During 1962–88 Burma had an economy that was based largely on socialist principles. Some private enterprise existed but many of the country's economic resources were nationalized. Also during this period, the government discouraged foreign investment. In 1988 the government began programs designed to encourage foreign investment and to expand private enterprise.

Burma is one of Asia's poorest nations and depends heavily on foreign aid. In the late 1980's, however, many donor countries suspended their aid in disapproval of the Burmese government's abuses of civil rights.

Burma's basic currency unit is the kyat.

About two-thirds of the Burmese people depend on agriculture for a living. Most of the cultivated land is in the deltas of the Irrawaddy and Sittang rivers and is devoted to rice, the nation's chief crop. In central Burma, the main crops include cotton, sugarcane, peas and beans, sesame seeds, wheat, and peanuts. Livestock include cattle, buffaloes, sheep, and chickens. Many of the cattle and buffaloes are used as draft animals. Fishing, both in ocean and inland waters, is of increasing importance.

Dense mountain forests form one of the country's most valuable resources. Hardwoods are the chief products. Burma has more than half of the world's reserves of teak, and teak is the leading export.

Although Burma is rich in minerals, the mining industry is only moderately developed. Enough petroleum is produced to meet most domestic needs. A number of metals and metal ores are mined, including lead, tin, tungsten, silver, and zinc. Gemstones, coal, and natural gas are also produced.

Manufacturing is closely tied to the processing of agricultural and forest products. Of particular importance are rice mills and sawmills, food-processing plants, and oil refineries. Small manufacturing establishments produce much of the food and many of the textiles and household goods used in Burma. The most heavily industrialized region is in the Rangoon-Pegu area.

Railway lines radiate from Rangoon and Mandalay. They extend as far north as Myitkyina and reach nearly to Tavoy in the south. The principal waterways are the Irrawaddy and its major tributary, the Chindwin. The Irrawaddy is navigable for some 900 miles (1,450 km). Rangoon is the country's chief seaport. Burma's roads are generally poor. A government-operated airline serves most Burmese cities; several private carriers operate international routes from the airport near Rangoon.