• Burmese
Friday, July 18, 2025
No Result
View All Result
NEWSLETTER
The Irrawaddy
30 °c
Yangon
  • Home
  • News
    • Burma
    • Politics
    • World
    • Asia
    • Myanmar’s Crisis & the World
    • Ethnic Issues
    • War Against the Junta
    • Junta Cronies
    • Conflicts In Numbers
    • Junta Watch
    • Fact Check
    • Investigation
    • Myanmar-China Watch
    • Obituaries
  • Politics
  • Business
  • Opinion
    • Commentary
    • Guest Column
    • Analysis
    • Editorial
    • Stories That Shaped Us
    • Letters
  • Junta Watch
  • Ethnic Issues
  • War Against the Junta
  • In Person
    • Interview
    • Profile
  • Books
  • Donation
  • Home
  • News
    • Burma
    • Politics
    • World
    • Asia
    • Myanmar’s Crisis & the World
    • Ethnic Issues
    • War Against the Junta
    • Junta Cronies
    • Conflicts In Numbers
    • Junta Watch
    • Fact Check
    • Investigation
    • Myanmar-China Watch
    • Obituaries
  • Politics
  • Business
  • Opinion
    • Commentary
    • Guest Column
    • Analysis
    • Editorial
    • Stories That Shaped Us
    • Letters
  • Junta Watch
  • Ethnic Issues
  • War Against the Junta
  • In Person
    • Interview
    • Profile
  • Books
  • Donation
No Result
View All Result
The Irrawaddy
No Result
View All Result
Home News Burma

Myanmar Junta’s Moves to Ease Currency Rules Won’t Help in Long Run: Experts

Nora Aung by Nora Aung
August 9, 2022
in Burma, Factiva, News
Reading Time: 3 mins read
0 0
A A
Myanmar Junta’s Moves to Ease Currency Rules Won’t Help in Long Run: Experts

A clerk counts US dollar notes at a money changer in Yangon.

6.3k
VIEWS
Share on FacebookShare on Twitter

Friday’s decision by the Myanmar junta’s central bank to weaken its official kyat-US dollar exchange rate and ease forced-conversion regulations for exporters will provide temporary relief at best for the crisis-hit Myanmar economy, according to financial analysts. 

The Central Bank of Myanmar raised its official exchange rate from 1,850 kyats per dollar to 2,100 kyats on Friday. In a directive dated the same day, central bank chairman U Than Nyein said export companies would now only be required to convert 65 percent of foreign currency earnings into kyats at the central bank rate, down from 100 percent previously. They have 30 days to use the remaining 35 percent to purchase imported goods or make other trade or non-trade cross-border payments. After 30 days, if it is not used, the remaining 35 percent of export proceeds must be converted at the official central bank rate, according to sources in the export/import community. 

However, the move has not had much of an impact on the black market rate, which fell from around 2,700 kyats per dollar on Friday to around 2,550 kyats on Monday. The central bank has prohibited individuals and companies from trading US dollars since the coup in February 2021. The situation appeared the same for other currencies and gold prices on Monday. 

RelatedPosts

Political assassinations and Myanmar’s fate

Political assassinations and Myanmar’s fate

July 18, 2025
39
Indian Top Brass Visit Myanmar After Cross-Border Drone Attack

Indian Top Brass Visit Myanmar After Cross-Border Drone Attack

July 18, 2025
148
Anti-Coup Icon Explains Urgent Call for NUG Reform

Anti-Coup Icon Explains Urgent Call for NUG Reform

July 11, 2025
579

The recent erratic policy shifts by the central bank have made the situation worse for Myanmar’s economy, which has already been battered by the country’s post-coup crisis. 

Last month, the central bank ordered borrowers to suspend repayment of foreign loans in a measure intended to conserve foreign currency reserves. 

In April, it ordered all businesses to convert all foreign currency earnings into kyats within one day at the official rate of 1,850 kyats, well below the informal market rate of over 2,200 kyats.

The actions only further eroded confidence in the kyat and prompted people to buy other assets like US dollars, other foreign currencies, gold, cars and property, leading to a shortage of dollars in the market. 

