Posts in category: ECONOMY

A total of 177 export/import companies got their licences revoked as they failed to deposit the foreign currency earned from exports in the local bank accounts. Legal action has been taken against them for non-compliance with the law, according to a statement released by the Commerce Ministry on 27 April 2022.

Under the Foreign Exchange Management Law, all export earnings in foreign currency must be deposited back into the local account within three months after the goods are loaded.

Licences of 177 companies were cancelled as they did not abide by the notifications issued by the Central Bank of Myanmar, including 16 export companies in 2016, 72 in 2017 and 93 in 2018. According to the notification, the export companies will get their licence revoked and face actions under the existing laws if they fail to comply with them.

Source: The Global New Light of Myanmar

CB Bank announced on April 27 that it could open yuan accounts at CB Bank for Myanmar-China border traders. Foreign Currency (Chinese Yuan) Account Company can be opened at CB Bank for business owners. With the Chin Border Trade service, you can send money directly to Yuan through any account in China and transfer money directly from China to your CB Bank Myanmar Kyats account. Company Account-CNH Account will be opened only with Muse Branch ID.

CNH Account can be opened at Muse Branch by check By withdrawing the book and at other CB Bank open branches. You can get a check book at UFC Branch in Yangon, 19th Street Branch in Mandalay and Ottara Thiri Branch in Nay Pyi Taw. The exchange rate will not be fixed on the yuan / kyat market in Muse every day (bank opening day) and Chinese banks will be asked for the yuan / kyat three times a day to avoid any harm to Myanmar businesses.

CB Bank’s yuan / kyat exchange rate will be set against the market price. You can contact CB Bank Contact Center (+951) 2317770 to open a Foreign Currency (Chinese Yuan) account at CB Bank. Company for customers who open Yuan Account Certificate Company Extract, Application Letter BOD Resolution & Authorized Authorized Person List of (officers with Extract); Export & amp; Import License and IDCard Copy of Authorized Persons are required.

Source: Daily Eleven

Under the Foreign Exchange Management Law, Foreign Exchange Management Regulations and Notification No 46/2021 dated 10-11-2021 of the Central Bank of Myanmar, the holder of a foreign currency trading licence shall inspect whether exporters receive export earnings within three months from the date of the shipment of the goods accordingly to the evidence of the actual exports. The exporters must deposit their export earnings into their banking accounts within three months from the date of the shipment of goods without fail under that law and regulations. However, it was found that exporters failed to follow the law mentioned above, rules and regulations. Therefore, exporters must deposit all their export earnings into their banking accounts within three months from the date of the shipment of goods without fail under the provisions of the Foreign Exchange Management Law and Foreign Exchange Management Regulations. If they fail to do so, action will be taken against them under Section 42(a) of the Foreign Exchange Management Law.

Central Bank of Myanmar
(27.4.2022)

Gold transactions still cannot be fixed on the Central Bank of Myanmar’s reference exchange rate amid the financial difficulty, said U Myo Myint, the Yangon Region Gold Entrepreneurs Association (YGEA) chair.
According to the provisions stipulated in Sections 11, 12 and 13 of the Foreign Exchange Management Law, the foreign exchange earned by locals in Myanmar must be deposited in accounts at the authorized dealers and exchanged for the local currency at the Central Bank of Myanmar’s reference rate of K1,850 per US dollar within one working day, according to the notification released on 3 April.

That is why the YGEA called for an urgent meeting on 8 April. The meeting determined to carry out gold transactions depending on the CBM’s reference exchange rate. However, it has not come into effect yet. “We have difficulty fixing the gold price on the CBM’S reference rate. The border market does not accept the set rate of K1,850. Nonetheless, the transaction is done with the exchange rate margin,” U Myo Myint was quoted as saying. On 23 April, officials from the department concerned, the YGEA and Mandalay Region Gold Entrepreneurs Association discussed gold price stability at the meeting. Gold transaction on the CBM’s reference rate, immediate payments, and avoiding price manipulation was discussed, he said.

Current market condition impedes transaction on the basis of the reference rate. Yet, it will be implemented later, he continued. The US dollar stands at K2,000 in the unofficial black market, while the CBM reference rate is K1,850. The gold price stands at US$1,903 per ounce in the global market. Meanwhile, 24-carat gold is worth K2,045,000 per tical (0.578 ounce or 0.016 kilogramme). The domestic gold price is highly correlated with the global gold price, YGEA stated. During the end of September 2021, a dollar value hit an all-time high of over K3,000 in the gold exchanges and consequently, the pure gold reached a record high of K2.22 million per tical in history.

