News / Asia

Burma Reforms Financial Controls Seeking Growth

Burma Overhauls Financial Controls In Search of Growthi
|| 0:00:00
X
December 11, 2012 4:49 PM
Burma's financial sector suffered years of mismanagement under military rule. But more recently, the government has pushed through economic reforms that are remaking banks and revitalizing businesses. Burma's political changes are reviving hopes that the country's economy can become the next Asian tiger.
VOA News
Burma's financial sector suffered years of mismanagement under military rule.  But more recently, the government has pushed through economic reforms that are remaking banks and revitalizing businesses. 

Nyi Nyi owns a papier mache workshop in Rangoon, where he and his family make toys.  In the past, he invested his savings in gold and stashed it in a hiding place, but he's not doing that any more.

"I just keep my money and use it when I need it," said Nyi Nyi.  "But my wife uses the bank. If I have one lakh, I give her 30 or 40,000 kyats for household things and for saving."

With clients buying his toys from as far away as Hong Kong, Nyi Nyi's business is international, but Burma's banks still are not.  To process foreign transactions, he still relies on informal money transfers through middlemen called "hondis."

Foreign visitors once relied on black market money changers and hondis are still the main method for international money transfers.  But the government hopes this informal cash-based economy is ending with new ATMs and foreign exchange licenses for private banks.  
 
Before the military government took over in 1962, Burma's economy was the best-performing in Southeast Asia.  Decades of tight state controls, widespread corruption and international sanctions have left it one of the poorest countries in the region.
 
Economist Sean Turnell says turning the economy around will require significant moves against corruption. That's why he says political change is key to economic reform.

"At present the most destructive regulation is the one that restricts access to foreign exchange and restricts access to import licenses," noted Turnell.  "Because the effect of that is not only to restrict the amount of imports that come into this country, and it really needs a lot of imports, but there's an added effect to it and that is that it keeps the exchange rate artificially high."

Burmese authorities have done away with the old official exchange rate, which pegged the Burmese currency at 6 Kyat to the dollar, while the black market rate was over 800 Kyat to the dollar.  There are also plans to loosen import restrictions and set up foreign investment laws.  
 
The hope is these changes will allow the country to recapture its past economic glory.  Than Lwin is a presidential advisor, as well as the deputy chair of the largest private bank in Burma, which plans to soon begin offering credit cards.

"Being a latecomer we have to speed up; we have to leapfrog," said Lwin.  "This is very important.  So what we have to do is to bring out all these new products in the picture, just to be in line with the ASEAN region.  2015 will be the target date for ASEAN integration.  We are very keen to see that we keep the promise."
 
With foreign investors, businesses and tourists all eyeing the newly opened country, authorities hope the new banks and regulations will clean up its decades-old image of corruption and cronyism.

You May Like

Anti-Terror Drills Highlight China’s Push Into Central Asia

China, Russia, several central Asian countries wrap up massive anti terrorism military drills in Inner Mongolia More

Erdogan’s First Step: Secure More Power in New Role in Turkey

Erdogan was sworn in as Turkey's first popularly elected president on Thursday; he picked former foreign minister Ahmet Davutoglu as PM More

Pakistan Army Fails to Break Political Deadlock

PM Sharif claims he didn't ask army to defuse crisis; military rejects claim More

This forum has been closed.
Comments
     
There are no comments in this forum. Be first and add one

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Ukraine Battles Pro-Russia Rebel Assaulti
X
Daniel Schearf
August 29, 2014 9:30 PM
After NATO concluded an emergency meeting to discuss the crisis in eastern Ukraine, the country is struggling to contain heavy fighting near the strategic port of Mariupol, on the Azov Sea. Separatist rebels are trying to capture the city, allegedly with Russian military help, and Ukraine's defense forces are digging in. VOA's Daniel Schearf spoke with analysts about what lies ahead for Ukraine.
Video

Video Ukraine Battles Pro-Russia Rebel Assault

After NATO concluded an emergency meeting to discuss the crisis in eastern Ukraine, the country is struggling to contain heavy fighting near the strategic port of Mariupol, on the Azov Sea. Separatist rebels are trying to capture the city, allegedly with Russian military help, and Ukraine's defense forces are digging in. VOA's Daniel Schearf spoke with analysts about what lies ahead for Ukraine.
Video

