Posts in category: ECONOMY

The Microfinance Businesses Supervisory Committee instructed microfinance institution (MFI) in Myanmar to ease loan collections among those who are not able to repay during the pandemic. The committee will inspect whether the MFIs follow the orders and take action if they fail to follow.

Myanmar authorities have instructed MFIs not to collect repayments and interest payments by force since early April. MFIs have also been encouraged to give out buffer loans, new loans and fix the payment term for these who are unable to repay on June 14.

Lowering interest rated could reduce access to finance and hence the issue of interest rates should be approached carefully. The government was urged to negotiate with MFIs over payback conditions and reduce the interest rate. As of 2020, 193 MFIs have beem permitted to operate and over K2217 billion has been given out to a total of 5.7 million people.

Source: Myanmar Times

Revenue from the Myanmar oil and gas sector will decline in fiscal 2020-21 as a result of COVID-19.This is because global oil prices have fallen, leading to decline in gas prices and production at four of Myanmar’s offshore gas projects and numerous other fields onshore. The decline also comes at a time when production levels at existing wells are decreasing and tenders for drilling at new gas fields have stalled.

Income from the natural resources sector contributes to around 10.9 percent of Myanmar’s total income, making it a major source of revenue for the country. In 2019-20, income from the Myanmar oil and gas sector totalled K2 trillion. This however, was down from a high of K2.3 trillion in 2018-19 as a result of declining production levels.

Tax revenues from the natural gas sector have also decreased, falling to K169 billion in fiscal 2019-20 due to lower production revenue from the Zawtika offshore project and lower exchange rate. The forecast amount had been K234 billion. The ministry expects tax revenues from the gas sector to amount to K334 billion in the coming fiscal year.

Source: Myanmar Times

The Directorate of Investment and Company Administration (DICA) is planning to launch online platform regarding the recommendation for a visa extension of the expatriates in Myanmar. This move aims to reduce opportunities for dishonesty in applying for visa extension, check the lists of the recommended company for visa, get easy access to the data of expatriates and stay period, reduce paperwork, ensure social distancing and facilitate the processing.

The DICA, on behalf of MIC, is planning to launch online system for the recommendation for a visa extension of the foreign director and foreign employee of the companies, and their family members in order to ensure smooth processing at the Ministry of Labour, Immigration and Population. At present, the online application form is posted on the DICA’s official website. The users can submit a suggestion to the system. Last 7 July, the director-general and deputy director-general of the DICA met with U Nyein Min Oo, CEO of Myanmar Digital IT Solution Co., Ltd regarding drawing software, and the work matters were suggested and explained. 

Source: The Global New Light of Myanmar

Myanmar trade is expected to hit US$34.7 billion in the new 2020-21 fiscal year despite the ongoing corona virus pandemic, the Ministry of Commerce said.Exports are forecast to total $16.2 billion, while imports should come in at $18.5 billion, leading to a trade deficit of $2.3 billion.

At those levels,trade in the new year fiscal year is expected to grow by $1.6 billion compared to the forecast $33 billion for the current fiscal year. Up to 85 percent of that volume has already been achieved.

Myanmar risks losing chunks of revenue from markets that dominate trade in certain products. The lack of new cut-make-pack(CMP) orders in the garment manufacturing sector is a concern. Since the start of COVID-19, a shortage of raw materials from China and order cancellations from major buyers like EU which accounts for 70 pc of the country’s garment exports, have led to the collapse of many local factories.But there is still potential for recovery and growth.

Moreover,Myanmar is expected to continue displaying high growth potential in garment manufacturing. Beside the low-cost labor, Myanmar’s proximity to China,its special market privileges granted by EU under the Generalized Scheme of Preference and low logistics and transport costs all “work in Myanmar’s favour.” They expect Myanmar’s growth to be driven by lower value basic garment exports which manufacturers will find more challenging to turn a profit on in Bangladesh and Cambodia, where production costs are comparatively higher.

Source: Myanmar Times