Posts in category: ECONOMY

The price of pure gold remains high at around K3 million per tical (0.578 ounce or 0.016 kilogramme) in the unofficial domestic market on 3 May as the spot gold price rallied at $2,010 per ounce.
On 13 May, YGEA hiked the reference rate to over K2,368,000 per tical while the precious yellow metal was priced at K3,006,000 per tical. Consequently, there is a large price difference of about K600,000 per tical between the YGEA’s reference price and the price in the unofficial market.
YGEA calculated the price depending on the Central Bank of Myanmar’s reference exchange rate of K2,100, with some addition, while the US dollar is exchanged at K2,860 in the unofficial forex market. The US dollar exchange rate weighs on domestic gold prices. The YGEA requested sellers to make gold transactions below K2.9 million per tical on 27 April when the gap between the reference price and the market price is wide.
Following the bankruptcy of the US bank, the gold price soared. Despite the gold gain in the global market, Myanmar’s forex market sees no movement at all. Consequently, YGEA requested its members not to buy them competitively, tracking the upward trend in the gold spot price, as per YGEA’s statement released on 20 March.
Afterwards, the YGEA called for the members to make gold transactions with only immediate payment and avoid verbal transactions over calls without having any physical stocks. The YGEA is not bound to have any responsibilities for market manipulation in the unofficial market. As a result of this, its members are asked to strictly adhere to the rules and regulations of the association while making gold transactions.
At present, the authorities concerned are attempting to deal with market abuse and inspecting and prosecuting market manipulation is being undertaken.
Moreover, the Central Bank of Myanmar will inspect those manipulators to interfere with market stability through digital platforms, according to the notification dated 20 March.
The soaring dollar exchanging at over K4,500 drove the pure gold price up to a record-high of K3.7 million per tical in late August 2022. For the gold price to decline, the Ministry of Natural Resources and Environmental Conservation has been selling gold ingots under the competitive bidding system in Yangon, Mandalay and Nay Pyi Taw. With an aim at reducing gold prices, the YGEA and Mandalay Region Gold Entrepreneurs Association sold gold bullion supplied by the executive members and the members as well. 

Source: The Global New Light of Myanmar

India-based Adani Business Group has sold a port and special economic zone project in Yangon for $30 million, according to Reuters.

Adani’s assets have been bought by a company called Solar Energy for $30 million, Reuters reported.

According to the statistics released in May 2021, the Adani group company invested US$127 million to establish the Yangon Port and Special Economic Zone in Myanmar, of which US$90 million was used for land.

According to a person close to the company, the investment of Adani company in Myanmar could be up to 195 million dollars, the news continued.

Reuters reports that Adani officials have yet to comment on the sale of multi-million dollar investments in Myanmar at a loss.

Adani Group announced in May last year that it would sell its investments in Myanmar as the United States imposed sanctions on Myanmar.

Source: Daily Eleven

A total of 1,270 Myanmar food processing companies and factories submitted over 2,200 applications to the General Administration of Customs of the People’s Republic of China (GACC) within 18 months, according to the Ministry of Commerce.

According to GACC Decres 248 and 249, GACC registration is mandatory for food exporters starting from 1 January 2022. Those individuals executing edible oil, oil seeds, stuffed pastry products, edible bird’s nest and related products, edible grains, grains milling industrial products and malt, fresh and dehydrated vegetables, dried beans, plant species, nuts and seeds, dried fruits, unroasted coffee and cocoa bean, special dietary food excluding milk-based formula, functional foods, honey products, aquatic products including farm products, animal products and animals feed and livestock animal businesses need to apply for GACC licences to place their goods in China’s market.

The relevant authorities for the registration with GACC are the Agriculture Department, the Livestock Breeding and Veterinary Department, the Fisheries Department and the Food and Drug Administration Department. Between 1 December 2021 and 28 April 2023, 2,279 applications by 1,270 factories have been forwarded to the GACC through the Agriculture Department (2,136 applications), the Fisheries Department (120), the Livestock Breeding and Veterinary Department (14) and the Food and Drug Administration Department (nine).

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 aforementioned 18 groups. As of 21 April 2023, a total of 1,844 applications have been successful in registering with the GACC with the approval of the competent authority.

Regarding the registration of the importing companies, the Department of Animal and Plant Quarantine under the GACC will check quarantine access for the imported grains, raw coffee beans, cocoa beans, vegetables, spices, edible grains, pulses, oil crops and herbal animal products and plant for their origins. The companies cannot directly proceed with registration and they need to carry out this step through competent authorities and departments concerned by sending emails via dapq@customs.gov.cn or submitting letters to the Chinese Embassy to Myanmar or Myanmar Embassy to China.

