World Bank: Myanmar economy remains ‘fragile’
Singapore, Jul 21 (EFE).- The World Bank said Thursday that Myanmar’s economy, mired in a spiral of violence since the army staged a coup last year, remains “fragile” in the face of rising inflation, declining dollar currencies, and domestic conflict.
“Myanmar experienced one of the worst economic contractions in the world last year, and the limited growth predicted for this year leaves its economy far behind other countries,” World Bank Myanmar Country Director Mariam Sherman said in a statement.
Sherman said Myanmar’s GDP in 2022 would be about 13 percent lower than that of 2019, before the Covid-19 pandemic and the Feb. 1, 2021 coup pushed the country back years in levels of growth and openness.
This is despite the 3 percent year-on-year GDP growth that the institution calculates for Myanmar until the end of the fiscal year in September, after contracting 18 percent in the last fiscal year.
“The balance of payments is a growing concern, with the United States dollar deficit already limiting the availability of several imported products, such as gasoline,” she said.
The agency spoke of the increase in prices of imported products, “partially attributable to the war in Ukraine,” it considers, as well as the domestic conflict, the power cuts and “the constant interruptions in the financial sector.”
Myanmar’s latest inflation data from March puts it up 17.3 percent.
The Myanmar Central Bank, under the control of the military regime, ordered the country’s banks and companies last weekend to suspend or delay payments on foreign loans, in the latest effort by the military junta to seize the currency flow control.
Myanmar has been in a deep political, social and economic crisis since the coup, which ended a decade of fledgling democracy and economic development.
Since the uprising, which has been met with strong opposition from the population, the value of the Myanmar currency has plummeted.
Despite the negative forecast, the World Bank said in the statement that “economic activity has increased in some areas during the past 12 months, demonstrating the adaptability of Myanmar business.”
In addition to the Myanmar crisis, it is feared some highly indebted Asian countries such as Bangladesh, Laos, Nepal or Pakistan, runaway inflation, declining foreign exchange and rising energy bills will meet the same fate as Sri Lanka, which faces a serious economic and political crisis. EFE