On 19 July 1947 Aung San, head of the anti-fascist League for the freedom of the people, was assassinated by right-wing elements but his place was taken by Thakin Nu (who later took the name of U Nu). Thakin Nu was able to guide the work of the Burmese constituent assembly and lead the country to complete independence, which was proclaimed on January 4, 1948 and sanctioned by the formal transfer of powers from the British governor to the first president of the Burmese Union. The Burmese Union thus became a sovereign state, within the British Commonwealth, under a republican regime with a bicameral parliament. But having achieved this success, the new republic found itself having to face and resolve serious and urgent internal political and economic problems.
In August 1948 two battalions of the 1st Burma Rifles regiment mutinied in Thayetmyo (on the Irawady, N of Prome) and this was the beginning of an insurrection organized by the Communists and by a group that broke away from the Anti-Fascist League for Freedom of the people, soon joined by the Karen, who claimed the autonomy of their ethnic group (about 2,500,000 people) and of the territory inhabited by it. Despite their tenacious anti-communism, the Karen did not hesitate to join forces with the communist insurgents against the government troops. The civil war was accompanied across the country by acts of terrorism and a general state of disorder and insecurity that raised serious concerns in the British, Indian and Pakistani governments. and that it became more and more complicated due to the multiplication of rebel groups (totaling 15 or 20 thousand men in all), now allies, now in contrast with each other. To these groups, more or less militarily organized and politically defined, were added bands of brigands (almost as numerous as the insurgents) who took advantage of the general confusion to extort the population of the countryside and plunder the villages. Meanwhile, in 1950, Chinese nationalist troops crossed the Yünnan border and under the command of generals Li Mi and Liu Kuo-chuan penetrated Burma engaging in combat with government troops. Despite the gravity of the situation and the number of adversaries it had to face, the Burmese government managed to report several military successes, so much so that Prime Minister Thakin Nu was able to declare, in October 1951 during a visit to New Delhi, that the insurrection was no longer a serious problem. In the same month of October an amendment was made to the constitution by which the district of Salwin, mainly inhabited by Karen, was erected as an autonomous state within the Burmese Union. In January 1953 no major center remained in the hands of the rebels, but despite the surrender of various groups and the promises of amnesty, in February 1959 a group of 8,000 men among Karen, Communists, Chinese nationalists and smaller groups still kept the government troops mainly west of the Irawady delta.
It is understood that this first troubled decade of Burmese independence cannot fail to have been marked by a profound economic crisis, which, however, has been able to effectively remedy thanks above all to the so-called Colombo plan for the economic development of Asia. southern and south-eastern, organized in 1951 between the countries of the Commonwealth.
Communications. – The railway network (2,810 km in 1956) and road network (10,830 km with natural ground and about 6000 with artificial ground) are absolutely inadequate. Internal air communications are currently handled by a national airline that has 34 airfields. The completely rebuilt Rangoon airport is one of the most important in the East, being served by 11 international lines.
Finances. – The economic development policy has encountered a limit in the low level of domestic savings. This was mainly fueled by marked periodic expansions in exports. The deficits recorded by the public finances since 1953 have led to inflationary pressures and have compromised the balance of the external accounts on several occasions. Moreover, the economic and financial assistance granted by the USA, some loans granted by the International Bank for Reconstruction and Development and, more recently, the initiation of payments by Japan in the reparation account ($ 250 million to be paid in ten installments equal annual payments) have exerted a favorable influence both on the internal financial situation and on that towards foreign countries. In 1956-57 the
The Union Bank was founded in early 1948 and is headquartered in London. It has the privilege of issuing and generally performs the functions of a central bank. On 1 July 1952, the currency unit, which was previously called the rupee, took on the new name of kyat. Monetary parity was officially declared in 1953 (i kyat = 0.186621 grams of fine gold; kyat 4.76190 per 1 US dollar). Since 1931, the kyat has been linked to the pound by the ratio of 13.33 kyat to 1 pound. Myanmar is part of the sterling area.