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

Lesotho Faces New Round of Violence, Political Crisis

Brutal killing of military officer has sent former leaders back into S. Africa where they're watching anxiously as regional officials head in to try to restore peace More

Video US Diplomat Expects Adoption of Bosnian Massacre Anniversary Resolution

Samantha Power says there's broad consensus about killings in Bosnia's war, but Russia calls resolution 'divisive,' backs UN countermeasure More

UN Report Exposes Widespread Boko Haram Atrocities

Damning report graphically details pattern of vicious, widespread atrocities committed by Islamist militants 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.
Olympics Construction Scars Sacred Korean Mountaini
X
July 02, 2015 4:10 AM
Environmentalists in South Korea are protesting a Winter Olympics construction project to build a ski slope through a 500-year-old protected forest. Brian Padden reports that although there is strong national support for hosting the 2018 Pyeongchang Winter Olympics, there are growing public concerns over the costs and possible ecological damage at the revered mountain.
Video

Video Olympics Construction Scars Sacred Korean Mountain

Environmentalists in South Korea are protesting a Winter Olympics construction project to build a ski slope through a 500-year-old protected forest. Brian Padden reports that although there is strong national support for hosting the 2018 Pyeongchang Winter Olympics, there are growing public concerns over the costs and possible ecological damage at the revered mountain.
Video

Video Xenophobia Victims in South Africa Flee Violence, Then Return

Many Malawians fled South Africa early this year after xenophobic attacks on African immigrants. But many quickly found life was no better at home and have returned to South Africa – often illegally and without jobs, and facing the tough task of having to start over. Lameck Masina and Anita Powell file from Johannesburg.
Video

Video Family of American Marine Calls for Release From Iranian Prison

As the crowd of journalists covering the Iran talks swells, so too do the opportunities for media coverage.  Hoping to catch the attention of high-level diplomats, the family of American-Iranian marine Amir Hekmati is in Vienna, pleading for his release from an Iranian prison after nearly 4 years.  VOA’s Heather Murdock reports from Vienna.
Video

Video UK Holds Terror Drill as MPs Mull Tunisia Response

After pledging a tough response to last Friday’s terror attack in Tunisia, which came just days before the 10th anniversary of the bomb attacks on London’s transport network, British security services are shifting their focus to overseas counter-terror operations. VOA's Henry Ridgwell has more.
Video

Video Obama on Cuba: This is What Change Looks Like

President Barack Obama says the United States will soon reopen its embassy in Cuba for the first time since 1961, ending a half-century of isolation. VOA White House correspondent Luis Ramirez reports.
Video

Video Hate Groups Spread Influence Via Internet

Hate groups of various kinds are using the Internet for propaganda and recruitment, and a Jewish human rights organization that monitors these groups, the Simon Wiesenthal Center, says their influence is growing. The messages are different, but the calls to hatred or violence are similar. VOA's Mike O’Sullivan reports.
Video

Video US Silica Sand Mining Surge Worries Illinois Residents, Businesses

Increased domestic U.S. oil and gas production, thanks to advances known as “fracking,” has created a boom for other industries supporting that extraction. Demand for silica sand, used in fracking, could triple over the next five years. In the Midwest state of Illinois, people living near the mines are worried about how increased silica sand mining will affect their businesses and their health. VOA’s Kane Farabaugh has more in this first of a series of reports.
Video

Video Blind Somali Journalist Defies Odds in Mogadishu

Despite improving security in the last few years, Somalia remains one of the most dangerous countries to be a journalist – even more so for someone who cannot see. Abdulaziz Billow has the story of journalist Abdifatah Hassan Kalgacal, who has been reporting from the Somali capital for the last decade despite being blind.
Video

Video Texas Defies Same-Sex Marriage Ruling

Texas state officials have criticized the US Supreme Court decision giving same-sex couples the right to marry nationwide. The attorney general of Texas says last week's decision did not overrule constitutional "rights of religious liberty," and therefore officials performing wedding services can refuse to perform them for same-sex couples if it is against their religious beliefs. Zlatica Hoke reports on the controversy.
Video

Video Rabbi Hits Road to Heal Jewish-Muslim Relations in France

France is on high alert after last week's terrorist attack near the city Lyon, just six months after deadly Paris shootings. The attack have added new tensions to relations between French Jews and Muslims. France’s Jewish and Muslim communities also share a common heritage, though, and as far as one French rabbi is concerned, they are destined to be friends. From the Paris suburb of La Courneuve, Lisa Bryant reports about Rabbi Michel Serfaty and his friendship bus.
Video

Video Saudi Leaks Expose ‘Checkbook Diplomacy’ In Battle With Iran

Saudi Arabia’s willingness to wield its oil money on the global diplomatic stage appears to have been laid bare, after the website WikiLeaks published tens of thousands of leaked cables from Riyadh’s Ministry of Foreign Affairs. VOA's Henry Ridgwell reports.
Video

Video In Kenya, Police Said to Shoot First, Ask Questions Later

An organization that documents torture and extrajudicial killings says Kenyan police were responsible for 1,252 shooting deaths in five cities, including Nairobi, between 2009 and 2014, representing 67 percent of all gun deaths in the areas reviewed. Gabe Joselow has more from Nairobi.

VOA Blogs