Kyat-dollar exchange rate hits K2,900 in market despite CBM’s reference rate of K2,100

by ECONOMY

A Kyat-dollar exchange rate rose to K2,900 in the black market, while the Central Bank of Myanmar (CBM) set the reference exchange rate at K2,100. In order to strengthen the domestic currency in the local forex market, the CBM set the currency trading band at 0.3 per cent for Kyat to fluctuate between these two specified upper and lower exchange rates for transactions, selling or buying on 10 August 2022. Therefore, financial institutions including banks and informal money exchanges set a dollar value of K2,100 for buying and K2,106 for selling.

In spite of the trading band, the dollar transaction was made with the buying price of K2,930 and the selling price of K2,980 in the grey market. Additionally, the hard currency US dollar hit a high of over K4,500 in the forex market at August-end. Consequently, the CBM sold dollars at its auction market for the sectors in need, to control the soaring dollar. A total of $443.8 million were sold at an auction rate in 2021 as well. Last 28 September 2021, a dollar value hit a peak of over K3,000 in the black market, pushing pure gold up to K2.22 million per tical.

Under the guidance of the Central Committee on Ensuring Smooth Flow of Trade and Goods, the Monitoring and Steering Committee on Gold and Currency Market was formed on 17 December 2021 as gold and currency market stability play a crucial role in the trade facilitation. The objectives of the committee are inspecting and prosecuting market manipulation, checking if there is compliance with payment rules in the domestic market, and proceeding against those unscrupulous traders who intend to interfere with the free and fair operation of the market under the existing laws, by-laws and regulations in line with the official directives, illegal foreign currency holding, illegal trade and taking legal actions against price manipulators. 

Source: The Global New Light of Myanmar

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Myanmar conveys over 983,780 MT of rice to external markets in H1

by TRADING

Myanmar shipped 983,782.7 metric tons of rice and broken rice to foreign trade partners in the first half (April-September) of the current financial year 2022-2023, with an estimated income of US$339 million, according to Myanmar Rice Federation (MRF). In the past six months, more than 40 exporter companies delivered over 773,446.7 MT of rice and broken rice to external markets by sea, whereas over 210,335 MT were sent to neighbouring countries via border trade camps.

Myanmar shipped rice and broken rice to regional countries, countries in Africa and European Union member countries through maritime trade. It is also exported to neighbouring countries, China and Thailand through cross-border posts. Myanmar exported rice to over 20 foreign markets in the past months, mostly to China (123,520 MT) and the Philippines (101,259 MT). Additionally, Myanmar primarily conveyed over 191,967 MT of broken rice to China and 140,893 MT to Belgium. The prices of high-grade rice varieties stood at K60,000-90,000 per bag and K35,500-45,000 per bag for low-grade rice varieties.

The prices of low-quality white rice varieties were approximately US$340-360 per MT depending on the different varieties and quality in September. The export price of Myanmar’s rice was relatively lower than the rates of Thailand and Viet Nam, according to MRF. Myanmar has shipped more than 1.4 million tonnes of rice and broken rice to foreign trade partners between 1 October and 31 March in the past mini-budget period (2021-2022), the Myanmar Rice Federation stated. Myanmar bagged US$700 million from two million tonnes of rice exports to foreign countries in the past 2020-2021 financial year. 

Source: The Global New Light of Myanmar

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Anti-Covid medicine successfully produced

by COVID

Anti-Covid medicine will be produced when an order is received from the Ministry of Health, according to the Myanma Pharmaceutical Industry, Ministry of Industry.

Myanma Pharmaceutical Industry produces various kinds of medicines, including Covid vaccines, for the Ministry of Health and has been producing K55 billion worth of COVID vaccines since the outbreak of the pandemic. Paclovid (Nirmatrelvir 150 mg + Ritonavir 100 mg) is a kind of Covid drug.

