ADVISORY COMMISSION ON RAKHINE STATE Restrictions on freedom of movement for the Muslim community, including the confinement of approximately 120,000 people in IDP camps – most of whom rely entirely on foreign aid – have particularly detrimental effects on the level of economic activity in the state. Such restrictions have created prohibitive barriers for Muslim businesses and labourers to enter the economy, and increased incentives for engaging in illicit commercial activities. It has also nurtured a culture of unproductive rent-seeking, as the complex matrix of restrictions enables Government officials to take bribes in return for travel permits and commercial licenses. This, however, does not only affect Muslims: For all communities in Rakhine, acquiring government permissions is a costly and challenging endeavour, often discouraging entrepreneurs from starting or expanding businesses. They all have to deal with expensive licenses, inefficient bureaucracies and corruption. Fear and insecurity also impede entrepreneurship. The threat of continued instability and violence – combined with a general lack of employment opportunities – has encouraged significant out-migration of both Rakhine and Muslims, resulting in labour shortage in various sectors. Some communities complain about “brain drain”, as the better educated and resourceful part of the work force has been the first to seek opportunities elsewhere. Within the Rakhine community, many unskilled labourers have also left, for instance for the jade mines in Kachin or the garment industry in Yangon. Moreover, poverty and discrimination have encouraged tens of thousands of Muslims to emigrate to other countries in the region, such as Malaysia and Indonesia. Most have relied on illegal trafficking networks, and many are believed to have died during the hazardous sea journeys. Women workers in Rakhine State face additional challenges, and continue to suffer from uneven pay, not least in the agricultural sector. Within the Rakhine community, more women than men migrate to find employment outside the state. Migration of men also tends to increase the workload of women left behind. Barriers exist for women wanting loans and credit, especially for those who are unmarried or widowed, and the lack of women’s rights to inheritance in some communities poses serious problems for women’s livelihood opportunities. Opportunities in the manufacturing sector remain limited. Muslim women have even fewer choices. Their education levels are lower, while severe restrictions on their movement make it difficult to engage in livelihood activities other than in their immediate neighbourhood. Rakhine has few comparative advantages in mass employment sectors, and even in a best-case scenario, it will take years to address the structural and political challenges currently holding back the state’s economic potential. Yet, the picture is not entirely bleak. Rakhine has a wealth of natural resources FINAL REPORT 21