Wednesday, 21 September 2011 15:50 Kyaw Kha
Chiang Mai (Mizzima) – The Central Bank of Myanmar is training senior employees at six banks that will be granted foreign currency exchange licenses.
The banks are Innwa Bank, Myawaddy Bank, Myanmar Livestock and Fisheries Development Bank, Myanmar Industrial Development Bank, Myanmar Oriental Bank and Kanbawza Bank, a senior official of the Myanmar Livestock and Fisheries Development Bank told Mizzima. “The training will last for two months,” he said.
The Central Bank of Myanmar has not yet announced procedures for exchanging foreign currencies. An official from the Foreign Exchange Management Department of the central bank told Mizzima that the bank would give instructions on exchanging currencies within two months after the training.
Economist Khin Maung Nyo said the government needed to establish clear laws and regulations regarding currency exchange or many people would continue to use the black market for exchanging foreign currencies.
“Nobody wants to buy and sell foreign currencies in the black market. But the black market will be dissolved only if suitable currency exchange laws are imposed,” Khin Maung Nyo told Mizzima.
On August 30, Upper House MP Thein Win of Sagaing Region constituency No. 9 submitted a proposal in Parliament that urged the government to amend, draw and prescribe administration laws in the Ministry of Finance and Revenue. MP Nyunt Tin of Rangoon Region constituency No. 2 discussed the proposal in the second regular parliamentary session.
Minister for Finance and Revenue Hla Tun said that in accordance with the circumstances, laws have been amended and modified and a relevant bill has been submitted to Parliament to enact the bill the law.
Hla Tun told Parliament that the ministry had coordinated with the Attorney General’s Office to amend The Pension Act, The Foreign Exchange Regulation Act, the Central Bank of Myanmar Act and the Myanmar Financial Institution Act.
Presently, services for exchanging foreign currencies legally in Burma can only be provided at the Myanmar Investment and Commercial Bank and Myanmar Foreign Trade Bank.
In accordance with section 5 of the Foreign Exchange Regulation Act 1947, any person, organization or department in Burma can hold foreign currency only with the permission of the foreign currency supervisor, and they must apply for a Foreign Exchange Acceptor & Holder License.
A weak foreign currency exchange is cited as a major reason foreign companies are slow to enter the Burmese economy.
A Wall Street Journal article in August attributed the government's inability to change its currency rate system as partly due to a lack of foreign reserves and a lack of support from the International Monetary Fund, which in turn is a result of pressure from the U.S.
The Network Myanmar group has estimated that official reserves are currently estimated at around US$ 5.5 billion. External debt is about US$ 8.6 billion, including arrears of US$ 3.9 billion.
The official exchange rate has been pegged at Kyat 8.5 per SDR since 1977, currently equivalent to Kyat 5.5 per US$, while the parallel market rate, which is now generally used for external transactions, stands at around kyat 760 per US$.
Lack of support from international financial institutions like the IMF and Asian Development Bank as a result of Western sanctions deprives the population of Myanmar of some US$ 2 billion in Overseas Development Assistance annually in comparison with pro capita levels of ODA granted to Laos and Cambodia.
Chiang Mai (Mizzima) – The Central Bank of Myanmar is training senior employees at six banks that will be granted foreign currency exchange licenses.
The banks are Innwa Bank, Myawaddy Bank, Myanmar Livestock and Fisheries Development Bank, Myanmar Industrial Development Bank, Myanmar Oriental Bank and Kanbawza Bank, a senior official of the Myanmar Livestock and Fisheries Development Bank told Mizzima. “The training will last for two months,” he said.
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| The Myanmar Livestock and Fisheries Development Bank flies a Burmese flag at the top of one of its banks. Photo: Mizzima |
The Central Bank of Myanmar has not yet announced procedures for exchanging foreign currencies. An official from the Foreign Exchange Management Department of the central bank told Mizzima that the bank would give instructions on exchanging currencies within two months after the training.
Economist Khin Maung Nyo said the government needed to establish clear laws and regulations regarding currency exchange or many people would continue to use the black market for exchanging foreign currencies.
“Nobody wants to buy and sell foreign currencies in the black market. But the black market will be dissolved only if suitable currency exchange laws are imposed,” Khin Maung Nyo told Mizzima.
On August 30, Upper House MP Thein Win of Sagaing Region constituency No. 9 submitted a proposal in Parliament that urged the government to amend, draw and prescribe administration laws in the Ministry of Finance and Revenue. MP Nyunt Tin of Rangoon Region constituency No. 2 discussed the proposal in the second regular parliamentary session.
Minister for Finance and Revenue Hla Tun said that in accordance with the circumstances, laws have been amended and modified and a relevant bill has been submitted to Parliament to enact the bill the law.
Hla Tun told Parliament that the ministry had coordinated with the Attorney General’s Office to amend The Pension Act, The Foreign Exchange Regulation Act, the Central Bank of Myanmar Act and the Myanmar Financial Institution Act.
Presently, services for exchanging foreign currencies legally in Burma can only be provided at the Myanmar Investment and Commercial Bank and Myanmar Foreign Trade Bank.
In accordance with section 5 of the Foreign Exchange Regulation Act 1947, any person, organization or department in Burma can hold foreign currency only with the permission of the foreign currency supervisor, and they must apply for a Foreign Exchange Acceptor & Holder License.
A weak foreign currency exchange is cited as a major reason foreign companies are slow to enter the Burmese economy.
A Wall Street Journal article in August attributed the government's inability to change its currency rate system as partly due to a lack of foreign reserves and a lack of support from the International Monetary Fund, which in turn is a result of pressure from the U.S.
The Network Myanmar group has estimated that official reserves are currently estimated at around US$ 5.5 billion. External debt is about US$ 8.6 billion, including arrears of US$ 3.9 billion.
The official exchange rate has been pegged at Kyat 8.5 per SDR since 1977, currently equivalent to Kyat 5.5 per US$, while the parallel market rate, which is now generally used for external transactions, stands at around kyat 760 per US$.
Lack of support from international financial institutions like the IMF and Asian Development Bank as a result of Western sanctions deprives the population of Myanmar of some US$ 2 billion in Overseas Development Assistance annually in comparison with pro capita levels of ODA granted to Laos and Cambodia.
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