Video Growing Business Offers Paint with a Twist of Wine

Two New Orleans area women started a small business seven years ago with one thing in mind: to help their neighbors relieve the stress of coping with a hurricane's aftermath. Today their business, which pairs painting and a little bit of wine, has become one of the fastest growing franchises across the U.S. VOA’s June Soh met the entrepreneurs at their newest franchise location in the Washington suburbs.
Video

Video Ebola Vaccine Trials To Begin Next Week

The National Institutes of Health says it is launching early stage trials of a vaccine to prevent the Ebola virus, which has infected or killed thousands of people across West Africa. The World Health Organization says Ebola could infect more than 20,000 people across the region by the time the outbreak is over. The epidemic has health experts and governments scrambling to prevent more people from becoming infected. Zlatica Hoke has more.
Video

Video Asian Bacteria Threatens Florida Orange Trees

Florida's citrus fruit industry is facing a serious threat from a bacteria carried by the Asian insect called psyllid. The widespread infestation again highlights the danger of transferring non-native species to American soil. VOA’s George Putic reports.
Video

Video Aging Will Reduce Economic Growth Worldwide in Coming Decades

The world is getting older, fast. And as more people retire each year, fewer working-age people will be there to replace them. Bond rating agency Moody’s says that will lead to a decline in household savings; reducing global investments - which in turn, will lead to slower economic growth around the world. But experts say it’s not too late to mitigate the economic impact of the world’s aging populations. Mil Arcega has more.
Video

Video Is West Doing Enough to Tackle Islamic State?

U.S. President Barack Obama has ruled out sending ground troops to Iraq to fight militants of the so-called Islamic State, or ISIS, despite officials in Washington describing the extremist group as the biggest threat the United States has faced in years. Henry Ridgwell reports from London on the growing uncertainty over whether the West’s response to ISIS will be enough to defeat the terrorist threat.
Video

Video Coalition to Fight Islamic State Could Reward Assad

The United States along with European and Mideast allies are considering a broader assault against Islamic State fighters who have spread from Syria into Iraq and risk further destabilizing an already troubled region. But as VOA State Department Correspondent Scott Stearns reports, confronting those militants could end up helping the embattled Syrian President Bashar al-Assad.
Video

Video Made in America Socks Get Toehold in Online Fashion Market

Three young entrepreneurs are hoping to revolutionize the high-end sock industry by introducing all-American creations of their own. And they’re doing most of it the old-fashioned way. VOA’s Julie Taboh recently caught up with them to learn what goes into making their one-of-a-kind socks.
Video

Video Americans, Ex-Pats Send Relief Supplies to West Africa

Health organizations from around the world are sending supplies and specialists to the West African countries that are dealing with the worst Ebola outbreak in history. On a smaller scale, ordinary Americans and African expatriates living in the United States are doing the same. VOA's Carol Pearson reports.
Video

Video America's Most Popular Artworks Displayed in Public Places

Public places in cities across America were turned into open-air art galleries in August. Pictures of the nation’s most popular artworks were displayed on billboards, bus shelters, subway platforms and more. The idea behind “Art Everywhere,” a collaborative campaign by five major museums is to allow more people to enjoy art and learn about the country’s culture and history. Faiza Elmasry has more.
Video

Video Chinese Doctors Use 3-D Spinal Implant

A Chinese boy suffering from a debilitating bone disease has become the first patient with a part of his spine created in a three-dimensional printer. Doctors say he will soon regain normal mobility. VOA’s George Putic reports.
Video

Video India’s Leprosy Battle Stymied by Continuing Stigma

Medical advancements in the treatment of leprosy have greatly diminished its impact around the world, largely eliminating the disease from most countries. India made great strides in combating leprosy, but still accounts for a majority of the world’s new cases each year, and the number of newly infected Indians is rising - more than 130,000 recorded last year. Doctors there say the problem has more to do with society than science. Shaikh Azizur Rahman reports from Kolkata.

AppleAndroid