Source: The Global New Light of Myanmar

MYANMAR Rice Federation (MRF) issued a warning ahead of the price hike at Yangon’s rice wholesale centre. MRF stated that it will inspect those manipulators who spread malicious rumours on digital platforms to spark the concerns of the consumers and raise the rice prices for the sake of the long-term benefit of the rice industry. The federation will forward the reports to the relevant authorities. Those
stakeholders in the supply chain need to exert concerted efforts in this, as per the MRF’s notification dated 24 April. This move is to stabilize the rice price and steer the market for the right price and
the right product.

The MRF will join hands with the rice millers, rice traders and companies. Additionally, it encouraged the mill owners to achieve performance balance between the short term and long term. Individuals and family entities can contact the rice wholesale centres for a fair price and the right product. It is mentioned in the statement that the office of MRF can be contacted in the event of any difficulty. On 25 April, the prices of rice stood at K82,000-K1,060,000 per bag of Pawsan rice depending on producing areas (Shwebo, Myaungmya and Pyapon and Bogale), K72,000 for Pawkywe, K65,000 for short-mature summer rice (90 days) and K60,000 for monsoon Nangka variety. As the growers have sold the paddy out, the traders who keep the stocks in their hands are making great profits. Consequently, the price has risen. The price hike occurred three times in 2023.

The price of rice usually goes up in the Yangon market when old stocks diminish and the harvest season has not come. This year, the price goes up for various reasons. The rice prices spiked as per speculations on rice prices in the post-Thingyan period. The authorities warned those unscrupulous traders of spreading any malicious rumours on social media to trigger the consumers’ concerns. The consumers also request the traders to have sympathy for them.

Source: The Global New Light of Myanmar

The Working Committee on Special Exemptions on Electric Vehicles and Related Industries notified that the special commodity taxes for EVs will be exempted until the end of March 2024.
In the 2023 Union Tax Law, the commercial tax on battery electric vehicles (BEVs) including battery-used electric two-wheeled and three-wheeled vehicles, accessories, and battery charging services, and the special commodity tax on EVs are spared from 1 April 2023 to 31 March 2024.
According to the release, they are working to allow tax exemption until the end of March 2024 since the zero per cent customs duty set for electric vehicles imported from abroad under the CBU, CKD and SKD systems expired at the end of March this year.
It is mentioned in the statement that road/bridge tolls for EV vehicles need not be paid for two years from 1 April of this year until 31 March 2025.
In addition, it is reported that EVs initially registered from 2023 to 2025 have been exempted from 100 per cent wheel tax, city entrance fee, toll, charges for overweight load, showroom fee, business licence, overnight fee, property tax among others. 

Source: The Global New Light of Myanmar

The Central Bank of Myanmar organized a meeting on procedures to implement Rupee/Kyat direct
payments for India-Myanmar trade with governmental departments, state-owned banks and private banks in Nay Pyi Taw yesterday. The meeting was attended by the governor and vice-governors of the Central Bank of Myanmar, the joint secretary of the Central Committee on Ensuring Smooth Flow of Trade and Goods, the director-general of the Trade Department under the Ministry of Commerce, the deputy director-general of the Customs Department, directors- general, deputy directors- general, officials of stateowned banks and private banks. During the meeting, the officials discussed the successful implementation of Yuan/Kyatand Baht/Kyat direct payment on border trade with China and Thailand, plans to implement Rupee/Kyat direct payments for India-Myanmar trade, formation of a working committee on the implementation of Rupee/Kyat payment system under the lead of CBM comprising representatives of Ministry of Foreign Affairs, Ministry of Planning and Finance, Ministry of Commerce, state-owned banks, State Bank of India, Punjab Nation Bank and Yangon Representative Office. It also focused on the Rupee/ Kyat payment Concept Paper approved by the Reserve Bank of India to be conducted by Myanmar and India with the cooperation of the Indian Embassy in Myanmar, designation of Punjab National Bank, India, as a designated bank to carry out Special Rupee Vostro (SRV) account of Myanmar banks, advantages for bilateral trade and payment methods approved by the central banks of two countries. Then, CBM Governor Daw Than Than Swe said it will take into account the fact of the
Rupee/Kyat direct payment system for normal trade in addition to border trade and the importers and exporters will be informed as soon as the instructions and approval of banking system are received, and she concluded the meeting.

