Myanmar’s economic growth is set to shrink by 10 percent this financial year as military rule hammers one of the region’s fastest-growing economies, according to the World Bank.
In December the global financial institution forecast that Myanmar’s economy would start to recover from COVID-19 by this month.
The World Bank said Myanmar has been heavily affected by protests, strikes, military action, reductions in mobility and disruption to public services, like banking, logistics and internet access.
Myanmar has seen daily protests against the military regime, the coup leaders have restricted internet access, including a shutdown of mobile internet to blackout brutal violence against peaceful protesters across the country. The internet shutdowns affect businesses and consumers, which rely on online access for payments, consumer access and delivery.
Since early February, only military-controlled banks have operated with almost all private banks shutting down as staff participate in the civil disobedience movement, refusing to work under the regime. Myanmar’s financial sector mainly relies on private bank transactions, meaning most economic activity and almost all international maritime trade has ceased.
The World Bank forecast in December that Myanmar’s 2 percent growth for the 2020-21 financial year, which ends on Sept. 30. Despite COVID-19, the medium-term outlook was positive with growth estimated to recover to 7 percent due to public investment, a resurgence in manufacturing and productivity gains associated with the adoption of digital technology.
Following the coup, the bank expressed grave concerns, saying military rule was a major setback to the country’s democratic transition and economic development.
The World Bank also put funding for its projects on hold.
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