crisis. Agricultural productivity in Myanmar, particularly in rice cultivation, has been severely affected by conflict, climate change, and economic mismanagement. Since 2021, 16% of the country’s rice-growing area has been lost, primarily due to conflict and flooding. Eroded purchasing power has resulted in a decline of farmers’ ability to purchase seeds, compromising timely planting and leading to reduced crop yields. Fertilizer shortages and increased prices, linked to both global market disruptions and the conflict, have reduced crop yields and have further undermined agricultural efficiency. Fuel prices have increased significantly in the past year, with diesel and petrol rising by 24.7% and 45.5%, respectively, further inflating production and transportation costs. These higher transportation costs, along with associated risks, discourage investment in essential inputs, resulting in a downward spiral. (27)(28) Especially in conflict-affected regions, these challenges, aggravated by trade restrictions, are leading to acute food shortages. Rakhine is particularly vulnerable and could face famine like conditions, with domestic food production projected to cover only 20% of its needs by mid- 2025. (29)
Soaring Prices and Eating Less
In addition to declining agricultural productivity, food security in Myanmar has been further worsened by rising commodity prices and decreasing purchasing power. The seventh round of the Myanmar Household Welfare Survey (MHWS) (30) and the Myanmar Monthly Food Price Report of November 2024 reveal that essential commodities, including rice, vegetables, and animal-sourced foods, are becoming increasingly unaffordable. For example, rice prices in Shan (North) surged to 47% above the national average in November 2024, driven by the combined effects of intensified conflict, disrupted trade, and flooding. By late 2024, key export crops such as maize and pulses—including green gram, black gram, chickpeas, and pigeon peas—saw price increases of approximately 50% compared to the same period the previous year. Potato prices experienced an extraordinary spike of 171%, largely due to the closure of Myanmar-China border crossings, which disrupted potato imports from Bangladesh and China. (31)
Animal-sourced foods also witnessed significant price increases in November 2024 compared to the previous year. Chicken, typically the least expensive meat, recorded a 91% year-on-year increase and a 25% month-on-month rise, making it more expensive than beef. Other meats saw similar price hikes, while egg prices rose by 76% over the past year. In contrast, fish prices remained relatively stable during this period. These price increases can in part be attributed to the aftermath of Typhoon Yagi, which caused severe flooding and resulted in the loss of approximately 200,000 livestock and nearly 2,000 acres of fish farming ponds across six states and regions. Additionally, rising costs of animal feed, veterinary medicines, and transportation have further driven up food prices.
As a result, more than one-quarter (28%) of households have reported reducing their food intake as a coping strategy to address income insufficiency. In Kayah, one of the states affected by intense conflict, over half (52%) of households have cut back on food expenditures. This reduction in food consumption represents a severe negative coping mechanism with long-term consequences, including detrimental impacts on nutrition and cognitive development in children, ultimately impairing future human development. (32)
5. Youth Exodus and Gender Inequality
The Youth Exodus
Myanmar is experiencing an alarming youth exodus. The Myanmar Youth Survey 2024 reveals that over 40% of the youth population in the country expresses a desire to migrate—a figure that does not account for those who have already left. This wave of migration is fueled by a lack of employment opportunities, a deteriorating education system, and the introduction of mandatory conscription laws, particularly targeting young men. The potential loss of educated and skilled individuals poses a severe threat to Myanmar’s human capital and economic stability, with long-term repercussions for the nation’s development. However, 90% of these potential youth migrants express a willingness to return, provided there are significant political and economic reforms.
Women Bearing the Brunt
Women have disproportionately borne the brunt of Myanmar's crises, facing both economic and social challenges. There is a concerning trend toward the feminization of poverty, with women-headed households being 1.2 times more likely to live in poverty compared to male-headed households. (33) Women's economic participation has declined significantly as job opportunities shrink, while traditional gender roles impose additional burdens, such as increased unpaid caregiving responsibilities. The absence of gender-sensitive interventions and support systems have further marginalized women in the labor market.
Moreover, the instability has heightened women’s vulnerability to exploitation and violence, including human trafficking in conflict-affected areas. These challenges highlight the critical need to integrate gender equality into recovery and development strategies, ensuring that women are not left behind.
6. Stay and Deliver: The Need for Local Service Delivery
Myanmar has experienced significant shifts in dominant armed presence, making local service and aid delivery increasingly challenging in this fragmented context. By late 2023, "Operation 1027," has changed the geographic composition of who are the dominant actors in the various States and Regions.