Why has the central bank changed its policy?

With the central bank buying dollar earnings from exports at the official rate of 1,850 kyats—while the informal market rate stands at about 2,500 kyats—export companies last month began setting up companies in countries like Thailand and the United Arab Emirates, smuggling export products abroad and receiving payment in US dollars in foreign bank accounts. 

“This deprived the central bank of taxes and US dollars, so I think they eased the regulations” as a result, said a local market analyst. 

The central bank has set its exchange rate at 2,100 kyats in an effort to encourage exporters to go through legal channels, he added.

“It is a temporary solution to the problem of the kyat’s depreciation. A free-float dollar exchange market and [permitting] unlimited selling of earnings would improve the situation,” said a local market analyst.

However, the Myanmar junta is currently battling an armed revolution and renewed conflicts with ethnic armed groups triggered by the military coup. Needing US dollars to fund its war, it is unlikely to lift the restrictions totally anytime soon.

The World Bank projects Myanmar’s economic growth at 3 percent in the fiscal year ending September 2022, following an 18 percent contraction last year, with firm downside risks. 

Junta spokesperson Zaw Min Tun said at a press conference on July 26 that the regime had plenty of US dollars in hand, so it wasn’t worried about a possible financial crisis like the one that recently engulfed Sri Lanka.

One financial analyst who asked for anonymity said the junta’s ad hoc actions would not achieve financial stability, as they did not address the main problems of a large budget deficit, banking sector instability and a decline in foreign direct investment, which had sapped the country’s supply of dollars. 

The World Bank warned in a policy note issued on July 8 that the political and economic chaos since the coup had destabilized the financial system. “Recent policy shifts are likely to have longer-term effects: inhibiting potential growth, worsening macroeconomic instability, and impairing the efficient allocation of resources,” the bank wrote in its policy note in July 2022.

Your Thoughts …
Tags: Central BankconversiondollarseaseExchange RateKyatsMyanmarregulations
Nora Aung

Nora Aung

Similar Picks:

Five-Star Casino Resort on Myanmar Tropical Island Runs Out of Luck
Burma

Five-Star Casino Resort on Myanmar Tropical Island Runs Out of Luck

by The Irrawaddy
February 6, 2024
19.3k

U Kyaw Lwin ran his casino resort on the visa-free island for more than 10 years before facing arrest in...

Read moreDetails
Myanmar Junta’s Central Bank Had $6.8 Bn in Reserves at 14 Int’l Banks in March
Myanmar’s Crisis & the World

Myanmar Junta’s Central Bank Had $6.8 Bn in Reserves at 14 Int’l Banks in March

by The Irrawaddy
August 21, 2023
19k

Singapore banks held 67% of the junta’s foreign reserves; in a bank document seen by The Irrawaddy, the junta praises...

Read moreDetails
UK Hits Myanmar Border Guard Force Colonel, Two Others, With Sanctions
Burma

UK Hits Myanmar Border Guard Force Colonel, Two Others, With Sanctions

by The Irrawaddy
December 9, 2023
10.8k

Saw Chit Thu and two others linked to a massive gambling project in Karen State were sanctioned over allegations of...

Read moreDetails
China and the Wars in Myanmar
Guest Column

China and the Wars in Myanmar

by Bertil Lintner
January 21, 2025
10.7k

Recent truces declared by ethnic armies show that China is still the only outside power that can intervene in Myanmar,...

Read moreDetails
Japan’s ‘Special Relationship’ With Myanmar Has Abetted Decades of Military Rule
From the Archive

Japan’s ‘Special Relationship’ With Myanmar Has Abetted Decades of Military Rule

by Bertil Lintner
May 17, 2024
18.1k

In light of EAO and NUG leaders’ recent talks in Tokyo, The Irrawaddy revisits a column from 2022 exploring Japan’s...

Read moreDetails
Book Review
Books

Book Review

by The Irrawaddy
August 17, 2024
8.7k

The Irrawaddy “Books” section offers you insightful reviews of volumes on a vast array of issues ranging from culture and...