A packet of Paclovid (30 capsules) costs K250,000 and is available only on prescription, according to Pacific Medical Industries. Pacific Medical Industries Ltd successfully produced the medicine with Myanmar FDA recommendation number (2308ND 012). The medicine is also recommended by WHO, US FDA, UK MHRA, Korean FDA, and Singapore FDA.

Source: The Global New Light of Myanmar

YBS

Plan underway to reduce YPS card fare by 20 kyats

by SERVICES

The Yangon Region Public Transport Committee-YRTC is working on a payment service aimed at facilitating the payment of public transport lines in Yangon Region, and Yangon Payment System (YPS) card shops are opened more so that passengers can make purchases easily. For those wishing to use the YPS card can buy the cards at over 60 shops including shops in front of Yangon City Hall, in front of Myanmar Plaza Stop, in front of Yuzana Plaza Plaza, Hledan Bus Stop, on Insein Road, Thakin Mya Park, Tamway Roundabout Bus Stop, YUPT of YPS stores, and Bandoola Housing.

“It is quite difficult to top up the card. There is no store where you can top up money wherever you want. It is difficult in many places. Instead of keeping it in stores, I would like to use a system that can be used to top up money through Mobile Pay, which is applied by many people. To find a shop I think it would be more convenient to go with the Mobile Pay system without wasting time,” said Ko Zarni Tun of Dagon Myothit (South) Township told the GNLM. Before, topping up on buses, you can get promotions that you can buy the card, but now you don’t see much,” he added.

YRTC and Asia Starmark Transport Intelligent Co., Ltd (ASTI) are working together to promote the widespread use of the YPS card system. In addition, G&G Convenience Store in partnership with Asia Starmark Transport Intelligent (ASTI) started selling YPS cards at more than 100 branches in Yangon. An official from the YRTC said that in order to encourage YBS bus riders to use the card system more, those who use the card system have been given a discount of 20 kyats per card for a one-way trip compared to the regular fare.

“If you use the card system, 200 kyats will be reduced by 20 kyats. We do this because we want to use the YBS card. Picking up fares according to the stop, in the past, the middle stop was set, and then each side was divided in a half. Now that’s not the case anymore. Since there are 30 stops from beginning to end, I will only pick up fare for 15 stops. It’s not expensive,” he added. It is reported that the number of YPS cards sold is about 150,000, and the number of cards in use is still more than 90,000.

Source: The Global New Light of Myanmar

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Myanmar foreign trade soars to over $17 bln in H1

by TRADING

Myanmar’s external trade in the first half of the 2022-2023 Financial Year tremendously edged up to US$17.08 billion, reflecting a sharp increase of $3 billion as against the year-ago period, according to the Ministry of Commerce.

The figures surged from $14.078 billion in the corresponding period last year. Myanmar’s export was worth over $8.56 billion whereas the country’s import was valued at $8.52 billion over the past two months. The border trade dropped owing to China’s strict virus rules and security in transport amid the political changes, with a decrease of $89.8 million in cross-border trade as against the year-ago period.

However, the maritime trade registered a significant rise of $2.257 billion in nearly four months. The external trade stood at $15.5 billion in the past mini-budget 2021-2022 (Oct-March) period and $29.58 billion in the 2020-2021 FY, as per the Commerce Ministry’s statistics.

Source: The Global New Light of Myanmar

Fuel prices rebound to K2,000 per litre

by ENERGY

The price of Octane 92 has gone up to K2,000 per litre again, according to the fuel oil market. The fuel prices fluctuated starting from the last week of September. On 5 October, oil prices fell to K1,880 per litre for Octane 92, K1,950 for Octane 95, K2,565 for premium diesel and K2,480 for diesel. The prices rebounded to K2,000 for Octane 92, K2,045 for Octane 95, K2,790 for premium diesel and K2,705 for diesel on 7 October, showing an increase of K100-200 per litre within two days. The domestic fuel prices are tracking the rise in price index set by Mean of Platts Singapore (MOPS), the pricing basis for many refined products in southeast Asia, according to the Supervisory Committee on Oil Import, Storage and Distribution of Fuel Oil.