By 2024, escalating conflict in Shan, Kachin, Sagaing, and Rakhine states has resulted in significant shifts in the presence and influence of armed actors in different areas. This underscores the complexities of the current landscape, characterized by constantly evolving security, political, and administrative control, resulting also in fragmented local service delivery systems.
7. The Year Ahead: Further Polycrisis or Poly-opportunity
A Challenging Outlook
The coming year will test Myanmar’s resilience as the nation faces interconnected challenges of economics, socio-political stability, and environmental protection. Conflict-prone regions will experience exponentially growing vulnerability across all these domains, without the coordinated and effective efforts and resources, domestic and external, to address deepening disruptions and disparities.
Myanmar's economy is expected to remain fragile due to insecurity, ongoing governance challenges, economic isolation, and currency depreciation. Inflation will persist, further eroding household purchasing power further. Infrastructure challenges, such as electricity shortages, will become far more extensive, continuing to constrain economic recovery.
Poverty levels are projected to rise as economic regression continues to affect livelihoods, especially in conflict-affected areas. Internal and external migration will persist, straining social systems. Education and healthcare systems will likely deteriorate further due to inappropriate budget priorities, conflict and the limited capacity of non-state actors to meet needs, leaving a growing gap in human capital development. Women will continue to face increased economic marginalization and vulnerability to exploitation, limiting progress toward gender equality.
Myanmar’s food security crisis is expected to worsen, reflecting the deep interlinkages between conflict, economic instability, and environmental vulnerabilities. Agricultural productivity and affordability of food is especially critical in conflict-affected states like Rakhine and Chin, where famine-like conditions could prevail this year.
Youth migration is expected to continue as conflict and economic challenges push young people to leave the country. Without changes to the conscription laws, insecurity and instability that undermines future opportunities for young people, the ongoing brain drain will significantly impact the domestic labour market and severely undermine prospects for recovery and advancing development.
Negative climate trends will accelerate in the coming years, with extreme weather events becoming more frequent and severe. These changes will disproportionately affect the most marginalized populations, who live in eco-fragile locations, deepening inequalities and compounding the socio-economic challenges faced by vulnerable communities. Environmental degradation, including deforestation and mangrove loss, will likely worsen due to continued illegal logging and unsustainable practices.
Opportunities Remain
Despite the overwhelming challenges Myanmar faces, opportunities exist to effectively intervene to mitigate the worst impacts of the ongoing crises:
Resilient Communities: Despite the crises, Myanmar’s ethnically diverse communities have shown extraordinary resilience. Building on this strength - by further developing community capacities, promoting community-driven interventions and working with local civil society organizations - can enhance social cohesion and invest in highly localized solutions.
Harnessing Youth Potential, inside and out: While the youth exodus is concerning, it also represents an opportunity to engage the diaspora and provide platforms for continued learning and skill development for young people within Myanmar, to help retain and attract young talent and provide new income opportunities.
Empowering Women: Women’s resilience and economic potential remain underutilized. Providing women with access to new skills and finance, and integrating more women into the workforce can significantly enhance household incomes and community development. Direct investments in women-led enterprises can serve as catalysts for local socio-economic transformation, even amid the ongoing crisis.
Agricultural Innovation and Food Security: Myanmar’s agricultural sector, though severely impacted, continues to hold immense potential. Promoting climate-resilient seeds and farming techniques, improving access to affordable fertilizer, farm equipment, storage and finance, and rebuilding small irrigation systems can revitalize farms and hence agricultural productivity. The immediate urgency is to ensure that the 2025 planting season in many parts of the country is reignited, including in the hardest hit areas. Targeted interventions ahead of the rainy season could preserve farm-related livelihoods and ensure food security. Opening borders to enable basic trade and essential inputs into Myanmar will be critical in this regard.
Investing in Environmental Protection: Myanmar’s rich biodiversity and natural resources remain a cornerstone for economic recovery and once lost will never be regained. Investing in reforestation, mangrove restoration, and sustainable resource management will create more livelihoods, mitigate climate and disaster risks, protect and regenerate existing natural assets and support community resilience against future shocks.
Local Capacities to Manage and Administer their own development: Myanmar’s current state of flux presents an opportunity to experiment with decentralized and community-led administration and service delivery. Strengthening these foundational capabilities and systems for local development can help establish inclusive communities and responsive administrations over time.