Read moreDetails
Load More
Next Post
Fuel Shortage Beckons as Prices Rise Across Myanmar

Fuel Shortage Beckons as Prices Rise Across Myanmar

Two Myanmar Military Bases Seized by Resistance in Kachin State

Two Myanmar Military Bases Seized by Resistance in Kachin State

No Result
View All Result

Recommended

What the ‘Snake Charmer’ Analogy Gets Wrong About Myanmar

What the ‘Snake Charmer’ Analogy Gets Wrong About Myanmar

3 days ago
1.4k
Myanmar Junta’s Recapture of Nawnghkio Shows Strategic Missteps by TNLA

Myanmar Junta’s Recapture of Nawnghkio Shows Strategic Missteps by TNLA

1 day ago
1.2k

Most Read

  • Myanmar Junta’s Power Transfer Looms, but Real Control to Remain With Regime Boss

    Myanmar Junta’s Power Transfer Looms, but Real Control to Remain With Regime Boss

    shares
    Share 0 Tweet 0
  • Myanmar Junta’s Recapture of Nawnghkio Shows Strategic Missteps by TNLA

    shares
    Share 0 Tweet 0
  • Karen Fighters Push for Myanmar Junta Outpost on Thai Border

    shares
    Share 0 Tweet 0
  • Belarus Universities Teach Myanmar Junta How to Kill: JFM

    shares
    Share 0 Tweet 0
  • Indian Army Accused of Deadly Strike on Separatists in Myanmar

    shares
    Share 0 Tweet 0

Newsletter

Get The Irrawaddy’s latest news, analyses and opinion pieces on Myanmar in your inbox.

Subscribe here for daily updates.

Contents

  • News
  • Politics
  • War Against the Junta
  • Myanmar’s Crisis & the World
  • Conflicts In Numbers
  • Junta Crony
  • Ethnic Issues
  • Asia
  • World
  • Business
  • Economy
  • Election 2020
  • Elections in History
  • Cartoons
  • Features
  • Opinion
  • Editorial
  • Commentary
  • Guest Column
  • Analysis
  • Letters
  • In Person
  • Interview
  • Profile
  • Dateline
  • Specials
  • Myanmar Diary
  • Women & Gender
  • Places in History
  • On This Day
  • From the Archive
  • Myanmar & COVID-19
  • Intelligence
  • Myanmar-China Watch
  • Lifestyle
  • Travel
  • Food
  • Fashion & Design
  • Videos
  • Photos
  • Photo Essay
  • Donation

About The Irrawaddy

Founded in 1993 by a group of Myanmar journalists living in exile in Thailand, The Irrawaddy is a leading source of reliable news, information, and analysis on Burma/Myanmar and the Southeast Asian region. From its inception, The Irrawaddy has been an independent news media group, unaffiliated with any political party, organization or government. We believe that media must be free and independent and we strive to preserve press freedom.

  • Copyright
  • Code of Ethics
  • Privacy Policy
  • Team
  • About Us
  • Careers
  • Contact
  • Burmese

© 2023 Irrawaddy Publishing Group. All Rights Reserved

Welcome Back!

Login to your account below

Forgotten Password?

Retrieve your password

Please enter your username or email address to reset your password.

Log In
No Result
View All Result
  • Home
  • News
    • Burma
    • Politics
    • World
    • Asia
    • Myanmar’s Crisis & the World
    • Ethnic Issues
    • War Against the Junta
    • Junta Cronies
    • Conflicts In Numbers
    • Junta Watch
    • Fact Check
    • Investigation
    • Myanmar-China Watch
    • Obituaries
  • Politics
  • Opinion
    • Commentary
    • Guest Column
    • Analysis
    • Editorial
    • Stories That Shaped Us
    • Letters
  • Ethnic Issues
  • War Against the Junta
  • In Person
    • Interview
    • Profile
  • Business
    • Economy
    • Business Roundup
  • Books
  • Donation

© 2023 Irrawaddy Publishing Group. All Rights Reserved

This website uses cookies. By continuing to use this website you are giving consent to cookies being used. Visit our Privacy and Cookie Policy.