NAYPYITAW—During a session of the Union Parliament on Wednesday, lawmakers urged the Union government to pay off loans from China as quickly as possible, pointing out that China’s interest rates are the highest among all foreign countries that have lent to Myanmar.
Lawmakers discussed the Joint Public Accounts Committee’s assessment of the government’s debt report for a six-month transitional period in 2018 before the new fiscal year began in October.
“As we are allowed to pay back any amount any time we wish, we should pay back loans from China—whose interest rate is high and whose loan amount accounts for 40 percent of the total national debt—as early as possible,” Lower House lawmaker Daw Cho Cho told the Union Parliament.
According to the latest government debt report, Myanmar had racked up some $4 billion in loans by 1988 and a further $2.7 billion up to 2011—97 percent of which is owed to China. It says the government amassed another $3.1 billion in loans between 2011 and 2016 and $91 million more since then.
Myanmar currently owes a total of $10 billion to international lenders, more than $4 billion of it to China. According to lawmakers, China’s interest rates are also the highest at 4.5 percent.
The previous Parliament approved $300 million in loans from the Export-Import Bank of China at 4.5 percent interest to fund a number of cooperatives.
Upper House lawmaker U Than Soe called for the urgent adoption of a debt management strategy to arrange loan repayments to China.
Citing international examples, he suggested that Myanmar can repay China’s loans in the form of rice exports, as the majority of Myanmar’s rice is exported to China through border trade.
“The majority of Chinese loans were borrowed under previous successive governments. Now it is time we pay them back,” said U Than Soe.
The Union ministers are set to discuss the national debt in response to the Joint Public Accounts Committee’s assessment at the Union Parliament on Jan. 29.