The committee is governing the fuel oil storage and distribution sector effectively not to have a shortage of oil in the domestic market and ensuring price stability for energy consumers. The committee draws up Standard Operating Procedures (SOPs) on fuel import, storage and distribution and sends reports of fuel import matters to the Foreign Exchange Supervisory Committee. Last September, fuel importers had an import quota of 233,594.60 tonnes of fuel oil, with 80,499 tonnes of gasoline and 153,095.60 tonnes of diesel. The Petroleum Products Inspection and Supervision Department, under the guidance of the committee, is issuing the daily reference rate for oil to offer a reasonable price to energy consumers.

The reference rate is set on the MOPS’ price assessment, shipping cost, profit margin, premium insurance and other general costs. The rates for regions and states other than Yangon are evaluated after adding the transportation cost and the retail reference rates daily cover on the state-run newspapers and are posted on the media and official website and Facebook page of the department on a daily basis starting from 4 May. As per the statement, 90 per cent of fuel oil in Myanmar is imported, while the remaining 10 per cent is produced locally.

The domestic fuel price is highly correlated with international prices. The State is steering the market to mitigate the loss between the importers, sellers and energy consumers. Consequently, the government is trying to distribute the oil at a reasonable price compared to those of regional countries. Some countries levied higher tax rates and hiked oil prices than Myanmar. However, Malaysia’s oil sector receives government subsidies and the prices are about 60 per cent cheaper than Myanmar. Every country lays down different patterns of policy to fix the oil prices. Myanmar also poses only a lower tax rate on fuel oil and strives for energy consumers to buy the oil at a cheaper rate. 

Source: The Global New Light of Myanmar

Myanmar food manufacturers need to seek mandatory GACC registration

by MANUFACTURING

Myanmar food exporters are required to be registered with the General Administration of Customs of the People’s Republic of China (GACC), according to the Ministry of Commerce. According to GACC Decrees 248 and 249, GACC registration is mandatory for food exporters starting from 1 January. That being so, Myanmar’s food products in 18 food groups such as meat products, fishery products, dairy products and edible bird’s nests, honey and honey products, eggs and egg products, edible oil, frozen food products, edible seeds and nuts, malted barley, fresh vegetable, dried beans, spices, hard nuts and seeds, dried fruits, coffee beans and cocoa beans, special nutritious food and supplements are required to be registered with GACC.

For GACC registration, the relevant authorities are the Agriculture Department, the Livestock Breeding and Veterinary Department (LBVD), the Fisheries Department and Food and Drugs Administration. Between 1 December 2021 and 30 September 2022, 1,850 applications of 1,022 companies and factories have been submitted to GACC. Among them, 1,711 applications by 883 companies were forwarded through the Agriculture Department, while 118 through the Fisheries Department, 12 through the LBVD and nine through the FDA. Exporters can directly access China International Trade Single Window through https://cifer.singlewindow.cn by creating accounts for those food groups which are not listed on those 18 groups. 

Source: The Global New Light of Myanmar

Trafigura’s Puma Energy to sell Myanmar business to local private company

by ENERGY

Trafigura’s Puma Energy, which is the main supplier of aviation fuel in Myanmar, has signed an agreement to sell its stake in Myanmar to a local private company, according to the official statement on 5 October.

Following a board decision to exit Myanmar earlier this year, Trafigura’s Puma Energy has signed an agreement to sell its stake in Puma Energy Asia Sun (PEAS) and National Energy Puma Aviation Services (NEPAS) to a locally owned private company.

National Energy Puma Aviation Services Company (NEPASC), a joint venture between Singapore-based Puma Energy and state-owned Myanmar Petrochemical Enterprise, has executed the jet fuel business since 2015.

