The use of Yuan or Kyat in the bilateral transaction is officially allowed in the border areas between Myanmar and China, and traders can legally open a foreign currency account at the designated banks, ensuring trade finance security for the traders engaged in Muse cross-border trade with China, said U Min Thein, vice-chair of the Muse Rice Wholesale Centre. “China often freezes accounts of Myanmar traders, supposedly linked to illegal activities. The traders suffered from it. If they lift the freeze, payment is made in full.
If not, traders cannot help. Now, the bank accounts can be legally opened and cannot be frozen as it is white money. It will definitely facilitate transaction in import and export,” he elaborated. The direct Yuan-Kyat trade platform commenced on 12 January 2022. Traders can open foreign currency accounts linked to Bank in China, CBC and BOC, by depositing 30 Yuan (which is equivalent to K10,000) at Myanmar Economic Bank in Muse. “Some traders might face challenges to do so as they used to make payments through private banks.
There might be red tape in opening accounts. However, this platform will assure the traders in the long term,” U Min Thein shared his opinion. This move is aimed to boost bilateral cross-border trade, facilitate trading and bilateral transaction, increase the use of domestic currency and lessen the reliance on the US dollar. The direct Yuan-Kyat payment has no impact on the domestic freight forwarding, a Mandalay-Muse freight forwarder. China shut down all the border posts with Muse city in the wake of COVID-19 impacts. Of them, Wamting and Kyinsankyawt border posts between Myanmar and China resumed operations. Mang Wein and Kyalgaung posts have still suspended the trade.
Source: The Global New Light of Myanmar