Prices of food and other basic necessities continue to soar in Myanmar despite the recent formation of a committee designed to combat the problem.
The Union Steering Committee to Stabilize Commodity Prices, led by Commerce Minister Aung Naing Oo, was formed in the last week of June. The Agriculture, Livestock and Irrigation minister was appointed vice-chair of the committee, whose 17 members also include nine deputy ministers, the vice-chair of the central bank, and director-general of the special investigation department.
The panel has been tasked with stabilizing prices of basic products like rice, cooking oil and other kitchen commodities.
It is also responsible for monitoring the balance between domestic production and demand of basic foodstuffs.
According to the regime’s announcement on its formation, the committee is empowered to combat any actions that threaten the stability of prices for basic commodities.
It was formed more than two years after a military coup that triggered turmoil and hardship for millions of people in Myanmar. Since the February 2021 putsch, prices of necessities have doubled or even tripled under the military regime’s economic mismanagement.
Although the committee has now been operating for almost two months, prices of basic products are still rising, said a housewife in Yangon.
A 2-kilo (one pyi) bag of quality rice that cost 5,000 kyats in June is now priced at 6,000 kyats. Meanwhile, the same quantity of low-quality rice has risen from 2,500 kyats to 3,500 kyats since the committee was formed.
The price of palm oil has also risen significantly during the same period, from 9,000 to 10,000 kyats per viss (1.6kg).
“Although our income has not increased, commodity prices never decline. It is not easy to get a meal if you don’t earn 10,000 kyats a day,” a housewife told The Irrawaddy.
Given that the minimum wage is only 4,800 kyats per day, many people are already in crisis, with no sign of relief from the soaring commodity prices.
Local junta officials are now warning food sellers in Yangon townships not to inflate product prices. But the cautions appear to have had little effect.
“Even though they warned sellers in wards, prices are often not dropping. The formation of the price control committee is also useless. This problem can only be solved by intelligent people who really analyze the situation in their own country,” a housewife told The Irrawaddy.
The analysts’ view
The price-control committee cannot be effective without a systematic calculation of supply and demand, said U Kyaw Zan, president of the Rakhine State Farmers Union.
“If we take rice as an example, we have to calculate the amount of production, sufficient supply, and excess for the region. If we can’t fufill the needs of the region, we can’t control the prices,” he told The Irrawaddy.
An exporter pointed out that commodity prices are also directly connected with government policy.
“If the exchange rate increases, the price of gold and fuel will also increase and this will have a knock-on effect on local commodity prices. So, the issue is connected entirely to government policy and has nothing to do with the price control committee,” the exporter told The Irrawaddy.
On Monday, the kyat fell even further to nearly 3,700 per dollar, a near threefold decline since the coup. The rate in January 2021 was 1,300 kyats per dollar.
A business analyst said the public knows that the price-control committee won’t work.
He added that the main problem is the lack of trust in the junta and its policies, along with public distrust of the central bank under military rule.
“That’s why people are withdrawing their money from the bank and trying to invest in cars and real estate to compensate for the kyat’s depreciation. On the other side, the junta can’t handle the exchange rate,” he told The Irrawaddy.
“The root of the problem is the regime itself,” he added. “Once they are gone, everything will be fine.”