Source: The Global New Light of Myanmar

Individual entitled to buy seven visses of gold: MGEA

by ECONOMY

The Mandalay Region Gold Entrepreneurs Association (MGEA) will sell about seven visses of gold (seven gold bars) each to individual in a bid to reduce the gold price. A gold bar weighs 10 ticals (one viss equals 100 ticals). The sales of pure gold bars will start on 7 October. The gold buyers can purchase them at the office of MGEA located on 67th street between 40thx41st streets in Mahaaungmyay Township, by presenting a citizenship scrutiny card. The association stated that they will offer a cheaper price in an attempt to control the volatile gold price.

The price of gold will be declared only at 2 pm on 7 October. Except for the members of the MGEA, anyone is free to buy them. At present, the price of pure gold ticked up to K2.6 million per tical (0.578 ounce or 0.016 kilogramme) in the domestic markets, tracking the mild rebound in gold spot prices in international markets and Kyat weakening against the US dollar. The soaring dollar exchanging at over K4,500 pushed up the pure gold price to a record-high of K3.7 million per tical in late August. The Ministry of Natural Resources and Environmental Conservation is, therefore, selling gold bars and coins in order for the gold price to ease.

Furthermore, the governor of the Central Bank of Myanmar (CBM) and officials of the Monitoring and Steering Committee on the Gold and Currency Market discussed matters regarding the stability of the gold and currency market and supporting plans of the banks for gold bar transactions to be made with banking system on14 September in Nay Pyi Taw. Then, on 30 September, the seven private banks opened special counters at the designated 48 branches to offer banking services for gold transactions.

According to CBM’s directive (43/2021) dated 3 November 2021, lump sum payments worth more than K20 million for buying or selling assets have to be processed with the banking system. The seven private banks are providing banking services by opening special counters at their 48 branches in Yangon and Mandalay regions and Mon State (Mawlamyine) to facilitate gold transactions with the banking payment system. Those banks are Kanbawza Bank (KBZ Bank), Co-operative Bank (CB Bank) PCL, Ayeyawady (AYA) Bank, Myanmar Apex Bank (MAB), UAB Bank, Yoma Bank and Ayeyawady Farmers Development Bank (A Bank).

Source: The Global New Light of Myanmar

CBM says banks won’t hike interest rates amid excess bank reserves

by ECONOMY

The banks will not hike the interest rate and there are excess bank reserves for now, according to a statement (9/2022) of the decisions of the Monetary Policy Committee of the Central Bank of Myanmar (CBM) meeting. In order to tackle inflation, the committee considered whether it should raise interest rates or not.  The economic growth in the 2021-2022 financial year was 2.4 per cent, which is lower than the target of 3.7 per cent.

The committee decided at a meeting (5/2022) held on 30 May 2022 not to raise the interest rates as the country missed economic targets, cash deposits at the banks are declining, bank credit expansion still cannot happen and the currency in circulation of the banking industry just starts off. For the ease of inflation, the committee made the Minimum Required Reserves (MRR) ratio remain unchanged at 3 per cent after mulling over banking operations.

The committee raised the current account balance (CAB) of the bank institutions at the Central Bank from 2.25 to 2.5 per cent and lowered the bank reserves (cash) from 0.75 to 0.5 per cent. This way, the cash physically held by the banks will be deposited to the CBM and modifying reserve requirements will reduce the currency in circulation (CIC) and hope to steer the volatile inflation rate, as per the statement. Additionally, bank reserves are exceeding at present.

As the bank credit expansion cannot still happen, the committee decided to set an interest rate on the average excess CAB. The statement said it will initially create an interest rate corridor for the money market. Furthermore, to steer inflation, the committee also discussed issuing the CBM Bill as a monetary policy instrument. Regarding issuing CBM Bill, taking everything into account, advantages, procedures, setting face value and interest rate, types of issuing and payment methods were raised at the meeting and the committee determined to make the necessary preparations.

Source: The Global New Light of Myanmar