International Engagement and Advocacy: Maintaining the situation of Myanmar on the regional and global agenda, with a view to recognizing and amplifying these opportunities is key. But advocacy and visibility will not be sufficient. Active positive international engagement and negotiation with all parties involved is necessary to help the people of Myanmar navigate through their current challenges and set the stage for a better future. A more stable and peaceful Myanmar, that thrives on a legal economy, protects it human and natural resource assets and invests in the safety and prosperity of all its people is also in the self-interest of its neighbors and the international community writ large.
Footnotes
- (1) The sources of the data points are referenced in the respective sections, with the majority of the data points coming directly from the reports produced by the Myanmar Development Observatory, with exception of macroeconomic data.
- (2) UNDP (2023) Myanmar and the FATF: June Update
- (3) UNDP (2023) Economic Policy in Myanmar: Analysis of 2021–2023 Trends
- (4) World Bank (2024) Myanmar Economic Monitor 2024: Compounding Crises
- (5) World Bank - World Development Indicators
- (6) World Bank (2024) Myanmar Economic Monitor 2024: Compounding Crises
- (7) Recent and reliable data on the cross-border trade with Bangladesh and India is unfortunately not available.
- (8) Myanmar remains the world’s leading source of opium and heroin
- (9) Upward trend in Myanmar online wildlife trade endangers biodiversity and public health | WWF Asiapacific
- (10) https://www.unodc.org/roseap/en/2024/casinos-casinos-cryptocurrency-underground-banking/story.html
- (11) UNDP (2024) Shedding Light on Myanmar’s Development Challenges through Night-time Light
- (12) UNDP (2024) Poverty and the Household Economy of Myanmar: A Disappearing Middle Class
- (13) UNICEF and UNDP (2023) Estimates of Monetary Poverty among Children in Myanmar
- (14) UNDP (2023) Seeking Opportunities Elsewhere: Myanmar Migrant Workers in Thailand
- (15) UNDP (2023) Migration in Myanmar: Moving to Cope
- (16) UNDP (2025) Dimensions of Rising Urban Poverty: Unpacking the Case of Yangon (to be published)
- (17) UNDP (2025) Stitches of Struggle: The Realities of Garment Workers in Yangon and Bago (to be published)
- (18) THAILAND MIGRATION REPORT 2024 | United Nations in Thailand
- (19) Enrollment rate 2023/24 standing at 79%. UNDP (2024) Shaky Foundations: The Looming Collapse of Human Capital in Myanmar. This figure is significantly lower than the pre-pandemic enrollment rate of 94% in 2017. CSO, UNSP and WB (2020) Myanmar Living Condition Survey 2017: Socio-Economic Report
- (20) UNDP (2024) Shaky Foundations: The Looming Collapse of Human Capital in Myanmar
- (21) UNDP (2025) Unveiling the Household-Based Human Development Index in Myanmar: Concentrated Loss and Polarization (to be published)
- (22) World Bank (2023) Extremely Severe Cyclonic Storm Mocha, May 2023, Myanmar: Global Rapid Post-Disaster Damage Estimation (GRADE) Report
- (23) UNDP (2025) Mapping the Impact of Typhoon Yagi on Myanmar: A Comprehensive Remote Sensing Analysis of Damage, Population Vulnerability, and Pathways to Recovery
- (24) Cities in Myanmar drop off list of world's 15 hottest cities | Eleven Media Group Co., Ltd
- (25) An estimated 40 people are dying each day in Myanmar as heat lingers in region – Radio Free Asia
- (26) UNDP (2025) Collateral Damage: The Environmental Toll of Myanmar's Polycrisis (to be published)
- (27) IFPRI (2024) Myanmar Agricultural Performance Survey (Dry Season 2024): Farm commercialization and farm services
- (28) IFPRI (2024) Myanmar Agricultural Performance Survey (MAPS) Monsoon Season 2024: Agricultural input markets, credit and extension services
- (29) UNDP (2024) Rakhine: A Famine in the Making
- (30) Myanmar Agrifood Program for Strategy and Analysis (2024) Livelihoods and welfare: Findings from the seventh round of the Myanmar Household Welfare Survey (January–June 2024). Myanmar SSP Working Paper 64. Washington, DC: International Food Policy Research Institute.
- (31) Myanmar Agrifood Program for Strategy and Analysis (2024) Myanmar Monthly Food Price Report – November 2024. Myanmar Monthly Food Price Report November 2024. Washington, DC: International Food Policy Research Institute.
- (32) UNDP (2024) Poverty and the Household Economy of Myanmar: A Disappearing Middle Class
- (33) UNDP (2024) Poverty and the Household Economy of Myanmar: A Disappearing Middle Class
Credits:
Myanmar’s Enduring Polycrisis: Four Years into a Tumultuous Journey