Source: The Global New Light of Myanmar

Exemption from dollar to kyat exchange rate is Myanmar kyat exchange rate sanctions may be lifted depending on the situation, said Aung Naing Oo, Union Minister for Ministry of Investment and Foreign Trade. He also said the straits as to whether the announcement is a period of time or will it continue forever is depends on the situation regarding the Times’ question, the exemption is granted by a government-appointed committee according to the Central Bank of Myanmar, and also said the ban could be lifted depending on the volatility of the Myanmar Kyat Exchange rate.

The Myanmar Investment Commission has also decided to exempt foreign investment businesses from the Central Bank Declaration. Foreign embassies, INGOS and NGOs are also exempt. They are aware that there may be some adverse effects from this announcement, so we are conducting daily studies and working to find the best solution. “It’s a time of change, so we are trying to be the best for all involved,” he said. The exemption includes new foreign investors and existing investors.

Foreign earnings from seven organizations, including MIC-licensed FDIs, SEZ investments, and state-owned / national international airlines. On April 20, the Central Bank of Myanmar announced that it would be exempt from currency trading. The exemptions mentioned in the statement include foreign direct investment (FDI) activities under the auspices of the Myanmar Investment Commission (MIC), operating in special economic zones.
Includes ongoing investments.

Established an embassy with Myanmar and an embassy in Myanmar Overseas diplomats, family members and similar level diplomats. These include Myanmar nationals holding UNis Laissez Passer travel passports working for the United Nations and its affiliates in Myanmar. This includes foreign agencies, development agencies that are assisting foreigners in Myanmar. International organizations (eg. Red Cross, International and foreign diplomats from INGOs and Development Agencies (eg TICA / JICA). Seven individuals, businesses and organizations have been exempted, including state-owned / national-owned international airlines.

Source: Daily Eleven

The gold export has stopped owing to the COVID-19 pandemic, said Chair U Myo Myint of the Yangon Region Gold Entrepreneurs Association (YGEA). As international passenger flights have been banned, there is no export demand for gold yet. However, export procedures have been prepared, he continued. “There is no foreign demand, yet the gold is ready for export. They appraise the gold and set the price depending on the prevailing market price.

Then, it can be exported,” U Myo Myint elaborated. The Ministry of Foreign Affairs and the Ministry of Transport and Communications have declared temporary measures to prevent the importation of COVID-19 to Myanmar through air travel since 29 March 2020. They are extended until 31 March 2022, as per the notification released by the Central Committee on Prevention, Control and Treatment of Coronavirus Disease 2019 (COVID-19) on 18 March 2022.

As the fatality rate from COVID-19 and the infection rate have significantly dropped, the temporary suspension on international passenger flights will be lifted from 17 April in order for foreigners to enter Myanmar in line with travel requirements. Once Myanmar eases entry restriction, the gold export market is expected to revive. Additionally, the international remittance for gold transactions valued below US$50,000 is allowed to use the Telegraph Transfer (TT) system. Japan and the Republic of Korea primarily purchase gold and other jewellery, and other tourists also buy them, the YGEA stated. 

Source: The Global New Light of Myanmar

The embassies of the two countries have demanded the exemption of Singapore and Japanese companies due to difficulties with the setting of 1,850 kyat per dollar, according to a statement. According to a statement from the embassies of these countries, the central bank’s directive to exchange dollars and kyats within a working day if there is foreign currency inflows is causing difficulties. Singaporean investment companies operating in Myanmar are facing challenges due to central bank directives and are struggling to stay afloat.

As a result, the Singapore embassy has demanded that all Singaporean companies be exempt from the central bank’s directive. From October 2021 to February 2022, a total of more than $ 530 million in foreign investment came in, accounting for more than 52% of the total investment from Singapore, valued at over US $ 277 million. The Japanese embassy said in a statement that it was “very difficult” for Japanese businesses to invest in Myanmar, and called on Japanese companies and legal entities to be exempt from the central bank’s policy in order to maintain goodwill between the two countries. The official bodies of the Japanese government in Myanmar are the Embassy of Japan in Myanmar; JICA; Jetro and the Thilawa SEZ are home to several billion-dollar companies.

