Myanmar ministries to repay 'embezzled' cash

YANGON (AFP) - Myanmar's president has ordered more than a dozen ministries to repay tens of thousands of dollars "embezzled" by staff, in a rare public move to tackle graft in one of the world's most corrupt nations.

The order comes after the auditor general found dozens of cases of "misuse and dishonest actions" involving 15 ministries that stripped nearly $65 million from government coffers over the 2011-12 fiscal year.

Around $150,000 is owed by staff at the ministries, who have until March next year to refund the money or face further legal action.

More than $45 million was also owed to the government by "private businessmen" loaned cash by the ministries, the financial watchdog said in a report to parliament submitted earlier this month and seen by AFP Tuesday. 

Listing the ministries where "embezzlement" occurred, the report said scores of businessmen owing millions of dollars had to repay their loans within months or face "a fine and lawsuit".

"The office of the Union Auditor General discussed with the heads of the respective departments about the findings and took action," the report said, without giving further details.

The money "would be refunded in a short time by the respective ministries", the office of President Thein Sein added in comments attached to the report.

Myanmar, which Transparency International last year ranked as the third most corrupt country in the world, retains a deep-rooted culture of graft among officials and the military who operated with impunity under the junta.

The nominally civilian government of Thein Sein has pledged to clean up the country as part of a reform process that promises greater democracy and measures to establish the rule of law after decades of corrupt military rule.

The auditor's probe indicates a willingness to investigate government departments, long-used to operating without scrutiny over financial matters.

The chief editor and publisher of a prominent weekly newspaper have been charged with defamation for reporting a separate graft probe into the mining ministry -- which is not mentioned in the auditor's investigation.

The case is ongoing.

On a historic visit to Myanmar on Monday US President Barack Obama praised democratic reforms sweeping the nation but warned graft could undermine efforts to lift the population out of poverty.

"This cycle of economic growth can only be created if corruption is left behind," he said, speaking as the first sitting US leader to visit the once-pariah nation.

"For investment to lead to opportunity, reform must promote budgets that are transparent," he said, adding US businesses expected to flock to Myanmar's newly opened markets will have to meet "high standards" of transparency.