News / Asia

Burma Reforms Financial Controls Seeking Growth

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

Arrested Football Officials Come Mainly From the Americas

US Justice Department alleges defendants participated in 24-year scheme to enrich themselves through corruption of international soccer More

Video Kenyans Lament Al-Shabab's Recruitment of Youths

VOA travels to Isiolo, where residents share their fears, struggles to get loved ones back from Somalia-based militant group More

This US Epidemic Keeps Getting Worse

One in 4 Americans suffers from this condition 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.
A Small Oasis on Kabul's Outskirts Provides Relief From Security Tensionsi
X
May 26, 2015 11:11 PM
When people in Kabul want to get away from the city and relax, many choose Qargha Lake, a small resort on the outskirts of Kabul. Ayesha Tanzeem visited and talked with people about the precious oasis.
Video

Video A Small Oasis on Kabul's Outskirts Provides Relief From Security Tensions

When people in Kabul want to get away from the city and relax, many choose Qargha Lake, a small resort on the outskirts of Kabul. Ayesha Tanzeem visited and talked with people about the precious oasis.
Video

Video Film Festival Looks at Indigenous Peoples, Culture Conflict

A recent Los Angeles film festival highlighted the plight of people caught between two cultures. Mike O'Sullivan has more on the the Garifuna International Film Festival, a Los Angeles forum created by a woman from Central America who wants the world to know more about her culture.
Video

Video Kenyans Lament Losing Sons to al-Shabab

There is agony, fear and lost hope in the Kenyan town of Isiolo, a key target of a new al-Shabab recruitment drive. VOA's Mohammed Yusuf visits Isiolo to speak with families and at least one man who says he was a recruiter.
Video

Video Scientists Say Plankton More Important Than Previously Thought

Tiny ocean creatures called plankton are mostly thought of as food for whales and other large marine animals, but a four-year global study discovered, among other things, that plankton are a major source of oxygen on our planet. VOA’s George Putic reports.
Video

Video US-led Coalition Gives Some Weapons to Iraqi Troops

In a video released Tuesday from the Iraqi Ministry of Defense, Iraqi forces and U.S.-led coalition troops survey a cache of weapons supplied to help Iraq liberate Mosul from Islamic State group. According to a statement provided with the video, the ministry and the U.S.-led coaltion troops have started ''supplying the 16th army division with medium and light weapons in preparation to liberate Mosul and nearby areas from Da'esh (Arabic acronym for Islamic State group).''
Video

Video Amnesty International: 'Overwhelming Evidence' of War Crimes in Ukraine

Human rights group Amnesty International says there is overwhelming evidence of ongoing war crimes in Ukraine, despite a tentative cease-fire with pro-Russian rebels. Researchers interviewed more than 30 prisoners from both sides of the conflict and all but one said they were tortured. Henry Ridgwell reports for VOA from London.
Video

Video Washington Parade Honors Those Killed Serving in US Military

Every year, on the last Monday in the month of May, millions of Americans honor the memories of those killed while serving in the armed forces. Memorial Day is a tradition that dates back to the 19th Century. While many people celebrate the federal holiday with a barbecue and a day off from work, for those who’ve served in the military, it’s a special day to remember those who made the ultimate sacrifice. Arash Arabasadi reports for VOA from Washington.
Video

Video Kenya’s Capital Sees Rise in Shisha Parlors

In Kenya, the smoking of shisha, a type of flavored tobacco, is the latest craze. Patrons are flocking to shisha parlors to smoke and socialize. But the practice can be addictive and harmful, though many dabblers may not realize the dangers, according to a new review. Lenny Ruvaga has more on the story for VOA from Nairobi, Kenya.
Video

Video Rolling Thunder Run Reveals Changed Attitudes Towards Vietnam War

For many US war veterans, the Memorial Day holiday is an opportunity to look back at a divisive conflict in the nation’s history and to remember those who did not make it home.
Video

Video Female American Soldiers: Healing Through Filmmaking

According to the United States Defense Department, there are more than 200-thousand women serving in the U.S. Armed Forces.  Like their male counterparts, females have experiences that can be very traumatic.  VOA's Bernard Shusman tells us about a program that is helping some American women in the military heal through filmmaking.

VOA Blogs