YANGON—Amid a slowing economy and complaints from the business community, Myanmar’s parliament has approved a National Planning Law for the 2018-2019 fiscal year which expects to see the highest growth rate in the country’s telecommunications, industrial and financial sectors.
On Wednesday, President U Win Myint signed the bill with the approval of the Union Parliament and it is to be effective from October 1 this year to September 30, 2019.
According to the National Planning Law, the government expects to increase the growth of GDP from 6.8 percent to 7.6 percent, while the telecommunications sector is projected to grow by 15 percent, the industrial sector by 11.2 percent and the financial sector by 9 percent in the coming fiscal year.
The law states that the government will make efforts to improve the trade sector by 7.7 percent, the mineral sector by 7.5 percent and the social management sector by 7.3 percent.
Meanwhile, a growth of only 4 percent is expected in the fisheries sector, 2.9 percent in the energy and electricity sector, 2.4 percent in agriculture and 1.1 percent in the forestry sector.
The government projects that the highest growth rates will take place in Yangon Region, Naypyitaw Union Territory, and Kachin State with rates of 9.8 percent, 9.6 percent and 9.3 percent respectively.
The relative ministries will draw up implementation plans in order to facilitate improvements across the sectors. The law also instructs the government departments to make a review of all national projects and assess whether they are beneficial to the people or not. It states that projects must be suspended or canceled if they are found not to be beneficial to the people.
The government departments need to compose a list of state-owned enterprises (SOEs) which make annual loses and suggests that they should be converted to private enterprises, according to the law.
The Ministry of Planning and Finance has said that 10 out of 32 state-owned enterprises make annual loses which are expected to amount to 1 billion kyats in the 2018-2019 fiscal year.
Businesses in Myanmar are suffering chronic loses due to the instability of the exchange rate which has caused inflation rates to rise at the fastest pace in recent years. This has affected imports and also raised fuel and transportation costs and overall consumer costs in the country. In their July inflation report, Myanmar Statistical Information Service (MSIS), a department under the planning and finance ministry, cited that the year-on-year inflation rate accelerated to 7.56 percent from 5.90 percent during the three-month period of May to July.
A recent survey by the Republic of the Union of Myanmar Federation of Chambers of Commerce and Industry (UMFCCI) said Myanmar’s economy has been slowing since 2016 and business in all sectors has declined significantly this year. Overall business confidence is down by nearly 25 percent compared to last year with the manufacturing sector and import and export trading sectors experiencing significant downturns in this year.