Source: The Global New Light of Myanmar

It is enacted in the National Planning Law 2023-2024 as a project objective to make the average gross domestic product of individuals (Per Capita GDP) to be more than K2.45 million at annual prices.
The average GDP is expected to increase by K400,000 over the 2022-2023 financial year. It is included in the National Planning Law signed and enacted by State Administration Council Chairman Senior General Min Aung Hlaing, on 31 March.
The National Planning Law, which takes effect on 1 April, is expected to increase gross domestic product and services (GDP) by 4.1 per cent at regular prices. More than K8,300 billion will be invested from the role of State, and it has been determined that only projects that benefit the state and citizens must be implemented.
In the last draft of the National Planning Law 2022-2023, the average gross domestic product of each individual (Per Capita GDP) was targeted to increase from K2,052,528 to K2,222,230 at annual prices.
In the current National Planning Law, the participation ratio of the agricultural sector, the industrial sector and the service sector in the total value of gross domestic product and services in annual prices are expected to reach 2.5 per cent, 4.8 per cent and 6.7 per cent respectively. If the Union Government verifies that the submitted projects do not generate interest, the projects will see rejection, suspension and less approval, the National Planning Law stipulates.

Source: The Global New Light of Myanmar

Kyat depreciation against greenbacks persists at K2,870 in the grey market although the Central Bank of Myanmar set the reference exchange rate at K2,100. CBM has set the currency trading band at 0.3 per cent for the Kyat to fluctuate between these two specified upper and lower exchange rates for transactions, selling or buying, according to a directive issued by the CBM on 10 August 2022. Therefore, financial institutions including banks and informal money exchanges are instructed to set a dollar value at K2,094 for buying and K2,106 for selling.

However, the over-the-counter Kyat-dollar exchange rate was K2,855 for buying and K2,870 for selling on 31 March. There is a large price difference between the reference rate of the CBM and the unofficial market rate. However, there is no way to set the new price, as per the notification released on 15 December. Investigation and Prosecuting of market manipulation to hike the exchange rate in the local forex market with the malicious rumours will be undertaken, according to the Central Bank of Myanmar’s statement released on 10 February.

Some exporters, importers and banks are attempting to raise the exchange rate owing to the rumours. The statement called for bank institutions to govern the market and investigate those fraudsters who circulate rumours. The CBM released a notice that the exporters, importers and banking institutions are asked not to elevate the exchange rate. Those banking institutions that will not abide by financial regulations will face legal action as well. Last August, a dollar value hit an all-time high of over K4,500 in the grey market. 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. 

Source: The Global New Light of Myanmar

The Central Bank of Myanmar (CBM) will steer private sectors to ensure that the foreign currency earned from exports will be deposited in the local bank accounts, the CBM’s governor Daw Than Than Swe said. On 20 March, the governor made that remark at a meeting held in Nay Pyi Taw with the companies that fail to deposit export earnings.

According to Sections 18 (A) and 38 (B) of the Foreign Exchange Management Law and directive 27/2021, exporters to Asian countries must deposit their export income within 45 days from the starting day. Those shipping goods to countries outside Asia must deposit income within 90 days.

The Central Committee on Ensuring Smooth Flow of Trade and Goods, the Ministry of Commerce, the Bureau of Special Investigation and the Working Group on facilitation of Trade and Goods are monitoring whether there is actual export income into the local bank account or not. Export earnings are one of the main foreign capital inflows. It also plays a pivotal role in stabilizing the forex market. Strong compliance of the export companies to the Foreign Exchange Management Law, rules and regulations will facilitate money flows. 

Source: The Global New Light of Myanmar

Yangon Region Gold Entrepreneurs Association hikes reference rate to over K2.34 mln per tical (0.578 ounce or 0.016 kilogramme) with the gold spot prices rising. On 1 March, gold spot prices hit US$1,833 per ounce and YGEA’s price was K2,159,500 per tical. As the gold spot price rallied to $1,989 per ounce in the international market, the reference price of the YGEA jumped to K2,343,300 per tical on 18 March. The figures indicated an increase of $156 per ounce and over 180,000 per tical within three weeks. Despite the YGEA’s reference price, pure gold climbed to K2,980,000 per tical in the unofficial market, showing a large gap of over K630,000 per tical with the reference price.

YGEA calculated the price depending on the Central Bank of Myanmar’s reference exchange rate of K2,100, with some addition, while the US dollar is exchanged at K2,870 in the unofficial forex market. The gold spot prices and dollar exchange rates influence the domestic gold price. The soaring dollar exchanging at over K4,500 drove the pure gold price up to a record-high of K3.7 million per tical in late August 2022. For the gold price to decline, the Ministry of Natural Resources and Environmental Conservation has been selling gold ingots under the competitive bidding system in Yangon, Mandalay and Nay Pyi Taw.

With an aim at reducing gold prices, the YGEA and Mandalay Region Gold Entrepreneurs Association sold gold bullion supplied by the executive members and the members as well.mUnder 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 21 January 2022 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 or not 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