Myanmar receives more overseas financial support to combat COVID-19

Japan will provide ¥45 billion in emergency funding to assist Myanmar in supporting the economy in the wake of COVID-19. Japanese Foreign Minister Toshimitsu Motegi extended the financial support during his meeting with State Counsellor Daw Aung San Suu Kyi in Nay Pyi Taw on August 24. This will consist of ¥30 billion in emergency budget support and ¥5 billion in official development assistance (ODA) loans to help small and medium-sized enterprises(SMEs) in Myanmar respond to COVID-19. Japan is pursuing cooperation with Myanmar in all areas, including health, education, agriculture, and administrative capacity building while promotion responsible investment by Japanese companies.

The two sides also discussed plans to facilitate a rapid economic recovery in Myanmar and keep the channels clear for more Japanese investments in the country. Negotiations to relax travel restrictions to allow Myanmar technicians and businessmen to enter Japan under a business track program starting next month also took place. Japan has so far provided technical as well as medical supply and equipment assistance equivalent to US$30 million to Myanmar.The additional support came shortly after more than K80 billion was freed up for the prevention, control and treatment of COVID-19 activities in the coming fiscal year under a Debt Service Suspension Initiate (DSSI) endorsed by the World Bank and countries under the G20. The DSSI was endorsed in April in response to a call by the World Bank and the International Monetary Fund(IMF) to grant debt-service suspension to the poorest countries to help them manage the impact of the COVID-19 pandemic.

The main goal of the DSSI is to allow poor countries to concentrate their resources on fighting the pandemic and safeguarding the lives and livelihoods of the most vulnerable people. Borrowers therefore commit to use freed-up resources to increase social, health, or economic spending in response to the crisis. Myanmar has so far also received half of a US$700 million fund provided by the IMF in July to support its economy. The second tranche of funds will be received in the coming fiscal year. The government will also be able to tap into remaining funds from the World Bank, Asia Development Bank and Japan International Cooperation Agency awarded this year to support the economy moving forward. It will also be spending more to ease the impact of COVID-19 on the economy, leading to a forecast budget deficit of 5.41 pc of GDP this year.

Source: Myanmar Times

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