Foreign exchange inflows must be converted into Myanmar kyats within one day from the date of entry and the exchange rate is 1,850 kyats per dollar, according to Directive No. 4/2022 dated 3 April 2022. According to Notification No. 12/2022 issued by the Central Bank of Myanmar on April 3, 2022, foreign exchange licensed (AD) licensed banks are required to comply with the following: (A) Notification No. (12/2022) of Notification No. 12/2022 dated (April 20, 2022) of the Central Bank of Myanmar (Ref. 3) Except for the exemption cases, the foreign currency accounts opened at AD licensed banks shall be exchanged for Myanmar kyats within one working day from the date of entry and shall be credited to the kyats opened by the recipient. The conversion from foreign currency to Myanmar kyat must be exchanged for 1850 Kyats per dollar. For other currencies, the central bank has set the exchange rate at 1,850 kyat per dollar.

Source: Daily Eleven

3rd Waxing of Tagu, 1383 ME
3 April 2022

1. The Central Bank of Myanmar has issued this notification in exercise of the authority conferred under sub-section (b) of Section 49 of the Foreign Exchange Management Law.
2. According to the provisions of Section 11, Section 12 and Section 13 of the Foreign Exchange Management Law, the foreign exchange earnings of the locals must be sent back to Myanmar to the foreign currency account opened at the Foreign Exchange Trading (AD) licensed banks and exchange for Myanmar Kyats within one working day.
3. In case of exemption in carrying out in accordance with paragraph (2), it shall be issued separately.
4. Transferring foreign currency abroad must be carried out through the AD licensed banks with the permission of the Foreign Exchange Supervisory Committee.
5. Foreign currency in various foreign currency accounts that have entered Myanmar before the date of issuance of this notification shall also be made in accordance with paragraph (2) of this notification.
6. The Central Bank of Myanmar revokes Notification No. 35/2021 issued on 3-10-2021 with this notification.
7. This notice shall take effect from the date of issue.
8. Failure to comply with this notice will result in legal action under the Foreign Exchange Management Law.

Source: The Global New Light of Myanmar

Under the guidance of the Monitoring and Steering Committee on Gold and Currency Market, the gold trading volume data is being collected, said Chair U Myo Myint of the Yangon Region Gold Entrepreneurs Association (YGEA). The data of the trading volume of the gold and jewellery shops in the Yangon Region and the association’s trading data have to be reported to the Yangon City Development Committee (YCDC).

The committee held a meeting on 12 March and the deputy governor of the Central Bank of Myanmar directed us to collect the actual trading figure of the gold trading in the region, whether it is export to India or Thailand or anywhere else. If the trading data is compiled, the officials concerned will take necessary measures to enhance the gold market to meet the international standard, U Myo Myint elaborated. There is no accurate data on gold exports, he added.

The officials of the committee, subcommittee, Myanmar Gold Entrepreneurs Association and YGEA discussed matters regarding gold trading and export market data on 11 March 2022. The meeting highlighted matters concerning the gold production condition, trading situations, export and domestic trading data, formation of separate teams to conduct the inspection tour to set the standards in line with the international criteria, determining the duties and responsibilities of the pricing, inspecting the trading situations of the importers and exporters along with the related financial institutions and other coordination matters in respect of the subcommittees. 

Source: The Global New Light of Myanmar

The majority of the exchanges are found trading a dollar at unofficial rates of over K2,000 although the Central Bank of Myanmar set the reference exchange rate at K1,778, according to local forex traders. To strengthen the Kyat value in the local forex market, the CBM set the exchange rate margin within 0.5 per cent of the reference rate for the transaction, selling or buying, according to a notification issued by the CBM on 9 November. Consequently, financial institutions, including the banks and informal money exchanges, set a dollar value at K1,781 for buying and K1,786 for selling.

Nevertheless, the dollar was traded only between K2,030 and K2,040 on 21 March in the informal financial market. The CBM sold US$95 million at its auction market within three months for edible oil, fuel oil and pharmaceutical sectors, to govern the market volatility. A total of $443.8 million were sold at an auction rate in 2021 as well. Last 28 September 2021, a dollar value hit an all-time high of over K3,000 in the black market and consequently, the pure gold reached a record high of K2.22 million per tical in history.

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 trade facilitation. The objectives of the committee are inspecting and prosecuting market manipulation, checking if there is compliance to payment rules or not in the domestic market, proceeding against those unscrupulous traders who intend to interfere with the free and fair operation in the market under the existing laws, bylaws and regulations in line with the official directives, illegal procurement of foreign currency, illegal trade and taking legal actions against price manipulators. Furthermore, the officials concerned will crack down on those people involved in charging a percentage for money withdrawals at banks as shadow money.

Source: The Global New Light of Myanmar